Lexmark International's spending on research and development in the first quarter was the lowest in more than eight years as the company sees the effect of ending its inkjet operations.
For the quarter, the company spent $81.6 million on R&D, a 15.6 percent decline from $96.7 million in the same quarter a year ago.
That was the lowest quarterly total since the third quarter of 2004, when Lexmark spent $78.3 million. The company began steadily increasing its spending after that to broaden its product lines.
"When we've gone through the restructuring with inkjet, it takes out a large element of the R&D," said CEO Paul Rooke, who added "we continue to optimize our laser investments there."
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The company announced last year it would lay off 1,700 employees worldwide — including 350 full-time employees and 200 contractors at the Lexington headquarters — during the next couple of years as part of its plan to cease inkjet printer operations. Lexmark struck a deal in April to sell its inkjet assets to Funai Electric Co. for $100 million.
Annual terms for board
Lexmark shareholders approved a plan to have annual terms for directors on the company's board.
The vote was conducted in conjunction with Thursday's annual shareholders meeting, which is always a low-key affair.
Beginning at the 2014 meeting, directors whose terms are expiring will be elected to annual terms.
The move follows a vote by stockholders in 2012 asking the company to declassify its board. The proposal had been brought by a representative of the North Carolina Retirement System, which held more than 166,000 shares of Lexmark stock at the time.
In submitting the proposal, the state treasurer said that "having directors stand for elections annually makes directors more accountable to shareholders and could thereby contribute to improving performance and increasing firm value."
More detail on managed print services
Lexmark has added more transparency to its investor materials in recent quarters.
The company is now noting the actual amount of revenue for managed print services, an offering that is just like it sounds. Lexmark manages companies' printing by choosing the most efficient printer setups and shipping more toner as needed.
In the first quarter, MPS revenue grew 10 percent year over year, to $160 million.
"We're in a transition in our business, and I think it's important that people understand the dynamics in this transition," Rooke said. "We started initially calling out the decline in the inkjet exit segment, then on the strategic pieces with Perceptive Software and managed print services, two key investment areas and growth areas.
"It reinforces we're having success in these areas, and we're trying to improve our communications with investors."
Dodgeball for charity
Lexmark's Perceptive Software unit, which is based in Kansas, hosted its eighth annual charity dodge ball tournament in February.
Called "Dodge for a Cause," the tournament has raised more than $120,000 since its inception for the Kansas City chapter of the Juvenile Diabetes Research Foundation.
The games were played at Perceptive Software's headquarters, which includes a dodgeball court that has been approved and sanctioned by the National Amateur Dodgeball Association.