Unisys Announces
4Q and FY21 Results
Company Achieves
All 2021 Guidance Metrics and is Free Cash Flow-Positive for Full
Year
BLUE BELL, Pa., Feb. 21, 2022 --
FY21:
- Revenue grew 1.4% year over year ("YoY"), in line with
guidance
- Operating profit grew 77.0% YoY; operating profit margin
increased 320 bps YoY
- FY21 Non-GAAP operating profit(5) grew 25.6% YoY;
non-GAAP operating profit margin increased 180 bps YoY to 9.4%, in
line with guidance
- Adjusted EBITDA(6) grew 15.3% YoY to $369.9M; adjusted EBITDA margin increased 220 bps
YoY to 18.0%, in line with guidance
- Cash from operations increased $813.7M to $132.5M;
free cash flow(8) increased $843.6M YoY to $32.3M; Adjusted free cash flow(9)
increased $129.6M YoY to $172.2M
- Company guides to revenue growth of 5 to 7% YoY, non-GAAP
operating profit margin of 9.5 to 10.5%, and adjusted EBITDA margin
of 18.0 to 19.0% for FY22
Unisys Corporation (NYSE: UIS) today reported
fourth-quarter and full-year 2021 financial results. "We made
advances on revenue, profit and cash flow during 2021," said Unisys
Chair and CEO Peter A. Altabef. "In
addition, our investments in solutions, go-to-market, and workforce
management planning helped us achieve our financial goals in 2021
and have positioned us to advance our momentum in 2022."
Summary of Full-Year 2021 Results
- Revenue:
- Revenue grew 1.4% YoY to $2.054B
vs. $2.026B in 2020, in line with
guidance
- Gross Profit:
- Gross profit increased 18.4% YoY to $572.0M vs. $483.0M
in 2020
- Gross profit margin increased 400 bps YoY to 27.8% vs. 23.8% in
2020
- Operating Profit:
- Operating profit increased 77.0% YoY to $154.0M vs. $87.0M
in 2020
- Non-GAAP operating profit increased 25.6% YoY to $192.8M vs. $153.5M
in 2020
- Operating profit margin increased 320 bps YoY to 7.5% vs. 4.3%
in 2020
- Non-GAAP operating profit margin increased 180 bps to 9.4% (in
line with guidance) vs. 7.6% in 2020
- Adjusted EBITDA and Net Income:
- Adjusted EBITDA increased 15.3% YoY to $369.9M vs. $320.8M
in 2020
- Adjusted EBITDA margin increased 220 bps to 18.0% (in line with
guidance) vs. 15.8% in 2020
- During 2021, the company undertook a number of liability
management initiatives that in combination reduced gross pension
liabilities by $1.2B, which required
approximately $500M in total non-cash
pre-tax settlement charges. As a result, the company recorded a net
loss from continuing operations in the amount of $448.5M vs. a net loss of $317.7M in 2020 (which included $142.1M of non-cash pre-tax settlement charges)
- Net income margin was (21.8)% vs. (15.7)% in 2020, as a result
of the same non-cash charges
- Non-GAAP net income from continuing operations increased
55.8%(7) YoY to $117.5M
vs. $75.4M in 2020
- Non-GAAP net income margin increased 200 bps YoY to 5.7% vs.
3.7% in 2020
- Earnings Per Share from Continuing Operations:
- The non-cash settlement charges referenced above related to
reducing gross pension liabilities amounted to $6.77 per share and resulted in a loss per share
from continuing operations in the amount of $6.75 vs. a loss of $5.05 in 2020
- Non-GAAP diluted earnings per share from continuing operations
increased 54.9% YOY to $1.75 vs.
$1.13 in 2020.
- Cash Flow:
- Cash from operations increased $813.7M YoY to $132.5M vs. $(681.2)M in 2020
- Free cash flow increased $843.6M
YoY to $32.3M vs. $(811.3)M in 2020
- Adjusted free cash flow increased $129.6M YoY to $172.2M vs. $42.6M
in 2020
- Pipeline, ACV and Backlog:
- Total company pipeline(2) increased 5% YoY and was
roughly flat sequentially at $4.8B
- Annual contract value ("ACV")(3) increased 11%
YoY
- Total company backlog(1) was flat sequentially at
$3.0B
- Balance Sheet:
- Net leverage(4) as of December 31, 2021 was 0.6x
- As of December 31, 2021, total
cash and cash equivalents was $553M
- Based on calculations and actuarial assumptions as of
December 31, 2021, no future cash
contributions are required to the qualified U.S. pension plans for
at least the next 10 years; approximately $35M in annual contributions required to all
other plans from 2022 to 2026
- The global GAAP pension deficit decreased by $283M as of December 31,
2021 to $753M vs. $1,036M as of December 31,
2020
FY21 Financial Highlights by Segment:
Digital Workplace Solutions ("DWS"), transforming digital
workplaces and end-user experiences:
- In 2021 the company evolved its DWS solution portfolio,
expanding user-experience offerings and exiting certain
non-strategic contracts that were not aligned to its targeted
margin profile. This resulted in a decline in revenue, but gross
profit and gross margin increased for the year.
- DWS revenue was $567.0M vs.
$588.3M in 2020, down 3.6% YoY
- DWS gross profit increased 38.0% YoY to $76.3M vs. $55.3M
in 2020
- DWS gross margin increased 410 bps YoY to 13.5% vs. 9.4% in
2020
Cloud and Infrastructure Solutions ("C&I"), driving modern
IT service platforms and cloud application development:
- C&I revenue grew 6.7% YoY to $496.5M vs. $465.2M
in 2020
- C&I gross profit grew 144.0% YoY to $56.6M vs. $23.2M
in 2020
- C&I gross margin improved 640 bps YoY to 11.4% vs. 5.0% in
2020, reflecting improvements to margins for both cloud and
traditional infrastructure solutions
Enterprise Computing Solutions ("ECS"), enabling digital
services through software-defined operating environments:
- ECS revenue grew 2.7% YoY to $677.5M vs. $659.7M
in 2020
- ECS gross profit grew 14.1% YoY to $428.6M vs. $375.7M
in 2020
- ECS gross margin increased 620 bps YoY to 63.1% vs. 56.9% in
2020
Summary of Q4 2021 Results
- 4Q21 revenue faced a difficult compare with 4Q20, including as
a result of the ECS license renewal schedule which was more
concentrated in the fourth quarter of 2020, but results were in
line with internal expectations, as evidenced by achievement of
FY21 revenue guidance.
- Revenue was $539.3M vs.
$576.9M in 2020, down 6.5% YoY
- The ECS license renewal schedule also resulted in lower
profitability YoY in the quarter, but as with revenue, overall
profitability results were in line with or slightly ahead of
internal expectations, as evidenced by achievement of non-GAAP
operating profit margin and adjusted EBITDA margin guidance for
FY21
- Gross Profit:
- Gross profit was $163.7M vs.
$175.1M in 4Q20
- Gross profit margin was flat YoY at 30.4%
- Operating Profit:
- Operating profit was $44.5M vs.
$47.7M in 4Q20
- Non-GAAP operating profit was $63.3M vs. $80.9M
in 4Q20
- Operating profit margin was flat YoY at 8.3%
- Non-GAAP operating profit margin was 11.7% vs. 14.0% in
4Q20
- Adjusted EBITDA and Net Income:
- Adjusted EBITDA was $107.0M vs.
$124.2M in 4Q20
- Adjusted EBITDA margin was 19.8% vs. 21.5% in 4Q20
- During the fourth quarter, as part of the pension liability
reductions noted above, the company completed a transfer of gross
pension liabilities through the purchase of a $235M annuity contract. As a result, the company
recorded a $130.1M non-cash, pre-tax
settlement charge, which resulted in a net loss from continuing
operations in 4Q21 of $131.2M vs. a
net loss of $174.7M in 4Q20 (which
included a $142.1M non-cash, pre-tax
settlement charge)
- Net income margin of (24.3)% vs. (30.3)% in 4Q20, impacted by
the same charge
- Non-GAAP net income from continuing operations was $34.8M vs. $49.2M
in 4Q20
- Non-GAAP net income margin was 6.5% vs. 8.5% in 4Q20
- Earnings Per Share from Continuing Operations:
- The non-cash settlement charge related to gross pension
liability reduction noted above translated to $1.94 per share, which drove the loss per share
from continuing operations of $1.95
vs. a loss of $2.77 in 4Q20
- Non-GAAP diluted earnings per share from continuing operations
was $0.51 vs. $0.73 in 4Q20
- Cash Flow:
- Cash from operations was $68.0M
vs. $(355.4)M in 4Q20
- Free cash flow was $44.3M vs.
$(390.4)M in 4Q20
- Adjusted free cash flow was $72.2M vs. $104.6M
in 4Q20
- ACV:
- 4Q21 represented the strongest ACV quarter of the year, up 54%
sequentially (although down 12% YoY, due to the ECS license renewal
schedule).
Fourth-Quarter Financial Highlights by Segment:
As noted above for total company results, 4Q21 faced a difficult
compare with 4Q20 at the segment level, as well, including as a
result of the ECS license renewal schedule. However, overall
results were in line with or slightly ahead of internal
expectations, as evidenced by achievement of guidance on all
metrics for FY21.
DWS:
- As a result of exiting certain non-strategic contracts that
were not aligned to the company's targeted margin profile in the
third quarter, 4Q21 DWS revenue declined YoY. However, 4Q21 DWS
gross profit and gross margin increased YoY.
- DWS revenue was $138.1M vs.
$146.3M in 4Q20
- DWS gross profit was up 6.9% YoY to $18.6M vs. $17.4M
in 4Q20
- DWS gross profit margin was up 160 bps YoY to 13.5% vs. 11.9%
in 4Q20
C&I:
- 4Q21 C&I revenue was expected to decrease YoY due to a
revenue timing issue that benefitted the company in the fourth
quarter of 2020. However, 4Q20 C&I gross profit and gross
margin increased YoY.
- C&I revenue of $129.9M vs.
$131.1M in 4Q20
- C&I gross profit increased 24.7% YoY to $19.7M vs. $15.8M
in 4Q20
- C&I gross profit margin increased 310 bps YoY to 15.2% vs.
12.1% in 4Q20
ECS:
- 4Q21 ECS revenue was expected to be lower YoY as a result of
the license renewal schedule, which was more concentrated in the
fourth quarter of 2020. The flow-through of this revenue impact was
also expected to drive lower gross profit and gross margin.
- ECS revenue was $191.2M vs.
$220.5M in 4Q20
- ECS gross profit was $124.3M vs.
$143.5M in 4Q20
- ECS gross margin was roughly flat YoY at 65.0% vs. 65.1% in
4Q20
Conference Call
Unisys will hold a conference call February
22nd at 8:00 a.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) Backlog – Represents future revenue
associated with contracted work which has not yet been delivered or
performed. Although we believe this backlog is firm, we may, for
commercial reasons, allow the orders to be cancelled, with or
without penalty.
(2) Pipeline – Pipeline represents prospective
sale opportunities being pursued or for which bids have been
submitted. There is no assurance that pipeline will translate
into recorded revenue.
(3) Annual Contract Value – The revenue
expected to be recognized during the first twelve months following
the signing of a contract.
(4) Net Leverage – Net leverage excludes
the deficit associated with the qualified U.S. pension plans, given
that based on calculations and actuarial assumptions as of
December 31, 2021, no future cash
contributions are required to the qualified U.S. pension plans for
at least the next 10 years. Net leverage includes the deficit from
all other pension plans, given the remaining contributions required
to those plans.
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 certain portions of
post-retirement, debt exchange and extinguishment and
cost-reduction and other expenses. 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.
(5) Non-GAAP operating profit – The
company recorded pretax post-retirement expense and pretax charges
in connection with cost-reduction activities, debt
exchange/extinguishment 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.
(6) EBITDA & adjusted EBITDA – Earnings
before interest, taxes, depreciation and amortization ("EBITDA") is
calculated by starting with net income (loss) from continuing
operations 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 post-retirement,
debt exchange/extinguishment, and cost-reduction and other
expenses, 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.
(7) Non-GAAP net income and non-GAAP diluted
earnings per share – The company has recorded
post-retirement expense and charges in connection with debt
exchange/extinguishment and 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.
(8) 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.
(9) Adjusted free cash flow – Because
inclusion of the company's post-retirement contributions,
discontinued operations and cost-reduction charges/reimbursements
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.
About Unisys
Unisys is a global IT solutions company that delivers successful
outcomes for the most demanding businesses and governments. Unisys
offerings include digital workplace solutions, cloud and
infrastructure solutions, enterprise computing solutions, and
business process solutions. For more information on how Unisys
delivers for its clients across the commercial, financial services
and government markets, visit 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 or
expectations of earnings, revenues, non-GAAP operating profit
margin, adjusted EBITDA margin, annual contract value, total
contract value, new business ACV or TCV, backlog, pipeline 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 annual and total contract value
are based, in part, on the assumption that each of those contracts
will continue for their full contracted term. Risks and
uncertainties that could affect the company's future results
include, but are not limited to, the following: our ability to
attract and retain experienced personnel in key positions; our
ability to grow revenue and expand margin in our Digital Workplace
Solutions and Cloud and Infrastructure Solutions businesses; our
ability to maintain our installed base and sell new solutions and
related services; the business and financial risk in implementing
acquisitions or dispositions; the potential adverse effects of
aggressive competition in the information services and technology
market; our ability to effectively anticipate and respond to rapid
technological innovation in our industry; our ability to retain
significant clients and attract new clients; our contracts may not
be as profitable as expected or provide the expected level of
revenues; our ability to develop or acquire the capabilities to
enhance the company's solutions; we have significant underfunded
pension obligations; the impact of COVID-19 on our business,
growth, reputation, projections, financial condition, operations,
cash flows and liquidity; the performance and capabilities of third
parties with whom we have commercial relationships; cybersecurity
breaches could result in incurring significant costs and could harm
our business and reputation; a failure to meet standards or
expectations with respect to the company's environmental, social
and governance practices; the risks of doing business
internationally when a significant portion of our revenue is
derived from international operations; our ability to access
financing markets; a reduction in our credit rating; the adverse
effects of global economic conditions, acts of war, terrorism,
natural disasters or the widespread outbreak of infectious
diseases; a significant disruption in our IT systems could
adversely affect our business and reputation; we may face damage to
our reputation or legal liability if our clients are not satisfied
with our services or products; the potential for intellectual
property infringement claims to be asserted against us or our
clients; the possibility that legal proceedings could affect our
results of operations or cash flow or may adversely affect our
business or reputation; and our ability to use our net operating
loss carryforwards and certain other tax attributes may be limited.
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. While included
under the definition of forward-looking statements, for the
avoidance of doubt, any specific guidance or color that the company
may provide from time to time regarding its expected future
financial performance is effective only on the date given. The
company generally will not update, reaffirm or otherwise comment on
any such information except as it deems necessary, and then only in
a manner that complies with Regulation FD.
RELEASE NO.: 0221/9863
| UNISYS
CORPORATION |
| CONSOLIDATED
STATEMENTS OF INCOME |
| (Unaudited) |
| (Millions, except
per share data) |
|
|
|
|
|
|
Three Months Ended
December 31, |
|
|
Year Ended December
31, |
|
2021 |
|
2020 |
|
|
2021 |
|
2020 |
| Revenue |
|
|
|
|
|
|
|
|
| Services |
$ 430.5 |
|
$ 445.0 |
|
|
$1,699.3 |
|
$1,692.9 |
| Technology |
108.8 |
|
131.9 |
|
|
355.1 |
|
333.4 |
|
539.3 |
|
576.9 |
|
|
2,054.4 |
|
2,026.3 |
| Costs and expenses |
|
|
|
|
|
|
|
|
| Cost of revenue: |
|
|
|
|
|
|
|
|
| Services |
339.0 |
|
367.8 |
|
|
1,358.7 |
|
1,429.4 |
| Technology |
36.6 |
|
34.0 |
|
|
123.7 |
|
113.9 |
|
375.6 |
|
401.8 |
|
|
1,482.4 |
|
1,543.3 |
| Selling, general and administrative |
109.8 |
|
116.9 |
|
|
389.5 |
|
369.4 |
| Research and development |
9.4 |
|
10.5 |
|
|
28.5 |
|
26.6 |
|
494.8 |
|
529.2 |
|
|
1,900.4 |
|
1,939.3 |
| Operating income |
44.5 |
|
47.7 |
|
|
154.0 |
|
87.0 |
| Interest expense |
8.4 |
|
8.3 |
|
|
35.4 |
|
29.2 |
| Other (expense), net |
(145.7) |
|
(195.3) |
|
|
(580.3) |
|
(329.6) |
| Loss from continuing operations before income
taxes |
(109.6) |
|
(155.9) |
|
|
(461.7) |
|
(271.8) |
| Provision (benefit) for income taxes |
21.9 |
|
18.8 |
|
|
(11.9) |
|
45.4 |
| Consolidated net loss from continuing
operations |
(131.5) |
|
(174.7) |
|
|
(449.8) |
|
(317.2) |
| Net (loss) income attributable to noncontrolling
interests |
(0.3) |
|
- |
|
|
(1.3) |
|
0.5 |
| Net loss from continuing operations
attributable to Unisys Corporation |
(131.2) |
|
(174.7) |
|
|
(448.5) |
|
(317.7) |
| Income from discontinued operations, net of
tax |
- |
|
1.6 |
|
|
- |
|
1,068.4 |
| Net (loss) income attributable to Unisys
Corporation |
$(131.2) |
|
$(173.1) |
|
|
$ (448.5) |
|
$ 750.7 |
|
|
|
|
|
|
|
|
|
| Earnings (loss) per common share attributable
to Unisys Corporation |
|
|
|
|
|
|
|
|
| Basic |
|
|
|
|
|
|
|
|
| Continuing operations |
$ (1.95) |
|
$ (2.77) |
|
|
$ (6.75) |
|
$ (5.05) |
| Discontinuing operations |
- |
|
0.02 |
|
|
- |
|
16.98 |
| Total |
$ (1.95) |
|
$ (2.75) |
|
|
$ (6.75) |
|
$ 11.93 |
| Diluted |
|
|
|
|
|
|
|
|
| Continuing operations |
$ (1.95) |
|
$ (2.77) |
|
|
$ (6.75) |
|
$ (5.05) |
| Discontinuing operations |
- |
|
0.02 |
|
|
- |
|
16.98 |
| Total |
$ (1.95) |
|
$ (2.75) |
|
|
$ (6.75) |
|
$ 11.93 |
| UNISYS
CORPORATION |
| REPORTING UNITS
RESULTS |
|
(Unaudited) |
| (Millions) |
|
|
|
|
|
|
|
|
|
|
|
Total |
|
DWS |
|
C&I |
|
ECS |
|
Other |
| Three Months Ended December 31, 2021 |
|
|
|
|
|
|
|
|
|
| Customer revenue |
$ 539.3 |
|
$138.1 |
|
$129.9 |
|
$191.2 |
|
$ 80.1 |
| Intersegment |
- |
|
- |
|
- |
|
- |
|
- |
| Total revenue |
$ 539.3 |
|
$138.1 |
|
$129.9 |
|
$191.2 |
|
$ 80.1 |
| Gross profit percent |
30.4 % |
|
13.5 % |
|
15.2 % |
|
65.0 % |
|
|
| Three Months Ended December 31, 2020 |
|
|
|
|
|
|
|
|
|
| Customer revenue |
$ 576.9 |
|
$146.3 |
|
$131.1 |
|
$220.5 |
|
$ 79.0 |
| Intersegment |
- |
|
- |
|
- |
|
- |
|
- |
| Total revenue |
$ 576.9 |
|
$146.3 |
|
$131.1 |
|
$220.5 |
|
$ 79.0 |
| Gross profit percent |
30.4 % |
|
11.9 % |
|
12.1 % |
|
65.1 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
DWS |
|
C&I |
|
ECS |
|
Other |
| Year Ended December 31, 2021 |
|
|
|
|
|
|
|
|
|
| Customer revenue |
$ 2054.4 |
|
$567.0 |
|
$496.5 |
|
$677.5 |
|
$313.4 |
| Intersegment |
- |
|
- |
|
- |
|
1.4 |
|
(1.4) |
| Total revenue |
$ 2054.4 |
|
$567.0 |
|
$496.5 |
|
$678.9 |
|
$312.0 |
| Gross profit percent |
27.8 % |
|
13.5 % |
|
11.4 % |
|
63.1 % |
|
|
| Year Ended December 31, 2020 |
|
|
|
|
|
|
|
|
|
| Customer revenue |
$2,026.3 |
|
$588.3 |
|
$465.2 |
|
$659.7 |
|
$313.1 |
| Intersegment |
- |
|
- |
|
- |
|
0.1 |
|
(0.1) |
| Total revenue |
$2,026.3 |
|
$588.3 |
|
$465.2 |
|
$659.8 |
|
$313.0 |
| Gross profit percent |
23.8 % |
|
9.4 % |
|
5.0 % |
|
56.9 % |
|
|
| UNISYS
CORPORATION |
| CONSOLIDATED BALANCE
SHEETS |
| (Unaudited) |
| (Millions) |
|
|
|
|
|
|
December 31, 2021 |
|
December 31, 2020 |
|
| Assets |
|
|
|
|
| Current assets |
|
|
|
|
| Cash and cash equivalents |
$
552.9 |
|
$
898.5 |
|
| Accounts receivable, net |
451.7 |
|
460.5 |
|
| Contract assets |
42.0 |
|
44.3 |
|
| Inventories |
7.6 |
|
13.4 |
|
| Prepaid expenses and other current assets |
78.8 |
|
89.3 |
|
| Total current assets |
1,133.0 |
|
1,506.0 |
|
| Properties |
468.0 |
|
727.0 |
|
| Less – Accumulated depreciation and
amortization |
381.5 |
|
616.5 |
|
| Properties, net |
86.5 |
|
110.5 |
|
| Outsourcing assets, net |
124.6 |
|
173.9 |
|
| Marketable software, net |
176.2 |
|
193.6 |
|
| Operating lease right-of-use assets |
62.7 |
|
79.3 |
|
| Prepaid postretirement assets |
159.7 |
|
187.5 |
|
| Deferred income taxes |
125.3 |
|
136.2 |
|
| Goodwill |
315.0 |
|
108.6 |
|
| Intangible assets, net |
34.9 |
|
- |
|
| Restricted cash |
7.7 |
|
8.2 |
|
| Assets held-for-sale |
20.0 |
|
- |
|
| Other long-term assets |
173.9 |
|
204.1 |
|
| Total assets |
$
2,419.5 |
|
$
2,707.9 |
|
| Liabilities and deficit |
|
|
|
|
| Current liabilities |
|
|
|
|
| Current maturities of long-term debt |
$
18.2 |
|
$
102.8 |
|
| Accounts payable |
180.2 |
|
223.2 |
|
| Deferred revenue |
253.2 |
|
257.1 |
|
| Other accrued liabilities |
300.9 |
|
352.0 |
|
| Total current liabilities |
752.5 |
|
935.1 |
|
| Long-term debt |
511.2 |
|
527.1 |
|
| Long-term postretirement liabilities |
976.2 |
|
1,286.1 |
|
| Long-term deferred revenue |
150.7 |
|
137.9 |
|
| Long-term operating lease liabilities |
46.1 |
|
62.4 |
|
| Other long-term liabilities |
47.2 |
|
71.4 |
|
| Commitments and contingencies |
|
|
|
|
| Total Unisys Corporation stockholders'
deficit |
(113.7) |
|
(356.8) |
|
| Noncontrolling interests |
49.3 |
|
44.7 |
|
| Total deficit |
(64.4) |
|
(312.1) |
|
| Total liabilities and deficit |
$
2,419.5 |
|
$
2,707.9 |
|
| UNISYS
CORPORATION |
| CONSOLIDATED
STATEMENTS OF CASH FLOWS |
| (Unaudited) |
| (Millions) |
|
|
|
|
|
|
|
Year Ended
December 31, |
|
|
2021 |
|
2020 |
| Cash flows from operating activities |
|
|
|
|
| Consolidated net loss from continuing
operations |
|
$ (449.8) |
|
$ (317.2) |
| Income from discontinued operations, net of
tax |
|
- |
|
1,068.4 |
| Adjustments to reconcile consolidated net income
(loss) to net cash provided by (used for) operating
activities: |
|
|
|
|
| Gain on sale of U.S. Federal business |
|
- |
|
(1,060.0) |
| Foreign currency losses |
|
2.6 |
|
36.2 |
| Non-cash interest expense |
|
1.8 |
|
4.6 |
| Debt extinguishment charge |
|
- |
|
28.5 |
| Employee stock compensation |
|
18.8 |
|
14.5 |
| Depreciation and amortization of properties |
|
30.5 |
|
29.7 |
| Depreciation and amortization of outsourcing
assets |
|
68.0 |
|
65.8 |
| Amortization of marketable software |
|
71.9 |
|
65.5 |
| Amortization of intangible assets |
|
3.0 |
|
- |
| Other non-cash operating activities |
|
(0.6) |
|
(0.3) |
| Loss on disposal of capital assets |
|
2.2 |
|
4.5 |
| Postretirement contributions |
|
(56.4) |
|
(832.2) |
| Postretirement expense |
|
552.0 |
|
239.2 |
| Deferred income taxes, net |
|
(59.2) |
|
(13.4) |
| Changes in operating assets and liabilities,
excluding the effects of acquisitions: |
|
|
|
|
| Receivables, net and contract assets |
|
47.4 |
|
(74.8) |
| Inventories |
|
6.0 |
|
3.0 |
| Other assets |
|
8.0 |
|
5.9 |
| Accounts payable and other accrued
liabilities |
|
(149.4) |
|
3.4 |
| Other liabilities |
|
35.7 |
|
47.5 |
| Net cash provided by (used for) operating
activities |
|
132.5 |
|
(681.2) |
| Cash flows from investing
activities |
|
|
|
|
| Purchases of businesses, net of cash acquired |
|
(239.3) |
|
- |
| Net proceeds from sale of U.S. Federal
business |
|
- |
|
1,162.9 |
| Proceeds from investments |
|
4,148.2 |
|
3,388.5 |
| Purchases of investments |
|
(4,168.1) |
|
(3,379.2) |
| Capital additions of properties |
|
(27.3) |
|
(27.7) |
| Capital additions of outsourcing assets |
|
(18.5) |
|
(30.1) |
| Investment in marketable software |
|
(54.4) |
|
(72.3) |
| Other |
|
(0.9) |
|
(0.5) |
| Net cash (used for) provided by investing
activities |
|
(360.3) |
|
1,041.6 |
| Cash flows from financing
activities |
|
|
|
|
| Proceeds from issuance of long-term debt |
|
1.5 |
|
497.3 |
| Payments of long-term debt |
|
(103.1) |
|
(454.8) |
| Cash paid for debt extinguishment |
|
- |
|
(23.7) |
| Issuance costs relating to long-term debt |
|
- |
|
(7.9) |
| Proceeds from exercise of stock options |
|
4.5 |
|
- |
| Other |
|
(8.4) |
|
(5.8) |
| Net cash (used for) provided by financing
activities |
|
(105.5) |
|
5.1 |
| Effect of exchange rate changes on cash, cash
equivalents and restricted cash |
|
(12.8) |
|
(10.6) |
| (Decrease) increase in cash, cash equivalents
and restricted cash |
|
(346.1) |
|
354.9 |
| Cash, cash equivalents and restricted cash,
beginning of period |
|
906.7 |
|
551.8 |
| Cash, cash equivalents and restricted cash, end
of period |
|
$ 560.6 |
|
$ 906.7 |
| UNISYS
CORPORATION |
| RECONCILIATION OF
SELECTED GAAP MEASURES TO NON-GAAP MEASURES |
|
(Unaudited) |
| (Millions, except
per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Year Ended |
|
|
|
December
31, |
|
December
31, |
|
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
| GAAP net loss from continuing
operations attributable to Unisys Corporation |
|
$(131.2) |
|
$(174.7) |
|
$(448.5) |
|
$(317.7) |
|
|
|
|
|
|
|
|
|
|
| Postretirement expense: |
pretax |
|
144.3 |
|
166.4 |
|
552.0 |
|
239.2 |
|
tax |
|
0.4 |
|
0.4 |
|
53.2 |
|
1.5 |
|
net of tax |
|
143.9 |
|
166.0 |
|
498.8 |
|
237.7 |
|
|
|
|
|
|
|
|
|
|
| Cost reduction and other expenses |
pretax |
|
22.1 |
|
58.6 |
|
67.8 |
|
157.0 |
|
tax |
|
- |
|
0.7 |
|
0.6 |
|
1.6 |
|
net of tax |
|
22.1 |
|
57.9 |
|
67.2 |
|
155.4 |
|
noncontrolling interest |
|
- |
|
- |
|
- |
|
- |
|
net of noncontrolling interest |
|
22.1 |
|
57.9 |
|
67.2 |
|
155.4 |
| Non-GAAP net income from continuing
operations attributable to Unisys Corporation |
|
34.8 |
|
49.2 |
|
117.5 |
|
75.4 |
| Add interest expense on convertible
notes |
|
- |
|
- |
|
- |
|
- |
| Non-GAAP net income attributable to
Unisys Corporation for diluted earnings per share |
|
$ 34.8 |
|
$ 49.2 |
|
$ 117.5 |
|
$ 75.4 |
|
|
|
|
|
|
|
|
|
|
| Weighted average shares
(thousands) |
|
67,170 |
|
63,038 |
|
66,451 |
|
62,932 |
| Plus incremental shares from assumed
conversion: |
|
|
|
|
|
|
|
|
|
Employee stock plans |
|
914 |
|
805 |
|
871 |
|
579 |
|
Convertible notes |
|
- |
|
3,425 |
|
- |
|
3,425 |
| Non-GAAP adjusted weighted average
shares |
|
68,084 |
|
67,268 |
|
67,322 |
|
66,936 |
| Diluted earnings (loss) per
share |
|
|
|
|
|
|
|
|
| GAAP basis |
|
|
|
|
|
|
|
|
| GAAP net loss from continuing
operations attributable to Unisys Corporation |
|
$(131.2) |
|
$(174.7) |
|
$(448.5) |
|
$(317.7) |
| Divided by adjusted weighted average
shares |
|
67,170 |
|
63,038 |
|
66,451 |
|
62,932 |
| GAAP diluted loss per
share |
|
$ (1.95) |
|
$ (2.77) |
|
$ (6.75) |
|
$ (5.05) |
| Non-GAAP basis |
|
|
|
|
|
|
|
|
| Non-GAAP net income attributable to
Unisys Corporation for diluted earnings per share |
|
$ 34.8 |
|
$ 49.2 |
|
$ 117.5 |
|
$ 75.4 |
| Divided by Non-GAAP adjusted weighted
average shares |
|
68,084 |
|
67,268 |
|
67,322 |
|
66,936 |
| Non-GAAP diluted earnings per
share |
|
$ 0.51 |
|
$ 0.73 |
|
$ 1.75 |
|
$ 1.13 |
| UNISYS
CORPORATION |
| RECONCILIATION OF
GAAP TO NON-GAAP |
|
(Unaudited) |
| (Millions) |
|
|
|
|
|
|
|
|
|
|
| FREE CASH
FLOW |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Year Ended |
|
|
|
December
31, |
|
December
31, |
|
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
| Cash provided by (used for)
operations |
|
$68.0 |
|
$(355.4) |
|
$132.5 |
|
$(681.2) |
| Additions to marketable software |
|
(12.3) |
|
(17.5) |
|
(54.4) |
|
(72.3) |
| Additions to properties |
|
(7.6) |
|
(11.0) |
|
(27.3) |
|
(27.7) |
| Additions to outsourcing assets |
|
(3.8) |
|
(6.5) |
|
(18.5) |
|
(30.1) |
| Free cash flow |
|
44.3 |
|
(390.4) |
|
32.3 |
|
(811.3) |
| Postretirement funding |
|
12.8 |
|
487.7 |
|
56.4 |
|
832.2 |
| Discontinued operations |
|
|
- |
|
0.7 |
|
- |
|
(8.4) |
| Cost reduction and other payments |
|
15.1 |
|
6.6 |
|
83.5 |
|
30.1 |
| Adjusted free cash flow |
|
$72.2 |
|
$ 104.6 |
|
$172.2 |
|
$ 42.6 |
| UNISYS
CORPORATION |
| RECONCILIATION OF
GAAP TO NON-GAAP |
|
(Unaudited) |
| (Millions) |
|
|
|
|
|
|
|
|
|
|
| EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Year Ended |
|
|
|
December
31, |
|
December
31, |
|
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
| Net loss from continuing operations
attributable to Unisys Corporation |
|
$(131.2) |
|
$(174.7) |
|
$ (448.5) |
|
$ (317.7) |
| Net (loss) income attributable to
noncontrolling interests |
|
(0.3) |
|
- |
|
(1.3) |
|
0.5 |
| Interest expense, net of interest
income of $2.4, $1.3, $7.8, $7.3 respectively* |
|
6.0 |
|
7.0 |
|
27.6 |
|
21.9 |
| Provision (benefit) for income
taxes |
|
21.9 |
|
18.8 |
|
(11.9) |
|
45.4 |
| Depreciation |
|
24.5 |
|
24.6 |
|
98.5 |
|
95.5 |
| Amortization |
|
22.3 |
|
15.3 |
|
74.9 |
|
65.5 |
| EBITDA |
|
$ (56.8) |
|
$(109.0) |
|
$ (260.7) |
|
$ (88.9) |
|
|
|
|
|
|
|
|
|
| Postretirement expense |
|
144.3 |
|
166.4 |
|
552.0 |
|
239.2 |
| Debt exchange, cost reduction and
other expenses** |
|
16.3 |
|
58.6 |
|
57.3 |
|
148.8 |
| Non-cash share based expense |
|
2.7 |
|
3.4 |
|
14.2 |
|
14.5 |
| Other (income) expense
adjustment*** |
|
0.5 |
|
4.8 |
|
7.1 |
|
7.2 |
| Adjusted EBITDA |
|
$ 107.0 |
|
$ 124.2 |
|
$ 369.9 |
|
$ 320.8 |
|
|
|
|
|
|
|
|
|
|
| *Included in other (expense), net on
the consolidated statements of income (loss) |
| **Reduced for depreciation and
amortization included above |
***Other expense, net as reported on
the consolidated statements of income (loss)
less postretirement expense, interest income and items included in
debt extinguishment, cost reduction
and other expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Year Ended |
|
|
|
December
31, |
|
December
31, |
|
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
| Revenue |
|
|
$ 539.3 |
|
$ 576.9 |
|
$2,054.4 |
|
$2,026.3 |
| Net loss from continuing operations
attributable to Unisys Corporation as a percentage of revenue |
|
(24.3)% |
|
(30.3)% |
|
(21.8)% |
|
(15.7)% |
| Non-GAAP net income from continuing
operations attributable to Unisys Corporation as a percentage of
revenue |
|
6.5 % |
|
8.5 % |
|
5.7 % |
|
3.7 % |
| Adjusted EBITDA as a percentage of
revenue |
|
19.8 % |
|
21.5 % |
|
18.0 % |
|
15.8 % |
| UNISYS
CORPORATION |
| RECONCILIATIONS OF
GAAP TO NON-GAAP |
| (Unaudited) |
| (Millions) |
|
|
|
|
|
|
| OPERATING
PROFIT |
|
|
|
|
|
|
|
|
Three Months
Ended |
Nine Months
Ended |
|
|
December
31, |
December
31, |
|
|
2021 |
2020 |
2021 |
2020 |
|
|
|
|
|
|
| GAAP operating income from continuing
operations |
|
$ 44.5 |
$ 47.7 |
$ 154.0 |
$ 87.0 |
| Cost reduction and other expenses* |
|
18.0 |
32.4 |
35.3 |
63.2 |
| Postretirement expense** |
|
0.8 |
0.8 |
3.5 |
3.3 |
| Non-GAAP operating profit from continuing
operations |
|
$ 63.3 |
$ 80.9 |
$ 192.8 |
$ 153.5 |
|
|
|
|
|
|
| Revenue |
|
$ 539.3 |
$ 576.9 |
$2,054.4 |
$2,026.3 |
|
|
|
|
|
|
| GAAP operating profit percent |
|
8.3 % |
8.3 % |
7.5 % |
4.3 % |
| Non-GAAP operating profit percent |
|
11.7 % |
14.0 % |
9.4 % |
7.6 % |
|
|
|
|
|
|
|
|
|
|
|
|
| *Included in cost of revenue, selling,
general and administrative and research and development on the
consolidated statements of income (loss) |
| **Included in selling, general and
administrative on the consolidated statements of income (loss) |
SOURCE Unisys Corporation
CONTACT: Investors: Courtney
Holben, Unisys, 215-986-3379, courtney.holben@unisys.com;
Media: John Clendening, Unisys,
214-403-1981, john.clendening@unisys.com
