|Industry Leadership, Annuity Business, Strong Financial Position Deliver Shareholder Value|
|Tuesday, 04 May 2010 00:00|
At its investor conference being held today, Xerox Corporation is addressing how its annuity-based business, strong operating cash flow and industry-leading technology and services are differentiating Xerox and creating more value for shareholders.
Xerox is now the world's leading enterprise for business process and document management. With the acquisition of Affiliated Computer Services, Inc. (ACS), which closed on Feb. 5, Xerox expanded its portfolio to include business process and IT outsourcing. The company's services business has doubled in size to $10 billion and Xerox's annuity -- or recurring revenue -- is more than 80 percent of total revenue.
"Over the past few years, we have fundamentally changed our company. We prioritized investments in innovation to create the industry's broadest portfolio of document technology. We significantly scaled our services business to boost our annuity and expand our market opportunities. We increased our distribution channels to bring the Xerox brand to more businesses of all sizes. And, we maintained a disciplined and diligent approach to driving efficiencies across the enterprise," said Ursula Burns, Xerox chief executive officer. "As a result, we are competitively advantaged to continue winning in the marketplace. And, we are well positioned to continue delivering solid revenue growth, earnings expansion and increased operating cash."
During the conference, Xerox will outline its financial profile for the next three years. For 2010, the company expects pro-forma revenue growth of 1 to 3 percent. Full-year GAAP earnings are expected to be 37 to 47 cents per share. Xerox expects to deliver full-year adjusted earnings per share at the high end of the company's guidance of 75 to 85 cents per share. Cash from operations is expected to be $2.6 billion.
Xerox projects that, by 2011, full-year revenue will be approximately $24 billion, and is expected to grow to $25 billion in 2012. The company expects adjusted EPS to be 95 cents to $1.05 per share in 2011 and $1.10 to 1.20 per share in 2012.
Xerox is on track with revenue synergies from the ACS acquisition and cost-reduction activities. The company expects to deliver at least $100 million in profit synergies during year one, with upside potential to $150 million. By year three, Xerox expects profit synergies will ramp to more than $375 million.