Table: Xerox' Dire Finances
The loss of $38 billion in shareholder wealth already qualifies Xerox as a corporate catastrophe. And the company's troubles are not over yet--not by a long shot
-- Xerox' total debt is $17 billion, including a $7 billion credit line it exhausted late last year after it was unable to roll over its commercial paper.
-- $2.6 billion in debt comes due this year, including $500 million in March and another $900 million in the second quarter.
-- Cash on hand is only $1.7 billion, up from a razor-thin $154 million in September.
-- Operations historically consume $700 million to $1.1 billion in the first two quarters.
-- Management says that by yearend it will slash annualized costs by $1 billion, partly through recently announced layoffs.
-- Xerox also hopes to raise as much as $4 billion by selling assets. To date, it has raised only $550 million, by selling its operation in China.
-- The company borrowed $435 million, secured by European receivables, from GE Capital.
-- Xerox is trying to raise $500 million in equity from a mer-chant bank, according to people familiar with the situation.
Can Xerox avoid Chapter 11? Moody's analyst Richard J. Lane doesn't expect a filing, at least in the first half of the year. Still, he adds: "I can't rule anything out." Even if Xerox manages to limp through 2001, it faces larger challenges next year. That's when the $7 billion it tapped last fall comes due.