The OEM saw revenue growth even excluding the company’s exit from inkjet printing.
Paul Rooke, Lexmark CEO
Lexmark’s results saw revenue growth of four percent in 4Q2013, which goes up to 11 percent excluding the OEM’s exit from the inkjet business, with its MPS revenue increasing by a substantial 22 percent in the quarter and 16 percent over the year.
The company’s Imaging Solutions and Services (ISS) business, including laser printers, saw revenue grow one percent to $939 million (€686.5 million), and excluding the inkjet exit, grew eight percent compared to last year. Its MPS business in turn saw a growth of 22 percent in revenue to $208 million (€152 million), whilst non-MPS revenue grew four percent to $631 million (€461.3 million).
In terms of hardware and supplies, revenue grew in both by three percent and one percent respectively, with totals of $228 million (€166.6 million) and $661 million (€483.2 million) respectively. Hardware revenue, excluding inkjet exit, grew seven percent, whilst supplies grew eight percent.
Revenue from the inkjet exit meanwhile declined by 32 percent to $100 million (€73.1 million), representing 10 percent of total revenue, and is “expected to decline as a percentage of total revenue as the trailing inkjet supplies revenue from the remaining install base of inkjet printers naturally decreases over time”.
Lexmark also revealed results for the whole year, noting that ISS revenue declined five percent to $3.444 billion (€2.517 billion), and excluding inkjet revenue grew by one percent. The MPS business grew 16 percent to a revenue of $722 million (€564.4 million), and inkjet exit revenue for the year fell by 37 percent, representing 11 percent of the total company revenue for the year.
Hardware revenue for the year fell eight percent to $763 million (€557.8 million), whilst supplies revenue fell six percent to $2.484 billion (€1.816 billion), with the former declining two percent and the latter growing by two percent excluding the inkjet exit. The company predicts that revenue in the first quarter of 2014 will increase, but expects a “continued negative impact from the decision to exit inkjet”, with total revenue thought to decline by three to five percent.
Paul Rooke, Lexmark Chairman and CEO, stated: “In the fourth quarter, Lexmark delivered strong revenue and earnings growth, and generated operating cash flow of more than $200 million (€146.2 million). Perceptive Software’s profitability increased again year to year, and once again Perceptive Software and Managed Print Services revenue each grew at a double-digit rate and now together represent 28 percent of our total revenue.
“The synergies we have created with our unique imaging and software solutions resonate well with our customers as we help them solve their unstructured information challenges. Lexmark is increasing value for our shareholders by utilising the company’s long history of free cash flow generation to return capital and accelerate our transformation to a higher-value solutions portfolio.”