NORWALK, Conn., March 20, 2009 -- Due to the increasingly more challenging global economic environment, Xerox Corporation (NYSE: XRX) today lowered its first-quarter 2009 earnings expectations to a range of 3 cents to 5 cents per share from a range of 16 cents to 20 cents per share.
The reduction includes a 6 cent impact from Xerox's share of Fuji Xerox's restructuring and a lower than expected Fuji Xerox profit contribution with the balance resulting from an industry-wide slowdown in technology spending, putting pressure on revenue and earnings. Xerox's total revenue in January and February declined 18 percent including a 5 point currency impact, largely due to lower sales of equipment and printer-based supplies.

"While Xerox remains the prominent player in our industry with number-one revenue share, we expect that enterprise spending on technology will continue to decline this year," said Anne Mulcahy, Xerox chairman and chief executive officer. "Through our expanded distribution, we're confident we'll continue to grow market share even in this challenging environment. At the same time, we're expediting further cost savings that help to offset the economic impact on revenue while fueling our operating cash flow."

The company said it is on track to deliver $250 million in savings throughout this year from previous restructuring actions, and has identified an additional $300 million in cost and expense reductions that will flow through to earnings and cash generation.

Xerox is decreasing its total debt during the first quarter and plans continued debt reduction during the year. With access to a $2 billion line of credit, the company also said it would access the credit markets only on an opportunistic basis.

"All our decisions are aligned with ensuring we have the financial flexibility to navigate well through these turbulent times while positioning the company for growth when the economy improves, building on our industry leadership in document technology and services," said Mulcahy.

Xerox is scheduled to announce first-quarter earnings on April 24, at which time it will update its guidance for full-year 2009.

NORTH MANCHESTER, Ind. and ROCHESTER, N.Y., March 20, 2009 -- Arming itself with the right technology to grow its on-demand book production business, The HF Group has installed the Xerox iGen3™ Digital Production Press with Automated Color Quality Suite Press Matching System. A national book binding and information services company, The HF Group selected the press to help expand and enhance its on-demand printing and binding business by a projected 40 percent.
"Our goal is to continue capturing and growing our share of the on-demand book publishing business - even in these challenging economic times," said Jim Heckman, vice president, The HF Group. "Our commitment is to provide the best image quality possible and the iGen3 press allows us to meet that high standard."

The iGen3 press with FreeFlow™ Printer Server and Automated Color Quality Suite automates the traditionally manual task of color matching and enables faster press set up, quicker time to production and greater color stability. It allows The HF Group to increase efficiency and keep pace with growing demand for short-run book printing from small publishers, self-publishers and educational institutions.

The HF Group is also using the iGen3 press to produce theses and dissertations for universities and students; they hold a steady market share in this unique book production niche. Book orders are seamlessly captured online with Xerox's FreeFlow Web Services, powered by Press-sense™, and then directed to the FreeFlow Print Server for processing. The iGen3 press meets the strict production standards and precise specifications required for the printing and binding of theses and dissertations.

On-demand book production is the fastest growth area for The HF Group. The Xerox iGen3's ability to print on the largest paper size for a cut sheet digital press (14.33¨ x 22.5¨) opens increased revenue streams by allowing the company to more efficiently print standard and oversized color book covers and book blocks.