Lexmark International Tuesday reported that fourth-quarter profit plummeted 82 percent to $18.1 million from $99 million in the same period a year ago, blaming lower laser and inkjet hardware sales and shifting currency rates.
Revenue in the quarter declined 17 percent to $1.08 billion from $1.31 billion a year ago. For the year, Lexmark reported that net income fell 20 percent to $240.2 million from $300.8 million. Revenue fell 9 percent to $4.53 billion from $4.97 billion a year ago.
For the quarter, business segment revenue was $718 million, which declined 10 percent. Some of the loss was attributed to a 21 percent revenue decline in laser hardware, aggressive pricing and weakening foreign currencies, the company said. In addition, laser unit shipments fell 8 percent, primarily due to lower OEM units, according to Lexmark.
Consumer segment revenue fell 28 percent to $366 million in the fourth quarter, compared to a year ago. Inkjet hardware revenue and unit shipments declined 43 percent in the consumer space, which the company said reflected increased market weakness. Elsewhere in the consumer business, laser and inkjet supplies revenues declined 12 percent in the quarter, mainly driven by a decline in inkjet supplies volume and by the negative impact of foreign currency rate changes, while laser and inkjet printer revenues fell 29 percent.
Lexmark also said that the consumer decline, in general, was due to its previously announced strategy to "aggressively" shift its focus to geographic regions, product segments and customers that generate higher page usage.
"In response to the current market conditions, Lexmark continues to take actions that will reduce our fixed infrastructure and business support costs, which are projected to generate savings of over $100 million in 2009," said Paul Curlander, chairman and CEO, in a statement.
Last week, Lexmark advised investors that it was restructuring, a move that includes eliminating 375 jobs. The reorganization is a continuation of a reduction in the company's general and administrative expenses, as well as supply chain and sales support.
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