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Xerox Reports 3Q 2013 Earnings


Revenue of $5.3 billion, flat from third quarter 2012

Xerox announced third-quarter 2013 adjusted EPS of 26 cents, which excludes 4 cents related to the amortization of intangibles, resulting in GAAP EPS from continuing operations of 22 cents. In the third quarter, total revenue of $5.3 billion was flat from the prior year or down 1% in constant currency.

Revenue from the company's services business was up 3% with a segment margin of 9.9%. Services revenue now represents 56% of Xerox's total revenue. The company's document technology revenue declined 4%, or 5% in constant currency, with a segment margin of 12.1%.

"This quarter shows how we are successfully capturing the benefits of a diversified portfolio. Within services we continue to focus on improving our cost structure while maintaining investments in areas where we see opportunity, such as healthcare. In document technology, revenue declines stabilized with continued good profitability. We continue to see demand from small and midsize businesses in the United States, and positive trends in the high end of our business," said Ursula Burns, Xerox chairman and CEO. "Our approach remains the same: to focus on areas of differentiation and profitable growth while finding new ways to deliver operational improvements across the board."

Third-quarter operating margin of 9.4% was up 0.5 points year over year. Gross margin was 31.5%. Selling, administrative and general expenses were 19.3% of revenue.

The company generated $961 million in operating cash flow in the quarter, and anticipates full year cash flow towards the higher-end of the $2.1 billion to $2.4 billion range.