3D SYSTEMS ANNOUNCES FINANCIAL RESULTS FOR Q2 2019

Leading 3D printer OEM 3D Systems has reported its financial results for the second quarter of 2019. For the three months ended June 30, 2019, the company has reported an 11% fall in total revenue to $157.3 million from $176.6 million in Q2 2018. Following the release of the Q2 2019 results, 3D Systems’ share price dropped from $8.16 to $6.88.

Despite this, the company has reported a 46.4% increase in printer unit sales for Q2 2019 compared to the same period in 2018. Speaking with analysts and investors, John McMullen, Executive Vice President and Chief Financial Officer, 3D Systems, explained that the unit sales increase was led by the Figure 4 platform. Yet, 3D printer revenue decreased overall due to “year-over-year timing of a large enterprise customer’s orders, and the decision not to ship DMP Factory solutionsduring the quarter and the softer macroeconomic industrial environment.”

“EXPECTED REVENUE HEADWINDS CONTINUED THIS QUARTER BASED ON THE ORDERING PATTERNS OF A LARGE ENTERPRISE CUSTOMER AND THE PAUSE WE HAVE TAKEN ON FACTORY METALS SYSTEMS AS WE COMPLETE TECHNICAL ENHANCEMENTS TO ENSURE THE QUALITY AND RELIABILITY LEVELS, MEET OUR EXPECTATIONS FOR HIGH VOLUME PRODUCTION ENVIRONMENT.”

3D Systems revenue by segment 

3D Systems revenue is reported in two segments: Products and Services. Products relate to sales of hardware, software, and consumables, whereas Services encompasses on-demand manufacturing and design consultancy offerings. For Q2 2019, Product revenue dropped by 15.36 percent to $93.7 million from $110.7 million in Q2 2018. Within this, there was a 27.4 percent decrease in 3D printer revenue compared to Q2 2018.

Revenue	Q2 FY2019	Q2 FY2018	Variance ($)	%
Products	93,758	110,785	-17,027	-15.36%
Services	63,514	65,783	-2,269	-3.44%
Total Segments	157,272	176,568	-19,296	-10.92%

There was also a reported 3.44 percent decline in Services revenue with $63.5 million in Q2 2019 from $65.7 million in Q2 2018. This followed a decline in Healthcare services and simulation revenue as well as on-demand services revenue.

McMullen comments, “healthcare revenue increased 11.4%. We continue to be pleased with the overall demand trends for healthcare, including our NextDent 5100 3D printer.”

3D Systems activity for Q2 2019

During Q2 2019, 3D Systems was awarded a $15 million machine development contract from the Combat Capabilities Development Command of the U.S. Army Research Laboratory (ARL) to create “the world’s largest, fastest, most precise metal 3D printer.” The company also opened a new Advanced Additive Manufacturing Center in Pinerolo, Italy to broaden the its On Demand manufacturing service in Europe.

The popularity of the Figure 4 system was also highlighted by the release of a new model in this quarter. At RAPID+TCT 2019 in May, the company announced the general availability of the Figure 4 Modular scalable 3D printing solution at an entry cost of $49,900, as well as the release of five new materials.

The Figure 4 Modular. Photo via 3D Systems.

Managing operating costs

3D Systems generated $18.7 million in cash from operations during Q2 2019, and had $150.4 million of unrestricted cash on hand at June 30, 2019. Improvements in working capital, including planned reductions of inventory, were a driving factor of cash generation during the period.

“I am pleased with the progress we are making on our cost structure, and we will continue to be laser-focused on additional reduction opportunities in the second half of the year,” added Vyomesh “VJ” Joshi, President and CEO of 3D Systems.

GAAP operating expenses for Q2 2019 were reported at a decrease of 1.5 percent to $92.5 million, from $93.9 million in Q2 2018. GAAP selling, general, and administrative (SG&A) expenses increased by 0.7 percent in Q2 2019 to $71.7 million,this includes a $3.5 million dollar litigation settlement during the second quarter of 2019.

VJ continued, “Operating expenses declined as a result of our cost reduction plans, beginning to take hold, as discussed over the past couple of quarters.”

In addition, GAAP R&D expenses for this quarter decreased by 8.4 percent at $20.8 million. As a result of cost reduction plans, Q2 2019 non-GAAP operating expenses decreased by 9.3 percent to $71.7 million compared to $79.0 million in the second quarter of 2018.

“WE REMAIN CONFIDENT IN OUR BROAD PORTFOLIO OF ADDITIVE CAPABILITIES, WORKFLOW SOLUTIONS AND OVERALL MARKET OPPORTUNITIES; AND WE REMAIN KEENLY FOCUSED ON EXECUTING ON OUR STRATEGY, REDUCING COSTS AND DRIVING LONG-TERM PROFITABLE GROWTH.”

3D Systems’ financial earnings for the second quarter and first half of 2019 can be found in full here.

Konica Minolta Launches LED Dome System That Produces 360-degree Images on a Domed Display

Konica Minolta Planetarium Co., Ltd. (Konica Minolta) announced that the company has launched the world’s LED Dome System in Japan and Korea.

Unlike the conventional projector-based dome system widely used today, the LED Dome System produces images by using LED elements that emit light by themselves. Characterized by higher luminance and wider color gamut, the system can reproduce highly realistic and beautiful starry skies of unprecedented quality.

Konica Minolta has acquired the exclusive rights to sell the LED Dome System in the Japanese and Korean markets by concluding a partnership agreement with Keisoku Giken Co., Ltd., the sole importing agent for this system in Japan and Korea. Leveraging its know-how of projection dome construction, Konica Minolta will offer the LED Dome System as a new large display solution for a diverse range of customers, including planetariums, dome theaters, museums, commercial facilities, amusement facilities, and companies seeking industrial simulators.

Values Offered by the LED Dome System

1. Reproducing ever more realistic images with vivid colors and high luminance

In the conventional method, an image is formed on a domed screen by the reflection of light rays projected from the projector, which means that the projected images have limited luminance and quality. In contrast, the LED Dome System has LED elements that emit light by themselves on its screen, and so achieves a maximum luminance of 600 cd/m² and color gamut of 155% of sRGB^*1. Thus, the LED Dome System can clearly reproduce a bright blue sky and sea, glowing sunset, and bright stars in the dark sky, which is difficult with the conventional method. The system also produces more realistic three-dimensional images than ever and gives the viewer a greater sense of immersion.

2. Expanding the possibility of 360-degree images

In 1997, Konica Minolta introduced a digital full-dome system capable of projecting CG images on a planetarium screen, and has since been supplying 360-degree shows to various facilities. By projecting these high-quality images on the LED Dome System, Konica Minolta hopes to bring to viewers an astounding experience like never before. The company is also keen to expand the possibility of 360-degree images by developing new shows that are only possible with the LED Dome System.

3. Delivering dreams and excitement from projection domes

Besides selling and installing projection equipment, Konica Minolta also manages projection dome construction, ranging from building the dome and installing the sound system and audience seating, to interior finishing. Leveraging its know-how of dome construction and experience in 360-degree images, the company will offer the LED Dome System as a new large display solution to customers in various fields.
With its know-how of managing image projection facilities and attracting visitors built up through its three directly-managed planetariums in Tokyo, the company also hopes to provide total support to projection domes to deliver dreams and excitement to visitors.

Main Specifications of the LED Dome System

	LP-TC2.7-20MI	LP-TC3.0-15MI	LP-TC1.9-7MI
Dome diameter	20m	15m	7m
Pitch width	2.7mm	3.0mm	1.93mm
Center resolution	About 11.5K Pix	About 8K Pix	About 6K Pix
Luminance	Max. 600cd/m2
Color gamut	155% of sRGB (ITU-R Rec.709)*1

*1:sRGB is an international standard for color gamut (range of colors that can be displayed) and is used as a color gamut standard for liquid crystal displays in the Windows environment. A color gamut of 155% of sRGB means that the color gamut is 55% wider than sRGB. ITU-R Rec.709 is another international standard for color gamut set by the International Telecommunication Union, Radiocommunication Sector.

RICOH – FY19 Q1 Financial Announcement

Konica Minolta – 1Q / March 2020 Consolidated Financial Results Highlight

1. Consolidated financial results for the three months ended June 30, 2019 (from April 1, 2019 to June 30, 2019)

(1) Consolidated results of operations

(Percentage figures represent changes from the same period of the previous fiscal year.)

Three months ended	Revenue		Operating profit		Profit before tax
	Millions of yen	%	Millions of yen	%	Millions of yen	%
June 30, 2019	241,743	-5.3	554	-96.4	(1,378)	–
June 30, 2018	255,214	9.8	15,445	77.2	15,274	86.1

Three months ended	Profit for the period		Profit attributable to owners of the Company		Total comprehensive income
	Millions of yen	%	Millions of yen	%	Millions of yen	%
June 30, 2019	(1,470)	–	(1,208)	–	(16,165)	–
June 30, 2018	10,858	102.2	11,180	108.3	17,105	64.8

Three months ended	Basic earnings per share	Diluted earnings per share
	Yen	Yen
June 30, 2019	(2.44)	(2.44)
June 30, 2018	22.61	22.54

(Note)Basic earnings per share and diluted earnings per share are calculated based on the profit attributable to owners of the Company.

(2) Consolidated financial position

As of	Total assets	Total equity	Equity attributable to owners of the Company	Equity ratio attributable to owners of the Company
	Millions of yen	Millions of yen	Millions of yen	%
June 30, 2019	1,279,227	543,246	533,458	41.7
March 31, 2019	1,218,986	565,983	555,689	45.6

2. Dividends per share

	End of the three-month period	End of the six-month period	End of the nine-month period	End of the year	Total
	Yen	Yen	Yen	Yen	Yen
Fiscal year ended March 31, 2019	–	15.00	–	15.00	30.00
Fiscal year ending March 31, 2020	–
Fiscal year ending March 31, 2020 (forecast)		15.00	–	15.00	30.00

(Note)Changes from the latest dividend forecasts: None

3．Consolidated forecasts for the fiscal year ending March 31, 2020 (from April 1, 2019 to March 31, 2020)

(Percentage figures represent changes from the previous fiscal year.)

Fiscal year ending	Revenue		Operating profit		Profit attributable to owners of the Company		Basic earnings per share
	Millions of yen	%	Millions of yen	%	Millions of yen	%	Yen
March 31, 2020	1,085,000	2.4	60,000	-3.9	37,500	-10.1	75.80

(Note)Changes from the latest consolidated forecasts: Yes

■ Notes

1. Changes in significant subsidiaries for the three months ended June 30, 2019 (changes in the scope of consolidation): None
2. Changes in accounting policies or changes in accounting estimates
   • a. Changes in accounting policies required by International
     Financial Reporting Standards (IFRS): Yes
   • b. Changes in accounting policies other than the above a.: None
   • c. Changes in accounting estimates: None
3. Number of issued and outstanding shares (common stock)
   • a. Number of issued and outstanding shares (including treasury shares)
     As of June 30, 2019: 502,664,337 shares
     As of March 31, 2019: 502,664,337 shares
   • b. Number of treasury shares
     As of June 30, 2019: 7,959,279 shares
     As of March 31, 2019: 8,008,984 shares
   • c. Average number of issued and outstanding shares during the period
     The three months ended June 30, 2019: 494,690,678 shares
     The three months ended June 30, 2018: 494,498,624 shares

Konica Minolta, Inc. (the “Company”) has established the Board Incentive Plan trust in which beneficiaries include Directors, Executive Officers, Group Executives, and Technology Fellows. The shares owned by the trust account relating to this trust are accounted for as treasury shares (1,250,538 shares as of June 30, 2019, and March 31, 2019).

■ This summary of quarterly consolidated financial results falls outside the scope of quarterly review procedures to be performed by certified public accountants or an audit firm.

■ Explanation concerning the appropriate use of the forecasts for results of operations and other special matters.

(Note on the forecasts for the consolidated financial results)

The forecasts for results of operations in this report are based on information currently available to the Company and its subsidiaries (the “Group”), and assumptions determined to be reasonable, and are not intended to assure achievement of the Group’s operations. Actual results may differ significantly from the forecasts due to various factors. For further details of the assumptions and other factors considered by the Company in preparing the forecasts above, refer to “1. QUALITATIVE INFORMATION ON FINANC IAL RESULTS FOR THE THREE MONTHS ENDED JUNE 30, 20192019, (3) Explanation Regarding the Forecasts for the Consolidated Financial Results” in the attached Supplementary Information on page 7.

Supplementary information for the quarterly financial results and briefing on the quarterly financial results

The Company will hold a briefing on the quarterly financial results for institutional investors on Tuesday, July 30, 2019. The proceedings and details of the briefing, along with the supplementary information on the quarterly financial results to be presented at the briefing, will be posted on the website of the Group soon after the briefing.

Oki printer sales decline

The OEM has announced Q1 results for fiscal year ending 31 March 2020.

Oki reported in its Q1 fiscal year 2020 a net sales increase of 18.7 percent of ¥107.6 billion ($990 million/ €891 million) compared to ¥88.9 billion ($818 million/ €737 million) for the same period of the previous year.

In its explanation of segments it is reported though, that the only segment that increased its net sales is Oki’s Information and Communication Technologies (ICTs) segment Which the OEM says is due to increases in network-related and some government agency projects.

In the printing segment, net sales fell 2.3 percent to ¥22.9 billion ($210 million/ € 189 million) compared to ¥25.2 billion ($232 million/ €209 million) in the same period of the previous year. Operating income for the segment was down 1.4 percent, ¥0.5 billion ($4.6 million/ €4.1 million) compared to ¥1.9 billion ($17.5 million/ €15.7 million) for the same period of the previous year.

Oki explained the decrease in the printer segment as “due to the impact of declined sales for consumables and yen appreciation for Euro”.

N.Z. Prime Minister Withholds Confidence in Fuji Xerox

Winston Peters withholds confidence in Fuji Xerox after suspension lifted

Acting Prime Minister Winston Peters won’t say he has full confidence in technology company Fuji Xerox, despite it being reinstated as a government contractor.

The company was suspended in late 2017 from its all-of-government contract for printing and office supplies after an independent report uncovered accounting “irregularities” and $466m in losses at Fuji Xerox New Zealand and its Australian partner.

The Serious Fraud Office is still investigating the company, but its suspension from applying for government contracts has been lifted.

The Ministry of Business, Innovation and Employment (MBIE) implemented a new code of conduct for all its suppliers last month over the concerns that prompted the suspension.

Acting Prime Minister Winston Peters was one of the company’s biggest critics prior to the election in 2017, saying the whole scandal portrayed New Zealand as a banana republic.

“This is nothing less than a stain on our country’s reputation and demands that serious questions be asked about External Reporting Board standards – a Crown agency – and other public bodies charged with detecting and defeating fraud,” Mr Peters said in June 2017.

“Accounting irregularities at Fuji Xerox NZ went unnoticed over a five-year period and this raises serious questions about standards set by the External Reporting Board.”

“We are being made to look like a banana republic and this grates when the government ignored repeated warnings from NZ First,” he said.

Two years down the track, Mr Peters said he most definitely stood by those comments, and would not say he had full confidence in the company now.

“I didn’t say that, all I’m saying is setting things right was the first thing the Japanese had to do and I believe they set about to do that.

“As to what is happening now I’m not over it because it’s in someone else’s portfolio. But bear in mind it only enables [Fuji Xerox] to tender or be part of a tender round, it doesn’t mean they’re going to be winning the tender at this point in time.”

Mr Peters said Fuji Xerox Japan had made a very “fulsome, unreserved apology” to the New Zealand government and taxpayers before the completion of the Serious Fraud Office’s investigation.

“They’d obviously conducted their own investigation. This is such a rare thing for international corporations to do that – one should commend it when it does happen,” Mr Peters said.

An MBIE spokesperson said the ministry made the decision to lift the suspension with effect from 1 May, but it was still subject to probationary terms.

“The probationary period remains in effect until September 2020, over which time the Ministry will continue to monitor FXNZ and their engagement with government agencies,” the spokesperson said.

In the roughly five years before its suspension, Fuji Xerox New Zealand secured about $55m in contracts with the government.

The new supplier code of conduct was published on 4 June. Individual agencies will determine how they implement and enforce it.

Chinese Toner Cloners Ninestar & Calidad Loses Ruling In Australia

OFFICE PRODUCT DEALERS :

A recent decision by the Full Federal Court has shed further light on the rights of businesses when selling or acquiring patented goods. The Court has made clear that modifications that go beyond mere repair and instead ‘remake’ or ‘repurpose’ the product will infringe the underlying patent.

In Calidad Pty Ltd v Seiko Epson Corporation,¹ three judges affirmed that unless a patent holder explicitly imposes conditions on a purchaser at the time of sale, an implied licence is granted to the purchaser to use and dispose of the patented goods as they wish. However, the Court clarified that this licence, although largely unrestricted, does not allow purchasers to make modifications that go so far as to repurpose or remake patented goods.

Although concurring on the ultimate outcome, their Honours elected to deliver individual opinions, hinting that some ambiguity remains with respect to the position under Australian law.

The case

Seiko Epson Corporation (Seiko) manufactures and sells printer cartridges overseas. Those cartridges are protected by patent in Australia. Ninestar Image (Malaysia) SDN (Ninestar), a large manufacturer of generic printer consumables, obtained used Epson cartridges (the cartridges) and restored them to working conditions, which were then imported and sold in Australia by Calidad Pty Ltd (Calidad).

The present case was an appeal from a Federal Court decision handed down in 2017.² In that case, the primary judge accepted that because Seiko sold the cartridges without any explicit restrictive conditions imposed at the time of sale, there was an implied licence that authorised at least the import, use and further disposal of the cartridges. In respect of some (but not all) of the categories of cartridges, it was found that the modifications extinguished the implied licence, and thus infringed the patents. This was because the implied licence applied to the cartridges as they were sold by Seiko, and not to the refurbished cartridges that were effectively new products or embodiments of the patented invention.

The decision

The Full Federal Court found that the modifications made by Ninestar constituted a repurposing of the cartridges, as articles embodying the patent, which amounted to ‘remaking’ the invention as specified in the patents. As such, Ninestar infringed the patents by exercising Seiko’s exclusive right to ‘make’ their patented product. Calidad, therefore, also infringed the patent by importing and selling those cartridges.

The Court emphasised that the correct analysis was not that this conduct had extinguished or terminated the implied licence—as the primary judge had found—but that it simply fell outside the scope of that licence.

There are several key points from the judgment to note.

1. Whatever the scope of implied licence, it does not permit remaking the patented invention. The licence encompasses ‘the normal rights of an owner’ of personal property, which does not include a right to ‘make’ a patented invention.
2. There was no clear consensus regarding the existence of a ‘right to repair’ in Australian law.Although the judgments did not rule out a general right to repair a patented good, the Court chose to leave this question aside. Jagot J commented that UK cases on this question ‘involv[ed] an assessment of the scope of the implied licence which arises on unrestricted sale of a patented article’. Greenwood J avoided the discussion, while Yates J put the question to one side, determining that it was unnecessary to consider on the facts of the case. This question may be addressed by the High Court, should Calidad seek leave to appeal this decision.
3. If it exists, the right of repair does not extend to what is, in reality, the creation of a new article embodying the invention. The Court rejected the argument that Ninestar was ‘repairing’ the cartridges. ‘Repair’ implies some defect requiring rectification to enable the article to function as intended, or to prolong its life. Here, the cartridges ceased to function when they ran out of ink—in an irreversible way—because that is precisely what they were designed to do. By modifying the cartridges to become refillable, Ninestar had repurposed the spent article to recreate the cartridge defined in the patent. This goes further than ‘repair’, and constitutes ‘making’ a product embodying the invention.
4. Whether Australian law should or might recognise the US doctrine of ‘exhaustion’ of a patent holder’s exclusive rights upon the first sale of the patented goods was left untouched. Calidad included this argument in its appeal, but only to leave this question open for later consideration in a potential appeal to the High Court. The Court did not explore the matter.

Consequences for businesses that sell patented goods

• The decision of the Full Court largely reinforced the key findings of the primary judge. Crucially, if you wish to impose restrictions on a purchaser’s use of patented goods, those conditions must be clearly expressed to the purchaser at the time of sale.
• Further, the purchaser must have actual knowledge of the conditions. Inbuilt features of the goods that make them difficult to modify do not amount to putting a purchaser on notice of limitations of use. Nor do the limitations ‘run with the goods’, meaning that subsequent purchasers will not be bound by any such restriction unless it is actually brought to their attention.
• If you do not impose any conditions at the time of sale, the purchaser will benefit from an implied licence to (at least) use, dispose and import the patented goods. Whether they have a right to repair remains to be confirmed, but what is certain is that this licence will not shield purchasers from infringement for making, or remaking, the invention.

Over 440 companies across the world remove misleading “go green – go paperless” messaging

Environmental claims such as “go green – go paperless” and “save trees” are regularly used by banks, telecoms, utilities, insurance companies and many other service providers, as they encourage their customers to switch from paper to lower cost electronic bills and statements.  However, a Two Sides global anti-greenwash campaign operating since 2010 has found that the majority of these claims are unsubstantiated and misleading.

To date, Two Sides has successfully engaged with 441 companies worldwide to remove or change such claims about print and paper.  Sectors showing the highest occurrence of greenwashing include telecom providers, banks and financial institutions, utility providers and governmental organizations.

In North America, 120 companies, including many of the Fortune 500, have changed or removed their environmental claims following discussions with Two Sides.  “Environmental claims in the U.S. and Canada must meet the guidelines and rules of the U.S. Federal Trade Commission¹ and the Competition Bureau of Canada² which include having credible and specific science-based facts to support claims.  Unfortunately, we have found that these requirements are rarely met and corporations use ‘go green’ claims purely for marketing and enticing more customers to digital options.  Companies are also ignoring the growing environmental footprint of their electronic infra-structure, including the use of non-renewable resources, energy and the large amounts of e-waste generated,” says Phil Riebel, President, Two Sides North America.

Martyn Eustace, Chairman of Two Sides Europe/UK, said: “We are really pleased that our ongoing effort is having such a significant effect on some of the world’s largest and most influential companies and organizations. However, our latest research shows that misleading environmental messages are having an impact on consumer perceptions of print and paper – particularly regarding the impact on forests.  This is why it is so vital for Two Sides to continue working with organizations to remove greenwashing claims and educate them about the unique sustainable aspects of print and paper.  Paper comes from a renewable resource and is one of the most recycled materials in the world. When responsibly produced and used, it can be a sustainable way to communicate.”

The drive to digital is not welcome by many consumers

Recent research commissioned by Two Sides has shown that consumers feel strongly about their choice to receive paper bills and statements from service providers.  In fact, efforts by major corporations to force their customers to go digital, often citing environmental benefits, are not welcome by many consumers.

An international survey of 2,094 consumers in the U.S.³ and 1,044 consumers in Canada⁴commissioned by Two Sides in February 2019 found:

• 86% of U.S. respondents and 82% of Canadian respondents believe they have the right to choose how they receive their communications (printed or electronically) from financial organizations and service providers.
• 66% of U.S. respondents and 63% of Canadian respondents don’t agree that corporations are really going paperless because they regularly need to print out documents at home if they want a hard copy.
• 61% of U.S. respondents and 58% of Canadian respondents think claims about the switch to digital being ‘better for the environment’ are made primarily because the sender wants to save money.
• 45% of U.S. respondents and 34% of Canadian respondents would consider switching service providers if they were forced to go paperless.

 

_______________

¹ US Federal Trade Commission, 2013. Green Guides.

² Competition Bureau of Canada and Canadian Standards Association. 2008. Environmental Claims: A Guide for Industry and Advertisers.

³ Two Sides and Toluna, 2019. Busting the Myths: A study of U.S. consumer perceptions and attitudes.

⁴ Two Sides and Toluna, 2019. Busting the Myths: A study of Canadian consumer perceptions and attitudes.

 

Two Sides, a global non-profit promoting the sustainability of print and paper, continues to address misleading environmental claims made by some of the world’s largest corporations.

Fuji Xerox NZ ‘For Sale’ before government contract reversal

Fuji Xerox NZ managing director Peter Thomas has confirmed that Japanese parent Fuji Xerox was considering selling its New Zealand subsidiary earlier this year before the government lifted the company’s suspension from government printing contracts, according to a report in The New Zealand Herald.

The FXNZ board (l-r): Graham Ford, Takaya Mogaki, Nobuhiko Koshimizu, Mutsuki Tomono, Peter Thomas and Katsumi Kizaki

Fuji Xerox NZ returned as a provider of print technology and logistic services to NZ government customers from May 1, on a probationary basis, 20 months after the agreement was suspended over an accounting scandal that’s still under investigation by the Serious Fraud Office (SFO).

Before the reinstatement was announced in April, financial advisor Deloitte had put together a presentation in March that called for expressions of interest to acquire Fuji Xerox NZ and Fuji Xerox Finance – described as a “trusted global brand with significant product portfolio growth opportunities,” according to the Herald report.

“The Deloitte document talked about the opportunity to expand the business and recover market share lost due to the negative impacts on the company’s reputation,” said the report. “The turnaround plan included a $25m lift in earnings with price increases, inventory reduction and headcount reduction.” It forecast earnings of $15.1m for the 2019 financial year, a turnaround from the company’s $10.1m loss in 2018.

Deloitte said $6.4m of additional earnings that could be gained from separating the NZ business from Fuji Xerox Asia Pacific. Other benefits included a $1m saving from moving the company’s call centre from Malaysia to New Zealand and $1.4m from “additional headcount reduction.”

Fuji Xerox NZ MD Peter Thomas confirmed that the Japanese-based parent company had considered a sale process, said the report.

“However, following this review, Fuji Xerox New Zealand’s shareholders have determined that it will continue to operate as a wholly owned subsidiary and Fuji Xerox remains committed to the New Zealand market,” Thomas told the Herald.

A 2017 independent report ordered by parent Fujifilm revealed “inappropriate accounting” and a “sales at any cost” culture at its FXNZ and FX Australia subsidiaries had inflated revenue by $A450m between 2011 and 2016, including $350m from the New Zealand business.

Fuji Xerox’s Japan-based chairman, deputy president and two directors all resigned following the release of the report.

Fuji Xerox NZ filed civil proceedings in the High Court against three former senior executives – former FXNZ MDs Neil Whittaker and Gavin Pollard, and former chief financial officer Mark Allright. The case is continuing. The Serious Fraud Office is also investigating the matter.

Xerox wins IWS contract

The OEM announced it has won a multi-year “Intelligent Workplace Services Contract” from the Commonwealth of Massachusetts.

Xerox has been awarded a multi-year, multi-million dollar contract administered by the Executive Office of Technology Services and Security (EOTSS), the Commonwealth of Massachusetts’ secretariat leading the digital transformation of the Executive Branch.

With the agreement, Xerox will provide Intelligent Workplace Services (IWS), a Xerox offering that transcends traditional Managed Print Services to enhance security, support compliance, reduce its environmental impact and improve productivity for the 43,000 employees the EOTSS serves across the Commonwealth.

Xerox will design and manage a more efficient print infrastructure for Massachusetts and will introduce Xerox AltaLink and VersaLink Multifunction Printers (MFPs). These MFPs are equipped with a common user interface and built-in security features that make it easier to create and share electronic documents securely.

Security software, Xerox Workplace Suite and Xerox Image Overwrite, also will help the EOTSS and the agencies it serves manage and secure their digital assets, a key priority for the Commonwealth, according to Xerox.

“The Executive Branch of the Commonwealth of Massachusetts is at the forefront of implementing new technologies that protect and maintain their assets and automate tasks to make them more effective,” said Mike Feldman, president of Americas Operations, Xerox. “Xerox will help the EOTSS engineer a smarter, more efficient print environment that will help those they serve, and by extension, the constituents in the Commonwealth of Massachusetts.”