Lexmark reports poor second quarter results
Lexmark reported their second quarter results yesterday and disappointed stock market analysts. What is interesting for us at Stinkyink Towers is in the detail of the reports. The main shortfal for Lexmark was in the consumer sector which declined 8% in the period. Going forward, the main thrust for business will be in the industries key areas of Colour Laser, Laser Multi-Function products and inkjet all-in-ones. Improving product costs will be another focus for the company.
The business market segment performed about as expected and won some major banking contracts in South America especially. Cash flow for the quarter was also very strong giving the company a strong financial position and balance sheet.
Looking forward into Q3 of 2007 the company expects revenue to be down in the low to mid digit percentage range year over year and is expecting tough competition especially from the likes of HP, Epson and now in the US Kodak.
There is still much speculation that Lexmark could be a very tempting take over target and we will be watching this space with much interest
