Free Research Report as Xerox’s Adjusted EPS Advanced 6% and Earnings Outlook Was Raised

Stock Monitor: DXC Technology Post Earnings Reporting

LONDON, UK / ACCESSWIRE / November 30, 2017 / Active-Investors free earnings report on Xerox Corp. (NYSE: XRX) has freshly been issued to its members, and you can also sign up to view this report at www.active-investors.com/registration-sg/?symbol=XRX. The Company reported its third quarter fiscal 2017 operating results on October 26, 2017. The copy machine and other office products maker exceeded earnings and revenue expectations and raised its earnings guidance. Register today and get free access to our complimentary member’s area where many more reports are available:

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Active-Investors.com is focused on giving you timely information and the inside line on companies that matter to you. This morning, Xerox most recent news is on our radar and we have decided to include it on our blog post. Today’s free coverage is available at:

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Earnings Highlights and Summary

Xerox reported total revenues of $2.50 billion in Q3 2017, down 5.0% compared to $2.63 billion in Q3 2016. The Company’s revenue numbers surpassed analysts’ expectations of $2.49 billion.

During Q3 2017, Xerox’s adjusted operating margin was 12.2%, down 0.4 points compared to the year ago same period.

The Company delivered net income from continuing operations attributable to Xerox of $176 million, or $0.67 per diluted share, in Q3 2017 compared to $175 million, or $0.66 per diluted share, in Q3 2016.

On an adjusted basis, net income from continuing operations attributable to Xerox was $0.89 per diluted share, up 6% versus adjusted net income of $0.84 per share in the year earlier comparable quarter. In Q3 2017, the Company’s adjusted income excluded $0.22 per share of after-tax costs related to the amortization of intangibles, restructuring and related costs, and certain retirement-related costs. Xerox’s earnings beat Wall Street’s estimates of $0.83 per share.

Operating Results

During Q3 2017, Xerox’s Post Sale segment’s revenues totaled $1.98 billion, down 3.9% compared to $2.06 billion in Q3 2016. Post Sale segment’s revenues contributed to 79% of the overall revenue. In the reported quarter, Post Sale segment’s gross margin of 42.4% increased 0.9% on a y-o-y basis. On an adjusted basis, Post Sale segment’s gross margin of 43.1% improved 1.0% as a result of cost savings from strategic transformation, including restructuring.

The Company’s Equipment Sale segment’s revenues totaled $521 million for the reported quarter, down 9.1% compared to $573 million in the year earlier corresponding quarter. The segment’s revenue decline was impacted by price declines of approximately 5%. For Q3 2017, Equipment Sale segment’s gross margin of 29.2% decreased 2.7% on a y-o-y basis, as product cost productivity was more than offset by transaction currency.

During Q3 2017, Xerox’s signings (estimated future revenues from contracts signed, including renewals of existing contracts) decreased 8.6% on a y-o-y basis, with a 1.9% unfavorable impact from currency, primarily reflecting a lower contribution from new business. On a trailing twelve-month basis, the Company’s signings decreased 14.1% compared to the year ago same period.

For Q3 2017, Xerox’s New Business Total Contract Value (TCV) declined 14.2% on a y-o-y basis. On a trailing twelve-month basis, New Business TCV decreased 28.2% from the prior year’s comparable period, with a 3.1% unfavorable impact from currency. This performance was attributed to ongoing competitive pressure in the market as well as the timing of new products amplified by the longer sales cycles in this area of the business.

The Company’s contract renewal rate was 85% for the reported quarter, an increase of 3% compared to a renewal rate of 82% in FY16.

Cash Matters

For Q3 2017, Xerox’s cash used in operating activities was $383 million, and included $671 million in pension contributions, which reflect the incremental $500 million contribution to domestic pension plans. The Company’s cash balance was $1.8 billion at the end of the reported quarter. Xerox returned $68 million in dividends to shareholders in Q3 2017.

Full-Year 2017 Guidance

Xerox updated its FY17 guidance of GAAP EPS from continuing operations to $1.97 to $2.13 from the previous forecasts of $1.84 to $2.08, and adjusted EPS estimates in the range of $3.28 to $3.44 from the prior outlook of $3.20 to $3.44.

Stock Performance Snapshot

November 29, 2017 – At Wednesday’s closing bell, Xerox’s stock rose 1.03%, ending the trading session at $29.30.

Volume traded for the day: 1.96 million shares, which was above the 3-month average volume of 1.87 million shares.

Stock performance in the previous six-month period – up 3.17%; past twelve-month period – up 17.56%; and year-to-date – up 27.39%

After yesterday’s close, Xerox’s market cap was at $7.41 billion.

Price to Earnings (P/E) ratio was at 13.79.

The stock has a dividend yield of 3.41%.

The stock is part of the Technology sector, categorized under the Information Technology Services industry.

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