Lexmark International Group Inc turned in solid fourth-quarter numbers that refelected stronger margins affected by a shift in the company’s product mix. The Lexington, Kentucky manufacturer of printers and supplies posted fourth-quarter net income up 26% at $57m on revenue up 7% at $735.5m. On a per share basis, earnings were up 32% at $0.78, easily beating the First Call consensus of $0.72. The strong showing was helped by gross margins that increased to 35.5% from 31.9% from the year-ago quarter, stemming from improved printer margins and a richer mix of supplies versus printer hardware. Gross margins improved 3.5 points to 34.9% for the full year. Fiscal 1997 net income rose 17% to $149m on revenue up 5% at $2.49bn. Earnings per share rose 17% to $1.98 for the year. Yearly results include a one-time loss of $14m, or $0.19 per share, stemming from the early extinguishment of debt. Lexmark has previously said that its long-term goal is for average annual operating income growth is 20%, and it expects to meet that goal in 1998. The company shows $43m in cash on its balance sheet. On the always unpredictable Wall Street, Lexmark shares responded to the news by slipping $0.375 to close at $36.375 Monday.
