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XEROX 1991 INCOME EVEN WITH YEAR AGO BEFORE SPECIAL ITEMS

 XEROX 1991 INCOME EVEN WITH YEAR AGO BEFORE SPECIAL ITEMS
 STAMFORD, Conn., Jan. 30 /PRNewswire/ -- Xerox Corporation's (NYSE: XRX) 1991 income from continuing operations was $555 million, unchanged from 1990, before taking into account two special items, the company reported today. On the same basis, primary earnings per share were $4.97 against $4.98.
 In the three months ended Dec. 31, income from continuing operations, also before the special items, was $192 million, or $1.79 a primary share, compared with $197 million, or $1.87 a primary share, a year earlier.
 The special items were an after-tax provision of $101 million, or $1.06 a primary share, in 1991 to cover costs of a document processing work-force reduction announced in December and the 1990 after-tax gain of $50 million, or 53 cents a share, from the sale of Xerox South Pacific Operations to Fuji Xerox Co., Ltd., the company's Japanese affiliate.
 As previously announced, the work-force reduction charge of $175 million pre-tax will reduce overhead and affect approximately 2,500 employees. The action is expected to save about $150 million pre-tax in 1992 and about $200 million annually in subsequent years.
 After the effects of special items and discontinued operations, the company's 1991 net income of $454 million, or $3.91 a primary share, compared with $243 million, or $1.66 a primary share, a year ago. In 1990, Xerox discontinued its real estate operations and third-party financing businesses.
 Fourth quarter net income of $91 million, or 73 cents a primary share, compared with $235 million, or $2.27 a primary share, in the corresponding 1990 period after discontinued operations.
 Revenues in 1991 totaled $17.8 billion against $18 billion a year ago. Fourth quarter revenues were $4.9 billion compared with $5 billion a year earlier.
 Comments from Xerox Chairman
 Xerox Chairman and Chief Executive Officer Paul A. Allaire said that "while the economic environment presented numerous challenges, 1991 was a year of significant accomplishments" for the company.
 "We became a more customer-responsive organization," he said. "We increased market share as sales of our lower end, less expensive office equipment continued to show good growth throughout the year. The weak economic climate affected sales of higher end products to our large customers. However, we are pleased with the reception of the DocuTech Production Publisher, which achieved our objectives in 1991."
 Allaire also said that "in spite of a weak property and casualty insurance environment, profits from financial services have been relatively stable."
 Document Processing Results
 Income from the Xerox document processing business in 1991 before the work-force reduction provision was $537 million, compared with $549 million in 1990, excluding the gain from the South Pacific Operations sale. On the same basis, fourth quarter income was $188 million against $180 million.
 Full-year revenues were $13.8 billion against $13.6 billion and in the three months ended Dec. 31, they were $3.8 billion compared with $3.9 billion a year ago.
 Revenues from document processing in both the full year and fourth quarter increased 3 percent from the corresponding 1990 periods, excluding revenues from South Pacific Operations and the effects of foreign currency translations.
 Xerox Chairman Allaire said that "we continued to manage assets aggressively and, for the third straight year, reduced average inventories as a percent of revenue."
 In addition to the success of the DocuTech, he pointed out that in 1991 the company introduced a broad array of technologically innovative copier, printer and color products.
 "These highly competitive products, along with a more efficient, flatter, customer-responsive organization, will make Xerox more productive and positioned for growth as the economy improves," said Allaire.
 Insurance and Other Financial Services Results
 Earnings from the operating units of insurance and other financial services in 1991 were $188 million compared with $173 million in 1990. In the fourth quarter, earnings were $47 million against $68 million a year ago.
 After interest and headquarters expense, full-year income from continuing operations was $18 million against $6 million a year earlier. In the fourth quarter, they were $4 million compared with $17 million a year ago.
 Revenues were $4 billion in 1991 against $4.4 billion in 1990 and $1 billion in the fourth quarter compared with $1.1 billion a year earlier.
 The revenue declines were primarily the result of withdrawing from personal lines of property and casualty insurance and other strategic actions, said Stuart B. Ross, Xerox executive vice president and chairman of Xerox Financial Services. Increased capital gains partially offset the declines, he added.
 "During 1991, we continued to implement our strategy to strengthen operations and position them for future profit growth," Ross said. "We have allocated resources to those businesses that will produce more shareholder value; nurtured growth in profitable operations, such as asset management; exited businesses in which we do not see the possibility of earning an adequate return on investment and taken a number of actions to substantially reduce overhead, assets and debt."
 During the past year, Xerox Financial Services sold six small insurance operations and three discontinued financing units, reduced net assets of discontinued operations by $1.4 billion and related debt by $1.3 billion, and increased fee income producing assets under management by $8 billion to $23 billion.
 In 1991, insurance and other financial services reduced its total employment by 2,100, or 20 percent.
 NOTES:
 Earnings per share on a fully diluted basis in 1991 for continuing operations were $4.81 compared with $4.79 in 1990, before two special items. On the same basis, earnings per share in the fourth quarter were $1.69 compared with $1.76 a year earlier. After the affects of special items and discontinued operations, fully diluted earnings per share were $3.86 in 1991 compared with $1.66 in 1990 and 74 cents in the fourth quarter compared with $2.32 in the fourth quarter of 1990.
 Total common shares used to calculate primary earnings per share were 94.9 million in 1991 compared with 94.2 million in 1990.
 The 1990 data have been restated to exclude the revenues and net income of real estate and third-party financing businesses discontinued in 1990.
 XEROX CORPORATION
 Financial Summary
 (In millions, except per-share data)
 Percent
 Full year ended Dec. 31, 1991 1990 B/(W) 1990
 Revenues;
 Document processing $ 13,819 $ 13,583 2
 Insurance & other
 financial services 4,011 4,390 (9)
 Total $ 17,830 $ 17,973 (1)
 Net Income:
 Document processing,
 before special items $ 537 $ 549 (2)
 Insurance & Other Financial Services:
 -Operating units 188 173 9
 -Interest & headquarters expense (170) (167) (1)
 Total insurance &
 other financial services 18 6 NM
 Income, before special items 555 555 --
 -Document processing
 workforce provision (101) -- NM
 -Document processing sale
 of S. Pacific Opns. -- 50 NM
 Income from continuing operations 454 605 (25)
 Discontinued operations -- (362) NM
 Net income $ 454 $ 243 87
 Primary Earnings per Share:
 Income, before special items $ 4.97 $ 4.98 --
 -Document processing
 workforce provision (1.06) -- NM
 -Document processing sale
 of S. Pacific Opns. -- .53 NM
 Continuing operations $ 3.91 $ 5.51 (29)
 After discontinued operations $ 3.91 $ 1.66 NM
 NM -- Calculation not meaningful.
 Earnings per share on a fully diluted basis in 1991 for continuing operations were $4.81 compared with $4.79 in 1990, before special items. After the effects of special items and discontinued operations, fully diluted earnings per share were $3.86 in 1991 compared with $1.66 in 1990.
 XEROX CORPORATION
 Financial Summary
 (In millions, except per-share data)
 Percent
 Three months ended Dec. 31, 1991 1990 B/(W) 1990
 Revenues:
 Document processing $ 3,835 $ 3,913 (2)
 Insurance & other
 financial services 1,032 1,092 (6)
 Total $ 4,867 $ 5,005 (3)
 Net Income:
 Document processing,
 before special items $ 188 $ 180 4
 Insurance & Other Financial Services:
 -Operating units 47 68 (32)
 -Interest & headquarters expense (43) (51) 16
 Total insurance &
 other financial services 4 17 (77)
 Income, before special items 192 197 (3)
 -Document processing
 workforce provision (101) -- NM
 -Document processing sale
 of S. Pacific Opns. -- 50 NM
 Income from continuing operations 91 247 (63)
 Discontinued operations -- (12) NM
 Net income $ 91 $ 235 (61)
 Primary Earnings per Share:
 Income, before special items $ 1.79 $ 1.87 (4)
 -Document processing
 workforce provision (1.06) -- NM
 -Document processing sale
 of S. Pacific Opns. -- .53 NM
 Continuing operations $ .73 $ 2.40 (70)
 After discontinued operations $ .73 $ 2.27 (68)
 (NM) -- Calculation not meaningful.
 Earnings per share on a fully diluted basis in 1991 for continuing operations were $1.69 compared with $1.76 in 1990, before special items. After the effects of special items and discontinued operations, fully diluted earnings per share were $.74 in 1991 compared with $2.32 in 1990.
 -0- 1/30/92
 /CONTACT: Thomas C. Abbott, 203-968-3378, or Judd Everhart, 203-968-3572, both of Xerox/
 (XRX) CO: Xerox Corporation ST: Connecticut IN: CPR SU: ERN


JT -- NY001 -- 5032 01/30/92 07:01 EST
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