Digital printing developer Xerox has turned around its financial fortunes after a tumultuous economic roller-coaster ride over the past 12 months, which saw its share price drop as low as US$4.20 per share in October last year. The company’s half year results show a marked improvement over the corresponding period in 2002, posting a net income of US$21million as opposed to a US$27million loss. The secret to this turnaround, according to Xerox, lies in the success of its new digital printing products. Equipment sales grew eight per cent for the quarter, with US$3.9billion in revenue. A US$2.5billion reduction of debt was also achieved.
"Equipment sales growth is a leading indicator of the company’s strong presence in the marketplace and a driver for future post-sale revenue," says Anne Mulcahy, Xerox chairman and chief executive officer.
"That’s why Xerox has remained focused on building and refreshing its product line with competitive offerings in the growing digital and colour markets. These investments are clearly paying off."
Xerox continues to yield strong revenue results from its technology in the production colour and office colour markets. Total colour revenue was up 19 per cent in the second quarter largely due to the success of Xerox’s DocuColor series.
The company also says that second-quarter equipment installation rates grew in key growth markets, evidence of the strong momentum from the 26 new products launched in the past 18 months. For example, production colour installs grew seven per cent in the second quarter led by increased demand for the Xerox DocuColor 6060 Digital Colour Press.
"Total revenue from the company’s targeted growth areas - office digital, production digital and value-added services - grew 10 percent in the quarter and now represents about 70 percent of the company’s revenue," says Mulcahy. "
These results are directly aligned with our growth strategy. We’re transforming Xerox into the industry’s leading digital player with black-and-white and colour digital systems that are integrated with a robust portfolio of services, delivering productivity improvements for our customers through lower cost, higher quality document management."
