Xerox cuts jobs, re­duces sev­er­ance pay­ments

The Norwalk Hour - - BUSINESS - By Alexan­der Soule [email protected]; 203-842-2545; @ca­soul­man

Xerox cut 900 peo­ple from its global work­force in the third quar­ter as part of an on­go­ing re­struc­tur­ing, while re­port­ing it has re­duced the sev­er­ance it pays em­ploy­ees who are los­ing their jobs, par­tic­u­larly in the United States.

In the first full quar­ter that CEO John Visentin has led Xerox, af­ter a proxy bat­tle that shifted lead­er­ship of the com­pany to ac­tivist in­vestors Carl Ic­ahn and Dar­win Dea­son, the Nor­walk-based print­ing equip­ment maker re­ported net in­come of $89 mil­lion in the third quar­ter, down from $179 mil­lion the year be­fore, with sales off 6 per­cent to un­der $2.4 bil­lion.

Speak­ing Wed­nes­day morn­ing on a con­fer­ence call, Visentin said he was dis­ap­pointed with the com­pany’s rev­enue in the third quar­ter, with Xerox fo­cused on im­prov­ing how it com­pen­sates em­ploy­ees for pro­duc­ing re­sults un­der a new in­ter­nal “Project Own It” pro­gram among other changes Visentin de­scribed as “op­ti­miza­tion” ac­tions.

Xerox paid sev­er­ance of $40 mil­lion dur­ing the quar­ter, along with an­other $1 mil­lion for lease can­cel­la­tions, ver­sus sev­er­ance of $39 mil­lion in the third quar­ter of 2017 when it cut 600 jobs.

“Op­ti­miza­tion ac­tions will ex­pand in (the fourth quar­ter) as we com­plete the Own It de­sign phase,” Visentin said. “As I have said to our em­ploy­ees, we own our destiny — we have ev­ery­thing we need to­day to im­prove our per­for­mance . ... We have a lot more work to do, but I am pleased with our early progress.”

Even as it con­tin­ues to cut jobs in­ter­nally, Visentin’s team is lay­ing out an ini­tial strat­egy to ac­quire busi­nesses that can help Xerox build mo­men­tum.

And Xerox is adding $200 mil­lion to an ex­ist­ing stock re­pur­chase pro­gram pegged pre­vi­ously at $500 mil­lion, af­ter buy­ing back about 4 per­cent of the com­pany’s shares out­stand­ing in the third quar­ter alone. Xerox shares were down slightly af­ter the open­ing bell Wed­nes­day, with shares off about $3 on the year to $26.35 on the heels of the proxy war and Ic­ahn and Dea­son aban­don­ing a pre­vi­ous, $6.1 bil­lion Xerox agree­ment to merge into Fu­ji­film Hold­ings.

Dur­ing the quar­ter, Xerox added to its ex­ec­u­tive suite with the ap­point­ment of Louie Pas­tor as gen­eral coun­sel and Joanne Collins Smee as chief com­mer­cial of­fi­cer lead­ing sales and chan­nel strat­egy. Smee served pre­vi­ously for a short pe­riod as deputy com­mis­sioner for the U.S. Gen­eral Ser­vices Ad­min­is­tra­tion which over­sees pur­chas­ing for the U.S. gov­ern­ment, and be­fore that worked a dozen years for IBM.

Alexan­der Soule / Hearst Con­necti­cut Me­dia

The head­quar­ters build­ing of Xerox at 201 Mer­ritt 7 in Nor­walk.

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