Xerox Corporation (NYSE:XRX) Q4 2014 Earnings Conference Call - Final Transcript

Jan 30, 2015 • 10:00 am ET


Xerox Corporation (NYSE:XRX) Q4 2014 Earnings Conference Call - Final Transcript


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Good morning, and welcome to the Xerox Corporation Fourth Quarter 2014 Earnings Release Conference Call hosted by Ursula Burns, Chairman of the Board and Chief Executive Officer. She is joined by Kathy Mikells, Executive Vice President and Chief Financial Officer.

During this call, Xerox executives will refer to slides that are available on the web at At the request of Xerox Corporation, today's conference call is being recorded. Other recording and/or rebroadcasting of this call are prohibited without the express permission of Xerox.

After the presentation there will be a question-and-answer session. (Operator Instructions)

(Forward-Looking Cautionary Statement)

Before turning the meeting over to Ms. Burns, Jim Lesko, Vice President of Investor Relations, has a few words.

Ursula Burns

Before Ursula begins, I would like to remind everyone that as a result of the pending

Unidentified Speaker

sale announced on December 18 of our ITO business to Atos and having met applicable accounting requirements, Xerox is now reporting the ITO business as a discontinued operation. We will be reporting today our Q4 and full year 2014 results on a continuing operations basis. Prior period results have been revised to reflect this change, details of which can be found on our Investor Relations website at Ursula?

Ursula Burns

Thanks, Jim. Good morning thanks for joining our call. Today we're reporting fourth quarter and full year 2014 earnings. A lot has happened in the last 90 days and overall we're pleased with where we ended the year. We're reporting solid results that in some places exceeded expectations. I'll give a quick overview of our financials, provide some perspective on the year and share updates on key initiatives contributing to our results before turning it over to Kathy to go into more detail on the financials.

We delivered strong profit and cash for the year and we closed strong in services revenue and margin. Services revenue growth improved through the year and we saw improved margin performance. Services signings increased as well driven by renewals in BPO and we ended the year with strong Document Outsourcing signings of over a $1 billion. In fact, our Canadian operation closed its largest ever multimillion-dollar MPS deal with the Government of Canada in November.

In Document Technology, we delivered strong margin throughout the year, reflecting both our continued focus on profitability as well as a favorable environment and for the fifth consecutive year we're the leader in equipment sale revenue. Demand has been strong for our iGen and the new Versant products in the U.S. and Europe. These products provide our graphic communications customers with the ability to produce digital color prints at scale with a high level of personalization, quality and reliability.

As you know, Xerox has been focusing on the segments where we have the most competitive advantage and we have been steadily shifting our portfolio mix. As an example, we announced the pending divestiture of our ITO business through a sale to Atos. This will allow us to focus squarely on Business Process Services and Document Outsourcing and provide