REG-Unisys Corp: Unisys Announces Full-Year 2017 Financial Results <Origin Href="QuoteRef">UIS.N</Origin>
09/02/2018 07:36
Unisys Announces 2017 Financial Results -- Exceeds or Achieves Full-Year
Guidance on All Guidance Metrics
Company generates fourth-quarter 2017 total revenue of $747 million,
representing growth of 3.5 percent year-over-year
BLUE BELL, Pa., Feb. 8, 2018 --
2017
* Exceeded or achieved full-year guidance on all guidance metrics
* Services backlog up 10.3 percent year over year to $4.3 billion, the highest
level since YE 2015
* Total ACV((2)) up 22 percent year-over-year; Total TCV((1)) up 8 percent
year-over-year
* Pension deficit declined $390 million to end 2017 at $1.78 billion
4Q 17
* Total revenue of $747 million, representing growth of 3.5 percent
year-over-year
* Operating cash flow of $203 million, up $88 million relative to $115 million
in prior-year quarter
* Adjusted free cash flow((5)) of $204 million, up $89 million relative to
$115 million in prior-year quarter
Unisys Corporation (http://www.unisys.com/) (NYSE: UIS) today reported
full-year and fourth-quarter 2017 financial results, exceeding or achieving
guidance for all guidance metrics. The company also reported accelerated
contract signings for the year with Annual Contract Value (or "ACV") up 22
percent year over year and Total Contract Value (or "TCV") up 8 percent year
over year. Services backlog was up 10.3 percent year over year.
The company also achieved revenue growth in the fourth quarter 2017 of 3.5
percent year over year. In addition, the company saw strong contract signings
during the quarter, supported by significant new business signings (which
include new logo and new scope). New business ACV and TCV were up 168
percent and 165 percent, respectively, in the quarter, and total ACV and TCV
were up 115 percent and 148 percent, respectively.
"Our 2017 results are strong and indicate that Unisys is on track with its
strategic plan," said Unisys President and CEO Peter A. Altabef. "We delivered
on our goals for the year, exceeding or achieving guidance on all guidance
metrics. These results represent the second consecutive year of achieving or
exceeding full-year guidance since we re-established the process of issuing it
two years ago."
"We had a solid fourth quarter, and signings and backlog entering 2018 are
strong. We have begun the new year focused on ongoing execution of our
go-to-market strategy and continued financial discipline."
Summary of Full-Year 2017 Business Results
Company:
2017 revenue of $2.74 billion came in at the high end of the guidance range of
$2.65-2.75 billion, driven by strong execution against the company's
go-to-market strategy. These results represent a 2.7 percent year-over-year
decline (a 370 basis-point improvement versus the rate of decline in 2016), or
a 3.3 percent decline on a constant-currency basis((3)).
Operating profit margin (which includes cost-reduction and other charges and
pension expense) was 0.2 percent, down 150 basis points versus 2016. The
company exceeded guidance on non-GAAP operating profit margin,((6)) which was
8.5 percent, up 80 basis points year over year, reflecting ongoing focus on
cost discipline and improving the company's cost structure overall.
In 2017, operating cash flow was $166 million. 2017 adjusted free cash flow
exceeded full-year guidance of $130-170 million, coming in at $199 million,
versus $278 million in 2016. At December 31, 2017, the company had $734
million in cash and cash equivalents, up $363 million year-over-year.
The company's pension deficit declined $390 million from the
previously-reported amount to end 2017 at $1.78 billion.
Net loss for 2017 was $65 million, versus a net loss of $48 million in 2016.
Unisys recorded a benefit for refunds of U.S. alternative minimum tax ("AMT")
credits of $50 million in 2017, $29 million of which is a result of U.S. tax
legislation enacted in December 2017.
Adjusted EBITDA((7)) for 2017 was up 4.0 percent year over year to $400
million. Adjusted EBITDA margin for 2017 was 14.6 percent, up 100 basis points
year over year, reflecting the company's execution on its cost plans.
Total ACV was up 22 percent year over year, and new business ACV was up 93
percent year-over-year. TCV was up 8 percent year-over-year, and new
business TCV was up 89 percent year-over-year.
Services:
Services revenue of $2.33 billion, which represented 85 percent of 2017 total
revenue, saw a 440-basis-point improvement relative to the rate of decline in
the prior year, with a 3.2 percent year-over-year decline as reported and a
decline of 3.7 percent in constant-currency. Services backlog grew 10.3
percent year-over-year to end 2017 at $4.3 billion, the highest level since
year end 2015. Services gross margin was up 60 basis points year-over-year to
16.8 percent. Services operating profit margin was up 90 basis points
year-over-year to 2.8 percent.
Technology:
Technology revenue in 2017 grew 0.2 percent year-over-year as reported and
declined 0.8 percent in constant currency to $415 million, which represented
15 percent of total 2017 revenue. Technology gross margin for 2017 was 59.3
percent, versus 59.9 percent in 2016, and Technology operating profit margin
was up 180 basis points year-over-year to 38.8 percent.
Summary of Fourth-Quarter 2017 Business Results
Company:
Fourth quarter revenue grew 3.5 percent year-over-year to $747 million (up 0.8
percent year-over-year on a constant-currency basis). Fourth quarter operating
profit margin (which includes cost-reduction and other charges and pension
expense) was up 310 basis points versus the prior-year period to 8.0 percent.
Non-GAAP operating profit margin was up 610 basis points year-over-year to
15.8 percent.
Net income for the fourth quarter was $51 million, versus a net loss of $1
million in the prior-year period. Unisys recorded a benefit for U.S. AMT
credit refunds of $29 million in the fourth quarter.
Adjusted EBITDA for the fourth quarter grew 41.7 percent year-over-year to
$161 million. Adjusted EBITDA margin for the fourth quarter of 21.6 percent
was up 580 basis points relative to the prior-year period.
In the fourth-quarter 2017, operating cash flow was $203 million, up $88
million versus $115 million in the prior-year period. Adjusted free cash flow
in the fourth quarter was $204 million, up $89 million versus $115 million in
the prior-year period.
Total ACV was up 115 percent year-over-year, and new business ACV was up 168
percent year-over-year for the fourth quarter. Total TCV was up 148 percent
year-over-year, and new business TCV was up 165 percent year-over-year for the
fourth quarter.
Services:
Services revenue of $593 million, which represented 79 percent of
fourth-quarter total revenue, saw less than a 1 percent year-over-year decline
as reported (a 740-basis-point improvement relative to the rate of decline in
the prior year) and a decline of 2.8 percent in constant currency. Services
gross margin was up 90 basis points year over year to 18.1 percent. Services
operating profit margin was up 230 basis points year-over-year to 4.8
percent.
Technology:
Technology revenue in the fourth quarter was up 23.0 percent year-over-year as
reported and 17.7 percent in constant currency to $154 million, which
represented 21 percent of total fourth-quarter revenue. Technology gross
margin for the fourth quarter was up 1,030 basis points year-over-year to 69.5
percent, and Technology operating profit margin was up 1,800 basis points
year-over-year to 57.3 percent.
Key Fourth-Quarter Contract Signings:
In the fourth quarter, the company entered into several key contracts in each
of its sectors including the following:
* U.S. Federal: Unisys signed a contract to expand its offerings to the U.S.
Department of Agriculture ("USDA") Office of the Chief Information Officer to
now provide IT support services. Working with a partner, Unisys will provide
these services as a building block for USDA's IT modernization efforts.
* Public: The European Central Bank ("ECB"), a key institution of the European
Union and the central bank for the euro and monetary policy of the eurozone,
signed a contract for Unisys to manage its IT operations. This includes next
generation digital workplace services for end user support, service desk, data
center and network management; designed to improve availability of services
and end user experience. ECB is a new client for Unisys.
* Commercial: Unisys signed a contract with a U.S.-based pharmaceutical
company for infrastructure and security services, including Unisys Stealth(®)
microsegmentation software, designed to optimize their environment via the
cloud and meet the company's digital transformation objectives. Unisys is
providing intelligent and adaptive IT services that will deliver continued
innovation for improved business outcomes.
* Financial Services: Business process transformation company Sutherland
Global selected Unisys' innovative banking solution Elevate™ to deliver
efficient, scalable and regulatory-compliant omnichannel banking to its UK
mortgage customers with services set to launch later in 2018.
Conference Call
Unisys will hold a conference call today at 5:30 p.m. Eastern Time to discuss
its results. The listen-only webcast, as well as the accompanying presentation
materials, can be accessed on the Unisys Investor website at
www.unisys.com/investor. Following the call, an audio replay of the webcast,
and accompanying presentation materials, can be accessed through the same
link.
((1)) Total Contract Value - TCV is the estimated total contractual revenue
related to signed contracts including option years and without regard for
cancellation terms. New business TCV represents TCV attributable to new scope
for existing clients and new logo contracts.
((2)) Annual Contract Value – ACV represents the revenue expected to be
recognized during the first twelve months following the signing of a contract.
((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.
Non-GAAP and Other Information
Although appropriate under generally accepted accounting principles ("GAAP"),
the company's results reflect charges that the company believes are not
indicative of its ongoing operations and that can make its profitability and
liquidity results difficult to compare to prior periods, anticipated future
periods, or to its competitors' results. These items consist of pension and
cost-reduction and other expense. Management believes each of these items can
distort the visibility of trends associated with the company's ongoing
performance. Management also believes that the evaluation of the company's
financial performance can be enhanced by use of supplemental presentation of
its results that exclude the impact of these items in order to enhance
consistency and comparativeness with prior or future period results. The
following measures are often provided and utilized by the company's
management, analysts, and investors to enhance comparability of year-over-year
results, as well as to compare results to other companies in our industry.
((4)) 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.
((5)) Adjusted free cash flow - Because inclusion of the company's pension
contributions and cost-reduction and other payments in free cash flow may
distort the visibility of the company's ability to generate cash flow from its
operations without the impact of these non-operational costs, management
believes that investors may be interested in adjusted free cash flow, which
provides free cash flow before these payments. This liquidity measure was
provided to analysts and investors in the form of external guidance and is
used by management to measure operating liquidity.
((6)) Non-GAAP operating profit - The company recorded pretax pension expense
and pretax charges in connection with cost-reduction activities and other
expenses. For the company, non-GAAP operating profit excluded these items. The
company believes that this profitability measure is more indicative of the
company's operating results and aligns those results to the company's external
guidance which is used by the company's management to allocate resources and
may be used by analysts and investors to gauge the company's ongoing
performance.
((7)) EBITDA & adjusted EBITDA – Earnings before interest, taxes,
depreciation and amortization ("EBITDA") is calculated by starting with net
income (loss) attributable to Unisys Corporation common shareholders and
adding or subtracting the following items: net income attributable to
noncontrolling interests, interest expense (net of interest income), provision
for income taxes, depreciation and amortization. Adjusted EBITDA further
excludes pension expense, cost-reduction and other expense, non-cash
share-based expense, and other (income) expense adjustment. In order to
provide investors with additional understanding of the company's operating
results, these charges are excluded from the adjusted EBITDA calculation.
((8)) Non-GAAP diluted earnings per share - The company has recorded pension
expense and charges in connection with cost-reduction activities and other
expenses. Management believes that investors may have a better understanding
of the company's performance and return to shareholders by excluding these
charges from the GAAP diluted earnings/loss per share calculations. The tax
amounts presented for these items for the calculation of non-GAAP diluted
earnings per share include the current and deferred tax expense and benefits
recognized under GAAP for these amounts.
About Unisys
Unisys Corporation is a global information technology company that specializes
in providing industry-focused services and software solutions integrated with
leading-edge security to clients in the government, commercial and financial
services markets. Our offerings include security solutions, advanced data
analytics, cloud and infrastructure services, application workspace services,
operating system software and application solutions. For more information,
visit www.unisys.com.
Forward-Looking Statements
Any statements contained in this release that are not historical facts are
forward-looking statements as defined in the Private Securities Litigation
Reform Act of 1995. Forward-looking statements include, but are not limited
to, any projections of earnings, revenues, annual contract value, total
contract value or other financial items; any statements of the company's
plans, strategies or objectives for future operations; statements regarding
future economic conditions or performance; and any statements of belief or
expectation. All forward-looking statements rely on assumptions and are
subject to various risks and uncertainties that could cause actual results to
differ materially from expectations. In particular, statements concerning
annual and total contract value are based, in part, on the assumption that all
options of the contracts included in the calculation of such value will be
exercised and that each of those contracts will continue for their full
contracted term. Risks and uncertainties that could affect the company's
future results include, 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; a
termination of the company's U.S. 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-K 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.: 0208/9566
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 December 31, Year Ended December 31,
2017 2016 2017 2016
Revenue
Services $ 592.6 $ 596.5 $ 2,328.2 $ 2,406.3
Technology 154.0 125.2 415.4 414.4
746.6 721.7 2,743.6 2,820.7
Costs and expenses
Cost of revenue:
Services 531.2 498.8 2,102.1 2,092.9
Technology 45.2 62.7 162.5 169.2
576.4 561.5 2,264.6 2,262.1
Selling, general and administrative 100.9 109.8 426.5 455.6
Research and development 9.5 14.9 47.2 55.4
686.8 686.2 2,738.3 2,773.1
Operating income 59.8 35.5 5.3 47.6
Interest expense 16.4 7.5 52.8 27.4
Other income (expense), net (15.2) (3.4) (23.8) 0.3
Income (loss) before income taxes 28.2 24.6 (71.3) 20.5
(Benefit) provision for income taxes (27.0) 23.0 (5.4) 57.2
Consolidated net Income (loss) 55.2 1.6 (65.9) (36.7)
Net income (loss) attributable to noncontrolling interests 4.0 2.8 (1.3) 11.0
Net income (loss) attributable to Unisys Corporation common shareholders $ 51.2 $ (1.2) $ (64.6) $ (47.7)
Earnings (loss) per share attributable to Unisys Corporation
Basic $ 1.01 $ (0.02) $ (1.28) $ (0.95)
Diluted $ 0.77 $ (0.02) $ (1.28) $ (0.95)
Shares used in the per share computations (in thousands):
Basic 50,475 50,085 50,409 50,060
Diluted 72,596 50,085 50,409 50,060
UNISYS CORPORATION
SEGMENT RESULTS
(Unaudited)
(Millions)
Total Eliminations Services Technology
Three Months Ended December 31, 2017
Customer revenue $ 746.6 $ — $ 592.6 $ 154.0
Intersegment (10.8) — 10.8
Total revenue $ 746.6 $ (10.8) $ 592.6 $ 164.8
Gross profit percent 22.8 % 18.1 % 69.5 %
Operating profit percent 8.0 % 4.8 % 57.3 %
Three Months Ended December 31, 2016
Customer revenue $ 721.7 $ — $ 596.5 $ 125.2
Intersegment — (5.3) — 5.3
Total revenue $ 721.7 $ (5.3) $ 596.5 $ 130.5
Gross profit percent 22.2 % 17.2 % 59.2 %
Operating profit percent 4.9 % 2.5 % 39.3 %
Total Eliminations Services Technology
Year Ended December 31, 2017
Customer revenue $ 2,743.6 $ — $ 2,328.2 $ 415.4
Intersegment (25.9) — 25.9
Total revenue $ 2,743.6 $ (25.9) $ 2,328.2 $ 441.3
Gross profit percent 17.5 % 16.8 % 59.3 %
Operating profit percent 0.2 % 2.8 % 38.8 %
Year Ended December 31, 2016
Customer revenue $ 2,820.7 $ — $ 2,406.3 $ 414.4
Intersegment (22.6) — 22.6
Total revenue $ 2,820.7 $ (22.6) $ 2,406.3 $ 437.0
Gross profit percent 19.8 % 16.2 % 59.9 %
Operating profit percent 1.7 % 1.9 % 37.0 %
UNISYS CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Millions)
December 31, 2017 December 31, 2016
Assets
Current assets:
Cash and cash equivalents $ 733.9 $ 370.6
Accounts receivable, net 504.7 505.8
Inventories:
Parts and finished equipment 13.6 14.0
Work in process and materials 12.5 15.0
Prepaid expenses and other current assets 125.1 121.9
Total current assets 1,389.8 1,027.3
Properties 898.8 886.6
Less-Accumulated depreciation and amortization 756.3 741.3
Properties, net 142.5 145.3
Outsourcing assets, net 202.3 172.5
Marketable software, net 138.3 137.0
Prepaid postretirement assets 148.3 33.3
Deferred income taxes 119.9 146.1
Goodwill 180.8 178.6
Restricted cash 30.2 30.5 *
Other long-term assets 190.6 151.0 *
Total assets $ 2,542.7 $ 2,021.6
Liabilities and deficit
Current liabilities:
Current maturities of long-term-debt $ 10.8 $ 106.0
Accounts payable 241.8 189.0
Deferred revenue 327.1 337.4
Other accrued liabilities 391.5 349.2
Total current liabilities 971.2 981.6
Long-term debt 633.9 194.0
Long-term postretirement liabilities 2,004.4 2,292.6
Long-term deferred revenue 159.0 117.6
Other long-term liabilities 99.9 83.2
Commitments and contingencies
Total deficit (1,325.7) (1,647.4)
Total liabilities and deficit $ 2,542.7 $ 2,021.6
* Certain amounts have been reclassified to conform to the current-year presentation.
UNISYS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Millions)
Year Ended December 31,
2017 2016
Cash flows from operating activities
Consolidated net loss $ (65.9) $ (36.7)
Adjustments to reconcile consolidated net loss to net cash provided by operating activities:
Foreign currency transaction losses 11.9 0.4
Non-cash interest expense 9.5 7.0
Loss on debt extinguishment 1.5 4.0
Employee stock compensation 11.2 9.5
Depreciation and amortization of properties 39.7 38.9
Depreciation and amortization of outsourcing assets 53.7 51.9
Amortization of marketable software 63.1 64.8
Other non-cash operating activities 3.3 1.9
Loss on disposal of capital assets 5.0 6.2
Pension contributions (138.4) (132.5)
Pension expense 92.4 82.7
Decrease in deferred income taxes, net 3.4 2.7
Changes in operating assets and liabilities:
Receivables, net 4.5 87.3
Inventories 4.1 15.3
Other assets 14.9 16.5 *
Accounts payable and other accrued liabilities 16.6 7.5 *
Other liabilities 35.9 (9.2)
Net cash provided by operating activities 166.4 218.2
Cash flows from investing activities
Proceeds from investments 4,717.2 4,455.9
Purchases of investments (4,692.4) (4,490.0)
Capital additions of properties (25.8) (32.5)
Capital additions of outsourcing assets (86.3) (51.3)
Investment in marketable software (64.4) (63.3)
Other (0.8) (0.9) *
Net cash used for investing activities (152.5) (182.1) *
Cash flows from financing activities
Proceeds from issuance of long-term debt 452.9 213.5
Payments for capped call transactions — (27.3)
Issuance costs relating to long-term debt (12.1) (7.3)
Payments of long-term debt (107.5) (129.8)
Net payments of short-term borrowings — (65.8)
Financing fees (1.1) —
Other (2.3) (0.4) *
Net cash provided by (used for) financing activities 329.9 (17.1) *
Effect of exchange rate changes on cash, cash equivalents and restricted cash 19.2 (14.7) *
Increase in cash, cash equivalents and restricted cash 363.0 4.3 *
Cash, cash equivalents and restricted cash, beginning of year 401.1 396.8 *
Cash, cash equivalents and restricted cash, end of year $ 764.1 $ 401.1 *
* Certain amounts have been reclassified to conform to the current-year presentation.
UNISYS CORPORATION
RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES
(Unaudited)
(Millions, except per share data)
Three Months Year Ended
Ended December 31, December 31,
2017 2016 2017 2016
GAAP net income (loss) attributable to Unisys Corporation common shareholders $ 51.2 $ (1.2) $ (64.6) $ (47.7)
Cost reduction and other expense: pretax 49.4 18.7 149.9 90.4
tax provision (benefit) (2.0) 0.7 (12.2) (4.0)
net of tax 47.4 19.4 137.7 86.4
minority interest — — (11.1) —
net of minority interest 47.4 19.4 126.6 86.4
Pension expense: pretax 23.0 19.7 92.4 82.7
tax provision 0.6 0.6 2.3 1.5
net of tax 23.6 20.3 94.7 84.2
Non-GAAP net income attributable to Unisys Corporation common shareholders 122.2 38.5 156.7 122.9
Add interest expense on convertible notes 4.8 4.7 19.0 14.5
Non-GAAP net income attributable to Unisys Corporation for diluted earnings per share $ 127.0 $ 43.2 $ 175.7 $ 137.4
Weighted average shares (thousands) 50,475 50,085 50,409 50,060
Plus incremental shares from assumed conversion:
Employee stock plans 253 402 295 233
Convertible notes 21,868 21,868 21,868 17,230
Non-GAAP adjusted weighted average shares 72,596 72,355 72,572 67,523
Diluted earnings (loss) per share
GAAP basis
GAAP net income (loss) attributable to Unisys Corporation for diluted earnings per share $ 56.0 $ (1.2) $ (64.6) $ (47.7)
Divided by adjusted weighted average shares 72,596 50,085 50,409 50,060
GAAP diluted earnings (loss) per share $ 0.77 $ (0.02) $ (1.28) $ (0.95)
Non-GAAP basis
Non-GAAP net income attributable to Unisys Corporation for diluted earnings per share $ 127.0 $ 43.2 $ 175.7 $ 137.4
Divided by Non-GAAP adjusted weighted average shares 72,596 72,355 72,572 67,523
Non-GAAP diluted earnings per share $ 1.75 $ 0.60 $ 2.42 $ 2.03
UNISYS CORPORATION
RECONCILIATION OF GAAP OPERATING PROFIT TO NON-GAAP OPERATING PROFIT
(Unaudited)
(Millions)
Three Months Year Ended
Ended December 31, Ended December 31,
2017 2016 2017 2016
GAAP operating profit $ 59.8 $ 35.5 $ 5.3 $ 47.6
Cost reduction and other expense 35.4 14.7 135.0 86.4
FAS87 pension expense 23.0 19.7 92.4 82.7
Non-GAAP operating profit $ 118.2 $ 69.9 $ 232.7 $ 216.7
Customer revenue $ 746.6 $ 721.7 $ 2,743.6 $ 2,820.7
GAAP operating profit % 8.0 % 4.9 % 0.2 % 1.7 %
Non-GAAP operating profit % 15.8 % 9.7 % 8.5 % 7.7 %
UNISYS CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP
(Unaudited)
(Millions)
FREE CASH FLOW
Three Months Year Ended
Ended December 31, Ended December 31,
2017 2016 2017 2016
Cash provided by operations $ 202.7 $ 115.2 * $ 166.4 $ 218.2
Additions to marketable software (17.8) (16.2) (64.4) (63.3)
Additions to properties (4.0) (14.2) (25.8) (32.5)
Additions to outsourcing assets (26.2) (9.9) (86.3) (51.3)
Free cash flow 154.7 74.9 * (10.1) 71.1
Pension funding 27.6 28.5 138.4 132.5
Cost reduction and other payments 21.3 11.7 70.3 74.0
Adjusted free cash flow $ 203.6 $ 115.1 * $ 198.6 $ 277.6
* Certain amounts have been reclassified to conform to the current-year presentation.
UNISYS CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP
(Unaudited)
(Millions)
EBITDA
Three Months Year Ended
Ended December 31, December 31,
2017 2016 2017 2016
Net income (loss) attributable to Unisys Corporation common shareholders $ 51.2 $ (1.2) $ (64.6) $ (47.7)
Net income (loss) attributable to noncontrolling interests 4.0 2.8 (1.3) 11.0
Interest expense, net of interest income of $2.7, $2.7, $9.9, $11.2, respectively* 13.7 4.8 42.9 16.2
(Benefit) provision for income taxes (27.0) 23.0 (5.4) 57.2
Depreciation 24.5 22.5 93.4 90.8
Amortization 16.0 16.8 63.1 64.8
EBITDA $ 82.4 $ 68.7 $ 128.1 $ 192.3
Pension expense 23.0 19.7 92.4 82.7
Cost reduction and other expense*** 49.4 17.5 149.6 89.2
Non-cash share based expense 2.6 1.8 11.2 9.5
Other (income) expense adjustment** 3.9 6.1 18.8 10.9
Adjusted EBITDA $ 161.3 $ 113.8 $ 400.1 $ 384.6
* Included in Other (income) expense, net on the Consolidated Statements of Income
** Other (income) expense, net as reported on the Consolidated Statements of Income less interest income and items included in cost reduction and other expense
*** Reduced for depreciation and amortization included above
CONTACT: Investors: Courtney Holben, Unisys, 215-986-3379,
courtney.holben@unisys.com; Media: John Clendening, Unisys, 214-403-1981,
john.clendening@unisys.com
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