Xerox Releases Fourth-Quarter and Full-Year Results

Plans to create separate Software, Financing and Innovation businesses, launch corporate venture capital fund

Financial Summary

  • $235 million of operating cash flow from continuing operations in Q4, up $129 million from Q3 and down $163 million year-over-year (YOY); $548 million of full-year (FY) operating cash flow from continuing operations, down $696 million YOY.
  • $221 million of free cash flow in Q4, up $133 million from Q3 and down $160 million YOY; $474 million of FY free cash flow, down $705 million YOY.
  • Q4 adjustedoperating margin of 9.5 percent, up 210 basis points from Q3 and down 730 basis points YOY; FY adjustedoperating margin of 6.6 percent, down 650 basis points YOY.
  • Q4 GAAP earnings per share (EPS) from continuing operations of $0.36, down $0.05 from Q3 and down $0.81 YOY; FY GAAP EPS from continuing operations of $0.84, down $1.94 YOY.
  • Q4 adjusted EPS of $0.58, up $0.10 from Q3 and down $0.75 YOY; FY adjusted EPS of $1.41, down $2.14 YOY.
  • $1.930 billion of Q4 revenue, up 9.2 percent or 8.5 percent in constant currency compared to Q3 and down 21.0 percent or 22.3 percent in constant currency YOY.
  • $7.022 billion of FY revenue, down 22.5 percent YOY or 22.7 percent in constant currency YOY.
  • Delivered $450 million of gross savings in 2020 under Project Own It.
  • Returned 112 percent of free cash flow to shareholders in 2020.

NORWALK, Conn.–(BUSINESS WIRE)–$XRXXerox Holdings Corporation (NYSE: XRX) today announced 2020 fourth-quarter and full-year results and guidance for 2021.

Times of adversity require working in unison, and I couldn’t be prouder of the way our team came together. We put our strategy to the test in 2020, delivering positive earnings per share and free cash flow, while returning capital to shareholders and continuing to invest in our future. The team’s discipline allowed us to turn on a dime, tightly controlling expenses while steadfastly supporting clients,” said Xerox Vice Chairman and CEO John Visentin. “Though the impact of the pandemic continues in 2021, we expect to return to growth this year as we increase the breadth of offerings and reach new customers in existing and new businesses.”

Fourth-Quarter Key Financial Results – Continuing Operations:

(in millions, except per share data)

Q4 2020

Q4 2019

B/(W)
YOY

% Change
YOY

Revenue

$1,930

$2,444

$(514)

(21.0)% AC

(22.3)% CC1

Gross Margin

36.2%

41.6%

(540) bps

 

RD&E %

3.9%

3.8%

(10) bps

 

SAG %

22.8%

20.9%

(190) bps

 

Pre-Tax Income

$103

$336

$(233)

(69.3)%

Pre-Tax Income Margin

5.3%

13.7%

(840) bps

 

Operating Income – Adjusted1

$184

$411

$(227)

(55.2)%

Operating Margin – Adjusted1

9.5%

16.8%

(730) bps

 

GAAP EPS

$0.36

$1.17

$(0.81)

(69.2)%

EPS – Adjusted1

$0.58

$1.33

$(0.75)

(56.4)%

 

Full-Year Key Financial Results – Continuing Operations:

(in millions, except per share data)

FY 2020

FY 2019

B/(W)
YOY

% Change
YOY

Revenue

$7,022

$9,066

$(2,044)

(22.5)% AC

(22.7)% CC1

Gross Margin

37.4%

40.3%

(290) bps

 

RD&E %

4.4%

4.1%

(30) bps

 

SAG %

26.4%

23.0%

(340) bps

 

Pre-Tax Income

$252

$822

$(570)

(69.3)%

Pre-Tax Income Margin

3.6%

9.1%

(550) bps

 

Operating Income – Adjusted1

$464

$1,192

$(728)

(61.1)%

Operating Margin – Adjusted1

6.6%

13.1%

(650) bps

 

GAAP EPS

$0.84

$2.78

$(1.94)

(69.8)%

EPS – Adjusted1

$1.41

$3.55

$(2.14)

(60.3)%

___________

(1) Refer to the “Non-GAAP Financial Measures” section of this release for a discussion of these non-GAAP measures and their reconciliation to the reported GAAP measures.

New Businesses to Deliver Continuous Growth

Xerox announced its intention to stand up its Software, Financing and Innovation organizations as separate and distinct businesses by 2022.

  • The Software business will include a growing portfolio comprised of: DocuShare®, a cloud-based content management system; XMPie, software that supports multichannel marketing campaigns; and CareAR, an augmented reality business Xerox acquired in late 2020. CareAR has signed agreements with a number of major companies.
  • Xerox Financial Services (XFS) will become a global payment solutions business, offering leasing for Xerox and third-party technology and office equipment. This will expand the company’s customer base, create cross-selling opportunities and provide more leasing options for small and medium-sized businesses.
  • The Palo Alto Research Center (PARC) has been central in advancing the company’s innovation portfolio including 3D Printing and Digital Manufacturing, IoT Sensors and Services, and Clean Technology. Xerox installed its first 3D printer for a client in December, and IoT solutions are at work with the U.S. Defense Advanced Research Projects Agency and other clients.

In the coming months, Xerox will establish a $250 million corporate venture capital fund to invest in start-ups and early and mid-stage growth companies aligned with the company’s innovation pillars and targeted adjacencies. The corporate venture capital fund will further enhance the company’s existing innovation ecosystem and drive growth through investment, commercial partnerships and co-development of new technologies.

2021 Guidance

Despite the high-level of economic uncertainty, the company expects continued progress on its strategic initiatives as projected in its 2021 financial guidance:

  • Revenue of at least $7.2 billion in constant currency or approximately 2.5 percent growth
  • Operating cash flow from continuing operations of at least $600 million and free cash flow of at least $500 million

About Xerox

Xerox Holdings Corporation (NYSE: XRX) makes every day work better. We are a workplace technology company building and integrating software and hardware for enterprises large and small. As customers seek to manage information across digital and physical platforms, Xerox delivers a seamless, secure and sustainable experience. Whether inventing the copier, the ethernet, the laser printer or more, Xerox has long defined the modern work experience. Learn how that innovation continues at xerox.com.

Non-GAAP Measures

This release refers to the following non-GAAP financial measures:

  • Adjusted EPS, which excludes restructuring and related costs, the amortization of intangible assets, non-service retirement-related costs, transaction and related costs, net and other discrete adjustments from GAAP-EPS from continuing operations.
  • Adjusted operating margin and income, which exclude the EPS adjustments noted above as well as the remainder of other expenses, net from pre-tax income and margin.
  • Constant currency (CC) revenue change, which excludes the effects of currency translation.
  • Free cash flow, which is cash flow from continuing operations less capital expenditures.

Refer to the “Non-GAAP Financial Measures” section of this release for a discussion of these non-GAAP measures and their reconciliation to the reported GAAP measures.

Forward-Looking Statements

This release, and other written or oral statements made from time to time by management contain “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. The words “anticipate”, “believe”, “estimate”, “expect”, “intend”, “will”, “should”, “targeting”, “projecting”, “driving” and similar expressions, as they relate to us, our performance and/or our technology, are intended to identify forward-looking statements. These statements reflect management’s current beliefs, assumptions and expectations and are subject to a number of factors that may cause actual results to differ materially. Such factors include but are not limited to: the effects of the COVID-19 pandemic on our and our customers’ businesses and the duration and extent to which this will impact our future results of operations and overall financial performance; our ability to address our business challenges in order to reverse revenue declines, reduce costs and increase productivity so that we can invest in and grow our business; our ability to attract and retain key personnel; changes in economic and political conditions, trade protection measures, licensing requirements and tax laws in the United States and in the foreign countries in which we do business; the imposition of new or incremental trade protection measures such as tariffs and import or export restrictions; changes in foreign currency exchange rates; our ability to successfully develop new products, technologies and service offerings and to protect our intellectual property rights; the risk that multi-year contracts with governmental entities could be terminated prior to the end of the contract term and that civil or criminal penalties and administrative sanctions could be imposed on us if we fail to comply with the terms of such contracts and applicable law; the risk that partners, subcontractors and software vendors will not perform in a timely, quality manner; actions of competitors and our ability to promptly and effectively react to changing technologies and customer expectations; our ability to obtain adequate pricing for our products and services and to maintain and improve cost efficiency of operations, including savings from restructuring actions; the risk that confidential and/or individually identifiable information of ours, our customers, clients and employees could be inadvertently disclosed or disclosed as a result of a breach of our security systems due to cyber attacks or other intentional acts; reliance on third parties, including subcontractors, for manufacturing of products and provision of services; the exit of the United Kingdom from the European Union; our ability to manage changes in the printing environment and expand equipment placements; interest rates, cost of borrowing and access to credit markets; funding requirements associated with our employee pension and retiree health benefit plans; the risk that our operations and products may not comply with applicable worldwide regulatory requirements, particularly environmental regulations and directives and anti-corruption laws; the outcome of litigation and regulatory proceedings to which we may be a party; any impacts resulting from the restructuring of our relationship with Fujifilm Holdings Corporation; and the shared services arrangements entered into by us as part of Project Own It. Additional risks that may affect Xerox’s operations and other factors that are set forth in the “Risk Factors” section, the “Legal Proceedings” section, the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section and other sections of Xerox Holdings Corporation’s and Xerox Corporation’s 2019 Annual Report on Form 10-K, as well as in Xerox Holdings Corporation’s and Xerox Corporation’s Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the SEC.

These forward-looking statements speak only as of the date of this release or as of the date to which they refer, and Xerox assumes no obligation to update any forward-looking statements as a result of new information or future events or developments, except as required by law.

Note: To receive RSS news feeds, visit https://www.news.xerox.com. For open commentary, industry perspectives and views, visit http://www.linkedin.com/company/xerox, http://twitter.com/xerox, http://www.facebook.com/XeroxCorp, https://www.instagram.com/xerox/, http://www.youtube.com/XeroxCorp.

Xerox® and DocuShare® are trademarks of Xerox in the United States and/or other countries.

 

XEROX HOLDINGS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

 

 

 

Three Months Ended

December 31,

 

Year Ended

December 31,

(in millions, except per-share data)

 

2020

 

2019

 

2020

 

2019

Revenues

 

 

 

 

 

 

 

 

Sales

 

$

773

 

 

$

919

 

 

$

2,449

 

 

$

3,227

 

Services, maintenance and rentals

 

1,101

 

 

1,465

 

 

4,347

 

 

5,595

 

Financing

 

56

 

 

60

 

 

226

 

 

244

 

Total Revenues

 

1,930

 

 

2,444

 

 

7,022

 

 

9,066

 

Costs and Expenses

 

 

 

 

 

 

 

 

Cost of sales

 

541

 

 

605

 

 

1,742

 

 

2,097

 

Cost of services, maintenance and rentals

 

658

 

 

790

 

 

2,533

 

 

3,188

 

Cost of financing

 

32

 

 

33

 

 

121

 

 

131

 

Research, development and engineering expenses

 

75

 

 

93

 

 

311

 

 

373

 

Selling, administrative and general expenses

 

440

 

 

512

 

 

1,851

 

 

2,085

 

Restructuring and related costs

 

29

 

 

53

 

 

93

 

 

229

 

Amortization of intangible assets

 

22

 

 

10

 

 

56

 

 

45

 

Transaction and related costs, net

 

 

 

4

 

 

18

 

 

12

 

Other expenses, net

 

30

 

 

8

 

 

45

 

 

84

 

Total Costs and Expenses

 

1,827

 

 

2,108

 

 

6,770

 

 

8,244

 

Income before Income Taxes & Equity Income(1)

 

103

 

 

336

 

 

252

 

 

822

 

Income tax expense

 

28

 

 

73

 

 

64

 

 

179

 

Equity in net income of unconsolidated affiliates

 

2

 

 

3

 

 

4

 

 

8

 

Income from Continuing Operations

 

77

 

 

266

 

 

192

 

 

651

 

Income from discontinued operations, net of tax

 

 

 

553

 

 

 

 

710

 

Net Income

 

77

 

 

819

 

 

192

 

 

1,361

 

Less: Income from continuing operations attributable to noncontrolling interests

 

 

 

 

 

 

 

3

 

Less: Income from discontinued operations attributable to noncontrolling interests

 

 

 

1

 

 

 

 

5

 

Net Income Attributable to Xerox Holdings

 

$

77

 

 

$

818

 

 

$

192

 

 

$

1,353

 

 

 

 

 

 

 

 

 

 

Amounts Attributable to Xerox Holdings:

 

 

 

 

 

 

 

 

Net income from continuing operations

 

$

77

 

 

$

266

 

 

$

192

 

 

$

648

 

Net income from discontinued operations

 

 

 

552

 

 

 

 

705

 

Net Income Attributable to Xerox Holdings

 

$

77

 

 

$

818

 

 

$

192

 

 

$

1,353

 

 

 

 

 

 

 

 

 

 

Basic Earnings per Share:

 

 

 

 

 

 

 

 

Continuing operations

 

$

0.37

 

 

$

1.22

 

 

$

0.85

 

 

$

2.86

 

Discontinued operations

 

 

 

2.56

 

 

 

 

3.17

 

Total Basic Earnings per Share

 

$

0.37

 

 

$

3.78

 

 

$

0.85

 

 

$

6.03

 

 

 

 

 

 

 

 

 

 

Diluted Earnings per Share:

 

 

 

 

 

 

 

 

Continuing operations

 

$

0.36

 

 

$

1.17

 

 

$

0.84

 

 

$

2.78

 

Discontinued operations

 

 

 

2.44

 

 

 

 

3.02

 

Total Diluted Earnings per Share

 

$

0.36

 

 

$

3.61

 

 

$

0.84

 

 

$

5.80

 

___________________________

(1) Referred to as “Pre-Tax Income” throughout the remainder of this document.

 

XEROX HOLDINGS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

 

 

 

Three Months Ended

December 31,

 

Year Ended

December 31,

(in millions)

 

2020

 

2019

 

2020

 

2019

Net Income

 

$

77

 

 

$

819

 

 

$

192

 

 

$

1,361

 

Less: Income from continuing operations attributable to noncontrolling interests

 

 

 

 

 

 

 

3

 

Less: Income from discontinued operations attributable to noncontrolling interests

 

 

 

1

 

 

 

 

5

 

Net Income Attributable to Xerox Holdings

 

77

 

 

818

 

 

192

 

 

1,353

 

 

 

 

 

 

 

 

 

 

Other Comprehensive Income (Loss), Net

 

 

 

 

 

 

 

 

Translation adjustments, net

 

234

 

 

184

 

 

241

 

 

62

 

Unrealized (losses) gains, net

 

 

 

(9)

 

 

4

 

 

(6)

 

Changes in defined benefit plans, net

 

27

 

 

28

 

 

69

 

 

(10)

 

Other Comprehensive Income, Net

 

261

 

 

203

 

 

314

 

 

46

 

Less: Other comprehensive loss, net from continuing operations attributable to noncontrolling interests

 

 

 

(1)

 

 

 

 

 

Other Comprehensive Income, Net Attributable to Xerox Holdings

 

261

 

 

204

 

 

314

 

 

46

 

 

 

 

 

 

 

 

 

 

Comprehensive Income (Loss), Net

 

338

 

 

1,022

 

 

506

 

 

1,407

 

Less: Comprehensive (loss) income, net from continuing operations attributable to noncontrolling interests

 

 

 

(1)

 

 

 

 

3

 

Less: Comprehensive income, net from discontinued operations attributable to noncontrolling interests

 

 

 

1

 

 

 

 

5

 

Comprehensive Income, Net Attributable to Xerox Holdings

 

$

338

 

 

$

1,022

 

 

$

506

 

 

$

1,399

 

 

XEROX HOLDINGS CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

 

(in millions, except share data in thousands)

 

December 31, 2020

 

December 31, 2019

Assets

 

 

 

 

Cash and cash equivalents

 

$

2,625

 

 

$

2,740

 

Accounts receivable (net of allowances of $69 and $55, respectively)

 

883

 

 

1,236

 

Billed portion of finance receivables (net of allowances of $4 and $3, respectively)

 

99

 

 

111

 

Finance receivables, net

 

1,082

 

 

1,158

 

Inventories

 

843

 

 

694

 

Other current assets

 

251

 

 

201

 

Total current assets

 

5,783

 

 

6,140

 

Finance receivables due after one year (net of allowances of $129 and $86, respectively)

 

1,984

 

 

2,082

 

Equipment on operating leases, net

 

296

 

 

364

 

Land, buildings and equipment, net

 

407

 

 

426

 

Intangible assets, net

 

237

 

 

199

 

Goodwill

 

4,071

 

 

3,900

 

Deferred tax assets

 

508

 

 

598

 

Other long-term assets

 

1,455

 

 

1,338

 

Total Assets

 

$

14,741

 

 

$

15,047

 

Liabilities and Equity

 

 

 

 

Short-term debt and current portion of long-term debt

 

$

394

 

 

$

1,049

 

Accounts payable

 

983

 

 

1,053

 

Accrued compensation and benefits costs

 

261

 

 

349

 

Accrued expenses and other current liabilities

 

840

 

 

984

 

Total current liabilities

 

2,478

 

 

3,435

 

Long-term debt

 

4,050

 

 

3,233

 

Pension and other benefit liabilities

 

1,566

 

 

1,707

 

Post-retirement medical benefits

 

340

 

 

352

 

Other long-term liabilities

 

497

 

 

512

 

Total Liabilities

 

8,931

 

 

9,239

 

 

 

 

 

 

Convertible Preferred Stock

 

214

 

 

214

 

 

 

 

 

 

Common stock

 

198

 

 

215

 

Additional paid-in capital

 

2,445

 

 

2,782

 

Treasury stock, at cost

 

 

 

(76)

 

Retained earnings

 

6,281

 

 

6,312

 

Accumulated other comprehensive loss

 

(3,332)

 

 

(3,646)

 

Xerox Holdings shareholders’ equity

 

5,592

 

 

5,587

 

Noncontrolling interests

 

4

 

 

7

 

Total Equity

 

5,596

 

 

5,594

 

Total Liabilities and Equity

 

$

14,741

 

 

$

15,047

 

 

 

 

 

 

Shares of common stock issued

 

198,386

 

 

214,621

 

Treasury stock

 

 

 

(2,031)

 

Shares of Common Stock Outstanding

 

198,386

 

 

212,590

 

 

XEROX HOLDINGS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

 

 

 

Three Months Ended

December 31,

 

Year Ended

December 31,

(in millions)

 

2020

 

2019

 

2020

 

2019

Cash Flows from Operating Activities

 

 

 

 

 

 

 

 

Net Income

 

$

77

 

 

$

819

 

 

$

192

 

 

$

1,361

 

Income from discontinued operations, net of tax

 

 

 

(553)

 

 

 

 

(710)

 

Income from continuing operations

 

77

 

 

266

 

 

192

 

 

651

 

Adjustments required to reconcile Net income to Cash flows from operating activities

 

 

 

 

 

 

 

 

Depreciation and amortization

 

96

 

 

98

 

 

368

 

 

430

 

Provisions

 

23

 

 

15

 

 

147

 

 

73

 

Net gain on sales of businesses and assets

 

(1)

 

 

(1)

 

 

(30)

 

 

(21)

 

Stock-based compensation

 

10

 

 

9

 

 

42

 

 

50

 

Restructuring and asset impairment charges

 

40

 

 

47

 

 

87

 

 

127

 

Payments for restructurings

 

(18)

 

 

(22)

 

 

(81)

 

 

(93)

 

Defined benefit pension cost

 

12

 

 

20

 

 

58

 

 

109

 

Contributions to defined benefit pension plans

 

(42)

 

 

(34)

 

 

(139)

 

 

(141)

 

Decrease (increase) in accounts receivable and billed portion of finance receivables

 

37

 

 

(50)

 

 

369

 

 

10

 

Decrease (increase) in inventories

 

140

 

 

78

 

 

(134)

 

 

109

 

Increase in equipment on operating leases

 

(32)

 

 

(40)

 

 

(118)

 

 

(153)

 

(Increase) decrease in finance receivables

 

(38)

 

 

(23)

 

 

183

 

 

101

 

Decrease (increase) in other current and long-term assets

 

6

 

 

(15)

 

 

8

 

 

(14)

 

Decrease in accounts payable

 

(54)

 

 

(23)

 

 

(123)

 

 

(47)

 

(Decrease) increase in accrued compensation

 

(40)

 

 

5

 

 

(189)

 

 

(94)

 

(Decrease) increase in other current and long-term liabilities

 

(19)

 

 

21

 

 

(165)

 

 

40

 

Net change in income tax assets and liabilities

 

19

 

 

60

 

 

32

 

 

90

 

Net change in derivative assets and liabilities

 

2

 

 

(4)

 

 

1

 

 

11

 

Other operating, net

 

17

 

 

(9)

 

 

40

 

 

6

 

Net cash provided by operating activities of continuing operations

 

235

 

 

398

 

 

548

 

 

1,244

 

Net cash provided by operating activities of discontinued operations

 

 

 

40

 

 

 

 

89

 

Net cash provided by operating activities

 

235

 

 

438

 

 

548

 

 

1,333

 

Cash Flows from Investing Activities

 

 

 

 

 

 

 

 

Cost of additions to land, buildings, equipment and software

 

(14)

 

 

(17)

 

 

(74)

 

 

(65)

 

Proceeds from sales of businesses and assets

 

1

 

 

 

 

30

 

 

21

 

Acquisitions, net of cash acquired

 

(10)

 

 

 

 

(203)

 

 

(42)

 

Other investing, net

 

 

 

 

 

1

 

 

1

 

Net cash used in investing activities of continuing operations

 

(23)

 

 

(17)

 

 

(246)

 

 

(85)

 

Net cash provided by investing activities of discontinued operations

 

 

 

2,233

 

 

 

 

2,233

 

Net cash (used in) provided by investing activities

 

(23)

 

 

2,216

 

 

(246)

 

 

2,148

 

Cash Flows from Financing Activities

 

 

 

 

 

 

 

 

Net (payments) proceeds on debt

 

(636)

 

 

(551)

 

 

133

 

 

(950)

 

Dividends

 

(54)

 

 

(60)

 

 

(230)

 

 

(243)

 

Payments to acquire treasury stock, including fees

 

(150)

 

 

(232)

 

 

(300)

 

 

(600)

 

Other financing, net

 

 

 

(8)

 

 

(19)

 

 

(41)

 

Net cash used in financing activities

 

(840)

 

 

(851)

 

 

(416)

 

 

(1,834)

 

Effect of exchange rate changes on cash, cash equivalents and restricted cash

 

22

 

 

13

 

 

10

 

 

 

(Decrease) increase in cash, cash equivalents and restricted cash

 

(606)

 

 

1,816

 

 

(104)

 

 

1,647

 

Cash, cash equivalents and restricted cash at beginning of period

 

3,297

 

 

979

 

 

2,795

 

 

1,148

 

Cash, Cash Equivalents and Restricted Cash at End of Period

 

$

2,691

 

 

$

2,795

 

 

$

2,691

 

 

$

2,795

 

 

Impact of COVID-19 on Our Business Operations

In response to the COVID-19 pandemic, we have prioritized the health and safety of our employees, customers and partners to support their needs in the current hybrid environment so work can be done flawlessly, migrating between the workplace and the home-office. The pandemic has significantly impacted our sales of equipment and unbundled supplies as businesses hold off or delay purchases; due to their transactional nature, we expect that these sales will continue to fluctuate and gradually improve concurrent with office building reopenings and the roll-out of vaccinations, which is anticipated to allow more of our customers’ employees to return to the office. Our bundled services contracts, on average, include a significant variable component based on print volumes, and a minimum fixed charge. The variable charges are impacted by our customers’ employees not being in the office using our equipment and services due to lock-downs or capacity restrictions in office buildings; we expect that this contractual relationship will continue to enable us to ramp up and support our customers’ needs as businesses resume operations.

We have a strong balance sheet and sufficient liquidity, including access to our undrawn $1.8 billion revolver. We further strengthened our liquidity with the early-redemption of all of our 2021 senior unsecured debt maturities during fourth quarter 2020, with the proceeds from the issuance of new senior unsecured notes and from finance receivables securitizations. With our Project Own It transformation and cost savings, we built a leaner and more flexible cost structure, and have also focused our efforts on incremental actions to prioritize and preserve cash as we manage through the pandemic. These actions include the use of available temporary government assistance measures and furlough programs, and the reduction of discretionary spend such as near-term targeted marketing programs, the use of contract employees, and the temporary suspension of 401(k) matching contributions, as well as lower compensation incentives consistent with lower sales and operating results.

The recent resurgence of the virus in several European countries and U.S. regions contributes to the remaining uncertainty around the trajectory, duration and economic impact of the pandemic in the near term, however we expect that measures to control the infection rate and expand economic activity will result in a moderate economic improvement in 2021. We expect to continue our actions to mitigate the effects of the pandemic on our business operations and financial performance.

Government Assistance and Furlough Programs

In response to the COVID-19 pandemic, various governments have enacted temporary measures to provide aid and economic stimulus directly to companies through cash grants and credits or indirectly through payments to temporarily furloughed employees.

In March 2020, in response to the COVID-19 pandemic, the U.S. government enacted the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”).

Contacts

Media:

Caroline Gransee-Linsey, Xerox, +1-203-849-2359, Caroline.Gransee-Linsey@xerox.com

Investors:

Ann Pettrone, Xerox, +1-203-849-2590, Ann.Pettrone@xerox.com

Read full story here

error: Content is protected !!