Here is a look at more of Thursday's top business stories:
Xerox posts profit
STAMFORD, Conn., July 25 (UPI) -- Xerox Corp., in its first quarterly report after changing accounting methods under pressure from U.S. regulators, said it posted a second-quarter net profit, due to the company's cost-cutting efforts.
Xerox said its net income jumped to $93 million, or 12 cents a share, from a net loss of $101 million, or 14 cents a share during the same period last year.
Analysts on Wall Street had expected Xerox to post a loss of 2 cents a share, according to Thomson Financial/First Call.
Excluding costs related to restructuring and unhedged foreign currency, Xerox said its second-quarter profit was 19 cents a share.
Revenue declined to $3.95 billion from $4.28 billion a year ago.
The company said operational improvements led to gross margins of 42.5 percent, an increase of 3.4 percentage points from last year.
Selling, general, and administrative costs declined 9 percent to $110 million from a year ago.
Anne Mulcahy, chairman and chief executive officer, said, "We continue to improve all areas of our global operations, reducing costs, enhancing liquidity and generating cash from operations."
Xerox has worked this year to turn a profit as it faces tough competition and a slowdown in corporate spending.
The profit came as the company emerges from a shroud of scrutiny by the Securities and Exchange Commission, which earlier this year charged Xerox with using accounting tricks to distort financial results from 1997 through 2000. Xerox agreed to pay a $10 million penalty, restate its results, and did not admit or deny any wrongdoing.
Commenting on the company's financial health, Lawrence A. Zimmerman, senior vice president and chief financial officer, said, "In a short period of time, Xerox has taken the right steps to improve its liquidity, reducing debt by 14 percent in the past year while maintaining a strong worldwide cash position of about $1.9 billion at the end of June."
Zimmerman also noted that Xerox recently completed the renegotiation of its bank facility, repaying $2.8 billion, agreeing to pay an additional $700 million by Sept. 15 and extending the maturity date for the remaining balance.
"The flow through from operational improvements, a rich product portfolio and a fortified balance sheet are the key enablers to building value for customers and shareholders. We're making impressive progress in each area and will continue to deliver on a well-defined strategy that focuses on long-term financial health. And, we are doing so with a commitment to the highest integrity of financial reporting and strengthened internal controls," Zimmerman added.
Earnings jump at Eastman Kodak
ROCHESTER, N.Y., July 25 (UPI) -- Eastman Kodak Co., the world's largest maker of photographic film, said its second-quarter net income rose to $284 million, or 97 cents a share, from $36 million, or 12 cents a share during the same period last year, when it had charges of $289 million.
Excluding costs in both quarters related to items such as asset write downs, restructuring and a 2002 tax benefit, Kodak's second-quarter per share profit was 85 cents.
Analysts on Wall Street were expecting the company to post a net income of 83 cents a share, according to Thomson Financial/First Call.
Second-quarter revenues fell to $3.34 billion from $3.59 billion a year ago.
Daniel A. Carp, chairman and chief executive officer, said, "As we said in January, we are managing this company with a long-term view in these tough economic times.
"We're generating cash, cutting costs, reducing debt, improving our manufacturing productivity -- while introducing new products and services. Because of these actions, the earnings recovery we forecasted at the start of the year is on track," Carp said.
The company said future earnings guidance is made difficult by the continuing weakness of the economy. Therefore, Kodak said its second-half earnings guidance remains unchanged at $1.35 to $1.75 per share.
Current revenue assumptions are for low single-digit revenue growth in the second half of the year (excluding exchange), which, if realized, would bring second-half earnings into the lower half of the guidance range, Kodak said.
"The weak economy continues to present business challenges," Carp said.
"As we anticipated, we improved share in the U.S. consumer film market in the second quarter compared with the first quarter, consistent with our share recovery plans, and we fully expect by year's end to report a fifth consecutive year of steady share. In Health Imaging, we continued to improve our performance, as evidenced by another quarter-sequential increase in profitability. The 19.7 percent margin reported in the second quarter for Health Imaging represents the seasonal peak in that measure, and will decline to a level in the mid- to upper teens in future quarters as we invest more resources in the business," Carp said.
"In these difficult economic times, we are succeeding in managing those things within our control," he said.
"We're improving our cash flow, boosting manufacturing productivity and introducing new products and services. Once the economy strengthens, we expect these actions and others to help Kodak accelerate its earnings recovery," Carp added.
Earnings climb at Viacom
NEW YORK, July 25 (UPI) -- Media group Viacom Inc., citing strong results at its CBS television network and cable networks, said its second-quarter net income surged to $547 million, or 31 cents a share, from $17 million, or 1 cent a share during the same period last year.
Adjusted for goodwill accounting changes, year-earlier earnings were 29 cents a share.
Analysts on Wall Street had expected the company to post a net income of 29 cents a share, according to Thomson Financial/First Call.
Revenue rose to $5.85 billion from $5.72 billion a year ago.
Earnings before interest, taxes, depreciation and amortization a key measure of cash flow, increased 4 percent to $1.42 billion from $1.36 billion a year earlier.
Viacom said it expects double-digit percentage growth in earnings per share, operating income and EBITDA for the full year. It also forecast that escalating growth in the third quarter will build into the fourth quarter.
The television unit, which includes CBS and 34 television stations, reported a 4 percent jump in revenue and a 7 percent increase in cash flow.
The Infinity unit, which includes 180 radio stations, posted unchanged revenue and a 6 percent decline in cash flow, with the weaker billboard business offsetting the strengthening radio business.
Sumner M. Redstone, chairman and chief executive officer, said "Viacom turned in an outstanding performance in the second quarter of 2002, particularly in light of the continuing challenges of a slow recovery in the overall economic environment.
"Viacom generated more than $1 billion in free cash flow in the quarter, a significant achievement that illustrates our management discipline, superior assets and our unique ability to consistently grow our company and create real value for shareholders. In fact, by every operational measure -- revenues, operating income, net earnings and EBITDA, Viacom delivered record second quarter results and is on track to achieve our full-year targets," Redstone said.
Mel Karmazin, president and chief operating officer, said, "Viacom's second-quarter results point out the unique value of our mix of businesses and the strength of our position in those businesses.
"Our Cable Networks, Television and Video segments delivered top line growth and strong bottom line growth. Underlying this performance is an upswing in our advertising-supported businesses. Upfront sales at CBS, UPN, our Cable Networks and our syndication businesses were exceptionally strong, which bodes well for advertising during the rest of 2002 and in 2003," Karmazin added.
