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AnonymousInactiveLEXMARK:Investor questions inkjet division
CEO CITES STRENGTH, GROWTH, PROFITABILITY
It’s almost a ritual now.An
investor at a recent conference attended by Lexmark International asked
the company’s CEO why it holds on to its struggling inkjet printer
division.The question is becoming as popular as the “Tell us about your
business with Dell” inquiry, regarding the computer maker for whom
Lexmark manufactures printers that are sold under Dell’s brand.The answer to that one, by the way, is Lexmark doesn’t talk about its customers’ business.
Back
to the present. An investor at the recent Sanford C. Bernstein &
Co. Strategic Decisions Conference asked Lexmark CEO Paul Curlander why
the company should stay in inkjet. After all, that division has been
slower to recover than its laser business since Lexmark saw a downturn
in the latter half of 2005.Since that time, the company has exited
about 20 percent of its inkjet business — primarily bundles that
didn’t meet profit expectations. But as time has gone on, the company
has seen difficulty in its OEM business, in which it sells printers to
companies such as Dell that then sell them under their own brands.Curlander told the investor that the company has “a lot of strengths in the inkjet market.”
“We
are No. 2 in the U.S., in fact in the North American market, and we’re
a strong No. 2,” he said. “We’re quite a bit stronger than anybody else
in the market other than Hewlett-Packard.”Curlander said the company
also sees a great opportunity in its new lineup of wireless-enabled
inkjets. The line offers the feature at prices far below the market’s
average, leading Lexmark to say it could jump-start another period of
growth.”So we see a lot of strengths. We see profitability. We’ve seen
historic growth. And we see opportunity,” Curlander said. “These are
all the reasons why we think that this is a business we should be in.”For sale: Scotland factory
Lexmark’s
former inkjet cartridge manufacturing plant in Rosyth, Scotland, has
attracted the interest of two manufacturers, according to a report in
The Scotsman newspaper.Lexmark closed the plant last year as part of a
worldwide restructuring that eliminated 925 jobs and transferred 525 to
lower-wage countries. It affected about 200 employees at the company’s
headquarters in Lexington. The Scotsman report stated the Rosyth
factory employed 700 at the time of closure.Lexmark sold the plant for
more than £4 million in February to two Scottish developers — the
Kilmartin Property Group and Deanway, the paper reported.A director of
one of the groups declined to identify the two companies, but said one
was interested in buying the 155,557-square-foot building while the
other was interested in leasing, the report said. -
AuthorJune 19, 2007 at 10:40 AM
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