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 user 2005-07-27 at 11:41:00 am Views: 38
  • #12110
    Lexmark profit falls, sets job cuts
    Printer maker says results hurt by tax-related costs, will cut 275 jobs; 3Q outlook below forecasts.
    July 05NEW
    YORK  – Computer printer maker Lexmark International Inc. said
    Tuesday that second-quarter profit fell sharply, hurt by tax-related
    costs, and said it has plans to cut 275 jobs to trim costs.

    Lexmark (down $8.37 to $60.18) also
    provided a third-quarter outlook that was short of Wall Street
    forecasts, and its stock fell 2 percent.

    Lexington, Kentucky-based Lexmark,
    which supplies printers to Dell Inc. and competes with Hewlett-Packard
    Co. (down $0.11 to $24.19), posted net income of $79.9 million, or 64
    cents a share, down from $136.6 million, or $1.02 a share, a year

    Excluding a tax cost of $53 million
    from the repatriation of foreign earnings, the quarterly profit was
    $1.06, which matched Wall Street analysts’ expectations, according to
    Reuters Estimates.

    Second-quarter revenue rose 3 percent
    to $1.28 billion compared to $1.25 billion, driven by 9 percent growth
    of laser and inkjet supplies revenue, but fell short of the $1.33
    billion that had been expected by analysts.

    Lexmark said it plans to reduce its
    work force by about 275 employees through the first half of 2006, with
    a majority of those affected exiting in the third quarter of 2005.
    Lexmark ended 2004 with 13,400 employees.

    As a result of the cuts, the company
    expects to take charges of about $26 million pretax, with some $13
    million to be recorded in the third quarter.

    In preopening dealings, Lexmark
    shares fell 2 percent to $67 on the Inet system from Monday’s close of
    $68.55 on the New York Stock Exchange