REG-Unisys Corp: 3rd Quarter Results
03/11/2021 07:05
Unisys Announces 3Q21 Results
Cloud & Infrastructure Revenue Growth Continues; Total Company Gross Profit
and Free Cash Flow Grow Year Over Year; Company Reaffirms FY 2021 Guidance
BLUE BELL, Pa., Nov. 2, 2021 --
* Continued growth in Cloud & Infrastructure Solutions ("C&I"), with segment
revenue up 1.7% YoY
* Total company gross profit grew 5.8% YoY and gross margin increased 180 bps
YoY
* Cash from operations was $65.5M vs. $66.3M in prior-year period; Free cash
flow((7)) increased 14.9% YoY to $39.4M; Adjusted free cash flow((8))
increased 36.3% YoY to $69.9M
* Company reaffirms FY 2021 guidance of 0 to 2% YoY revenue growth, 9 to 10%
non-GAAP operating profit margin, and 17.25 to 18.25% adjusted EBITDA margin
* Unisys CFO Mike Thomson to become president and COO
Unisys Corporation
(https://c212.net/c/link/?t=0&l=en&o=3344718-1&h=1433325051&u=http%3A%2F%2Fwww.unisys.com%2F&a=Unisys+Corporation) (NYSE:
UIS) today reported third-quarter 2021 financial results. "During the third
quarter, we made continued progress executing on our strategy for sustained
revenue growth and margin improvement by expanding the company's solution
portfolio and enhancing go-to-market efforts, while proactively managing the
workforce to successfully attract and retain talent in a competitive labor
market," said Unisys Chair and CEO Peter A. Altabef. "We did this while
increasing gross profit, free cash flow and total contract value year over
year."
Summary of Third-Quarter 2021 Results
* Revenue: * Revenue was $488.0M vs. $495.2M in 3Q20, down 1.5% YoY * The
company saw continued revenue growth in C&I and Enterprise Computing Solutions
("ECS") year over year. Digital Workplace Solutions ("DWS") revenue declined
due to exiting some contracts that were not core to how it plans to grow this
business and impacts related to global supply chain shortages.
* Gross Profit: * Gross profit increased 5.8% YoY to $126.9M vs. $119.9M in
3Q20
* Gross profit margin increased 180 bps YoY to 26.0% vs. 24.2% in 3Q20
* Operating Profit: * Operating profit was $25.1M vs. $27.7M in 3Q20 *
Non-GAAP operating profit((4)) was $28.0M vs. $42.4M in 3Q20
* Operating profit margin was 5.1% vs. 5.6% in 3Q20 * Non-GAAP operating
profit margin was 5.7% vs. 8.6% in 3Q20
* SG&A increased year over year largely due to increased investments in the
company's go-to-market efforts, primarily related to direct sales support and
increases to non-cash-based compensation.
* Adjusted EBITDA and Net Income: * Adjusted EBITDA((5)) was $74.6M vs. $82.3M
in 3Q20 * Adjusted EBITDA margin was 15.3% vs. 16.6% in 3Q20
* Net loss from continuing operations was $18.7M vs. a net loss of $13.3M in
3Q20 * Net income margin of (3.8)% vs. (2.7)% in 3Q20 (110 bps decline)
* Non-GAAP net income from continuing operations((6)) was $6.9M vs. $34.7M in
3Q20 * Non-GAAP net income margin was 1.4% vs. 7.0% in 3Q20
* Adjusted EBITDA was driven by the same items that impacted operating profit,
and net income was impacted by higher taxes year over year as a result of the
geographies in which income was earned.
* Earnings Per Share from Continuing Operations: * Loss per share from
continuing operations of $0.28 vs. a loss of $0.21 in 3Q20, impacted by the
profitability items and higher taxes highlighted above.
* Non-GAAP diluted earnings per share from continuing operations((6)) was
$0.10 vs. $0.51 in 3Q20, also impacted by the noted profitability and
tax-related items.
* Cash Flow: * Cash from operations was $65.5M vs. $66.3M in 3Q20 * Cost
reduction and other payments increased $13.5M year over year, in connection
with the company's profitability improvement initiatives, which impacted cash
from operations.
* Free cash flow improved 14.9% YoY to $39.4M vs. $34.3M in 3Q20
* Adjusted free cash flow improved 36.3% YoY to $69.9M vs. $51.3M in 3Q20
* TCV, Pipeline and Backlog: * Total contract value((3)) was up 13.0% YoY
* Total company pipeline((2)) was up 4.9% sequentially * The pipelines for
proactive experience DWS solutions and cloud solutions each also grew
sequentially, both on a dollar basis and as a percent of the total company
pipeline.
* Total company backlog((1)) of $3.0B vs. $3.3B as of 2Q21 * Total company
backlog was impacted by shifting the mix of business toward higher-growth,
higher-margin solutions and exiting some non-strategic contracts. The duration
of contracts in backlog also shortened in 2021. The types of contracts the
company is shifting toward are less capital intensive and have shorter
implementation times.
* Balance Sheet: * The company continued de-risking the balance sheet with the
removal of additional pension liabilities in October through an annuity
contract valued at $235M.
Leadership Changes
The company announced the appointment of Unisys Chief Financial Officer (CFO)
Mike Thomson as president and chief operating officer (COO), effective upon
the hiring of a new CFO. Thomson has driven the financial transformation of
the company since becoming CFO in 2019, including the substantial
strengthening of the company's balance sheet. Thomson has also played an
important operational role in the company, as he currently runs the company's
corporate development efforts and oversees the strategy function. The company
has begun the search for a new CFO.
Thomson will succeed current Unisys President and COO Eric Hutto, who is
stepping down after 6.5 years of service with the company to pursue other
interests. Hutto, who was instrumental in improving the financial performance
of the company in recent years and in the implementation of the company's new
strategy and operating model, will be leaving his current role on November 30.
Chair and CEO Peter Altabef will assume Hutto's responsibilities on an interim
basis until the CFO transition is complete.
Financial Highlights by Segment:
DWS:
* DWS revenue was $141.3M vs. $148.3M in 3Q20, down 4.7% YoY * As noted above,
as the company exited certain non-strategic contracts within DWS and also saw
some supply chain impacts, both of which impacted revenue.
* DWS gross profit was $16.8M vs. $21.6M in 3Q20 * DWS gross margin was 11.9%
vs. 14.6% in 3Q20
* Gross profit and margin were down year over year largely due to the
flow-through impact of the revenue decline noted above.
* During 3Q21, the company signed a new scope contract with a global
commercial real estate services firm to implement a case management system,
which will help the client move to a centralized global model for this process
and technology.
C&I:
* C&I revenue grew 1.7% YoY to $118.9M vs. $116.9M in 3Q20 * C&I revenue
growth supported by 16.9% YoY growth in C&I revenue in the U.S. & Canada
* C&I gross profit grew 116.3% YoY to $9.3M vs. $4.3M in 3Q20 * C&I gross
margin improved 410 bps YoY to 7.8% vs. 3.7% in 3Q20, reflecting improvements
to margins for both cloud and traditional infrastructure solutions.
* During 3Q21, the company signed a contract with a leading Mexican insurance
company to design a hybrid environment integrating public and private clouds
and to migrate crucial business information from a conventional data center to
that cloud environment.
ECS:
* ECS revenue grew 1.8% YoY to $149.2M vs. $146.6M in 3Q20 * YoY revenue
growth was supported by higher license renewal revenue than anticipated
* ECS services revenue also grew 1% YoY
* ECS gross profit grew 28.8% YoY to $97.0M vs. $75.3M in 3Q20 * ECS gross
margin improved 1360 bps YoY to 65.0% vs. 51.4% in 3Q20
* During 3Q21, the company signed a contract with an Asia Pacific national
government agency to manage IT infrastructure, based on the ClearPath
Forward(®) platform, that supports systems processing approximately 25
million driver's license and 60 million motor vehicle transactions per year.
Conference Call
Unisys will hold a conference call November 3 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)) Total Contract Value – TCV is the estimated total contractual revenue
related to contracts signed in the period without regard for cancellation
terms. New business TCV represents TCV attributable to new scope for existing
clients and new logo contracts.
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.
((4)) 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.
((5)) 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.
((6)) 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.
((7)) 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.
((8)) 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, business process solutions and cybersecurity solutions.
For more information on how Unisys delivers for its clients across the
commercial, financial services and government 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 or expectations of earnings, revenues, 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: uncertainty of the magnitude, duration and
spread of the novel coronavirus ("COVID-19") pandemic and the impact of
COVID-19 and governments' responses to it on the global economy and our
business, growth, reputation, projections, prospects, financial condition,
operations, cash flows and liquidity, our ability to attract, motivate and
retain experienced personnel in key positions; our ability to grow revenue and
expand margin in our Digital Workplace Solutions and Cloud and Infrastructure
businesses; our ability to maintain our installed base and sell new solutions;
the potential adverse effects of aggressive competition in the information
services and technology marketplace; our ability to effectively anticipate and
respond to volatility and rapid technological innovation in our industry; our
ability to retain significant 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; the potential
adverse effects of the concentration of the company's business in the global
commercial sector of the information technology industry; our significant
pension obligations and required cash contributions and the possibility that
we may be required to make additional significant cash contributions to our
defined benefit pension plans; our ability to use our net operating loss
carryforwards and certain other tax attributes may be limited; the risks of
doing business internationally when a significant portion of our revenue is
derived from international operations; the business and financial risk in
implementing future acquisitions or dispositions; cybersecurity breaches could
result in significant costs and could harm our business and reputation; the
performance and capabilities of third parties with whom we have commercial
relationships; a failure to meet standards or expectations with respect to the
company's environmental, social and governance practices; 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; the impact of
Brexit could adversely affect the company's operations in the United Kingdom
as well as the funded status of the company's U.K. pension plans; 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 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.: 1102/9854
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 (LOSS)
(Unaudited)
(Millions, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
Revenue
Services $417.9 $426.0 $1,268.8 $1,247.9
Technology 70.1 69.2 246.3 201.5
488.0 495.2 1,515.1 1,449.4
Costs and expenses
Cost of revenue:
Services 343.1 345.9 1,019.7 1,061.6
Technology 18.0 29.4 87.1 79.9
361.1 375.3 1,106.8 1,141.5
Selling, general and administrative 95.1 85.5 279.7 252.5
Research and development 6.7 6.7 19.1 16.1
462.9 467.5 1,405.6 1,410.1
Operating income 25.1 27.7 109.5 39.3
Interest expense 8.5 2.4 27.0 20.9
Other (expense), net (24.2) (32.5) (434.6) (134.3)
Loss from continuing operations before income taxes (7.6) (7.2) (352.1) (115.9)
Provision for (benefit from) income taxes 10.9 6.1 (33.8) 26.6
Consolidated loss from continuing operations (18.5) (13.3) (318.3) (142.5)
Net income (loss) attributable to noncontrolling interests 0.2 - (1.0) 0.5
Net loss from continuing operations attributable to Unisys Corporation (18.7) (13.3) (317.3) (143.0)
Income from discontinued operations, net of tax - 0.4 - 1,066.8
Net (loss) income attributable to Unisys Corporation $ (18.7) $ (12.9) $ (317.3) $ 923.8
Earnings (loss) per share attributable to Unisys Corporation
Basic
Continuing Operations $ (0.28) $ (0.21) $ (4.79) $ (2.27)
Disontinued Operations - 0.01 - 16.96
Total $ (0.28) $ (0.20) $ (4.79) $ 14.69
Diluted
Continuing Operations $ (0.28) $ (0.21) $ (4.79) $ (2.27)
Disontinued Operations - 0.01 - 16.96
Total $ (0.28) $ (0.20) $ (4.79) $ 14.69
UNISYS CORPORATION
SEGMENT RESULTS
(Unaudited)
(Millions)
Total DWS C&I ECS Other
Three Months Ended September 30, 2021
Customer revenue $ 488.0 $141.3 $118.9 $149.2 $ 78.6
Intersegment - - - - -
Total revenue $ 488.0 $141.3 $118.9 $149.2 $ 78.6
Gross profit percent 26.0 % 11.9 % 7.8 % 65.0 %
Three Months Ended September 30, 2020
Customer revenue $ 495.2 $148.3 $116.9 $146.6 $ 83.4
Intersegment - - - - -
Total revenue $ 495.2 $148.3 $116.9 $146.6 $ 83.4
Gross profit percent 24.2 % 14.6 % 3.7 % 51.4 %
Total DWS C&I ECS Other
Nine Months Ended September 30, 2021
Customer revenue $1,515.1 $428.9 $366.6 $486.3 $233.3
Intersegment - - - 1.4 (1.4)
Total revenue $1,515.1 $428.9 $366.6 $487.7 $231.9
Gross profit percent 26.9 % 13.5 % 10.1 % 62.4 %
Nine Months Ended September 30, 2020
Customer revenue $1,449.4 $442.0 $334.1 $439.2 $234.1
Intersegment - - - 0.1 (0.1)
Total revenue $1,449.4 $442.0 $334.1 $439.3 $234.0
Gross profit percent 21.2 % 8.6 % 2.2 % 52.9 %
UNISYS CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Millions)
September 30, December 31,
2021 2020
Assets
Current assets:
Cash and cash equivalents $ 615.4 $ 898.5
Accounts receivable, net 356.0 460.5
Contract assets 51.3 44.3
Inventories 11.2 13.4
Prepaid expenses and other current assets 91.5 89.3
Total current assets 1,125.4 1,506.0
Properties 616.4 727.0
Less-accumulated depreciation and amortization 530.2 616.5
Properties, net 86.2 110.5
Outsourcing assets, net 136.8 173.9
Marketable software, net 184.8 193.6
Operating lease right-of-use assets 62.9 79.3
Prepaid postretirement assets 123.0 187.5
Deferred income taxes 147.0 136.2
Goodwill 242.9 108.6
Intangible assets, net 16.5 -
Restricted cash 9.1 8.2
Assets held for sale 20.0 -
Other long-term assets 166.8 204.1
Total assets $ 2,321.4 $ 2,707.9
Liabilities and deficit
Current liabilities:
Current maturities of long-term-debt $ 18.8 $ 102.8
Accounts payable 119.7 223.2
Deferred revenue 224.2 257.1
Other accrued liabilities 299.1 352.0
Total current liabilities 661.8 935.1
Long-term debt 514.1 527.1
Long-term postretirement liabilities 1,144.5 1,286.1
Long-term deferred revenue 153.0 137.9
Long-term operating lease liabilities 47.9 62.4
Other long-term liabilities 50.2 71.4
Commitments and contingencies
Total Unisys Corporation stockholders' deficit (294.3) (356.8)
Noncontrolling interests 44.2 44.7
Total deficit (250.1) (312.1)
Total liabilities and deficit $ 2,321.4 $ 2,707.9
UNISYS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Millions)
Nine Months Ended
September 30,
2021 2020
Cash flows from operating activities
Consolidated net loss from continuing operations $ (318.3) $ (142.5)
Income from discontinued operations, net of tax - 1,066.8
Adjustments to reconcile consolidated net loss to net cash provided by (used for) operating activities:
Gain on sale of U.S. Federal business - (1,057.7)
Loss on debt extinguishment - 28.5
Foreign currency losses 3.2 14.3
Non-cash interest expense 1.5 3.5
Employee stock compensation 11.5 11.1
Depreciation and amortization of properties 23.2 22.0
Depreciation and amortization of outsourcing assets 50.8 48.9
Amortization of marketable software 50.9 50.2
Amortization of intangible assets 1.7 -
Other non-cash operating activities (0.1) 0.6
Loss on disposal of capital assets 1.5 3.3
Postretirement contributions (43.6) (344.5)
Postretirement expense 407.7 72.8
Deferred income taxes, net (65.3) (16.9)
Changes in operating assets and liabilities, net of acquisitions
Receivables, net and contract assets 135.0 12.4
Inventories 2.2 1.5
Other assets (4.1) 0.4
Accounts payable and current liabilities (229.6) (127.7)
Other liabilities 36.3 27.2
Net cash provided by (used for) operating activities 64.5 (325.8)
Cash flows from investing activities
Purchase of business (150.4) -
Net proceeds from sale of U.S. Federal business - 1,162.9
Proceeds from investments 3,286.4 2,550.2
Purchases of investments (3,294.6) (2,561.7)
Investments in marketable software (42.1) (54.8)
Capital additions of properties (19.7) (16.7)
Capital additions of outsourcing assets (14.7) (23.6)
Other (0.9) (0.5)
Net cash (used for) provided by investing activities (236.0) 1,055.8
Cash flows from financing activities
Proceeds from issuance of long-term debt 1.5 7.1
Payments of long-term debt (99.1) (451.0)
Cash paid for debt extinguishment - (23.7)
Proceeds from exercise of stock options 4.5 -
Other (7.7) (4.8)
Net cash used for financing activities (100.8) (472.4)
Effect of exchange rate changes on cash, cash equivalents and restricted cash (9.9) (25.3)
(Decrease) increase in cash, cash equivalents and restricted cash (282.2) 232.3
Cash, cash equivalents and restricted cash, beginning of period 906.7 551.8
Cash, cash equivalents and restricted cash, end of period $ 624.5 $ 784.1
UNISYS CORPORATION
RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES
(Unaudited)
(Millions, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
GAAP net loss from continuing operations attributable to Unisys Corporation $(18.7) $(13.3) $(317.3) $(143.0)
Postretirement expense: pretax 13.0 24.4 407.7 72.8
tax 0.4 0.4 52.8 1.1
net of tax 12.6 24.0 354.9 71.7
Cost reduction and other expenses: pretax 13.0 23.8 45.7 98.4
tax - (0.2) 0.6 0.9
net of tax 13.0 24.0 45.1 97.5
noncontrolling interest - - - -
net of noncontrolling interest 13.0 24.0 45.1 97.5
Non-GAAP net income from continuing operations attributable to Unisys Corporation 6.9 34.7 82.7 26.2
Add interest expense on convertible notes - 2.1 - 6.2
Non-GAAP net income attributable to Unisys Corporation for diluted earnings per share $ 6.9 $ 36.8 $ 82.7 $ 32.4
Weighted average shares (thousands) 67,131 63,032 66,211 62,897
Plus incremental shares from assumed conversion:
Employee stock plans 764 613 857 504
Convertible notes - 8,625 - 8,625
Non-GAAP adjusted weighted average shares 67,895 72,270 67,068 72,026
Diluted earnings (loss) per share from continuing operations
GAAP basis
GAAP net loss from continuing operations attributable to Unisys Corporation for diluted earnings per share $(18.7) $(13.3) $(317.3) $(143.0)
Divided by weighted average shares 67,131 63,032 66,211 62,897
GAAP diluted loss per share $(0.28) $(0.21) $ (4.79) $ (2.27)
Non-GAAP basis
Non-GAAP net income (loss) from continuing operations attributable to Unisys Corporation for diluted earnings per share $ 6.9 $ 36.8 $ 82.7 $ 32.4
Divided by Non-GAAP adjusted weighted average shares 67,895 72,270 67,068 72,026
Non-GAAP diluted earnings (loss) per share $ 0.10 $ 0.51 $ 1.23 $ 0.45
UNISYS CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP
(Unaudited)
(Millions)
FREE CASH FLOW
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
Cash provided by (used for) operations $65.5 $66.3 $ 64.5 $(325.8)
Additions to marketable software (12.4) (18.1) (42.1) (54.8)
Additions to properties (7.7) (6.1) (19.7) (16.7)
Additions to outsourcing assets (6.0) (7.8) (14.7) (23.6)
Free cash flow 39.4 34.3 (12.0) (420.9)
Postretirement funding 11.5 11.5 43.6 344.5
Discontinued operations - - - (9.1)
Cost reduction and other payments 19.0 5.5 68.4 23.5
Adjusted free cash flow $69.9 $51.3 $100.0 $ (62.0)
UNISYS CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP
(Unaudited)
(Millions)
EBITDA
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
Net loss from continuing operations attributable to Unisys Corporation $ (18.7) $ (13.3) $ (317.3) $ (143.0)
Net income (loss) attributable to noncontrolling interests 0.2 - (1.0) 0.5
Interest expense, net of interest income of $2.0, $1.3, $5.5, $6.0, respectively* 6.5 1.1 21.5 14.9
Provision for (benefit from) income taxes 10.9 6.1 (33.8) 26.6
Depreciation 25.6 22.6 74.0 70.9
Amortization 17.7 14.2 52.6 50.2
EBITDA $ 42.2 $ 30.7 $ (204.0) $ 20.1
Postretirement expense $ 13.0 $ 24.4 $ 407.7 $ 72.8
Debt extinguishment, cost reduction and other expenses** 11.8 23.8 41.0 90.2
Non-cash share based expense 4.5 3.1 11.5 11.1
Other expense, net adjustment*** 3.1 0.3 6.7 2.4
Adjusted EBITDA $ 74.6 $ 82.3 $ 262.9 $ 196.6
*Included in other (expense), net on the consolidated statements of income (loss)
**Reduced for depreciation and amortization included above
***Other (income) expense, net as reported on the consolidated statements of income (loss) less postretirement expense, interest income and items included in cost reduction and other expenses
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
Revenue $488.0 $495.2 $1,515.1 $1,449.4
Net loss from continuing operations attributable to Unisys Corporation as a percentage of revenue (3.8)% (2.7)% (20.9)% (9.9)%
Adjusted EBITDA as a percentage of revenue 15.3 % 16.6 % 17.4 % 13.6 %
UNISYS CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP
(Unaudited)
(Millions)
OPERATING PROFIT
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
GAAP operating income from continuing operations $ 25.1 $ 27.7 $ 109.5 $ 39.3
Cost reduction and other expenses* 2.1 13.8 17.3 30.8
Postretirement expense** 0.8 0.9 2.7 2.5
Non-GAAP operating profit from continuing operations $ 28.0 $ 42.4 $ 129.5 $ 72.6
Revenue $488.0 $495.2 $1,515.1 $1,449.4
GAAP operating profit percent 5.1 % 5.6 % 7.2 % 2.7 %
Non-GAAP operating profit percent 5.7 % 8.6 % 8.5 % 5.0 %
*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
Contacts: Investors: Courtney Holben, Unisys, 215-986-3379,
courtney.holben@unisys.com, or Media: John Clendening, Unisys, 214-403-1981,
john.clendening@unisys.com
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