Lexmark International Group dominated this year’s Blue Chip 50 rankings, as the Fortune 500 company bested its counterparts in the following categories: overall composite score (5.25), two-year total return to shareholders (a whopping 263.80 percent) and return on average assets (18.06 percent in 1998).

In March of 1998, a third secondary offering completed the sale of Lexmark common shares held by the principal shareholders in the company’s 1991 spin-off from IBM. Lexmark purchased a portion of those shares and the company’s overall repurchase program has expanded to more than 10 million shares. The company also issued its first public debenture in 1998, a 10-year note with a fixed nominal interest rate of 6.75 percent, which was rated investment grade. Additionally, a $300 million revolving line of credit was negotiated through a group of 14 banks. The company’s debt-to-total capital ratio ended the year at 22 percent, slightly below the company’s target of 30 percent. Lexmark ended 1998 with $149 million of cash on the balance sheet. The company’s cash flow was $189 million after capital expenditures of $102 million. In 1999, the company estimates capital expenditures to be in the range of $140 to $160 million to support new product and capacity requirements.

Beginning with the first quarter of 1999, Lexmark began reporting on Shareholder Value Add (SVA), the result of after-tax operating income minus a charge for the average net assets invested in the company. Lexmark’s SVA in 1998 was $170 million, more than double the $81 million achieved in 1997.

The Lexington-based entity is a global developer, manufacturer and supplier of printing solutions, including laser, inkjet and dot matrix printers and associated consumable supplies for the office and home markets. The company’s large-scale financial success in 1998 can be attributed to a broad series of achievements. Lexmark introduced a dozen printers last year and implemented further improvements in printer management for network administrators and new productivity tools. The company has employed an acutely targeted marketing campaign supported by technological leadership as well as sustained cost control under judicious financial management.

Lexmark customers, whether at home or in a small or large business environment, depend on the company for a broad range of printing solutions. Lexmark unveiled an enhanced line of their popular high-performance Optra S monochrome laser printers last year. In light of the emerging digital office, the company’s MarkVision, the industry’s most powerful printer management tool, becomes increasingly valuable to network administrators and other information technology personnel. During the course of 1998, Lexmark engineers worked with counterparts at companies such as Microsoft, Tivoli Systems, IBM and Novell to ensure MarkVisions’ compatibility with their products. In another print management advancement, Lexmark announced MarkTrack software in 1998, which enabled detailed analysis of printer activity and easy creation of financial and administrative reports. MarkTrack, like MarkVision and the products they support, help Lexmark customers better understand and manage their total cost of printing.

In the consumer market, the launch of the Photo Jetprinter 5770 did nothing less than redefine an entire product category. Based on the award-winning Color Jetprinter 5770, the Photo Jetprinter is the industry’s first printer to combine a solution for digital photos as well as text and graphics. Lexmark also brought the Color Jetprinter 1100 and Color Jetprinter 3200 to home users in 1998. The 1100 established the company as the clear leader in the rapidly expanded sub-$100 sector.

During 1998, Lexmark reached an agreement to begin producing three models of custom-designed printers to be sold with the popular Compaq personal computers or individually. This arrangement meets the needs of a niche of customers that prefer to have a printer and a PC in a matched pair while, simultaneously, giving the company an opportunity to expand its share of the highly competitive retail channel.

On the retail front, Lexmark color inkjet printers and supplies are available in more than 15,000 outlets worldwide, including such well-known names as Best Buy, Office Max and Circuit City in the United States; Media Markt, Carrefour and Dixon’s in Europe; Radio Shack and Home Computing in Canada and Harvey Norman in Australia. The company’s fleet of inkjet printers -- with three "best in class" models -- provide industry-leading features for less than $200 in the U.S., which complements the growing popularity of sub-$1000 personal computers.

Lexmark’s growth and progress can also be measured by the public recognition the company has garnered on an international level. In 1998, the company received 132 awards around the world, including "Technology of the Year" from PC Computing for the Optra Color 1200; first place in the PC World top 10 printers list for the 5700 Color Jetprinter and first-place rankings in six-of-eight network laser categories by VARBusiness magazine. Lexmark products have received 666 awards since 1992.

Lexmark also has a commendable track record serving the communities in which they operate. Lexmark employees, 8,000 total, volunteered more than 1,450 community service hours -- ranging from building homes for Habitat for Humanity to Lexmark Enviro Day in Lexington.