The spin-off company from Xerox after its split has posted a “large loss” in its first results.
Democrat and Chronicle reported on the business service company, which was created after Xerox split last year, and which posted “in its first earnings report as a standalone company” a “large loss partly due to an incomplete project with New York state”. The company reported a $935 million (€886 million) “goodwill impairment charge” as well as a $161 million (€152 million) “non-cash charge”, both related to a Health Enterprise platform project.
The company stated it would “not fully implement the project with the state, and was in discussions to back out of the work entirely”, and the news site added that Xerox before the split was “plagued by issues with similar projects for other states over processing of Medicaid enrolments, claims, payments and other related work”.
Conduent’s total losses for the quarter “amounted to” around $1.2 billion (€1.1 billion), while revenue for the year fell four percent to $6.4 billion (€6 billion) and for the quarter fell 13 percent to $1.5 billion (€1.4 billion), which was the last quarter “under the Xerox umbrella”. CEO Ashok Vemuri stated in an investor call that “we have a lot of work ahead to fully realise a new operating model and vision for success.
“We have an aggressive change agenda and will make continual productive change a facet of our culture and leadership approach. We are taking important steps to streamline our business”. These included that it is looking to save $700 million (€663 million) in costs and “operational efficiencies” later in 2017, and Vemuri added that “we are making steady progress on priority and identifying on the aggressive goals in the programmes.
“These savings are being comprised over every aspect of our company. This work is having an immediate impact”. Conduent has cut around 5,000 jobs “since the end of last year”, with 91,000 employees as of 15 February, “as part of efforts to reduce costs”.