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Lexmark issues 4Q warning
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October 18, 1999: 12:52 p.m. ET
Printer maker's stock battered by forecast; 3Q net tops estimates
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NEW YORK (CNNfn) - Lexmark International Group Inc., while reporting third-quarter earnings slightly ahead of Wall Street estimates, warned Monday that its fourth-quarter earnings would fall at the low end of analysts' estimates -- sending the printer maker's shares plunging in midday trade.
The Lexington, Ky.-based company said purchase delays as customers prepare for Year 2000-related uncertainties would result in lower fourth-quarter revenue. Lexmark also warned that its fourth-quarter earnings would fall at the low end of analysts estimates.
Analysts expect Lexmark to report a fourth-quarter profit of 72 cents a share, with forecasts ranging from 66 cents a share to 80 cents a share.
The warning sent Lexmark shares tumbling 21, or 23 percent, to 72 in midday trade.
"Our revenue growth of 14 percent in the third quarter reflected the start of a major product transition in the corporate market, production constraints in the consumer market and adverse currency movements," said Paul Curlander, Lexmark chairman and chief executive officer. "Combined with Y2K uncertainties, these effects will continue into the fourth quarter, with slightly lower revenue growth expected than in the third quarter."
For the third quarter, Lexmark (LXK) posted a profit of $77 million, or 56 cents a share. Analysts polled by First Call expected the company to earn 54 cents a share. A year earlier, Lexmark earned $57.8 million, or 41 cents a share.
Revenue grew to $845 million from $743.8 million.
Lexmark reported year-to-date earnings of $219 million, or $1.58 a share, on $2.4 billion in revenue, compared with year-earlier profits of $161 million, or $1.13 a share, on $2.1 billion in revenue.
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Lexmark
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