23 October 2018 by lberuti
Earlier in the year, the control of XRX ( Xerox Corp ) was handed to activist investors Icahn and Deason, after its planned merger with Fuji was scrapped. The company delivered today its first set of results under their guidance, and they were consistent with granting top priority to shareholder returns. The US photocopier which is facing a long running decline in its core business reported net profit that roughly halved and said revenue fell 5.8% year on year to $2.35Bln in the third quarter, below an average analyst estimate of $2.42Bln. Despite that fall, the new management increased its share-repurchase expectations by $200m, even though according to the different rating agencies, XRX does not have any further flexibility within its current BBB rating category. Investors certainly copied that, and sent XRX’s 5-year risk premium 27bps at 224bps.