Xerox Corporation announced today fourth-quarter 2011 results that include adjusted earnings per share of 33 cents, up 14 percent from fourth-quarter 2010, and $1.3 billion in operating cash flow. Adjusted EPS excludes 7 cents related to amortization of intangibles, resulting in GAAP EPS of 26 cents.

The company ended 2011 with full-year adjusted EPS up 15 percent, pro-forma revenue up 2 percent and operating cash flow of $2 billion. "Our performance reflects Xerox's operational discipline in delivering strong bottom-line results while scaling our services business and maintaining our leadership in document technology," said Ursula Burns, Xerox chairman and chief executive officer.

In the fourth quarter, total revenue of $6 billion was flat; revenue from the company's services business was up 6 percent, and revenue from its technology business was down 5 percent. Growth in services was driven by an 8 percent increase in both business process outsourcing and document outsourcing. Technology revenue, which represents the sale of document systems, supplies, technical service and financing of products, was significantly impacted by economic weakness in Europe.

"While operating in a challenging economic environment, we've grown our global market share for equipment revenue, further strengthening our industry leadership. Installs of Xerox equipment increased 8 percent in the fourth quarter. And, our managed print services are proving not only to be the industry standard but also an engine of growth for our business," said Burns.

"Signings for our diverse services offerings were up 15 percent in the fourth quarter," Burns added. "Our services portfolio remains a competitive advantage -- providing clients cost-efficient ways to run more productive enterprises and benefitting our business for the long term through a healthy base of recurring revenue."

The increase in services signings continues to put near-term pressure on gross margins as Xerox makes initial investments to implement new contracts. Fourth-quarter gross margin was 32.2 percent, and selling, administrative and general expenses improved to 19.3 percent of revenue. Fourth-quarter 2011 results include 2 cents from a curtailment gain net of restructuring expenses. Operating margin of 10 percent was down 0.4 points from fourth-quarter 2010.

Full-year 2011 results include:

• Net income of $1.3 billion, adjusted net income of $1.6 billion, up 21 percent

• Total revenue of $22.6 billion, up 5 percent, 2 percent pro-forma

• Operating margin of 9.8 percent, up 0.3 points pro-forma

• Operating cash flow of $2 billion

• $700 million in share repurchase

The company expects first-quarter 2012 GAAP earnings of 17 to 20 cents per share. First-quarter adjusted EPS is expected to be 21 to 24 cents per share.

Full-year 2012 GAAP earnings are expected to be 97 cents to $1.03 per share. Full-year adjusted earnings are expected to be $1.12 to $1.18 per share, including restructuring.

The company also expects $2 billion to $2.3 billion in cash flow from operations for 2012.

The Xerox board of directors recently increased the company's share repurchase authorization by $500 million to more than $1.3 billion. With this authorization, the company expects to repurchase between $900 million and $1.1 billion in Xerox shares during 2012.