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 (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
September 30, |
|
Nine Months
Ended
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,
2021 |
|
December 31,
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