* Revenue and EPS records set for quarter and full year.
* Sixth consecutive quarter of double-digit hardware revenue growth
achieved.
* Annual hardware revenue growth of 14 percent is the highest since 1998.
LEXINGTON, Ky., Jan. 24 /PRNewswire-FirstCall/ -- Lexmark International,
Inc. (NYSE: LXK) today announced record financial results for its fourth
quarter and full year ended Dec. 31, 2004. Fourth quarter revenue was $1.544
billion, an increase of 13 percent compared to $1.370 billion last year.
Laser and inkjet printer revenue increased 16 percent year over year and
revenue from laser and inkjet supplies was up 13 percent. Diluted net
earnings per share for the quarter were $1.18, up 12 percent compared to $1.05
in the same quarter last year.
(Logo: http://www.newscom.com/cgi-bin/prnh/20020819/LEXMARKLOGO )
"We are pleased to deliver record revenue and earnings that exceeded our
expectations for the fourth quarter," said Paul J. Curlander, Lexmark chairman
and chief executive officer. "This was a very good quarter for Lexmark. We
achieved double-digit revenue growth in both hardware and supplies. Most
importantly, we continued disciplined investment in our core strategic
development and marketing initiatives to drive future growth, and delivered a
28 percent year-to-year increase in EPS for the full year."
Gross profit margin was 32.0 percent for the quarter versus 31.9 percent a
year ago. An increase in the mix of printers was offset by improved product
margins. Operating expenses, which included an approximate $15 million
increase in advertising, were $297 million compared with $249 million in the
prior year. Operating income was a record $197 million, up from $188 million
last year.
Net cash provided by operating activities was $284 million in the fourth
quarter. Capital expenditures for the quarter were $79 million. Lexmark
repurchased 1,620,000 shares of its common stock during the quarter for $139
million. The company's remaining share repurchase authorization was
approximately $901 million at year-end.
New multifunction products are fast, flexible, easy to use
Earlier this month, Lexmark announced three new powerful multifunction
products that give businesses the ability to move documents seamlessly from
paper to digital formats. The Lexmark X634e and Lexmark X634dte with
estimated street prices of $2,899 and $3,699 respectively, deliver up to 45
page per minute performance and an easy-to-use color touch-screen display at a
fraction of the cost of larger departmental devices. The compact Lexmark
X632s with print speeds of up to 40 pages per minute is perfect for small
enterprise workgroups and is affordably priced at $1,999.
Full-year financial results
Revenue for the 12 months ended Dec. 31, 2004 was $5.314 billion, an
increase of 12 percent versus $4.755 billion in the same period of 2003. Gross
profit margin was 33.7 percent, up 1.2 points from the prior year. Operating
income was $732 million versus $594 million a year earlier, an increase of 23
percent. Net earnings per share on a diluted basis increased 28 percent in
2004 to $4.28. Net cash provided by operating activities for the year was $775
million. Full-year capital expenditures were $198 million. The company
repurchased 3,220,000 shares in 2004 for $281 million.
Looking forward
In the first quarter of 2005, the company expects a year-over-year revenue
growth rate of mid- to high-single digits and earnings per share of $0.95 to
$1.05. This compares to earnings per share of $0.91 in the same quarter a
year ago. The company believes that the strength of its product line and its
supplies-driven business model will keep it well positioned for continued
growth, however uncertainty in the economy and the potential for aggressive
price competition continue.
Lexmark is hosting a conference call with securities analysts on Monday,
Jan. 24, 2005, at 8:30 a.m. Eastern Time (888-338-6461). A live broadcast
over the Internet and a complete replay of this call can be accessed from
Lexmark's investor relations Web site at http://investor.lexmark.com.
Lexmark International, Inc. makes it easier for businesses and consumers
to move information between the digital and paper worlds. Since its inception
in 1991, Lexmark has become a leading developer, manufacturer and supplier of
printing and imaging solutions for customers in more than 150 countries.
Lexmark reported approximately $5.3 billion in revenue in 2004, and can be
found on the Internet at http://www.lexmark.com.
Lexmark and Lexmark with diamond design are trademarks of Lexmark
International, Inc., registered in the U.S. and/or other countries. Prices are
estimated street prices in U.S. dollars.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act
of 1995: Statements in this release which are not historical facts are
forward-looking and involve risks and uncertainties, including, but not
limited to, the impact of competitors' products, aggressive pricing from
competitors and resellers, market acceptance of new products and pricing
programs, management of the company's and resellers' inventory levels,
increased investment to support product development and marketing, the ability
and/or incremental expense to produce and deliver products to satisfy customer
demand, changes in a country's or region's political or economic conditions,
currency fluctuations, financial failure or loss of business with a key
customer, reseller or supplier, production and supply difficulties including
disruptions at important points of exit and entry and distribution centers,
competition in aftermarket supplies, unforeseen cost impacts, conflicts among
sales channels, the outcome of pending and future litigation or governmental
proceedings, intellectual property and other legal claims and expenses,
difficulties or delays in software and information systems implementations,
and other risks described in the company's Securities and Exchange Commission
filings. The company undertakes no obligation to update any forward-looking
statement.
LEXMARK INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(In Millions, Except Per Share Amounts)
(Unaudited)
Three Months Ended
December 31
2004 2003
Revenue $1,543.9 $1,369.5
Cost of revenue 1,049.9 932.8
Gross profit 494.0 436.7
Research and development 85.7 70.4
Selling, general and administrative 211.5 178.5
Operating expense 297.2 248.9
Operating income 196.8 187.8
Interest income, net (5.8) (0.7)
Other (income) expense (0.8) 1.0
Earnings before income taxes 203.4 187.5
Provision for income taxes 48.4 48.7
Net earnings $155.0 $138.8
Net earnings per share:
Basic $1.20 $1.08
Diluted $1.18 $1.05
Shares used in per share calculation:
Basic 129.0 128.9
Diluted 131.5 132.2
LEXMARK INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(In Millions, Except Per Share Amounts)
(Unaudited)
Year Ended
December 31
2004 2003
Revenue $5,313.8 $4,754.7
Cost of revenue 3,522.4 3,209.6
Gross profit 1,791.4 1,545.1
Research and development 312.7 265.7
Selling, general and administrative 746.6 685.5
Operating expense 1,059.3 951.2
Operating income 732.1 593.9
Interest income, net (14.5) (0.4)
Other (income) expense 0.1 0.8
Earnings before income taxes 746.5 593.5
Provision for income taxes 177.8 154.3
Net earnings $568.7 $439.2
Net earnings per share:
Basic $4.38 $3.43
Diluted $4.28 $3.34
Shares used in per share calculation:
Basic 129.7 128.1
Diluted 132.9 131.4
LEXMARK INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL POSITION
(In Millions)
(Unaudited)
December 31 December 31
2004 2003
ASSETS
Current assets:
Cash and cash equivalents $626.2 $744.6
Marketable securities 940.5 451.5
Trade receivables, net 744.4 615.4
Inventories 464.9 437.0
Prepaid expenses and other current assets 224.9 195.3
Total current assets 3,000.9 2,443.8
Property, plant and equipment, net 792.2 715.9
Other assets 331.2 290.7
Total assets $4,124.3 $3,450.4
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term debt $1.5 $1.1
Accounts payable 670.6 465.7
Accrued liabilities 795.6 716.5
Total current liabilities 1,467.7 1,183.3
Long-term debt 149.5 149.3
Other liabilities 424.2 474.8
Total liabilities 2,041.4 1,807.4
Stockholders' equity:
Preferred stock -- --
Common stock and capital in excess of par 1,077.7 958.0
Retained earnings 2,663.7 2,095.0
Treasury stock, net (1,493.2) (1,213.5)
Accumulated other comprehensive loss (165.3) (196.5)
Total stockholders' equity 2,082.9 1,643.0
Total liabilities and
stockholders' equity $4,124.3 $3,450.4
SOURCE Lexmark International, Inc.
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Photo Notes:
NewsCom: http://www.newscom.com/cgi-bin/prnh/20020819/LEXMARKLOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, photodesk@prnewswire.com
Related links:
http://www.lexmark.com
http://investor.lexmark.com
CONTACT:
Investor: John Morgan, +1-859-232-5568,
jmorgan@lexmark.com, Media: Julane Hamon, +1-859-232-1536,
jhamon@lexmark.com
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