3rd Quarter Results
Unisys Corporation
Unisys Announces Preliminary Third-Quarter 2005 Financial Results; Company
Announces Strategic Actions to Drive Profitable Growth, Requiring Review of
Deferred Tax Asset
Unisys Corporation (NYSE:UIS) today reported a preliminary third-quarter 2005
net loss of $54.3 million, or 16 cents per share, including a pre-tax charge of
$10.7 million, or 2 cents per share, related to the company's cash tender for
its 8 1/8% notes due 2006. This compared with third-quarter 2004 net income of
$25.2 million, or 7 cents per diluted share. The year-ago results included a net
benefit of $8.2 million, or 2 cents per diluted share, from a tax benefit net of
a charge for cost reduction actions. The results are preliminary because the
strategic actions being announced today are requiring the company to review the
recoverability of its $1.6 billion deferred tax asset, net. This review will be
completed by the time the company files its timely third-quarter 10Q. The
results of this review could impact the final third-quarter financial results.
The third-quarter 2005 results include pre-tax pension expense of $44.2 million,
or 9 cents per share, compared with pension expense of $23.5 million, or 5 cents
per share, in the year-ago quarter. Excluding the impact of pension expense in
both periods, the third-quarter 2005 net loss was $24.3 million, or 7 cents per
share, compared with net income of $41.1 million, or 12 cents per diluted share,
in the third quarter of 2004. These results include the items discussed above.
Revenue for the third quarter of 2005 declined 4% to $1.39 billion from $1.45
billion in the year-ago quarter. Currency had a 1 percentage-point positive
impact on the company's revenue in the third quarter, reflecting a weak U.S.
dollar against most major currencies worldwide.
Comments from President and CEO Joseph W. McGrath
'We are disappointed by these results, and we are taking decisive actions to
accelerate our repositioning efforts,' said Joseph W. McGrath, Unisys President
and Chief Executive Officer. 'These actions, which are beginning now and will
roll out through 2006, will enable us to focus our resources on high-growth,
high-return market segments, reduce costs, and drive profitable revenue growth.
As these actions take hold, we believe they will enable us to build our
financial momentum and result in significantly improved profitability.'
McGrath said, as a result of its strategic review process, the company will take
actions in the following areas:
-- Focused investments. The company will focus its resources on high-growth
market areas - outsourcing, open source/Linux, Microsoft solutions, and
security - delivered through a vertical industry focus. Within its
technology business, the company remains strongly committed to its
ClearPath and ES7000 systems and will continue to invest in operating
systems and software to drive continuous improvements in new features
and capabilities.
-- Divestitures. As it concentrates its resources on the areas discussed
above, the company plans to divest non-strategic areas of the business
and use the proceeds from such asset sales or divestitures to implement
cost reduction actions, fund its growth businesses, and pursue
complementary tuck-in acquisitions.
-- Cost reduction. The company plans to rightsize its cost structure to
support its more focused business model and to improve margins. As a
result of a series of actions in services delivery, research and
development, and selling, general, and administrative areas, the company
plans to reduce its headcount by 10% of its current workforce over the
next year. Unisys expects to take cost restructuring charges of
approximately $250 - $300 million through 2006 for these actions. These
actions are expected to yield approximately $250 million of annualized
cost savings on a run-rate basis by the end of 2007.
-- Sales and marketing. The company continues to make significant changes
to its sales and marketing programs to support its more focused model
and drive profitable order and revenue growth. In the sales area, Unisys
has recently significantly strengthened its business development skills
by recruiting first-class sales management and personnel and by
implementing high-impact training to more effectively manage
relationships with large accounts and drive new business.
'We believe these actions will position Unisys as a major player in large,
fast-growing market areas, with a competitive cost structure, and a highly
skilled, highly focused workforce,' McGrath said. 'As the actions take hold,
they should enable us to grow at or above industry growth rates, significantly
expand our margins and profitability, and position Unisys as a leader in our
chosen market segments.'
Third-Quarter Company Results
The company reported a decline in overall orders in the third quarter. Services
orders declined double digits, driven by substantial order declines in the
outsourcing business, which can vary substantially from quarter to quarter.
Systems integration and consulting orders grew double digits over a year ago. In
technology, growth in ES7000 orders was offset by order declines for ClearPath
mainframes.
Significant contracts signed in the quarter included:
-- An IT outsourcing contract from the U.S. Department of Health and Human
Services (HHS) under which Unisys will support 8,000 users across eight
HHS operating divisions; the contract has a three-year base period,
worth approximately $65 million, and one two-year option period that is
potentially worth approximately an additional $35 million;
-- A significant, multi-year contract from Lufthansa Systems to provide the
Unisys AirCore solution as the basis for Lufthansa Systems'
next-generation airline passenger management system;
-- A five-year outsourcing contract, valued at approximately $30 million,
from ABN AMRO under which Unisys will process the bank's paper-based
payments in the Netherlands through the Unisys Payment Services and
Solutions (UPSS) operation;
-- A contract from the U.S. Federal Bureau of Prisons to provide systems
and services for the nationwide deployment and operation of a
next-generation federal inmate telephone system; the estimated value of
the three-year base period of the contract is $37 million, and if three
additional one-year options are exercised, the estimated value could be
as high as $96 million.
The company said its financial results in the quarter reflected weakness in its
high-end server business, as a few clients deferred decisions on transactions
that had been expected to close in the quarter. In its services business, the
company's margins were impacted by lower-than-expected revenue, underutilization
of personnel and higher implementation costs in project-based businesses, and
continuing issues in the two challenging outsourcing operations.
Revenue in the U.S. grew 3% to $672 million. Revenue in international markets
declined 10% in the quarter to $715 million.
The company's gross profit margin and operating profit margin in the quarter
were 17.7% and (5.5%), respectively, compared with 23.6% and (2.6%) in the third
quarter of 2004. The year-over-year margin declines were principally due to the
impact of weakness in project-based services, lower sales of enterprise servers,
and higher pension expense. Excluding pension expense in both periods, overall
gross profit margin and operating profit margin for the third quarter of 2005
were 19.9% and (2.3%), respectively, compared with 24.8% and (1.0%) in the third
quarter of 2004.
Third-Quarter Business Segment Results
Unisys has a long-standing policy to evaluate business segment performance on
operating income exclusive of restructuring charges and unusual and
non-recurring items. Therefore, the comparisons below exclude the third-quarter
2004 cost reduction charges discussed above.
Customer revenue in the company's services segment grew 2% in the third quarter
of 2005 compared with the year-ago period. Services revenue growth was driven by
double-digit growth in outsourcing and single-digit growth in infrastructure
services. Growth in these areas was partially offset by a single-digit revenue
decline in systems integration and consulting and a double-digit revenue decline
in core maintenance. On a reported basis, gross profit margin in the services
business declined to 11.3% from 16.2% a year ago, while the services operating
margin was (5.1%) compared with (0.2%) a year ago. The services margin declines
in the quarter primarily reflected the weakness in project-based services as
well as the increase in pension expense. Excluding the impact of pension expense
in both periods, services gross profit margin declined to 13.8% from 17.6% a
year ago, while services operating margin declined to (2.0%) compared with 1.6%
a year ago.
Customer revenue in the company's technology segment declined 29% in the third
quarter. Sales of enterprise servers and specialized equipment both showed
double-digit declines in the quarter. On a reported basis, technology gross
margin declined to 42.4% from 51.0% a year ago, and technology operating margin
declined to (5.9%) from 13.9% a year ago. Excluding the impact of pension
expense in both periods, the technology gross margin decreased to 42.8% in the
third quarter of 2005 from 51.1% in the year-ago quarter and the technology
operating margin declined to (3.0%) compared with 14.7% in the year-ago period.
The technology margin declines in the quarter reflected lower sales and margin
in high-end enterprise servers.
Cash Flow Results
Unisys used $68 million of cash from operations in the quarter compared with
cash flow from operations of $6 million in the year-ago quarter. The decline in
operational cash flow year-over-year was primarily driven by lower net income.
Capital expenditures in the third quarter of 2005 were $85 million, including
$60 million invested in revenue-generating projects. This compared to capital
expenditures of $84 million in the year-ago quarter, including $64 million in
revenue-generating projects.
During the third quarter of 2005 Unisys announced a cash tender offer for all of
its $400 million of 8 1/8% senior notes due June 2006. Holders representing
$342.1 million aggregate principal amount of notes, or about 86% of the notes
outstanding, tendered their notes. The company financed the transaction with the
proceeds of its $550 million of senior notes, which were offered during the
quarter in two tranches -- $400 million of 8% senior notes due 2012 and $150
million of 8 1/2% senior notes due 2015. The company ended the quarter with $466
million of cash on hand.
Business Outlook
'As we work through the current significant changes to our business, we are
taking a conservative view of our financial results over the near term,' McGrath
said. 'We look to close out 2005 with a profitable fourth quarter, excluding any
impact of the planned actions, driven by higher sales of enterprise servers in
our technology business. Our fourth-quarter results will be heavily dependent on
our ability to close a number of very large technology transactions in the
quarter. Given this dependency, our earnings per share, excluding pension
expense and any impact of the planned actions, could range from 10 - 15 cents
per share in the fourth quarter of 2005. We will continue to execute against our
repositioning efforts and take the aggressive actions to drive improved results
in 2006.'
Conference Call
Unisys will hold a conference call today at 8:15 a.m. Eastern Time to discuss
its results. The listen-only Webcast, as well as the accompanying presentation
materials, can be accessed via a link on the Unisys Investor Web site 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.
About Unisys
Unisys is a worldwide information technology services and solutions company. Our
people combine expertise in consulting, systems integration, outsourcing,
infrastructure and server technology with precision thinking and relentless
execution to help clients, in more than 100 countries, quickly and efficiently
achieve competitive advantage. 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, contract values 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, the
company's ability to divest non-strategic areas of the business and to use the
proceeds as planned is dependent upon the market for these businesses and on the
company's ability to sell them for an acceptable price. In addition, the
estimated charges associated with planned cost-reduction actions are subject to
change based upon the degree to which the company generates cash, the location
and length of service of the affected employees, the number of employees who
leave the company voluntarily, and other factors. The anticipated cost savings
associated with the planned headcount reductions are subject to the risk that
the company may not implement the reductions as quickly or as fully as currently
planned. Statements in this release regarding contract values are based upon
various assumptions, which are subject to change, including the projected volume
of products and services to be provided by Unisys, the contracts continuing for
their full term, and for contracts with governmental entities, the availability
of appropriated funds. Accordingly, the contract values are not guaranteed.
Other risks and uncertainties that could affect the company's future results
include general economic and business conditions; the effects of aggressive
competition in the information services and technology markets on the company's
revenues, pricing and margins and on the competitiveness of its product and
services offerings; the level of demand for the company's products and services
and the company's ability to anticipate and respond to changes in technology and
customer preferences; the company's ability to grow outsourcing and
infrastructure services and its ability to effectively and timely complete the
related solutions implementations, client transitions to the new environment and
work force and facilities rationalizations; the company's ability to effectively
address its challenging outsourcing operations through negotiations or
operationally and to fully recover the associated outsourcing assets; the
company's ability to drive profitable growth in consulting and systems
integration; the level of demand for the company's high-end enterprise servers;
the company's ability to effectively rightsize its cost structure; the risks of
doing business internationally and the potential for infringement claims to be
asserted against the company or its clients. Additional discussion of these and
other factors that could affect Unisys future results is contained in its
periodic filings with the Securities and Exchange Commission. Unisys assumes no
obligation to update any forward-looking statements.
Presentation of Information in this Press Release
This release presents information that excludes pension expense. This financial
measure is considered non-GAAP. Generally, a non-GAAP financial measure is a
numerical measure of a company's performance, financial position, or cash flows
where amounts are either excluded or included not in accordance with generally
accepted accounting principles. A reconciliation of this non-GAAP measure to the
most directly comparable GAAP measure, as well as disclosure of the reasons why
the company uses this measure, is included in the financial information
accompanying this release.
Release No: 1018/8584 (See accompanying financial information)
http://www.unisys.com/about__unisys/news_a_events/10188584.htm
Unisys is a registered trademark of Unisys Corporation. All other brands and
products referenced herein are acknowledged to be trademarks or registered
trademarks of their respective holders.
UNISYS CORPORATION
PRELIMINARY CONSOLIDATED STATEMENTS OF INCOME
(Millions, except per share data)
Three Months Nine Months
Ended September 30 Ended September 30
------------------ ------------------
2005 2004 2005 2004
-------- -------- -------- --------
Revenue
Services $1,174.0 $1,147.1 $3,517.7 $3,470.9
Technology 213.1 298.6 671.5 825.8
-------- -------- -------- --------
1,387.1 1,445.7 4,189.2 4,296.7
Costs and expenses
Cost of revenue:
Services 1,036.0 965.7 3,080.8 2,821.6
Technology 105.1 139.0 324.7 375.5
-------- -------- -------- --------
1,141.1 1,104.7 3,405.5 3,197.1
Selling, general and
administrative 261.0 303.7 790.0 837.8
Research and development 61.2 75.3 192.7 218.1
-------- -------- -------- --------
1,463.3 1,483.7 4,388.2 4,253.0
-------- -------- -------- --------
Operating income (loss) (76.2) (38.0) (199.0) 43.7
Interest expense 17.1 16.2 44.9 51.4
Other income
(expense), net 13.3 (3.0) 45.8 21.6
-------- -------- -------- --------
Income (loss) before
income taxes (80.0) (57.2) (198.1) 13.9
Provision (benefit) for
income taxes (25.7) (82.4) (71.2) (59.6)
-------- -------- -------- --------
Net income (loss) ($54.3) $25.2 ($126.9) $73.5
======== ======== ======== ========
Earnings (loss) per share
Basic ($ .16) $ .08 ($ .37) $ .22
======== ======== ======== ========
Diluted ($ .16) $ .07 ($ .37) $ .22
======== ======== ======== ========
Shares used in the per share
computations (thousands):
Basic 340,914 335,576 339,736 334,236
======== ======== ======== ========
Diluted 340,914 337,362 339,736 338,059
======== ======== ======== ========
UNISYS CORPORATION
PRELIMINARY SEGMENT RESULTS
(Millions)
Elimi-
Total nations Services Technology
-------- -------- -------- ----------
Three Months Ended
September 30, 2005
------------------
Customer revenue $1,387.1 $1,174.0 $213.1
Intersegment ($57.1) 4.5 52.6
-------- -------- -------- --------
Total revenue $1,387.1 ($57.1) $1,178.5 $265.7
======== ======== ======== ========
Gross profit percent 17.7% 11.3% 42.4%
======== ======== ========
Operating profit
(loss) percent (5.5%) (5.1%) (5.9%)
======== ======== ========
Three Months Ended
September 30, 2004
------------------
Customer revenue $1,445.7 $1,147.1 $298.6
Intersegment ($63.6) 5.2 58.4
-------- -------- -------- --------
Total revenue $1,445.7 ($63.6) $1,152.3 $357.0
======== ======== ======== ========
Gross profit percent 23.6% 16.2% 51.0%
======== ======== ========
Operating profit
(loss) percent (2.6%) (0.2%) 13.9%
======== ======== ========
Nine Months Ended
September 30, 2005
------------------
Customer revenue $4,189.2 $3,517.7 $671.5
Intersegment ($192.7) 14.2 178.5
-------- -------- -------- --------
Total revenue $4,189.2 ($192.7) $3,531.9 $850.0
======== ======== ======== ========
Gross profit percent 18.7% 11.5% 45.0%
======== ======== ========
Operating profit
(loss) percent (4.8%) (5.1%) (1.1%)
======== ======== ========
Nine Months Ended
September 30, 2004
------------------
Customer revenue $4,296.7 $3,470.9 $825.8
Intersegment ($166.6) 14.5 152.1
-------- -------- -------- --------
Total revenue $4,296.7 ($166.6) $3,485.4 $977.9
======== ======== ======== ========
Gross profit percent 25.6% 17.9% 50.7%
======== ======== ========
Operating profit
percent 1.0% 1.0% 9.6%
======== ======== ========
* 2004 results exclude charges for cost reductions
and related actions as announced on October 6, 2004
UNISYS CORPORATION
PRELIMINARY CONSOLIDATED BALANCE SHEETS
(Millions)
September 30, December 31,
2005 2004
------------ ------------
Assets
Current assets
Cash and cash equivalents $466.1 $660.5
Accounts and notes receivable, net 1,118.2 1,136.8
Inventories
Parts and finished equipment 86.9 93.7
Work in process and materials 109.1 122.4
Deferred income taxes 292.4 291.8
Prepaid expense and other
current assets 142.7 112.4
---------- ----------
Total 2,215.4 2,417.6
---------- ----------
Properties 1,326.8 1,305.5
Less accumulated depreciation
and amortization 928.9 881.4
---------- ----------
Properties, net 397.9 424.1
---------- ----------
Outsourcing assets, net 428.3 431.9
Marketable software, net 335.3 336.8
Investments at equity 197.1 197.1
Prepaid pension cost 43.3 52.5
Deferred income taxes 1,394.6 1,394.6
Goodwill 193.1 189.9
Other long-term assets 158.3 176.4
---------- ----------
Total $5,363.3 $5,620.9
========== ==========
Liabilities and stockholders' equity
Current liabilities
Notes payable $4.7 $1.0
Current maturities of long-term debt 60.5 151.7
Accounts payable 413.0 487.4
Other accrued liabilities 1,053.0 1,382.7
---------- ----------
Total 1,531.2 2,022.8
---------- ----------
Long-term debt 1,052.2 898.4
Accrued pension liabilities 638.9 537.9
Other long-term liabilities 708.2 655.3
Stockholders' equity
Common stock 3.4 3.4
Accumulated deficit (503.1) (376.2)
Other capital 3,911.6 3,883.8
Accumulated other comprehensive loss (1,979.1) (2,004.5)
---------- ----------
Stockholders' equity 1,432.8 1,506.5
---------- ----------
Total $5,363.3 $5,620.9
UNISYS CORPORATION
PRELIMINARY CONSOLIDATED STATEMENT OF CASH FLOWS
(Millions)
Nine Months Ended
September 30
------------------
2005 2004
------- -------
Cash flows from operating activities
Net income (loss) ($126.9) $73.5
Add (deduct) items to reconcile
net income (loss) to net cash
provided by operating activities:
Equity income (3.8) (7.2)
Depreciation and amortization of properties 89.7 99.9
Depreciation and amortization of
outsourcing assets 96.0 88.6
Amortization of marketable software 91.6 96.6
Gain on the sale of facility (15.8)
Loss on the tender of debt 10.7
Increase in deferred income taxes, net (.6) (25.3)
Decrease in receivables, net 20.7 97.2
Decrease in inventories 19.6 19.1
Decrease in accounts payable and
other accrued liabilities (344.6) (260.1)
Increase in other liabilities 199.4 19.8
Increase in other assets (48.8) (9.8)
Other 35.3 50.6
------- -------
Net cash provided by operating activities 22.5 242.9
------- -------
Cash flows from investing activities
Proceeds from investments 5,758.9 4,423.4
Purchases of investments (5,746.2) (4,427.4)
Investment in marketable software (93.7) (88.8)
Capital additions of properties (84.9) (95.5)
Capital additions of outsourcing assets (115.7) (126.6)
Purchases of businesses (.5) (18.6)
Proceeds from sales of properties 23.4
------- -------
Net cash used for investing activities (258.7) (333.5)
------- -------
Cash flows from financing activities
Net proceeds from (reduction in)
short-term borrowings 3.8 (1.0)
Proceeds from employee stock plans 12.8 30.9
Payments of long-term debt (500.2) (2.3)
Proceeds from issuance of long-term debt 541.5
------- -------
Net cash provided by financing activities 57.9 27.6
------- -------
Effect of exchange rate changes on cash
and cash equivalents (16.1) .8
------- -------
Decrease in cash and cash equivalents (194.4) (62.2)
Cash and cash equivalents, beginning of
period 660.5 635.9
------- -------
Cash and cash equivalents, end of period $466.1 $573.7
======= =======
Reconciliation of GAAP to Non-GAAP
Financial Information
The preceding release presents information with and without pension
expense. Unisys believes that this information will enhance an overall
understanding of its financial performance due to the significant
change in pension expense from period to period and the
non-operational nature of pension expense. The presentation of
non-GAAP information is not meant to be considered in isolation or as
a substitute for results prepared in accordance with accounting
principles generally accepted in the United States.
UNISYS CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP
PRELIMINARY CONSOLIDATED STATEMENTS OF INCOME
(Millions, except per share data)
Three Months Ended
September 30, 2005
----------------------------
US GAAP Less Without
as Pension Pension
Reported Expense Expense
-------- -------- --------
Revenue $1,387.1 $1,387.1
Costs and expenses
Cost of revenue 1,141.1 ($30.2) 1,110.9
Selling, general and
administrative 261.0 (9.1) 251.9
Research and development 61.2 (4.9) 56.3
-------- -------- --------
1,463.3 (44.2) 1,419.1
-------- -------- --------
Operating income (loss) (76.2) 44.2 (32.0)
Interest expense 17.1 17.1
Other income
(expense), net 13.3 13.3
-------- -------- --------
Income (loss) before
income taxes (80.0) 44.2 (35.8)
Provision (benefit) for
income taxes (25.7) 14.2 (11.5)
-------- -------- --------
Net income (loss) ($54.3) $30.0 ($24.3)
======== ======== ========
Earnings (loss) per share ($ .16) $ .09 ($ .07)
======== ======== ========
Three Months Ended
September 30, 2004
----------------------------
US GAAP Less Without
as Pension Pension
Reported Expense Expense
-------- -------- --------
Revenue $1,445.7 $1,445.7
Costs and expenses
Cost of revenue 1,104.7 ($17.1) 1,087.6
Selling, general and
administrative 303.7 (4.4) 299.3
Research and development 75.3 (2.0) 73.3
-------- -------- --------
1,483.7 (23.5) 1,460.2
-------- -------- --------
Operating income (loss) (38.0) 23.5 (14.5)
Interest expense 16.2 16.2
Other income
(expense), net (3.0) (3.0)
-------- -------- --------
Income (loss) before
income taxes (57.2) 23.5 (33.7)
Provision (benefit) for
income taxes (82.4) 7.6 (74.8)
-------- -------- --------
Net income $25.2 $15.9 $41.1
======== ======== ========
Earnings per share $ .07 $ .05 $ .12
======== ======== ========
UNISYS CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP
PRELIMINARY CONSOLIDATED STATEMENTS OF INCOME
(Millions, except per share data)
Nine Months Ended
September 30, 2005
----------------------------
US GAAP Less Without
as Pension Pension
Reported Expense Expense
-------- -------- --------
Revenue $4,189.2 $4,189.2
Costs and expenses
Cost of revenue 3,405.5 ($95.0) 3,310.5
Selling, general and
administrative 790.0 (27.1) 762.9
Research and development 192.7 (14.7) 178.0
-------- -------- --------
4,388.2 (136.8) 4,251.4
-------- -------- --------
Operating income (loss) (199.0) 136.8 (62.2)
Interest expense 44.9 44.9
Other income
(expense), net 45.8 45.8
-------- -------- --------
Income (loss) before
income taxes (198.1) 136.8 (61.3)
Provision (benefit) for
income taxes (71.2) 43.8 (27.4)
-------- -------- --------
Net income (loss) ($126.9) $93.0 ($33.9)
======== ======== ========
Earnings (loss) per share ($ .37) $ .27 ($ .10)
======== ======== ========
Nine Months Ended
September 30, 2004
----------------------------
US GAAP Less Without
as Pension Pension
Reported Expense Expense
-------- -------- --------
Revenue $4,296.7 $4,296.7
Costs and expenses
Cost of revenue 3,197.1 ($50.4) 3,146.7
Selling, general and
administrative 837.8 (14.1) 823.7
Research and development 218.1 (6.0) 212.1
-------- -------- --------
4,253.0 (70.5) 4,182.5
-------- -------- --------
Operating income 43.7 70.5 114.2
Interest expense 51.4 51.4
Other income
(expense), net 21.6 21.6
-------- -------- --------
Income before income taxes 13.9 70.5 84.4
Provision (benefit) for
income taxes (59.6) 22.6 (37.0)
-------- -------- --------
Net income $73.5 $47.9 $121.4
======== ======== ========
Earnings per share $ .22 $ .14 $ .36
======== ======== ========
UNISYS CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP
PRELIMINARY SEGMENT RESULTS OF OPERATIONS
(Millions)
Three Months Ended
September 30, 2005
---------------------------
Less Without
As Pension Pension
Reported Expense Expense
-------- -------- --------
Services Segment
Total revenue $1,178.5 $1,178.5
Gross profit 133.3 ($29.2) 162.5
% of revenue 11.3% 13.8%
Operating income (loss) (60.2) (36.7) (23.5)
% of revenue -5.1% -2.0%
Technology Segment
Total revenue 265.7 265.7
Gross profit 112.6 (1.0) 113.6
% of revenue 42.4% 42.8%
Operating income (loss) (15.6) (7.5) (8.1)
% of revenue -5.9% -3.0%
Total Company
Total revenue 1,387.1 1,387.1
Gross profit 246.0 (30.2) 276.2
% of revenue 17.7% 19.9%
Operating income (loss) (76.2) (44.2) (32.0)
% of revenue -5.5% -2.3%
Three Months Ended
September 30, 2004
---------------------------
Less Without
As Pension Pension
Reported Expense Expense
-------- -------- --------
Services Segment *
Total revenue $1,152.3 $1,152.3
Gross profit 186.2 ($16.7) 202.9
% of revenue 16.2% 17.6%
Operating income (loss) (2.2) (20.6) 18.4
% of revenue -0.2% 1.6%
Technology Segment *
Total revenue 357.0 357.0
Gross profit 182.0 (0.4) 182.4
% of revenue 51.0% 51.1%
Operating income 49.7 (2.9) 52.6
% of revenue 13.9% 14.7%
Total Company
Total revenue 1,445.7 1,445.7
Gross profit 341.0 (17.1) 358.1
% of revenue 23.6% 24.8%
Operating income (loss) (38.0) (23.5) (14.5)
% of revenue -2.6% -1.0%
* 2004 results exclude charges for cost reductions
and related actions as announced on October 6, 2004
UNISYS CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP
PRELIMINARY SEGMENT RESULTS OF OPERATIONS
(Millions)
Nine Months Ended
September 30, 2005
-----------------------------
Less Without
As Pension Pension
Reported Expense Expense
-------- -------- --------
Services Segment
Total revenue $3,531.9 $3,531.9
Gross profit 406.6 ($92.1) 498.7
% of revenue 11.5% 14.1%
Operating income (loss) (181.7) (114.6) (67.1)
% of revenue -5.1% -1.9%
Technology Segment
Total revenue 850.0 850.0
Gross profit 382.8 (2.9) 385.7
% of revenue 45.0% 45.4%
Operating income (9.2) (22.2) 13.0
% of revenue -1.1% 1.5%
Total Company
Total revenue 4,189.2 4,189.2
Gross profit 783.7 (95.0) 878.7
% of revenue 18.7% 21.0%
Operating income (loss) (199.0) (136.8) (62.2)
% of revenue -4.8% -1.5%
Nine Months Ended
September 30, 2004
-----------------------------
Less Without
As Pension Pension
Reported Expense Expense
-------- -------- --------
Services Segment *
Total revenue $3,485.4 $3,485.4
Gross profit 624.0 ($49.3) 673.3
% of revenue 17.9% 19.3%
Operating income 35.2 (61.0) 96.2
% of revenue 1.0% 2.8%
Technology Segment *
Total revenue 977.9 977.9
Gross profit 496.2 (1.1) 497.3
% of revenue 50.7% 50.9%
Operating income 94.0 (9.5) 103.5
% of revenue 9.6% 10.6%
Total Company
Total revenue 4,296.7 4,296.7
Gross profit 1,099.6 (50.4) 1,150.0
% of revenue 25.6% 26.8%
Operating income 43.7 (70.5) 114.2
% of revenue 1.0% 2.7%
* 2004 results exclude charges for cost reductions
and related actions as announced on October 6, 2004
UNISYS CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP
FORWARD-LOOKING ESTIMATED EARNINGS (LOSS) PER SHARE
Three
Months
Ending
12/31/2005
----------
Earnings per share-
on a GAAP basis .01 - .06
Add back estimated pension expense,
net of tax .09
---------
Earnings per share-
on a NON-GAAP basis
(excluding pension expense) .10 - .15
=========
NOTE: See section in press release entitled
'Forward-Looking Statements'.
CONTACT: Unisys Corporation
Media:
Guy Esnouf, 215-986-2472
Guy.Esnouf@unisys.com
or
Jacqueline Lewis, 215-986-5204
Jacqueline.Lewis@unisys.com
or
Investors:
Jim Kerr, 215-986-5795
Jim.Kerr@unisys.com
Friday, 10th January 2025
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