Computer maker Dell remained the top customer of Lexington-based printermaker Lexmark International in 2009.
Dell accounted for 12 percent of Lexmark's revenue in 2009 and was the only customer generating 10 percent or more of revenue, Lexmark chief financial officer John Gamble Jr. told analysts during the company's recent fourth-quarter earnings call.
Lexmark manufactures printers for Dell, which then sells them under the Dell brand.
Dell accounted for 13 percent of revenue in 2008 and 15 percent in 2005, 2006 and 2007.
Laser hardware issues
CEO Paul Curlander told analysts during the company's recent earnings call that sales of laser printers have been curtailed by issues including component shortages.
Curlander said those shortages along with higher-than-expected demand and longer lead times from suppliers have slowed Lexmark in fulfilling demand.
He said demand for certain parts has been higher than expected across the overall technology industry, causing the parts shortages.
"We're very focused on trying to catch that up ..." he said. "Clearly it's going to be some time in the first half of 2010 before we get to where we'd like to be."
No stock repurchases
For the first time in years, Lexmark did not repurchase any of its outstanding stock in 2009.
The company had been aggressively buying back stock in recent years, including spending more than $1 billion in 2005 to buy 17 million shares.
The company has slowed its purchases in recent quarters as much of its cash is overseas, and it would have to pay a certain amount to be able to bring it back to the United States to fund share repurchases.
The company has billed the program as a way to return value to shareholders, but some analysts have been skeptical.
"Thankfully most of the cash is overseas, making it less likely for Lexmark to do its historical shareholder unfriendly repurchase plans," said Tom Carpenter, vice president and senior equity analyst at Hilliard Lyons in Louisville.
Deal inked with LG
Lexmark has signed an agreement with electronics powerhouse LG to produce inkjet and laser printers to be sold under the LG name in South Korea.
The deal is for that country only, though it is one of the top 10 PC markets in the world, noted Lexmark spokesman Jerry Grasso.
Printers hailed by critics
Lexmark has been calling attention to the praise bestowed upon its recent laser and inkjet printer lines by critics.
In an internal assessment released during the earnings period, Lexmark announced its laser printers won more than three times as many laser awards in the United States last year as its competitors. The company says it also received 28 percent of the U.S. industry inkjet awards, coming in second among top manufacturers.
It's "strong recognition of the evolution of our inkjets over the past two years," Grasso said.