Unisys Announces
Third-Quarter 2017 Financial Results and Reaffirms Full-Year
Financial Guidance
BLUE BELL, Pa., Oct. 30, 2017 --
3Q 17
- Total revenue of $666 million,
flat on a sequential basis, an approximately 2 percent
year-over-year decline
- Technology revenue up 10 percent year-over-year to
$91 million
- Services revenue of $576
million, a 4 percent year-over-year decline; Services
operating profit margin of 3 percent, a 480 basis point sequential
improvement and a 60 basis point year-over-year
improvement
- Operating profit margin of (4) percent, relative to (1)
percent in the prior-year period; non-GAAP operating profit
margin(4) of 7.3 percent, up 370 basis points
sequentially and up 60 basis points year-over-year
- Services backlog up 1 percent sequentially at $3.7 billion
- Unisys reaffirms full-year 2017 guidance for revenue of
$2.65-2.75 billion, non-GAAP
operating profit margin of 7.25-8.25 percent and adjusted free cash
flow of $130-170 million
Unisys Corporation (NYSE: UIS) today reported third-quarter 2017
financial results. The company's revenue for the third quarter was
$666 million, flat on a sequential
basis and an approximately 2 percent year-over-year decline (4
percent decline on a constant-currency(2) basis), an
improvement of 510 basis points versus the rate of decline in the
prior-year period. Technology revenue was up 10 percent
year-over-year. Services revenue saw a 4 percent year-over-year
decline (a 420 basis point improvement relative to the rate of
decline in the prior year), and Services operating margin was up
480 basis points sequentially and up 60 basis points year-over-year
to 3 percent.
"We are pleased with the revenue trends we saw in the third
quarter, as well as new business TCV," said Unisys President and
CEO Peter Altabef. "While we still
need to make additional progress on improving the profitability of
our Services business, we are encouraged by the improvement we made
on that front this quarter."
Summary of Third Quarter 2017 Business
Results
Company:
Third quarter revenue of $666
million was flat on a sequential basis and an approximately
2 percent year-over-year decline (4 percent year-over-year decline
on a constant-currency basis), an improvement of 510 basis points
versus the rate of decline in the prior-year period. Third quarter
operating profit margin was (4) percent, which includes
cost-reduction and other charges and pension expense, relative to
(1) percent in the prior-year period. Non-GAAP operating profit
margin was 7.3 percent, up 370 basis points sequentially and up 60
basis points year-over-year.
Net loss attributable to Unisys Corporation common stockholders
for the third quarter was $41
million, versus a net loss of $28
million in the prior-year period. Adjusted
EBITDA(5) for the third quarter was $89 million, up 1 percent year-over-year.
Adjusted EBITDA margin for the third quarter was 13 percent, up 50
basis points relative to the prior-year period.
In the third quarter 2017, operating cash flow was $54 million, relative to $46 million in the prior-year period. The company
generated free cash flow(3) of $7
million in the third quarter, versus $9 million in the third quarter 2016. Adjusted
free cash flow(6) in the third quarter was
$67 million, versus $72 million in the prior-year period. Although
operating cash flow was up year-over-year, free cash flow and
adjusted free cash flow were impacted by higher year-over-year
capital expenditures related to updating systems in our
check-processing JV in the UK. Excluding these expenditures, free
cash flow and adjusted free cash flow would have been up
year-over-year.
Total TCV(1) was down 44 percent year-over-year,
largely due to a tough compare resulting from a large 12-year
contract signed in the third quarter 2016. New business TCV was up
38 percent year-over-year for the third quarter.
At September 30, 2017, the company
had $599 million in cash and cash
equivalents. On October 5, 2017, the
company entered into a new 5-year $125
million revolving credit facility to replace the previous
facility, which was due to expire June
2018.
Services:
Services revenue of $576 million,
which represented 86 percent of third quarter total revenue, saw a
4 percent year-over-year decline as reported (a 420 basis point
improvement relative to the rate of decline in the prior year) and
a decline of 5 percent in constant-currency. Services backlog ended
the third quarter at $3.7 billion, up
1 percent sequentially. Services gross margin was up 240 basis
points sequentially, although down 20 basis points year-over-year
to 16 percent. Services operating profit margin was 3 percent, up
480 basis points sequentially, reflective of changes implemented in
the third quarter of 2017 and up 60 basis points
year-over-year.
Technology:
Technology revenue in the third quarter was up 10 percent
year-over-year as reported and in constant currency to $91 million, which represented 14 percent of
total third-quarter revenue. Technology gross margin for the third
quarter was 53 percent, versus 60 percent in the prior-year period,
and Technology operating profit margin was 31 percent, relative to
32 percent in the prior-year period. Technology margins were lower
year-over-year largely due to higher sales of lower-margin hardware
and third-party products.
Key Third-Quarter Contract
Signings:
The company in the third quarter entered into several key
contracts in each of its sectors including the following:
- U.S. Federal: In collaboration with a partner, Unisys won an
engagement to implement a Unisys Stealth® pilot solution
to provide micro-segmentation capability for the U.S. Navy in its
data center environment.
- Public: One of the biggest Wastewater Treatment Companies in
Brazil renewed and expanded a
five-year contract with Unisys to continue providing ClearPath
Forward™ and data analytics services software licensing, support
and maintenance services, as well as implementation of a backup
virtual tape library and disaster recovery management
services.
- Commercial: Unisys signed a new contract with a leading
European airline group for business consultancy and Unisys' AirCore
passenger service solutions.
- Financial Services: A New
Zealand bank engaged Unisys to manage and maintain their
core banking applications - designed to better integrate within the
banks' digital channels - as well as set up a disaster recovery
system.
Conference Call
Unisys will hold a conference call today at 5:30 p.m. Eastern Time to discuss its results.
The listen-only webcast, as well as the accompanying presentation
materials, can be accessed on the Unisys Investor website at
www.unisys.com/investor. Following the call, an audio replay of the
webcast, and accompanying presentation materials, can be accessed
through the same link.
(1) Total Contract Value - TCV is the
estimated total contractual revenue related to signed contracts
including option years and without regard for cancellation terms.
New business TCV represents TCV attributable to new scope for
existing clients and new logo contracts.
(2) Constant currency - The company refers to
growth rates in constant currency or on a constant currency basis
so that the business results can be viewed without the impact of
fluctuations in foreign currency exchange rates to facilitate
comparisons of the company's business performance from one period
to another. Constant currency is calculated by retranslating
current and prior period results at a consistent rate.
Non-GAAP and Other Information
Although appropriate under generally accepted accounting
principles (GAAP), the company's results reflect charges that the
company believes are not indicative of its ongoing operations and
that can make its profitability and liquidity results difficult to
compare to prior periods, anticipated future periods, or to its
competitors' results. These items consist of pension and
cost-reduction and other expense. Management believes each of these
items can distort the visibility of trends associated with the
company's ongoing performance. Management also believes that the
evaluation of the company's financial performance can be enhanced
by use of supplemental presentation of its results that exclude the
impact of these items in order to enhance consistency and
comparativeness with prior or future period results. The following
measures are often provided and utilized by the company's
management, analysts, and investors to enhance comparability of
year-over-year results, as well as to compare results to other
companies in our industry.
(3) Free cash flow - The company defines free
cash flow as cash flow from operations less capital expenditures.
Management believes this liquidity measure gives investors an
additional perspective on cash flow from on-going operating
activities in excess of amounts used for reinvestment.
(4) Non-GAAP operating profit - The company
recorded pretax pension expense and pretax charges in connection
with cost-reduction activities and other expenses. For the company,
non-GAAP operating profit excluded these items. The company
believes that this profitability measure is more indicative of the
company's operating results and aligns those results to the
company's external guidance which is used by the company's
management to allocate resources and may be used by analysts and
investors to gauge the company's ongoing performance.
(5) EBITDA & adjusted EBITDA – Earnings
before interest, taxes, depreciation and amortization (EBITDA) is
calculated by starting with net income (loss) attributable to
Unisys Corporation common shareholders and adding or subtracting
the following items: net income attributable to noncontrolling
interests, interest expense (net of interest income), provision for
income taxes, depreciation and amortization. Adjusted EBITDA
further excludes pension expense, cost-reduction and other expense,
non-cash share-based expense, and other (income) expense
adjustment. In order to provide investors with additional
understanding of the company's operating results, these charges are
excluded from the adjusted EBITDA calculation.
(6) Adjusted free cash flow - Because
inclusion of the company's pension contributions and cost-reduction
and other payments in free cash flow may distort the visibility of
the company's ability to generate cash flow from its operations
without the impact of these non-operational costs, management
believes that investors may be interested in adjusted free cash
flow, which provides free cash flow before these payments. This
liquidity measure was provided to analysts and investors in the
form of external guidance and is used by management to measure
operating liquidity.
(7) Non-GAAP diluted earnings per share
- The company has recorded pension expense and charges in
connection with cost-reduction activities and other expenses.
Management believes that investors may have a better understanding
of the company's performance and return to shareholders by
excluding these charges from the GAAP diluted earnings/loss per
share calculations. The tax amounts presented for these items for
the calculation of non-GAAP diluted earnings per share include the
current and deferred tax expense and benefits recognized under GAAP
for these amounts.
About Unisys
Unisys is a global information technology company that
specializes in providing industry-focused solutions integrated with
leading-edge security to clients in the government, financial
services and commercial markets. Unisys offerings include security
solutions, advanced data analytics, cloud and infrastructure
services, application services and application and server software.
For more information, visit www.unisys.com.
Forward-Looking Statements
Any statements contained in this release that are not historical
facts are forward-looking statements as defined in the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements include, but are not limited to, any projections of
earnings, revenues, total contract value or other financial items;
any statements of the company's plans, strategies or objectives for
future operations; statements regarding future economic conditions
or performance; and any statements of belief or expectation. All
forward-looking statements rely on assumptions and are subject to
various risks and uncertainties that could cause actual results to
differ materially from expectations. In particular, statements
concerning total contract value are based, in part, on the
assumption that all options of the contracts included in the
calculation of such value will be exercised and that each of those
contracts will continue for their full contracted term. Risks and
uncertainties that could affect the company's future results
include the company's ability to effectively anticipate and respond
to volatility and rapid technological innovation in its industry;
the company's ability to improve margins in its services business;
the company's ability to sell new products while maintaining its
installed base in its technology business; the company's ability to
access financing markets to refinance its outstanding debt; the
company's ability to realize anticipated cost savings and to
successfully implement its cost reduction initiatives to drive
efficiencies across all of its operations; the company's
significant pension obligations and requirements to make
significant cash contributions to its defined benefit plans; the
company's ability to attract, motivate and retain experienced and
knowledgeable personnel in key positions; the risks of doing
business internationally when a significant portion of the
company's revenue is derived from international operations; the
potential adverse effects of aggressive competition in the
information services and technology marketplace; the company's
ability to retain significant clients; the company's contracts may
not be as profitable as expected or provide the expected level of
revenues; cybersecurity breaches could result in significant costs
and could harm the company's business and reputation; a significant
disruption in the company's IT systems could adversely affect the
company's business and reputation; the company may face damage to
its reputation or legal liability if its clients are not satisfied
with its services or products; the performance and capabilities of
third parties with whom the company has commercial relationships;
the adverse effects of global economic conditions, acts of war,
terrorism or natural disasters; contracts with U.S. governmental
agencies may subject the company to audits, criminal penalties,
sanctions and other expenses and fines; the potential for
intellectual property infringement claims to be asserted against
the company or its clients; the possibility that pending litigation
could affect the company's results of operations or cash flow; the
business and financial risk in implementing future dispositions or
acquisitions; and the company's consideration of all available
information following the end of the quarter and before the filing
of the Form 10-Q and the possible impact of this subsequent event
information on its financial statements for the reporting period.
Additional discussion of factors that could affect the company's
future results is contained in its periodic filings with the
Securities and Exchange Commission. The company assumes no
obligation to update any forward-looking statements.
RELEASE NO.: 1030/9550
Unisys and other Unisys products and services mentioned herein,
as well as their respective logos, are trademarks or registered
trademarks of Unisys Corporation. Any other brand or product
referenced herein is acknowledged to be a trademark or registered
trademark of its respective holder.
UIS – Q
UNISYS
CORPORATION |
CONSOLIDATED
STATEMENTS OF INCOME |
(Unaudited) |
(Millions, except
per share data) |
|
|
|
|
|
|
|
Three Months
Ended
September 30, |
|
Nine Months
Ended
September 30, |
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Revenue |
|
|
|
|
|
|
|
|
Services |
|
$ 575.5 |
|
$
600.9 |
|
$ 1,735.6 |
|
$ 1,809.8 |
Technology |
|
90.8 |
|
82.4 |
|
261.4 |
|
289.2 |
|
|
666.3 |
|
683.3 |
|
1,997.0 |
|
2,099.0 |
Costs and expenses |
|
|
|
|
|
|
|
|
Cost of revenue: |
|
|
|
|
|
|
|
|
Services |
|
539.7 |
|
531.3 |
|
1,570.9 |
|
1,594.1 |
Technology |
|
40.5 |
|
30.4 |
|
117.3 |
|
106.5 |
|
|
580.2 |
|
561.7 |
|
1,688.2 |
|
1,700.6 |
Selling, general and administrative |
|
102.3 |
|
120.0 |
|
325.6 |
|
345.8 |
Research and development |
|
10.8 |
|
11.4 |
|
37.7 |
|
40.5 |
|
|
693.3 |
|
693.1 |
|
2,051.5 |
|
2,086.9 |
Operating profit (loss) |
|
(27.0) |
|
(9.8) |
|
(54.5) |
|
12.1 |
Interest expense |
|
16.4 |
|
7.7 |
|
36.4 |
|
19.9 |
Other income (expense), net |
|
3.0 |
|
2.3 |
|
(8.6) |
|
3.7 |
Loss before income taxes |
|
(40.4) |
|
(15.2) |
|
(99.5) |
|
(4.1) |
Provision for income taxes |
|
12.5 |
|
9.9 |
|
21.6 |
|
34.2 |
Consolidated net loss |
|
(52.9) |
|
(25.1) |
|
(121.1) |
|
(38.3) |
Net income (loss) attributable to noncontrolling
interests |
|
(11.8) |
|
3.1 |
|
(5.3) |
|
8.2 |
Net loss attributable to Unisys Corporation
common shareholders |
|
$ (41.1) |
|
$
(28.2) |
|
$ (115.8) |
|
$
(46.5) |
Loss per share attributable to Unisys
Corporation |
|
|
|
|
|
|
|
|
Basic |
|
$ (0.81) |
|
$
(0.56) |
|
$ (2.30) |
|
$
(0.93) |
Diluted |
|
$ (0.81) |
|
$
(0.56) |
|
$ (2.30) |
|
$
(0.93) |
Shares used in the per share computations (in
thousands): |
|
|
|
|
|
|
|
|
Basic |
|
50,471 |
|
50,082 |
|
50,388 |
|
50,052 |
Diluted |
|
50,471 |
|
50,082 |
|
50,388 |
|
50,052 |
UNISYS
CORPORATION |
SEGMENT
RESULTS |
(Unaudited) |
(Millions) |
|
|
|
|
|
|
|
|
|
|
|
Total |
|
Eliminations |
|
Services |
|
Technology |
Three Months Ended September 30,
2017 |
|
|
|
|
|
|
|
Customer revenue |
|
$ 666.3 |
|
$
— |
|
$ 575.5 |
|
$
90.8 |
Intersegment |
|
— |
|
(4.4) |
|
— |
|
4.4 |
Total revenue |
|
$ 666.3 |
|
$
(4.4) |
|
$ 575.5 |
|
$
95.2 |
Gross profit percent |
|
12.9 % |
|
|
|
16.5 % |
|
53.3 % |
Operating profit (loss) percent |
|
(4.1)% |
|
|
|
3.2 % |
|
31.1 % |
Three Months Ended September 30,
2016 |
|
|
|
|
|
|
|
Customer revenue |
|
$ 683.3 |
|
$
— |
|
$ 600.9 |
|
$
82.4 |
Intersegment |
|
— |
|
(5.8) |
|
— |
|
5.8 |
Total revenue |
|
$ 683.3 |
|
$
(5.8) |
|
$ 600.9 |
|
$
88.2 |
Gross profit percent |
|
17.8 % |
|
|
|
16.7 % |
|
59.8 % |
Operating profit (loss) percent |
|
(1.4)% |
|
|
|
2.6 % |
|
32.3 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
Eliminations |
|
Services |
|
Technology |
Nine Months Ended September 30,
2017 |
|
|
|
|
|
|
|
Customer revenue |
|
$ 1,997.0 |
|
$
— |
|
$ 1,735.6 |
|
$
261.4 |
Intersegment |
|
— |
|
(15.1) |
|
— |
|
15.1 |
Total revenue |
|
$ 1,997.0 |
|
$
(15.1) |
|
$ 1,735.6 |
|
$
276.5 |
Gross profit percent |
|
15.5 % |
|
|
|
16.3 % |
|
53.2 % |
Operating profit (loss) percent |
|
(2.7)% |
|
|
|
2.1 % |
|
27.8 % |
Nine Months Ended September 30,
2016 |
|
|
|
|
|
|
|
Customer revenue |
|
$ 2,099.0 |
|
$
— |
|
$ 1,809.8 |
|
$
289.2 |
Intersegment |
|
— |
|
(17.3) |
|
— |
|
17.3 |
Total revenue |
|
$ 2,099.0 |
|
$
(17.3) |
|
$ 1,809.8 |
|
$
306.5 |
Gross profit percent |
|
19.0 % |
|
|
|
15.9 % |
|
60.2 % |
Operating profit percent |
|
0.6 % |
|
|
|
1.8 % |
|
36.0 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
UNISYS
CORPORATION |
CONSOLIDATED BALANCE
SHEETS |
(Unaudited) |
(Millions) |
|
|
|
|
|
|
September 30, 2017 |
|
December 31, 2016 |
|
Assets |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
$
598.7 |
|
$
370.6 |
|
Accounts and notes receivable, net |
511.8 |
|
505.8 |
|
Inventories: |
|
|
|
|
Parts and finished equipment |
17.7 |
|
14.0 |
|
Work in process and materials |
15.1 |
|
15.0 |
|
Prepaid expenses and other current assets |
118.8 |
|
121.9 |
|
Total current assets |
1,262.1 |
|
1,027.3 |
|
Properties |
915.4 |
|
886.6 |
|
Less-Accumulated depreciation and
amortization |
766.7 |
|
741.3 |
|
Properties, net |
148.7 |
|
145.3 |
|
Outsourcing assets, net |
190.6 |
|
172.5 |
|
Marketable software, net |
136.4 |
|
137.0 |
|
Prepaid postretirement assets |
47.9 |
|
33.3 |
|
Deferred income taxes |
150.8 |
|
146.1 |
|
Goodwill |
181.2 |
|
178.6 |
|
Restricted cash |
21.3 |
|
30.5 |
* |
Other long-term assets |
157.9 |
|
151.0 |
* |
Total assets |
$
2,296.9 |
|
$
2,021.6 |
|
Liabilities and deficit |
|
|
|
|
Current liabilities: |
|
|
|
|
Current maturities of long-term-debt |
$
11.3 |
|
$
106.0 |
|
Accounts payable |
195.5 |
|
189.0 |
|
Deferred revenue |
326.9 |
|
337.4 |
|
Other accrued liabilities |
387.8 |
|
349.2 |
|
Total current liabilities |
921.5 |
|
981.6 |
|
Long-term debt |
631.5 |
|
194.0 |
|
Long-term postretirement liabilities |
2,195.2 |
|
2,292.6 |
|
Long-term deferred revenue |
108.3 |
|
117.6 |
|
Other long-term liabilities |
90.3 |
|
83.2 |
|
Commitments and contingencies |
|
|
|
|
Total deficit |
(1,649.9) |
|
(1,647.4) |
|
Total liabilities and deficit |
$
2,296.9 |
|
$
2,021.6 |
|
|
|
|
|
|
* Certain amounts have been
reclassified to conform to the current-year presentation. |
UNISYS
CORPORATION |
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS |
|
(Unaudited) |
|
(Millions) |
|
|
|
|
|
|
|
|
|
Nine Months
Ended
September 30, |
|
|
|
2017 |
|
2016 |
|
Cash flows from operating
activities |
|
|
|
|
|
Consolidated net loss |
|
$ (121.1) |
|
$ (38.3) |
|
Adjustments to reconcile consolidated
net loss to net cash provided by (used for) operating
activities: |
|
|
|
|
|
Foreign currency transaction (gains)
losses |
|
(0.5) |
|
0.4 |
|
Non-cash interest expense |
|
6.9 |
|
4.9 |
|
Loss on debt extinguishment |
|
1.5 |
|
— |
|
Employee stock compensation |
|
8.6 |
|
7.7 |
|
Depreciation and amortization of
properties |
|
29.6 |
|
28.6 |
|
Depreciation and amortization of
outsourcing assets |
|
39.3 |
|
39.7 |
|
Amortization of marketable
software |
|
47.1 |
|
48.0 |
|
Other non-cash operating
activities |
|
3.3 |
|
1.4 |
|
Loss on disposal of capital
assets |
|
4.5 |
|
2.0 |
|
Pension contributions |
|
(110.8) |
|
(104.0) |
|
Pension expense |
|
69.4 |
|
63.0 |
|
Decrease (increase) in deferred income
taxes, net |
|
2.3 |
|
(2.7) |
|
Changes in operating assets and
liabilities: |
|
|
|
|
|
Receivables, net |
|
3.1 |
|
59.9 |
|
Inventories |
|
(2.6) |
|
5.5 |
|
Accounts payable and other accrued
liabilities |
|
(15.3) |
|
(44.9) |
* |
Other liabilities |
|
(21.8) |
|
10.5 |
|
Other assets |
|
20.2 |
|
21.3 |
* |
Net cash (used for) provided by
operating activities |
|
(36.3) |
|
103.0 |
* |
Cash flows from investing
activities |
|
|
|
|
|
Proceeds from investments |
|
3,663.5 |
|
3,307.3 |
|
Purchases of investments |
|
(3,632.8) |
|
(3,331.6) |
|
Investment in marketable software |
|
(46.6) |
|
(47.1) |
|
Capital additions of properties |
|
(21.8) |
|
(18.3) |
|
Capital additions of outsourcing
assets |
|
(60.1) |
|
(41.4) |
|
Other |
|
(0.8) |
|
(0.8) |
* |
Net cash used for investing
activities |
|
(98.6) |
|
(131.9) |
* |
Cash flows from financing
activities |
|
|
|
|
|
Proceeds from issuance of long-term
debt |
|
445.0 |
|
213.5 |
|
Payments for capped call
transactions |
|
— |
|
(27.3) |
|
Issuance costs relating to long-term
debt |
|
(12.1) |
|
(7.3) |
|
Payments of long-term debt |
|
(98.4) |
|
(2.1) |
|
Payments of short-term borrowings |
|
— |
|
(65.8) |
|
Other |
|
0.2 |
|
(0.4) |
* |
Net cash provided by financing
activities |
|
334.7 |
|
110.6 |
* |
Effect of exchange rate changes on
cash, cash equivalents and restricted cash |
|
19.1 |
|
(2.3) |
* |
Increase in cash, cash equivalents
and restricted cash |
|
218.9 |
|
79.4 |
* |
Cash, cash equivalents and
restricted cash, beginning of period |
|
401.1 |
|
396.8 |
* |
Cash, cash equivalents and
restricted cash, end of period |
|
$ 620.0 |
|
$ 476.2 |
* |
|
|
|
|
|
|
* Certain amounts have been
reclassified to conform to the current-year presentation. |
|
UNISYS
CORPORATION |
RECONCILIATION OF
SELECTED GAAP MEASURES TO NON-GAAP MEASURES |
(Unaudited) |
(Millions, except
per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months |
|
Nine Months |
|
|
|
Ended September
30, |
|
Ended September
30, |
|
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
GAAP net loss attributable to
Unisys Corporation common shareholders |
|
$
(41.1) |
|
$
(28.2) |
|
$
(115.8) |
|
$
(46.5) |
|
|
|
|
|
|
|
|
|
|
Cost reduction and other expense: |
pretax |
|
46.1 |
|
34.6 |
|
100.5 |
|
71.7 |
|
tax benefit |
|
(1.2) |
|
(2.6) |
|
(10.2) |
|
(4.7) |
|
net of tax |
|
44.9 |
|
32.0 |
|
90.3 |
|
67.0 |
|
minority interest |
|
(11.1) |
|
— |
|
(11.1) |
|
— |
|
net of minority interest |
|
33.8 |
|
32.0 |
|
79.2 |
|
67.0 |
|
|
|
|
|
|
|
|
|
|
Pension expense: |
pretax |
|
23.6 |
|
21.2 |
|
69.4 |
|
63.0 |
|
tax (benefit) provision |
|
(0.1) |
|
0.3 |
|
1.7 |
|
0.9 |
|
net of tax |
|
23.5 |
|
21.5 |
|
71.1 |
|
63.9 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income attributable to
Unisys Corporation common shareholders |
|
16.2 |
|
25.3 |
|
34.5 |
|
84.4 |
|
|
|
|
|
|
|
|
|
|
Add interest expense on convertible
notes |
|
4.8 |
|
4.6 |
|
14.2 |
|
9.9 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income attributable to
Unisys Corporation for diluted earnings per share |
|
$
21.0 |
|
$
29.9 |
|
$
48.7 |
|
$
94.3 |
|
|
|
|
|
|
|
|
|
|
Weighted average shares
(thousands) |
|
50,471 |
|
50,082 |
|
50,388 |
|
50,052 |
|
|
|
|
|
|
|
|
|
|
Plus incremental shares from assumed
conversion: |
|
|
|
|
|
|
|
|
Employee stock plans |
|
241 |
|
226 |
|
308 |
|
175 |
|
Convertible notes |
|
21,868 |
|
21,868 |
|
21,868 |
|
15,685 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjusted weighted average
shares |
|
72,580 |
|
72,176 |
|
72,564 |
|
65,912 |
|
|
|
|
|
|
|
|
|
|
Diluted earnings (loss) per
share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP basis |
|
|
|
|
|
|
|
|
GAAP net loss attributable to Unisys
Corporation for diluted earnings per share |
|
$
(41.1) |
|
$
(28.2) |
|
$ (115.8) |
|
$
(46.5) |
|
|
|
|
|
|
|
|
|
|
Divided by adjusted weighted average
shares |
|
50,471 |
|
50,082 |
|
50,388 |
|
50,052 |
|
|
|
|
|
|
|
|
|
|
GAAP diluted loss per
share |
|
$
(0.81) |
|
$
(0.56) |
|
$
(2.30) |
|
$
(0.93) |
|
|
|
|
|
|
|
|
|
|
Non-GAAP basis |
|
|
|
|
|
|
|
|
Non-GAAP net income attributable to
Unisys Corporation for diluted earnings per share |
|
$
21.0 |
|
$
29.9 |
|
$
48.7 |
|
$
94.3 |
|
|
|
|
|
|
|
|
|
|
Divided by Non-GAAP adjusted weighted
average shares |
|
72,580 |
|
72,176 |
|
72,564 |
|
65,912 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP diluted earnings per
share |
|
$
0.29 |
|
$
0.41 |
|
$
0.67 |
|
$
1.43 |
UNISYS
CORPORATION |
RECONCILIATION OF
GAAP OPERATING PROFIT TO NON-GAAP OPERATING PROFIT |
(Unaudited) |
(Millions) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months |
|
Nine Months |
|
|
|
Ended September
30, |
|
Ended September
30, |
|
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
GAAP operating profit
(loss) |
|
$ (27.0) |
|
$
(9.8) |
|
$
(54.5) |
|
$
12.1 |
Cost reduction and other expense |
|
51.8 |
|
34.6 |
|
99.6 |
|
71.7 |
FAS87 pension expense |
|
23.6 |
|
21.2 |
|
69.4 |
|
63.0 |
Non-GAAP operating profit |
|
$
48.4 |
|
$
46.0 |
|
$
114.5 |
|
$
146.8 |
|
|
|
|
|
|
|
|
|
|
Customer revenue |
|
$ 666.3 |
|
$
683.3 |
|
$
1,997.0 |
|
$
2,099.0 |
GAAP operating profit (loss)
% |
|
(4.1)% |
|
(1.4)% |
|
(2.7)% |
|
0.6 % |
Non-GAAP operating profit
% |
|
7.3 % |
|
6.7 % |
|
5.7 % |
|
7.0 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNISYS
CORPORATION |
|
RECONCILIATION OF
GAAP TO NON-GAAP |
|
(Unaudited) |
|
(Millions) |
|
|
|
|
|
|
|
|
|
|
|
|
|
FREE CASH
FLOW |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months |
|
|
Nine Months |
|
|
|
|
Ended September
30, |
|
|
Ended September
30, |
|
|
|
|
2017 |
|
2016 |
|
|
2017 |
|
2016 |
|
Cash (used for) provided by
operations |
|
$
53.9 |
|
$
46.1 |
* |
|
$
(36.3) |
|
$ 103.0 |
* |
Additions to marketable software |
|
(17.8) |
|
(16.9) |
|
|
(46.6) |
|
(47.1) |
|
Additions to properties |
|
(5.9) |
|
(7.3) |
|
|
(21.8) |
|
(18.3) |
|
Additions to outsourcing assets |
|
(23.2) |
|
(12.6) |
|
|
(60.1) |
|
(41.4) |
|
Free cash flow |
|
7.0 |
|
9.3 |
* |
|
(164.8) |
|
(3.8) |
* |
Pension funding |
|
39.6 |
|
39.9 |
|
|
110.8 |
|
104.0 |
|
Cost reduction and other payments |
|
20.2 |
|
23.1 |
|
|
49.0 |
|
62.3 |
|
Adjusted free cash flow |
|
$
66.8 |
|
$
72.3 |
* |
|
$
(5.0) |
|
$ 162.5 |
* |
|
|
|
|
|
|
|
|
|
|
|
|
* Certain amounts have been
reclassified to conform to the current-year presentation. |
|
UNISYS
CORPORATION |
RECONCILIATION OF
GAAP TO NON-GAAP |
(Unaudited) |
(Millions) |
|
|
|
|
|
|
|
|
|
|
EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months |
|
Nine Months |
|
|
|
Ended September
30, |
|
Ended September
30, |
|
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Net loss attributable to Unisys
Corporation common shareholders |
|
$
(41.1) |
|
$
(28.2) |
|
$ (115.8) |
|
$ (46.5) |
Net income (loss) attributable to
noncontrolling interests |
|
(11.8) |
|
3.1 |
|
(5.3) |
|
8.2 |
Interest expense, net of interest
income of $2.5, $2.9, $7.2, $8.5, respectively* |
|
13.9 |
|
4.8 |
|
29.2 |
|
11.4 |
Provision for income taxes |
|
12.5 |
|
9.9 |
|
21.6 |
|
34.2 |
Depreciation |
|
22.8 |
|
23.3 |
|
68.9 |
|
68.3 |
Amortization |
|
15.3 |
|
15.6 |
|
47.1 |
|
48.0 |
EBITDA |
|
$
11.6 |
|
$
28.5 |
|
$
45.7 |
|
$ 123.6 |
|
|
|
|
|
|
|
|
|
Pension expense |
|
23.6 |
|
21.2 |
|
69.4 |
|
63.0 |
Cost reduction and other
expense*** |
|
45.8 |
|
34.6 |
|
100.2 |
|
71.7 |
Non-cash share based expense |
|
2.4 |
|
2.4 |
|
8.6 |
|
7.7 |
Other (income) expense
adjustment** |
|
5.2 |
|
0.6 |
|
14.9 |
|
4.8 |
Adjusted EBITDA |
|
$
88.6 |
|
$
87.3 |
|
$ 238.8 |
|
$ 270.8 |
|
|
|
|
|
|
|
|
|
|
* Included in Other (income) expense,
net on the Consolidated Statements of Income |
** Other (income) expense, net as
reported on the Consolidated Statements of Income less Interest
income and items included in cost reduction and other expense |
*** Reduced for Depreciation and
Amortization included above |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONTACT: Investors: Courtney
Holben, Unisys, 215-986-3379,
courtney.holben@unisys.com;
Media: John Clendening, Unisys,
214-403-1981, john.clendening@unisys.com