OEM’s revenue remains flat in 3Q13, while services business revenue increased three percent.
Xerox has reported its result for 3Q13, with GAAP earnings per share (EPS) from continuing operations recorded at 22 cents (€0.16) and total revenue for the quarter remaining flat from the previous year at $5.3 billion (€3.8 billion), or down one percent in constant currency.
Growth was again seen in the OEM’s services business, which underwent a three percent rise and currently represents 56 percent of the company’s total revenue, with a segment margin of 9.9 percent. However, Xerox’s document technology revenue declined four percent, or five percent in constant currency, with a segment margin of 12.1 percent.
Operating margin for 3Q13 grew by 0.5 points year-over-year, while gross margin was recorded at 31.5 percent. Selling, administrative and general expenses represented 19.3 percent of revenue.
In terms of operating clash flow, Xerox generated $961 million (€695.4 million) in the quarter and anticipates a full-year cash flow of between $2.1 billion (€1.5 billion) and $2.4 billion (€1.7 billion); with expectations for full-year GAAP EPS from continuing operations to reach between 93 and 95 cents (€0.67 and €0.69), and an adjusted EPS of between $1.08 (€0.78) and $1.10 (€0.80)
Looking ahead to 4Q13, Xerox forecasts GAAP earnings from continuing operations to reach between 24 and 26 cents (€0.17 and €0.19)per share and adjusted EPS to reach between 28 and 30 cents (€0.20 and €0.22). The company added that this includes around two cents per share of restructuring charges and two cents from higher pension settlement expenses.
Commenting on the 3Q13 results, Urusla Burns, Chairman and CEO of Xerox, said: “This quarter shows how we are successfully capturing the benefits of a diversified portfolio. Within services we continue to focus on improving our cost structure while maintaining investments in areas where we see opportunity, such as healthcare. In document technology, revenue declines stabilised with continued good profitability. We continue to see demand from small and midsize businesses in the United States, and positive trends in the high end of our business.
“Our approach remains the same: to focus on areas of differentiation and profitable growth while finding new ways to deliver operational improvements across the board.”