REG-Unisys Corp: 3rd Quarter Results
09/11/2018 07:05
Unisys Announces 3Q18 Results; Revenue Grows for Fourth Consecutive Quarter,
Operating Margin Expands; Company Reaffirms Full-Year Guidance
BLUE BELL, Pa., Nov. 8, 2018 /PRNewswire/ --
3Q 2018:
* Revenue grew 3.3 percent year over year (5.8 percent in
constant-currency((3)))
* Backlog((4)) was up 33 percent year over year to $4.9 billion, the highest
year-over-year growth since 4Q1999
* Operating profit margin expanded 850 basis points year over year to 8.1
percent and non-GAAP operating profit((6)) margin expanded 20 basis points
year over year to 7.7 percent
* Net income was $6 million; Adjusted EBITDA((9)) margin expanded to 14.0
percent, up 50 basis points year over year
* Diluted earnings per share was $0.12 versus a diluted loss per share of
$0.81 in the prior-year period; non-GAAP diluted earnings per share((10)) was
$0.39 versus $0.31 in the prior-year period
Unisys Corporation (http://www.unisys.com/) (NYSE: UIS) today reported
third-quarter 2018 financial results and reaffirmed full-year financial
guidance. Total company revenue grew 3.3 percent (5.8 percent in
constant-currency), and Services revenue grew 5.2 percent year over year (7.6
percent in constant-currency). This marked the fourth consecutive quarter of
revenue growth for the total company and the second consecutive quarter of
revenue growth in Services. Operating profit margin expanded 850 basis points
year over year to 8.1 percent, and non-GAAP operating profit margin expanded
20 basis points year over year to 7.7 percent.
The company reported strong contract signings with Total Contract Value((1))
(or "TCV") up 46 percent year over year for the quarter and 93 percent year to
date. New business TCV was up 133 percent year over year in the quarter and
131 percent year to date. Backlog was up 33 percent year over year to $4.9
billion, the highest year-over-year growth since 4Q1999.
"Our go-to-market momentum continues, with our fourth consecutive quarter of
revenue growth, which was supported by improvements to profitability year over
year," said Unisys Chairman, President and CEO Peter A.
Altabef. "Additionally, we made further progress with our focus on digital
transformation for state governments, as we signed a contract with the
Virginia Information Technology Agency following contracts we have signed over
the last twelve months with the states of Hawaii, Georgia and Kansas."
Summary of Third-Quarter 2018 Business Results
Company:
Revenue grew 3.3 percent year over year to $688.3 million (up 5.8 percent in
constant-currency), reflecting the fourth consecutive quarter of total company
revenue growth. Non-GAAP adjusted revenue((5)) was up 2.8 percent year over
year to $685.2 million.
Operating profit margin expanded 850 basis points year over year to 8.1
percent. Non-GAAP operating profit margin expanded 20 basis points year over
year to 7.7 percent, helped by a Technology quarter that was stronger than
company expectations.
Net income for the third quarter was $6.1 million, versus a net loss of $41.1
million in the third quarter of 2017. Diluted earnings per share was $0.12,
versus a diluted loss per share of $0.81 in the third quarter of 2017.
Non-GAAP diluted earnings per share was $0.39 versus $0.31 in the prior-year
period.
Adjusted EBITDA for the third quarter increased to $96.1 million, and Adjusted
EBITDA margin expanded to 14.0 percent, up 50 basis points year over year.
Third-quarter cash used in operations was $15.5 million versus operating cash
flow of $53.9 million in the third quarter 2017, largely driven by an increase
in receivables related to several Technology contracts signed late in the
quarter. Third-quarter adjusted free cash flow((12)) was $(6.4) million,
versus $70.2 million in the third quarter of 2017. At September 30, 2018, the
company had $516.1 million in cash and cash equivalents.
The company reaffirms full-year 2018 guidance for non-GAAP adjusted revenue of
$2.7-2.825 billion (GAAP revenue of $2.75-2.875 billion), non-GAAP operating
profit margin of 7.75-8.75 percent (GAAP operating profit margin of 9.5-10.5
percent) and adjusted EBITDA margin of 13.7-14.9 percent.
TCV grew 46 percent year over year, and new business TCV grew 133 percent. On
a cumulative basis year to date, TCV was up 93 percent year over year, with
new business TCV up 131 percent year over year.
Services:
Services revenue grew 5.2 percent year over year (or 7.6 percent in
constant-currency) to $605.6 million, marking the second consecutive quarter
of revenue growth for the segment. Services non-GAAP adjusted revenue grew 4.7
percent year over year to $602.5 million. Backlog grew 33 percent year over
year to end the third quarter at $4.9 billion, the highest year-over-year
growth since 4Q1999. Services gross profit margin was 15.9 percent, down 60
basis points year over year, and Services operating profit margin was 3.1
percent, down 10 basis points year over year. Non-GAAP adjusted Services gross
profit margin((7)) was 15.4 percent, down 110 basis points year over year, and
non-GAAP adjusted Services operating profit margin((8)) was 2.6 percent, down
60 basis points year over year. Year-over-year declines in Services margins
were driven by new Services contracts in ramp-up stage.
Technology:
Technology revenue in the third quarter was $82.7 million, ahead of company
expectations and up sequentially, although down 8.9 percent year over year (or
5.3 percent in constant currency). Technology gross profit margin for the
third quarter expanded 910 basis points year over year to 62.4 percent.
Technology operating profit margin was up 860 basis points year over year to
39.7 percent. The improvements to Technology margins were driven in part by a
higher mix of software revenue in the quarter.
Key Third-Quarter Contract Signings:
In the third quarter, the company entered into several key contracts in each
of its sectors including the following:
* U.S. Federal: Unisys signed a contract with the U.S. Army for the first
phase of Next Generation Biometric Collection Capability. Unisys will leverage
its Stealth(identity)™
(https://www.unisys.com/offerings/security-solutions/unisys-stealth-products-and-services/stealth(identity))
Software solution and deep domain expertise in biometrics system integration
for the U.S. Federal Government to provide end-to-end data flow required to
support multiple U.S. Army operational missions, and to be capable of
achieving efficient, near real-time, identity matches to the soldier in the
field.
* Public: The Virginia Information Technologies Agency (VITA) has awarded a
six-year, $242.4 million contract to Unisys for server, storage and data
center services, representing a significant step in VITA's strategy to
modernize the state's IT infrastructure.
* Commercial: Unisys announced it has entered into an agreement with Bangalore
International Airport Limited (BIAL) to develop an Analytics Center of
Excellence. The Analytics Center of Excellence will support a business
intelligence and advanced data analytics platform for BIAL to consolidate and
rationalize the Airport's strategic, tactical and operational reporting –
enabling Airport staff to make faster and better-informed business decisions,
process air travelers more quickly and enhance the airport experience for the
customer.
* Financial Services: Unisys' banking platform, Elevate™
(https://www.unisys.com/elevate), was selected by Monmouthshire Building
Society (MBS) to provide new current account services to its customers –
which many building societies in the UK do not offer. The new services include
digital wallet capabilities which provide MBS customers more flexibility in
managing their money.
Conference Call
Unisys will hold a conference call today at 5:00 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 contracts signed in the period including option years (Federal
contracts only) and without regard for cancellation terms. New business TCV
represents TCV attributable to new scope for existing clients and new logo
contracts.
((2)) Annual Contract Value – ACV represents the revenue expected to be
recognized during the first twelve months following the signing of a contract
in the period.
((3)) 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.
((4)) Backlog – Backlog is the balance of contracted services revenue not
yet recognized, including only the funded portion of services contracts with
the U.S. Federal government.
Non-GAAP and Other Information
Although appropriate under generally accepted accounting principles ("GAAP"),
the company's results reflect revenue and charges that the company believes
are not indicative of its ongoing operations and that can make its revenue,
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 revenue, post-retirement 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.
((5)) Non-GAAP adjusted revenue – In 2018, the company's non-GAAP results
reflect adjustments to exclude certain revenue. This includes revenue from
software license extensions and renewals which were contracted for in 2017 and
properly recorded as revenue at that time under the revenue recognition rules
then in effect (ASC 605). Upon adoption of the new revenue recognition rules
(ASC 606) on January 1, 2018, and since the company adopted ASC 606 under the
modified retrospective method whereby prior periods were not restated, the
company was required to include $53 million in the cumulative effect
adjustment to retained earnings on January 1, 2018. ASC 606 requires revenue
related to software license renewals or extensions to be recorded when the new
license term begins, which in the case of the $53 million is January 1, 2018.
The company has excluded revenue and related profit for these software
licenses in its non-GAAP results since it has been previously reported in
2017. This is a one-time adjustment and it will not reoccur in future periods.
However, in its 2018 quarterly disclosures, the company is required to report
what its financial statements would have been if it had not adopted ASC 606.
The $53 million is included in those adjustments. There are additional
adjustments being made, but they do not represent previously recorded revenue.
Those adjustments represent other differences between ASC 605 and ASC 606,
principally extended payment term software licenses and short-term software
licenses both of which are recorded at the inception of the license term under
ASC 606 but were required to be recognized ratably over the software license
term under ASC 605. Additionally, the company's non-GAAP results include
adjustments to exclude certain revenue and related profit relating to
reimbursements from the company's check-processing JV partners for
restructuring expenses included as part of the company's recent restructuring
program.
((6)) Non-GAAP operating profit - The company recorded pretax post-retirement
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. During 2018, the company included the non-GAAP
adjustments discussed in (5) herein.
((7) ) Non-GAAP adjusted Services gross profit margin – During 2018, the
company included the adjustments discussed in (5) herein.
((8)) Non-GAAP adjusted Services operating profit margin – During 2018,
the company included the adjustments discussed in (5) herein.
((9)) 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 post-retirement 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.
During 2018, the company included the adjustments discussed in (5) herein.
((10)) Non-GAAP diluted earnings per share - The company has recorded
post-retirement 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. During 2018,
the company included the adjustments discussed in (5) herein.
((11)) 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.
((12)) Adjusted free cash flow - Because inclusion of the company's
post-retirement contributions 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 information technology company that builds
high-performance, security-centric solutions for the most demanding businesses
and governments on Earth. Unisys offerings include security software and
services; digital transformation and workplace services; industry applications
and services; and innovative software operating environments for
high-intensity enterprise computing. For more information on how Unisys builds
better outcomes securely for its clients across the Government, Financial
Services and Commercial markets, 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, annual contract value, total
contract value, new business ACV or TCV, backlog 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 all options of the contracts (Federal only)
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, but are
not limited to, the following: our ability to improve revenue and margins in
our services business; our ability to maintain our installed base and sell new
solutions in our technology business; our ability to effectively anticipate
and respond to volatility and rapid technological innovation in our industry;
our ability to retain significant clients; the potential adverse effects of
aggressive competition in the information services and technology marketplace;
cybersecurity breaches could result in significant costs and could harm our
business and reputation; our significant pension obligations and required cash
contributions and requirements to make additional significant cash
contributions to our defined benefit pension plans; our ability to attract,
motivate and retain experienced and knowledgeable personnel in key positions;
the risks of doing business internationally when a significant portion of our
revenue is derived from international operations; our contracts may not be as
profitable as expected or provide the expected level of revenues; our ability
to access financing markets; contracts with U.S. governmental agencies may
subject us to audits, criminal penalties, sanctions and other expenses and
fines; 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
performance and capabilities of third parties with whom we have commercial
relationships; an involuntary termination of the company's U.S. qualified
defined benefit pension plan; the potential for intellectual property
infringement claims to be asserted against us or our clients; the business and
financial risk in implementing future acquisitions or dispositions; the
adverse effects of global economic conditions, acts of war, terrorism or
natural disasters; the possibility that pending litigation could affect our
results of operations or cash flow; 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.: 1108/9625
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 Nine Months Ended
September 30, September 30,
2018 2017 2018 2017
Revenue
Services $ 605.6 $ 575.5 $ 1,760.8 $ 1,735.6
Technology 82.7 90.8 303.3 261.4
688.3 666.3 2,064.1 1,997.0
Costs and expenses
Cost of revenue:
Services 504.9 522.5 * 1,460.0 1,519.7 *
Technology 29.6 40.2 * 96.2 116.4 *
534.5 562.7 * 1,556.2 1,636.1 *
Selling, general and administrative 90.9 97.8 * 274.5 314.2 *
Research and development 7.1 8.7 * 21.8 31.3 *
632.5 669.2 * 1,852.5 1,981.6 *
Operating profit (loss) 55.8 (2.9) * 211.6 15.4 *
Interest expense 15.9 16.4 48.2 36.4
Other income (expense), net (17.7) (21.1) * (58.3) (78.5) *
Income (loss) before income taxes 22.2 (40.4) 105.1 (99.5)
Provision for income taxes 15.2 12.5 50.4 21.6
Consolidated net income (loss) 7.0 (52.9) 54.7 (121.1)
Net income (loss) attributable to noncontrolling interests 0.9 (11.8) 4.2 (5.3)
Net income (loss) attributable to Unisys Corporation $ 6.1 $ (41.1) 50.5 $ (115.8)
common shareholders
Earnings (loss) per share attributable to Unisys
Corporation
Basic $ 0.12 $ (0.81) $ 0.99 $ (2.30)
Diluted $ 0.12 $ (0.81) $ 0.89 $ (2.30)
Shares used in the per share computations (in thousands):
Basic 51,021 50,471 50,918 50,388
Diluted 51,718 50,471 73,265 50,388
*Certain amounts have been reclassified to conform to the current-year presentation.
UNISYS CORPORATION
SEGMENT RESULTS
(Unaudited)
(Millions)
Total Eliminations Services Technology
Three Months Ended September 30, 2018
Customer revenue $ 688.3 $ - $ 605.6 $ 82.7
Intersegment - (4.3) - 4.3
Total revenue $ 688.3 $ (4.3) $ 605.6 $ 87.0
Gross profit percent 22.3% 15.9% 62.4%
Operating profit percent 8.1% 3.1% 39.7%
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 15.5% * 16.5% 53.3%
Operating profit (loss) percent (0.4)% * 3.2% 31.1%
Total Eliminations Services Technology
Nine Months Ended September 30, 2018
Customer revenue $ 2,064.1 $ - $ 1,760.8 $ 303.3
Intersegment - (18.3) - 18.3
Total revenue $ 2,064.1 $ (18.3) $ 1,760.8 $ 321.6
Gross profit percent 24.6% 16.3% 66.7%
Operating profit percent 10.3% 3.1% 48.1%
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 18.1% * 16.3% 53.2%
Operating profit percent 0.8% * 2.1% 27.8%
*Certain amounts have been reclassified to conform to the current-year presentation.
UNISYS CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Millions)
September 30, December 31,
2018 2017
Assets
Current assets:
Cash and cash equivalents $ 516.1 $ 733.9
Accounts receivable, net 492.2 503.3
Contract assets 73.3 -
Inventories:
Parts and finished equipment 12.3 13.6
Work in process and materials 10.7 12.5
Prepaid expenses and other current assets 102.6 126.2
Total current assets 1,207.2 1,389.5
Properties 857.2 898.8
Less-Accumulated depreciation and amortization 737.4 756.3
Properties, net 119.8 142.5
Outsourcing assets, net 202.0 202.3
Marketable software, net 157.2 138.3
Prepaid postretirement assets 155.0 148.3
Deferred income taxes 97.3 119.9
Goodwill 178.1 180.8
Restricted cash 17.8 30.2
Other long-term assets 193.6 190.6
Total assets $ 2,328.0 $ 2,542.4
Liabilities and deficit
Current liabilities:
Current maturities of long-term-debt $ 9.9 $ 10.8
Accounts payable 225.7 241.8
Deferred revenue 254.7 327.5
Other accrued liabilities 351.9 391.5
Total current liabilities 842.2 971.6
Long-term debt 640.1 633.9
Long-term postretirement liabilities 1,814.0 2,004.4
Long-term deferred revenue 167.4 159.0
Other long-term liabilities 68.1 100.0
Commitments and contingencies
Total deficit (1,203.8) (1,326.5)
Total liabilities and deficit $ 2,328.0 $ 2,542.4
UNISYS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Millions)
Nine Months Ended
September 30,
2018 2017
Cash flows from operating activities
Consolidated net income (loss) $ 54.7 $ (121.1)
Adjustments to reconcile consolidated net income (loss) to net cash used for operating activities:
Foreign currency transaction losses (gains) 1.1 (0.5)
Non-cash interest expense 7.8 6.9
Loss on debt extinguishment - 1.5
Employee stock compensation 10.0 8.6
Depreciation and amortization of properties 31.2 29.6
Depreciation and amortization of outsourcing assets 48.7 39.3
Amortization of marketable software 42.8 47.1
Other non-cash operating activities (2.6) 3.3
Loss on disposal of capital assets 0.6 4.5
Gain on the sale of properties (7.3) -
Postretirement contributions (124.5) (119.2) *
Postretirement expense 58.2 74.5 *
Decrease in deferred income taxes, net 9.3 2.3
Changes in operating assets and liabilities:
Receivables, net (69.3) 3.1
Inventories (1.3) (2.6)
Accounts payable and other accrued liabilities (144.1) (15.3)
Other liabilities (1.5) (18.5) *
Other assets 8.8 20.2
Net cash used for operating activities (77.4) (36.3)
Cash flows from investing activities
Proceeds from investments 2,889.3 3,663.5
Purchases of investments (2,892.4) (3,632.8)
Investment in marketable software (61.7) (46.6)
Capital additions of properties (25.0) (21.8)
Capital additions of outsourcing assets (54.4) (60.1)
Net proceeds from sale of properties 19.2 -
Other (0.9) (0.8)
Net cash used for investing activities (125.9) (98.6)
Cash flows from financing activities
Proceeds from issuance of long-term debt - 445.0
Issuance costs relating to long-term debt - (12.1)
Payments of long-term debt (2.0) (98.4)
Financing fees (0.2) -
Other (2.2) 0.2
Net cash (used for) provided by financing activities (4.4) 334.7
Effect of exchange rate changes on cash, cash equivalents and restricted cash (22.5) 19.1
(Decrease) increase in cash, cash equivalents and restricted cash (230.2) 218.9
Cash, cash equivalents and restricted cash, beginning of period 764.1 401.1
Cash, cash equivalents and restricted cash, end of period $ 533.9 $ 620.0
* Certain amounts have been reclassified to conform to the current-year presentation.
UNISYS CORPORATION
RECONCILIATIONS OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES
(Unaudited)
(Millions, except per share data)
Three Months Nine Months
Ended September 30, Ended September 30,
2018 2017 2018 2017
GAAP net income (loss) attributable to Unisys $ 6.1 $ (41.1) $ 50.5 $ (115.8)
Corporation common shareholders
Topic 606 adjustment: pretax - - (53.0) -
tax - - (5.3) -
net of tax - - (47.7) -
Postretirement expense: pretax 19.7 25.3 * 58.2 74.5 *
tax (0.3) 0.1 (0.8) (1.7)
net of tax 20.0 25.2 * 59.0 76.2 *
Cost reduction and other expense: pretax (4.0) 46.1 (6.2) 100.5
tax (0.1) 1.2 (0.2) 10.2
net of tax (3.9) 44.9 (6.0) 90.3
minority interest (1.5) 11.1 (1.5) 11.1
net of minority interest (2.4) 33.8 (4.5) 79.2
Non-GAAP net income attributable to Unisys 23.7 17.9 * 57.3 39.6 *
Corporation common shareholders
Add interest expense on convertible notes 4.9 4.8 14.6 14.2
Non-GAAP net income attributable to Unisys $ 28.6 $ 22.7 * $ 71.9 $ 53.8 *
Corporation for diluted earnings per share
Weighted average shares (thousands) 51,021 50,471 50,918 50,388
Plus incremental shares from assumed conversion:
Employee stock plans 697 241 479 308
Convertible notes 21,868 21,868 21,868 21,868
Non-GAAP adjusted weighted average shares 73,586 72,580 73,265 72,564
Diluted earnings (loss) per share
GAAP basis
GAAP net income (loss) attributable to Unisys Corporation for diluted earnings per share $ 6.1 $ (41.1) $ 65.1 $ (115.8)
Divided by adjusted weighted average shares 51,718 50,471 73,265 50,388
GAAP diluted earnings (loss) per share $ 0.12 $ (0.81) $ 0.89 $ (2.30)
Non-GAAP basis
Non-GAAP net income attributable to Unisys Corporation for diluted earnings per share $ 28.6 $ 22.7 * $ 71.9 $ 53.8 *
Divided by Non-GAAP adjusted weighted average shares 73,586 72,580 73,265 72,564
Non-GAAP diluted earnings per share $ 0.39 $ 0.31 * $ 0.98 $ 0.74 *
* Certain amounts have been reclassified to conform to the current-year presentation.
UNISYS CORPORATION
RECONCILIATIONS OF GAAP TO NON-GAAP
(Unaudited)
(Millions)
FREE CASH FLOW
Three Months Nine Months
Ended September 30, Ended September 30,
2018 2017 2018 2017
Cash (used for) provided by operations $ (15.5) $ 53.9 $ (77.4) $ (36.3)
Additions to marketable software (20.6) (17.8) (61.7) (46.6)
Additions to properties (15.1) (5.9) (25.0) (21.8)
Additions to outsourcing assets (12.0) (23.2) (54.4) (60.1)
Free cash flow (63.2) 7.0 (218.5) (164.8)
Postretirement funding 51.6 43.0 * 124.5 119.2 *
Cost reduction and other payments, net of reimbursements 5.2 20.2 32.2 49.0
Adjusted free cash flow $ (6.4) $ 70.2 * $ (61.8) $ 3.4 *
* Certain amounts have been reclassified to conform to the current-year presentation.
UNISYS CORPORATION
RECONCILIATIONS OF GAAP TO NON-GAAP
(Unaudited)
(Millions)
EBITDA
Three Months Nine Months
Ended September 30, Ended September 30,
2018 2017 2018 2017
Net income (loss) attributable to Unisys Corporation $ 6.1 $ (41.1) $ 50.5 $ (115.8)
common shareholders
Net income (loss) attributable to noncontrolling interests 0.9 (11.8) 4.2 (5.3)
Interest expense, net of interest income of $2.7, $2.5, $9.0, $7.2 respectively** 13.2 13.9 39.2 29.2
Provision for income taxes 15.2 12.5 50.4 21.6
Depreciation 26.4 22.8 79.9 68.9
Amortization 14.2 15.3 42.8 47.1
EBITDA $ 76.0 $ 11.6 $ 267.0 $ 45.7
Topic 606 adjustment $ - $ - $ (53.0) $ -
Postretirement expense 19.7 25.3 * 58.2 74.5 *
Cost reduction and other expense*** (4.0) 45.8 (6.2) 100.2
Non-cash share based expense 2.7 2.4 10.0 8.6
Other (income) expense adjustment**** 1.7 5.1 12.0 14.9
Adjusted EBITDA $ 96.1 $ 90.2 * $ 288.0 $ 243.9 *
*Certain amounts have been reclassified to conform to the current-year presentation.
**Included in other (income) expense, net on the consolidated statements of income
***Reduced for depreciation and amortization included above
****Other (income) expense, net as reported on the consolidated statements of income less postretirement expense, interest income and items included in cost reduction and other expense
UNISYS CORPORATION
RECONCILIATIONS OF SEGMENT REPORTING TO NON-GAAP SEGMENT REPORTING
(Unaudited)
(Millions)
Three Months Nine Months
Services Segment Ended September 30, Ended September 30,
2018 2017 2018 2017
GAAP total revenue $ 605.6 $ 575.5 $ 1,760.8 $ 1,735.6
Restructuring reimbursement (3.1) - (3.1) -
Non-GAAP revenue $ 602.5 $ 575.5 $ 1,757.7 $ 1,735.6
GAAP gross margin $ 96.1 $ 95.0 * $ 286.9 $ 282.8 *
Restructuring reimbursement (3.1) - (3.1) -
Non-GAAP gross margin $ 93.0 $ 95.0 * $ 283.8 $ 282.8 *
GAAP operating profit $ 18.6 $ 18.7 * $ 54.3 $ 36.6 *
Restructuring reimbursement (3.1) - (3.1) -
Non-GAAP operating profit $ 15.5 $ 18.7 * $ 51.2 $ 36.6 *
GAAP gross margin % 15.9% 16.5% * 16.3% 16.3% *
Non-GAAP gross margin % 15.4% 16.5% * 16.1% 16.3% *
GAAP operating profit % 3.1% 3.2% * 3.1% 2.1% *
Non-GAAP operating profit % 2.6% 3.2% * 2.9% 2.1% *
Three Months Nine Months
Technology Segment Ended September 30, Ended September 30,
2018 2017 2018 2017
GAAP total revenue $ 87.0 $ 95.2 $ 321.6 $ 276.5
Topic 606 impact - - (53.0) -
Non-GAAP revenue $ 87.0 $ 95.2 $ 268.6 $ 276.5
GAAP gross margin $ 54.3 $ 50.7 * $ 214.4 $ 147.0 *
Topic 606 impact - - (53.0) -
Non-GAAP gross margin $ 54.3 $ 50.7 * $ 161.4 $ 147.0 *
GAAP operating profit $ 34.5 $ 29.6 * $ 154.7 $ 77.0 *
Topic 606 impact - - (53.0) -
Non-GAAP operating profit $ 34.5 $ 29.6 * $ 101.7 $ 77.0 *
GAAP gross margin % 62.4% 53.3% * 66.7% 53.2% *
Non-GAAP gross margin % 62.4% 53.3% * 60.1% 53.2% *
GAAP operating profit % 39.7% 31.1% * 48.1% 27.8% *
Non-GAAP operating profit % 39.7% 31.1% * 37.9% 27.8% *
Three Months Nine Months
Total Unisys Ended September 30, Ended September 30,
2018 2017 2018 2017
GAAP total revenue $ 688.3 $ 666.3 $ 2,064.1 $ 1,997.0
Topic 606 impact - - (53.0) -
Restructuring reimbursement (3.1) - (3.1) -
Non-GAAP revenue $ 685.2 $ 666.3 $ 2,008.0 $ 1,997.0
GAAP gross margin $ 153.8 $ 103.6 * $ 507.9 $ 360.9 *
Topic 606 impact - - (53.0) -
Restructuring reimbursement (3.1) - (3.1) -
Postretirement expense - 0.8 * - 3.1 *
Cost reduction expense (0.7) 42.7 (4.2) 70.8
Non-GAAP gross margin $ 150.0 $ 147.1 * $ 447.6 $ 434.8 *
GAAP operating profit (loss) $ 55.8 $ (2.9) * $ 211.6 $ 15.4 *
Topic 606 impact - - (53.0) -
Restructuring reimbursement (3.1) - (3.1) -
Postretirement expense 1.0 1.2 * 2.9 4.6 *
Cost reduction expense (0.9) 51.7 (3.1) 99.6
Non-GAAP operating profit $ 52.8 $ 50.0 * $ 155.3 $ 119.6 *
GAAP gross margin % 22.3% 15.5% * 24.6% 18.1% *
Non-GAAP gross margin % 21.9% 22.1% * 22.3% 21.8% *
GAAP operating profit (loss) % 8.1% (0.4)% * 10.3% 0.8% *
Non-GAAP operating profit % 7.7% 7.5% * 7.7% 6.0% *
*Certain amounts have been reclassified to conform to the current-year presentation.
CONTACT: Investors: Courtney Holben, Unisys, 215-986-3379,
courtney.holben@unisys.com; Media: John Clendening, Unisys, 214-403-1981,
john.clendening@unisys.com
Copyright (c) 2018 PR Newswire Association,LLC. All Rights ReservedRecent news on Unisys
See all newsREG - Official List - Removal-UNISYS CORPORATION
AnnouncementREG - Stock Exch Notice Unisys Corp - Cancellation - UNISYS CORPORATION
AnnouncementREG-Unisys Corporation: Unisys Announces 2Q24 Results
AnnouncementREG-Unisys Corporation: Unisys Announces 1Q24 Results
AnnouncementREG-Unisys Corporation: Unisys Announces 4Q and Full-Year 2023 Results
Announcement