Lexmark: Strong Free Cash Flow Generator With Catalysts In Place
Lexmark: Still A Turnaround Story With Buyout Potential
Jul. 22, 2014, 2:10 PM
- In addition to beating Q2 estimates, Lexmark (LXK +3.5%) expects Q3 revenue to be flat to down 2% Y/Y, and EPS to be in a range of $0.85-$0.95. That's mostly above a consensus for -3.2% growth and EPS of $0.95.
- Lexmark is also guiding for 2014 revenue to be flat to down 2% (consensus is -2.8%), and EPS to be in a range of $3.95-$4.15 (consensus is $3.93).
- Hardware revenue rose 7% Y/Y in Q2 to $183M, a turnaround from Q1's 8% drop and helping fuel the Q2 beat. Supplies revenue -1% Y/Y (to $602M) vs. -1% in Q1, software/other revenue -1% (to $106M) vs. +13% in Q1.
- Laser supplies (+5%) were a strong point, as were sales related to Lexmark's managed print services business (+14% to $195M). Legacy inkjet revenue fell 33%.
- Gross margin +40 bps Y/Y to 40.8%. Opex +2% to $267M. $19M was spent on buybacks.
- Q2 results, PR
Jul. 22, 2014, 6:32 AM
- Lexmark International (NYSE:LXK): Q2 EPS of $0.99 beats by $0.06.
- Revenue of $894M (+0.4% Y/Y) beats by $26.91M.
Jul. 21, 2014, 5:30 PM
Jul. 15, 2014, 10:12 AM
Jul. 14, 2014, 10:19 AM
- Lexmark (LXK +0.7%) is now offering SEK50/share for ReadSoft (OTCMKTS:RDSFF), 16% more than a prior offer of SEK43/share and 11% above Hyland Software's recent SEK45/share bid.
- The new bid values ReadSoft at $224M exc. net cash. Lexmark says it still has the support of ReadSoft's founders, who own 23% of the company and 43% of its voting rights, and that it has taken a 5.3% stake on its own. Hyland has disclosed taking a 10.9% stake.
- A new tender offer period runs through Aug. 28. ReadSoft shares have soared to SEK50.75 in Stockholm, as investors bet the bidding war for the document management software company continues.
Jul. 8, 2014, 9:47 AM
- Hyland Software has raised its bid for Swedish document management software vendor ReadSoft (RDSFF) to SEK45/share. That trumps a revised SEK43.00/share offer from Lexmark (LXK +0.1%) made on June 19.
- Hyland adds it now owns 10.9% of ReadSoft's shares. Its latest offer values the company at $203M net of cash.
- Lexmark's June offer came after Hyland made an SEK42.86/share bid that surpassed a prior SEK39.78 offer from Lexmark. ReadSoft traded at only SEK18.44/share prior to Lexmark's original bid.
- In response to Hyland's latest move, Lexmark only says it's "evaluating all of its options and will discuss with ReadSoft's Board of Directors at the appropriate time."
- ReadSoft shares are trading at SEK45.90 in Stockholm.
Jun. 18, 2014, 5:24 PM
- Lexmark (LXK) is now offering SEK43.00/share for Swedish document management software firm ReadSoft (RDSFF), a 7.4% increase from its original offer. The revised tender offer price values ReadSoft at $194M net of cash.
- Lexmark's move comes after private Hyland Software made a SEK42.86/share bid for ReadSoft. Lexmark says ReadSoft's board continues to back its bid, and that it also has the support of ReadSoft's two biggest shareholders.
- With ReadSoft shares having closed at SEK45.00 today in Stockholm (up 12.8%), investors are betting on a bidding war.
May 6, 2014, 8:01 AM
- Lexmark (LXK) is offering $6.11/share (SEK39.78/share) in cash, or $182M net of cash, to acquire all outstanding shares of Swedish document management software vendor ReadSoft. The price represents nearly a 120% premium to ReadSoft's Monday close in Stockholm. ReadSoft's board backs the offer.
- ReadSoft claims 12K+ customers in 70 countries, and had 2013 revenue of $117M - the latter figure implies a fairly low acquisition multiple of 1.56x trailing sales. Clients include Siemens, BASF, HSBC, and Lego.
- The company has a product line that includes a number of apps specifically meant to automate the flow of documents for widely-used Oracle/SAP apps. Lexmark says ReadSoft's products will complement its Perceptive Software (content management software) unit,
- The purchase is part of Lexmark's ongoing effort to lower its dependence on a slumping printer business in favor of software/services. The company's software/other revenue rose 13% Y/Y in Q1, but still only made up 12% of revenue.
Apr. 24, 2014, 4:56 PM
- Lexmark International, Inc. (LXK) declares $0.36/share quarterly dividend, 20.0% increase from prior dividend of $0.30.
- Forward yield 3.41%
- Payable June 13; for shareholders of record May 30; ex-div May 28.
Apr. 22, 2014, 12:46 PM
Apr. 22, 2014, 12:39 PM
- Though Lexmark (LXK -11.3%) beat Q1 estimates, it's guiding for Q2 EPS of $0.85-$0.95; the midpoint is below a $0.94 consensus. Revenue is expected to fall 2%-4% Y/Y vs. a -3.8% consensus. With shares having closed yesterday near their 52-week high of $47.98, the outlook isn't going over well.
- Supplies revenue (69% of total revenue), pressured by declining sales related to discontinued inkjet hardware, fell 1% Y/Y after growing 1% in Q4; laser supplies rose 9%.
- Hardware revenue (19% of total) fell 8% after growing 3% in Q4. Software/other sales (12% of total) grew 13%, down from Q4's 31%, with Perceptive Software's sales rising 38% to $64M.
- Gross margin rose 100 bps Y/Y to 41%. Opex rose 2% to $270M, and $21M was spent on buybacks.
- Rival H-P (HPQ -0.6%) is ticking lower on an up day for equities. H-P's printing ops accounted for 20% of its Jan. quarter revenue, and 36% of its op. profit.
Apr. 22, 2014, 6:32 AM
- Lexmark International (LXK): Q1 EPS of $0.92 beats by $0.05.
- Revenue of $877.7M (-0.9% Y/Y) beats by $21.9M.
Apr. 22, 2014, 12:05 AM
Apr. 21, 2014, 5:30 PM
Feb. 20, 2014, 4:29 PM
- Lexmark International, Inc. (LXK) declares $0.30/share quarterly dividend, in line with previous.
- Forward yield 2.83%
- Payable March 14; for shareholders of record March 3; ex-div Feb. 27.
Jan. 28, 2014, 1:57 PM
- In addition beating Q4 estimates, Lexmark (LXK +7.4%) is guiding for Q1 revenue to be down only 3%-5% Y/Y, less than a consensus for a 5.1% drop. Q1 EPS is expected to be in a range of $0.80-$0.90, in-line with an $0.85 consensus.
- The report acts as further validation of Lexmark's efforts to grow its software exposure, and thereby lower its dependence on printing hardware and supplies markets that remain pressured by a long-term shift towards digital document and photo sharing/viewing. While hardware revenue fell 8% Y/Y to $763M, and supplies revenue 6% to $2.48B, software/other revenue jumped 27% to $420M.
- Lexmark's Perceptive Software (content management, data capture, and enterprise search software) unit posted Q4 sales of $224M, +48% Y/Y. Excluding sales tied to Lexmark's discontinued inkjet printing business (-37% Y/Y to $405M), hardware revenue only fell 2%, and supplies revenue rose 2%.
- Thanks to rising software sales, gross margin came in at 40.7%, +180 bps Y/Y. $82M was spent on buybacks.
Lexmark International, Inc. engages in the development, manufacture and sale of printing solutions. It operates through the Imaging Solutions and Perceptive Software segments. The Imaging Solutions segment supplies monochrome and color laser and provides managed print and customer support... More
Industry: Computer Based Systems
Country: United States
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