Xerox Posts Drop in 3rd-Quarter Profit
STAMFORD,
Conn. – Xerox Inc. reported a 53 percent drop in profit for the third
quarter on Friday from results boosted by a tax gain a year ago, but
both earnings and sales beat Wall Street expectations on strong demand
for its color printers and office services.The office equipment maker
earned $254 million, or 27 cents per share, for the quarter ended Sept.
30 from $536 million, or 54 cents per share, a year ago. The 2006
figures included a tax gain of 45 cents a share partly offset by
restructuring and litigation charges of 14 cents per share.The latest
results were better than the 26 cents a share profit expected by
analysts surveyed by Thomson Financial.Revenue grew 12 percent to $4.3
billion from $3.84 billion a year ago, helped by the weaker dollar,
rising post-sale and financing revenue, and contributions from the
acquisition of Global Imaging Systems.Post-sale and financing revenue
are annuity streams that together represent more than 70 percent of
Xerox’s total revenue.Analysts expected total revenue of $4.24
billion.”This quarter’s solid results are proof positive that our
business model is on track, generating double-digit profit growth and
fueling a strong annuity pipeline that serves us well for the long
term,” said Anne M. Mulcahy, Xerox chairman and chief executive Xerox
expects fourth-quarter earnings in the range of 39 cents to 41 cents
per share, and full-year earnings of $1.18 to $1.20. Wall Street has
forecast quarterly profit of 41 cents per share and fiscal 2007
earnings of $1.18.The purchase of Tampa, Fla.-based Global Imaging was
intended to give Xerox access to about 200,000 new customers and
increase its U.S. distribution to small- and mid-sized customers.