REG-Unisys Corp: Final Results
22/02/2022 07:15
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
(https://c212.net/c/link/?t=0&l=en&o=3450326-1&h=3985764893&u=http%3A%2F%2Fwww.unisys.com%2F&a=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 22(nd) 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
(https://c212.net/c/link/?t=0&l=en&o=3450326-1&h=2947250258&u=http%3A%2F%2Funisys.com%2F&a=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
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