Thursday, July 27, 2000 | 11:10 a.m.
THE ASSOCIATED PRESS
STAMFORD, Conn. -- Second-quarter earnings at Xerox Corp. fell 68 percent due to a charge for accounting irregularities in its Mexico subsidiary and a decline in revenues for certain products.
And Chief executive Paul Allaire warned Wednesday that expectations for the second half of the year should be lowered, sending shares down 18 percent.
The company said that for the three months ended June 30, it had net income of $145 million, or 19 cents per share, compared with $448 million, or 62 cents per share in the same period a year ago. That includes a charge of $78 million, or 11 cents per share, to cover problems associated with its Mexican operation.
Xerox reported a revenue decline in high-speed black-and-white production printing and publishing products.
Allaire said that the accounting irregularities, which are being investigated by the Securities & Exchange Commission, appear to have been caused by several senior managers in Mexico who collaborated to circumvent Xerox accounting policies and administrative procedures. The charge is primarily for bad debt and unrecorded liabilities.
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