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News > Companies
Xerox posts loss
January 29, 2001: 12:05 p.m. ET

Troubled copier maker posts weak 4Q, but sees profitability by end of 2001
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NEW YORK (CNNfn) - Xerox Corp. reported a widely expected fourth-quarter loss Monday, but said it expects a second-half recovery to delivery a profit for the full year and that it will cover its debt maturities for 2001.

The company also said it would trim an additional 800 jobs beyond the 5,200 cuts it announced last March.

The troubled copier maker lost 31 cents a share excluding one-time items in the quarter, compared with a profit of 41 cents a share a year earlier. Wall Street was looking for a loss of 30 cents a share, according to First Call, which tracks analysts' estimates.

Sales fell 13 percent to $4.8 billion, Xerox (XRX: Research, Estimates) said in a statement, adding that its plans to stem losses was "on track."

"We expect an earnings recovery in 2001 ... by strengthening our operations, improving our strong product offering and through significant cost reductions," Paul Allaire, Xerox chairman and chief executive, said in a conference call with reporters and analysts. "We expect to achieve this, even if the economy and competing environment preclude any revenue growth in the year."

graphicXerox Vice Chairman and Chief Financial Officer Barry Romeril said the company, which has struggled to generate cash to pay its debts, would meet its commitments through the rest of the year.

"We believe that the combination of asset sales ... and the operational cash improvements we are implementing will much more than cover our debt maturities in 2001 and provide a solid foundation for even further progress in 2002," he said on the conference call.

Xerox, has been a subject of bankruptcy speculation as it struggles to transform itself from a traditional copier maker into more of a scanning and computer networking systems manufacturer,such as rivals Canon (CAJ: Research, Estimates) and Hewlett-Packard (HWP: Research, Estimates)

Earlier this month, the company secured $435 million in financing from General Electric Co.'s (GE: Research, Estimates) GE Capital unit as it fights to catch up with the rest of the industry.

The company also said it trimmed 2,000 jobs in the fourth quarter as part of a cost-cutting binge that will see an additional 4,000 jobs cut in the first quarter.

Xerox originally announced last March it would cut 5,200 jobs, and in October said an additional, but unspecified number of jobs would be cut. Monday's announcement brings the total number of job cuts to 6,000.

"We are aggressively implementing our cost-reduction plans, which will yield more than $1 billion in savings by the end of 2001," Xerox President Anne Mulcahy said. "Since the third quarter of 2000, we have taken actions that account for more than one-third of this target, including the reduction of approximately 2,000 jobs worldwide in the fourth quarter. This activity will intensify with the reduction of 4,000 jobs in the first quarter and additional reductions through the balance of the year."

For the year, Xerox earned $117 million, or 12 cents a share before special items. Including special items, the company reported a loss of $384 million, or 63 cents a share. In 1999, the company earned $294 million, or 41 cents a share. Full-year sales sank to $18.6 billion from $19.5 billion in 1999.

Xerox stock was up 77 cents, or more than 11 percent, to $7.65 in midday trade. graphic





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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.