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Jan 25, 2000 - 06:19 PM

Xerox Profits Fall 52 Percent in Fourth Quarter

The Associated Press

STAMFORD, Conn. (AP) - Xerox Corp. reported Tuesday its profits fell 52 percent in the fourth quarter as it struggled with increased competition and sales that were diminished by Y2K anxiety. The company said it was pursuing cost-cutting steps but did not say what they might be.

Net income in the October-December period was $294 million, or 41 cents per share, compared with $615 million, or 84 cents a share, a year earlier. Analysts surveyed by First Call/Thomson Financial had expected earnings of 40 cents.

Revenues in the quarter fell 6 percent to $5.44 billion from $5.79 billion a year ago.

The company had warned last month that its earnings, which fell 11 percent in the third quarter, would drop again in the fourth. It said Tuesday it probably will see a similar decline in earnings in the first quarter and a smaller decline in the second before earnings start rising again.

In a conference call with industry analysts Xerox president Rick Thoman said the company would look for efficiencies and cost-savings steps and may take a charge of "hundreds of millions of dollars" in the first quarter of this year. Thoman, who called the fourth-quarter results a major disappointment, said "virtually everything is on the table" to get costs down.

Shares of Xerox rose 18 3/4 cents to $21.93 3/4 in trading at 5:15 p.m. on the New York Stock Exchange.

The company said that in addition to Year 2000 computer fears, its results were hurt by reduced earnings from Brazil, its own customer administration reorganization and unfavorable currency exchange rates.

For all of 1999, net income from continuing operations fell 16 percent to $1.42 billion, or $1.96 a share, from $1.69 billion, or $2.33 a share, in 1998. Including special items, such as a restructuring charge of $1.11 billion, net income in 1998 was $395 million, or 52 cents a share.

Revenues fell 1 percent to $19.23 billion from $19.45 billion in 1998.

-- snooze button (alarmclock_2000@yahoo.com), January 26, 2000

Answers

Snooze button, I am not real smart at how the world works, was gone today had to go hock my sewing machine to pay a few bills... but on the car radio I heard, something about the consumer market index(?) am not sure if that is what they said but said it was high, consumers are happy with the economy and the way the world is going, and going to spend more... what on I wonder gas perhaps? No mention of shortages on the radio just the cuban kid, and dc was shut down cause of the weather, no mention of gas prices nada... we are getting lied too, and more everyday is MHO. But whould loke an explination on the cpi if anyone has one, trying to get educated Sandy

-- sandy (rstyree@overland.net), January 26, 2000.

(Prov 11:26 KJV) "He that withholdeth corn, the people shall curse him: but blessing shall be upon the head of him that selleth it."

Maybe some of these Mega Corps should learn to share their wealth with the employees. I don't mean as in socialism. They keep looking to cut when maybe they should be looking at the problem as in the above Proverb.

A few years back there was a story re: a textile mfg(?) who did that and he seemed to prosper, even continued to pay his people after the plant burnt down. What a guy!

-- Mark Hillyard (foster@inreach.com), January 26, 2000.

Even though their profits were DOWN 52%, they beat Wallstreet's estimate of 40 cents a share, therefore the stock MUST rally significantly.

As long as the stock BEATS the estimates all is well in bubble.com land. This even can be said when profits go negative as long as they be the streets estimates!!

This has been the BIGGEST con game in the history of the financial world.

Ray

-- Ray (ray@totacc.com), January 26, 2000.