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AnonymousInactivehttp://www.kentucky.com/181/story/673047.html
Lexmark job cuts include nearly 160 in Lexington
Lexmark earnings fall 82% as sales weaken
Job cuts would have meant quarterly loss without tax boost
Lexmark
International will cut or transfer nearly 160 jobs at its Lexington
headquarters as part of its fifth restructuring or work-force reduction
in as many years.Company officials confirmed the number to the
Herald-Leader on Tuesday as they discussed fourth-quarter earnings,
which would have been a loss because of the restructuring’s costs if
not for a one-time tax benefit. They did not elaborate on precisely
which divisions in Lexington would be affected.The total
restructuring will see printermaker Lexmark cut 250 jobs and transfer
roughly 125 more to lower-cost countries in coming months. Affected
areas around the globe include the company’s supply chain – the way
products get to customers – and sales support, as well as its finance
and information-technology divisions. Finance, in particular, will
continue its consolidation into shared-service centers in locations
such as the Philippines and Argentina, chief executive Paul Curlander
said two weeks ago when Lexmark announced theThe company’s
sales and marketing team also is being realigned. It’s likely that the
sales streamlining might be related to a cut in late November of a
reported 60 sales and marketing managers and staff spread across the
globe, including some in Lexington. Curlander has also said the company
will consolidate some product-development programs in research and
development.Going forward, that will reduce Lexmark’s
employment in Lexington to around 2,840 people, though the company has
traditionally employed about a thousand contractors on top of that
number. The company is Lexington’s second-largest private employer,
behind St. Joseph Healthcare, and is the only Fortune 500 company based
in Lexington. It does no manufacturing in Lexington, instead
concentrating its ink and toner production at company-owned facilities
in Mexico and the Philippines. Manufacturing of its printers is done by
contractors primarily in China. Most of its administrative functions
and high-end research and development is done in Lexington. It has
invested heavily in recent years in the Philippines, where it does some
research and development, and last year opened a second large office
building. Worldwide, Lexmark employed about 13,800 at the beginning of
2008.With the costs of the restructuring factored in, Lexmark
reported a loss before taxes of $5.1 million for the quarter. But a
favorable tax benefit of $23.2 million boosted the bottom line to a
profit of $18.1 million for the quarter. That’s down from $99 million
in the same quarter a year ago.In the fourth quarter, revenue fell 17
percent to $1.08 from $1.31 billion a year ago, as the company was hurt
by “global economic weakness and significant currency rate shifts,”
executives said in a Tuesday morning statement.Fourth-quarter earnings
per share were 23 cents, down from $1.04 in the same period a year ago.
Without restructuring and other one-time charges, earnings would have
been 75 cents a share, down from $1.29 comparably a year ago.The
company on Tuesday also released figures for its inkjet and laser
printer divisions. The laser printer division, long the most stable of
the two divisions, saw revenue fall 10 percent to $718 million compared
to the fourth quarter of 2007. Revenue for the inkjet division, which
has struggled since 2005, fell 28 percent to $366 million.For the full
year, Lexmark’s revenue was $4.53 billion, down 9 percent from $4.97
billion. Laser division revenue fell 1 percent to $2.98 billion, while
inkjet revenue dropped 22 percent to $1.55 billion. Full-year profit
was $240.2 million, down from $300.8 million in 2007. -
AuthorJanuary 28, 2009 at 3:58 PM
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