Lexmark International SA today announced record revenue and earnings per share for the second quarter of 2003. Revenue grew 6% to $1.120 billion compared to a year ago and earnings per share of 77c grew 16% from 67c a year earlier.
"Once again our supplies annuity has added stability to our financial results," stated Paul J Curlander, chairman and CEO. "We are pleased to deliver second-quarter results that reflect growth in revenue, operating income and earnings per share."
Laser and inkjet supplies account for 56% of total revenue
Lexmark`s revenue for the second quarter ended 30 June was $1.120 billion, an increase of 6% versus $1.058 billion in the same period of 2002. Laser and inkjet supplies revenue was $630 million, an 11% increase over $566 million a year ago and now represents 56% of total revenue, up from 54% in the prior year. Laser and inkjet printer revenue was $400 million in the second quarter of 2003, up 2% versus $394 million a year earlier.
Gross profit margin was 34% for the quarter versus 32% a year ago due to the increase of supplies in the product mix and higher supplies margins, partially offset by lower printer margins. Operating expenses were $244 million compared to $216 million in the prior year due to the strength of the euro versus the US dollar and increased investment in marketing and sales. Operating income margin was 12.2 % in the second quarter of 2003, an increase of 0.6 points over last year. Diluted net earnings per share for the period were 77c, an increase of 16% over a year ago.
Lexmark`s debt-to-total-capital ratio at 30 June 2003 was 10% compared to 11% at 31 March 2003. Net cash provided by operating activities was $159 million. Capital expenditures were $16 million in the second quarter.
Supplies annuity drives first-half EPS growth.
Revenue for the six months ended 30 June 2003 was $2.228 billion, an increase of 6% versus $2.108 billion in the same period of 2002. First-half revenue from laser and inkjet supplies was $1.272 billion, an increase of 14% from $1.113 billion a year ago. Laser and inkjet printer revenue was $770 million compared to $795 million in the first six months of 2002.
Gross profit margin was 33.1%, up 2.3 points from the prior year. Operating income was $266 million versus $227 million a year earlier, an increase of 17%. Net earnings for the period were $1.50 per share on a diluted basis, an increase of 25% over the $1.20 per share recorded in the first half of 2002.
Looking forward
"As we look forward to the third quarter, we believe our extensive corporate and consumer product launches in the second quarter have put us in a good position for the second half of 2003," said Curlander. "We continue to be cautious, however, due to softness in corporate and consumer spending, and aggressive pricing competition. In the third quarter of 2003, we expect a year-over-year revenue growth rate in the low- to mid-single digits and earnings per share of 63c to 73c, compared to 70c in the third quarter of 2002."
A full copy of the financials is available on request.
For further information, please contact Cathy Steyn at telephone (011) 329 0999; fax (011) 792 7449; e-mail cathryn.steyn@lexmark.co.za
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Lexmark International, Inc is a leading developer, manufacturer and supplier of printing solutions - including laser and inkjet printers, associated supplies and services - for offices and homes in more than 150 countries. Founded in 1991, Lexmark reported more than $4.4 billion of revenue in 2002, and can be found on the Internet at www.lexmark.com.
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