Lexmark 2011 Annual Report Download - page 53

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Revenue by geography:
The following table provides a breakdown of the Company’s revenue by geography:
(Dollars in Millions) 2011 % of Total 2010 % of Total % Change 2010 2009 % of Total % Change
United States ........ $1,755.4 42% $1,790.9 43% -2% $1,790.9 $1,672.1 43% 7%
EMEA (Europe, the
Middle East &
Africa) ............ $1,531.6 37% 1,510.2 36% 1% 1,510.2 1,453.9 38% 4%
Other International .... 886.0 21% 898.6 21% -1% 898.6 753.9 19% 19%
Total revenue ........ $4,173.0 100% $4,199.7 100% -1% $4,199.7 $3,879.9 100% 8%
For 2011 currency exchange rates had a 2% favorable YTY impact on revenue. For 2010 currency
exchange rates had an immaterial impact on revenue compared to 2009.
Gross Profit
The following table provides gross profit information:
(Dollars in Millions) 2011 2010 Change 2010 2009 Change
Gross profit dollars .................. $1,580.6 $1,519.5 4% $1,519.5 $1,309.8 16%
% of revenue ..................... 37.9% 36.2% 1.7 pts 36.2% 33.8% 2.4 pts
During 2011, consolidated gross profit increased when compared to the prior year as did gross profit
as a percentage of revenue. The gross profit margin versus the prior year was impacted by a 2.9
percentage point increase due to a favorable mix shift among products, driven by relatively less inkjet
hardware, and growth in laser supplies and software. Partially offsetting this was a 1.5 percentage
point decrease YTY due to unfavorable product margins, predominately inkjet hardware. Gross profit
margin was also impacted by a 0.3 percentage point increase due to lower YTY cost of restructuring
and acquisition-related activities. Gross profit in 2011 included $5.2 million of restructuring-related
charges and project costs in connection with the Company’s restructuring activities as well as $20.4
million of pre-tax acquisition-related adjustments. Gross profit for 2011 includes the first full year of
Perceptive Software financial results.
During 2010, consolidated gross profit increased when compared to the prior year as did gross profit
as a percentage of revenue. The gross profit margin increase versus the prior year was primarily due
to a 2.5 percentage point increase resulting from higher product margins. Gross profit margins were
also favorably impacted by 0.9 percentage points due to lower restructuring-related costs YTY. The
unfavorable mix shift among products, reflecting a higher percentage of hardware versus supplies, had
a 0.7 percentage point negative impact on gross profit percentage versus the prior year. Also,
acquisition-related costs incurred in 2010 had a 0.5 percentage point negative impact on gross profit
margin percentage, as there were no acquisition-related costs incurred in 2009. Gross profit in 2010
included $17.4 million of restructuring-related charges and project costs in connection with the
Company’s restructuring activities as well as $22.1 million of pre-tax acquisition-related adjustments.
See “Restructuring and Related Charges and Project Costs” and “Acquisition-related Adjustments”
sections that follow for further discussion.
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