Lexmark International, Inc, today announced record financial results for both the fourth quarter and full year 2002. Fourth-quarter revenue was a record $1.207 billion and full year 2002 revenue was a record $4.356 billion, each up 6% from the same periods in 2001. Net earnings per share for the fourth quarter of 2002 were a record 90c, up sharply from 27c in the year-ago quarter.
Reported earnings per share in the 2002 quarter were positively impacted by $6 million from the reversal of previously accrued restructuring charges. Reported earnings per share in the 2001 quarter were negatively impacted by $88 million from restructuring related charges, and positively impacted by $40 million from the resolution of income tax matters. Adjusting for these items, fourth-quarter 2002 earnings per share would have been 86c compared to 46c in the year-ago quarter, an increase of 89%.
"We are pleased to report record financial results during these weak economic times," stated Paul J Curlander, chairman and CEO. "Overall, our results again demonstrate the stability of our supplies-driven business model." Lexmark`s revenue for the fourth quarter ended 31 December 2002 was $1.207 billion, up 6% from $1.140 billion in the same period of 2001. Without the impact of foreign currency translation, revenue growth would have been 2% versus the prior year. Laser and inkjet supplies revenue was $654 million, a 23% increase over $530 million a year ago, and now represents 54% of total revenue, up from 46% in the prior-year quarter. Laser and inkjet printer revenue was $456 million, down 6% from $487 million in the fourth quarter of 2001. Gross profit was $384 million or 31.8% of revenue for the quarter versus $279 million or 24.5% a year ago. The improvement in gross profit margin was due to an increase of supplies in the product mix, a restructuring-related inventory charge of approximately $29 million in 2001 and higher supplies margins, somewhat offset by lower printer margins. Operating expense was $224 million or 18.6% of revenue compared to $278 million in the prior year. Operating income for the fourth quarter was $160 million (13.2% of revenue) versus $0.3 million a year earlier. Net earnings were $116 million in the fourth quarter, up substantially from $37 million reported a year ago. Diluted net earnings per share for the period were 90c, an increase of 226% from the same period of 2001.
Lexmark`s 2002 annual revenue was $4.356 billion, an increase of 6% over 2001 revenue of $4.104 billion. Laser and inkjet supplies revenue was $2.335 billion for 2002, a 19% increase from $1.958 billion a year earlier, and represents 54% of total revenue versus 48% in 2001. Laser and inkjet printer revenue was $1.631 billion, a slight increase from $1.623 billion a year ago. Gross profit margin was 31.5% in 2002 versus 30.2% in 2001. Operating expense for 2002 was 19.7% of revenue, an improvement of 2.2 points from 21.9% a year ago, reflecting the company`s continuing focus on expense management. Operating income grew 50% to $511 million, compared to $341 million in the prior year, due to the higher gross profit margin and lower operating expense. Diluted net earnings per share were $2.79 versus $2.05 reported in 2001, an increase of 36%.
Lexmark`s cash from operations was $816 million in 2002 versus $196 million in the prior year. Capital expenditures for the year totalled $112 million.
"The company did an outstanding job of generating cash in 2002 due to our increased focus on reducing cash cycle days. We are pleased with this progress and we continue to focus on improving this metric," said Curlander.
"As we look forward to the first quarter, we believe that our business model and industry trends that favour distributed printing will keep us well-positioned for earnings growth," said Curlander. "However, we continue to be cautious due to a soft corporate and consumer spending environment and aggressive competition. In the first quarter of 2003, we expect a year-over-year revenue growth rate in the low- to mid-single digits. Earnings per share for the first quarter are expected to be in the range of 62c to 72c as stated in the company`s press release on 9 January 2003. This range represents solid growth in earnings per share over the 53c reported in 2002."
For further information, please contact Cathy Steyn at telephone (011) 329 0999; fax (011) 792 7449; e-mail cathryn.steyn@lexmark.co.za
Share
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 2001, and can be found on the Internet at www.lexmark.com.
Editorial contacts