Xerox Posts Surprise Operating Profit

The copier giant also backs first-quarter estimates.
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Xerox

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said it earned 15 cents a share in the fourth quarter before restructuring charges and currency adjustments, beating analysts' 1-cent loss estimate on the strength of a massive cost-cutting campaign.

On the bottom line, the copier maker had a loss of $4 million, or 1 cent a share. Revenue in the quarter was $4.26 billion, down 13% from a year ago but slightly higher than analysts had forecast. The company's cash position rose to $4.5 billion at the end of the year and net debt fell $4.1 billion from a year ago.

"With the clear objective of creating a leaner, faster, and more flexible enterprise, we made the difficult but necessary decisions this past year to exit certain businesses, outsource some internal functions and dramatically reduce our cost base," the company said in a statement. "The benefits of these actions resulted in the strong performance delivered in the fourth quarter including increased gross margins; lower selling, administrative and general expenses; reduction of inventory to historically low levels; and improved receivables."

The company said revenue would probably decline further in the first quarter, but predicted it would still meet analysts' earnings expectations through cost-cutting.

The company said it reduced its headcount by 4,400 in the fourth quarter to 78,900 -- down 13,600 in a year -- and said annualized cost cuts totaled $1.1 billion.