【正文】 D TO LEXMARK Strong Medium Weak * Includes other information equipment (. scanners, projectors) $457 million 12% 29% $1,573 million* 9%* 11%* $583 million* 6%* N/A* 12% 47% 17% 22 ? INTERNAL ASSESSMENT ? Relevant BU segments (based on customer, product, geography, distribution channel) ? Operating contribution estimates for each segment How does your current business emphasis fit with the industry opportunities and the petitive landscape? Which segments of the business are providing the highest returns?* What have been the performance trends along major BU KPIs? ? KPI performance trends over the last 35 years, . return on capital employed (ROCE)**, operating ine, margins, capital employed ? Assessment of underlying trend drivers ? Expected evolution Key question Subquestions Issues to be considered Which intangible assets could be nearterm sources of value? ? Identification of inhouse intellectual property, talent, works, brand/image ? Conversion into sources of value * Based on latest available, 12 year historical financial statements ** ROCE = Operating ine x (1tax rate) All interest bearing debt (short and long) + minority interest + stockholders’ equity 23 ? SEGMENT ANALYSIS Revenue Gross profit Operating profit Assets employed People employed Operating profit margin Gross profit margin ROCE Step 1: Identify the relevant segments Step 2: Provide a segment analysis based on the following minimum financial metrics: revenue, gross profit and margin, operating profit and margin Step 3: To the extent assets and people can be disaggregated by segment, deployment of assets against returns can be analyzed % PhP % of total Segment 1 PhP % of total Segment 2 PhP % of total Segment 3 PhP % of total Segment 4 PhP % of total Total % % % % Segment 1 Segment 2 Segment 3 Segment 4 Total 24 ? SEGMENT ANALYSIS APPLIED TO LEXMARK Printers and suppliers Other office imaging Keyboards and other 59347Rest of world Europe US Product Percent Geography Percent of total revenues, 1995 100% = USD 3,807 million 100%= $2494 m 100%=$895 m 11 41 48 6 48 46 100%= $3021 m 100%= $1024 m 14 35 51 8 46 46 100%= $3452 m 100%= $1031 m 14 28 58 40 60 100%= $3807 m 100%= $1164 m 9 23 68 32 67 1 Gross profit Rev 1992 Gross profit Rev 1993 Gross profit Rev 1994 Gross profit Rev 1995 0 25 ? TREND ANALYSIS – RETURN ON CAPITAL EMPLOYED (ROCE) The ROCE tree can be disaggregated to show the other relevant KPIs of a BU ROCE Percent Operating ine x (1 tax rate) PhP million Capital employed PhP million 247。 minimal opportunity for major product differentiation ?Growth of laser and inkjet printer markets stable but dependent on PC sales and degree of replacement Economics of supply ?HP holds lion’s share of printer market ?Industry capacity exceeds market demand ?Presence of counterfeit and recycled product supply especially in consumables ?High exit barriers due to asset intensity Industry chain economics ?Bargaining power of suppliers low ?Bargaining power of distributors high ?Little integration (forward or backward) Marketing ?Manufacturers peting mainly on price ?Retail dominant distribution channel ?Aggressive development and release of new products ?Moves to increase brand awareness via marketing campaigns ?Creative financing packages Internal efficiency ?Relentless drive to low cost manufacturing ?Continuous efforts to create more specialized features and/or functions Others ?Entry of PC and peripherals players ?Clamp down on counterfeit and recycled consumables suppliers Finance ?Price petition on printer hardware drives margins down and forces players to rely on profits from consumable products (good margins) and high volume capture on hardware S External shocks Feedback tructure C onduct P erformance 13 ? RESULTING OPPORTUNITIES AND RISKS FOR LEXMARK Opportunities Risks ? Bee the first mover in printers for portable, handheld, wireless puter market ? Grow demand base via use of creative, nontraditional channels and alternative financing/payment methods ? Grow demand for consumables via programs to increase printing usage ? Be the supplier of printers for PC/peripheral players hoping to the expand into printer market ?Expand leadership in corporate’ institutional accounts ? Increasing demand for customization may increase costs and erode margins ? Any decline in PC sales may significantly bring down revenues ? Market share may be eroded as petition intensifies –Branding/marketing push from established players –Pricing push from lowcost manufacturers ? Margins at risk if printing usage declines with push for paperless society NOT EXHAUSTIVE 14 ? COMPETITIVE ASSESSMENT ? Privileged assets that create petitive advantage, . physical assets, location/”space”, distribution/sales work ? Distinctive skills/petencies that create petitive advantage, . innovation, talent development What are your petitive strengths and weaknesses? What are the capabilities required to succeed in this industry? How do you pare against these necessary capabilities? ? Strengths and weaknesses of your petitive position vs. necessary capabilities ? Benchmark perfor