Xerox Delays First-Quarter Report

The company will restate its results by June as part of an SEC settlement.

Author:: Michael Dunn
Publish date:: Apr 24, 2002 10:25 AM EDT

Xerox

delayed its first-quarter financial report as it adopts new accounting standards in the wake of a settlement with the

Securities and Exchange Commission

Using now-discontinued pro forma standards, the office-equipment company said it had a first-quarter profit of $53 million, or 7 cents a share, compared with net income of $202 million, or 25 cents a share, in the year-ago period. Analysts polled by First Call were expecting the company to post a loss of 1 cent a share.

On a GAAP basis, Xerox said it lost 9 cents a share. But the results are unaudited, and Xerox had until June 30 to post audited results.

Earlier this month, Xerox reached a settlement with the SEC in which it agreed to change its accounting methods. The SEC charged that Xerox for four years used pro forma accounting that misrepresented financial results. Under the settlement, Xerox paid a penalty of $10 million, but did not admit or deny any wrongdoing, and agreed to restate results as far back as 1997.

Xerox said Wednesday that its first-quarter revenue fell to $3.7 billion, an 11% drop from $4.2 billion last year, roughly in-line with analyst estimates of $3.75 billion. However, these results are subject to change as the company has been required to restate its financial results from 1997 through 2001 using new accounting methods, and the first-quarter results were calculated using the company's old methods.

"I am encouraged by our first-quarter progress and believe that we have clearly set the stage for a return to full-year operational profitability," said Xerox Chairman Anne Mulcahy in a prepared statement.