*NEWS*XEROX: $978MIL IN PROFITS FOR 2005
*NEWS*XEROX: $978MIL IN PROFITS FOR 2005
2006-06-01 at 11:16:00 am #15624
Xerox Profits Hit US$978m And Reduces Debts.
At Xerox’s annual shareholder meeting, chairman and chief executive officer Anne M Mulcahy, described Xerox’s strategies and said a focus on excellence will fuel shareholder value and growth. ‘Because of the progress we’re making, we’re back in the driver’s seat, in control of our own destiny and in a position to exploit our balance sheet to create shareholder value – and that’s precisely what we’re doing,’ Mulcahy said. Xerox earned US$978 million on US$15.7 billion in revenue in 2005, whilst generating US$1.4 billion in operating cash flow and reducing debt by US$2.8 billion from year-end 2004.Reflecting continued confidence in Xerox’s performance, the board of directors authorised a US$1 billion share repurchase plan – the first in eight years.As of April 30, the company had re-purchased US$676 million in Xerox stock.Mulcahy noted that the company routinely invests about six per cent of its revenues in research, development and engineering – all based on customer need and all focused on areas where the company said it can deliver profitable revenue growth.Last year alone, Xerox launched 49 new colour and mono digital presses, printers, copiers and multi-function systems along with an array of document management services and software to help people anywhere they work, from the office to the commercial print enterprise.Nine additional Xerox systems have been launched so far this year, including last week’s announcement of the Docucolor 5000 digital press and three Workcentre colour multifunction devices that print, copy, fax and scan.The company believes that colour printing is rapidly becoming a business-critical tool for customers and the number of colour pages printed on Xerox devices has doubled in the past two years.Mulcahy commented: ‘Colour now represents more than 30 per cent of our total revenue.The potential for colour technology is as enormous as it is profitable.’ In a market estimated to be worth US$112 billion, Xerox believes its document management capability is key to the company’s growth strategy, based on aggressive competition in the US$58 billion digital mono printing market and its drive in the rapidly growing US$17 billion digital colour printing market.Xerox said it intends to create a new US$17 billion market by harnessing digital technology to the world of offset printing with applications such as print-on-demand and personalised communications.The company added that it also aims to lead the burgeoning document services market by working with customers to reduce document costs, streamline processes and enable the flow of documents in the workplace around the world.Mulcahy said: ‘Ever since creating the plain-paper copier industry 50 years ago, documents have been part of the DNA of Xerox.We have research teams around the world that study the flow of documents in the workplace and develop smarter software and services that simplify this workflow.That’s an enormous advantage as the document becomes more digital, more dynamic and more critical to the conduct of business.’ She added that a ‘steady drumbeat’ of customers is turning to Xerox to help them manage the documents that keep their businesses running, including US$53 million in services contracts announced with the University of Calgary and Intercontinental Hotels Group.Also at the annual meeting, shareholders elected to vote all 11 members of the Xerox board of directors, including director Mary Agnes Wilderotter, chairman and chief executive officer of Citizens Communications, who joined the board earlier this year.Re-elected to the board are Glenn A Britt, Richard J Harrington, William Curt Hunter, Vernon E Jordan Junior, Hilmar Kopper, Ralph S Larsen, Robert A McDonald, Anne M Mulcahy, N J Nicholas Junior, and Ann N Reese.More than 90 per cent of the Xerox board is considered independent.Shareholders also approved the selection of Pricewaterhouse Coopers as the company’s independent auditors for 2006.In addition, shareholders voted against a shareholder proposal related to director election by majority vote and a shareholder proposal related to senior executive bonuses.In related news, the Xerox board of directors declared a dividend of US$1.5625 per share on outstanding 6.25 per cent Series C mandatory convertible preferred stock.The dividends will be paid July 1 to shareholders of record as of June 9.