Lexmark Q2 earnings surpass analysts' expectations

ctruman@herald-leader.comJuly 23, 2013 

  • Lexmark second quarter

    Revenue

    2Q13: $890 million

    2Q12: $921 million

    Earnings

    2Q13: $61 million

    2Q12: $64 million

    Earnings per share

    2Q13: 95 cents

    2Q12: 89 cents

    Looking ahead

    Lexmark expects third-quarter revenue to be down 4 to 6 percent. The company forecast earnings per share in the range of 85 to 95 cents.

Lexmark International on Tuesday announced second-quarter earnings of 95 cents a share, compared with 89 cents per share for the same period last year. That beats analysts' expectations by 8 cents. However, revenue fell 3 percent year over year to $890 million.

Company executives said that Lexington-based Lexmark is still feeling the effects of its 2012 decision to shed its inkjet printing division.

"We remain confident in our strategy," Lexmark CEO Paul Rooke said in a morning conference call with analysts, adding that Lexmark's strategy "will drive long-term value in our business."

Rooke said that Lexmark came close to offsetting economic headwinds from a continuing weak international economy and its exit from the inkjet market.

Lexmark shares (NYSE:LXK) closed at 36.43 Tuesday, up 5.38 percent.

Revenue was $890 million, compared to $921 million last year, with net earnings $61 million compared to $64 million in 2012. The quarter also included a $71 million pre-tax gain on the sale of Lexmark's inkjet-related technology and assets.

Rooke said that the company's shift to more managed print services should not affect the company's Lexington employment levels. The company employs about 2,300 people in Lexington.

In its managed print services business, Lexmark manages companies' printing by choosing the most efficient printer setups and shipping more toner as needed.

The company said that the success of its new strategy was reflected in three "recent wins":

■ The FBI chose Lexmark as its exclusive output provider, a deal estimated at more than $30 million over a three-year period.

■ Averitt, a freight transportation and supply chain management company, chose Lexmark to provide automation for its bills of lading, used in the transport of goods.

■ Kohler, a plumbing products company, selected Lexmark's Perceptive Software to automate its accounts payable.

In May, the Europe-based industry analyst firm Quocirca said in a report that Lexmark achieved the highest scores possible in the areas of managing print solutions strategy, geographical reach, document workflow and mobile printing support.

"Lexmark shines in the depth of its industry solutions portfolio," the Quocirca report said.


LEXMARK SECOND QUARTER

Revenue

2Q13: $890 million

2Q12: $921 million

Earnings

2Q13: $61 million

2Q12: $64 million

Earnings per share

2Q13: 95 cents

2Q12: 89 cents

LOOKING AHEAD

Lexmark expects third-quarter revenue to be down 4 to 6 percent. The company forecast earnings per share in the range of 85 to 95 cents.

Cheryl Truman: (859) 231-3202. Twitter: @CherylTruman

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