Buy
Sell
Share Name Share Symbol Market Type Share ISIN Share Description
Unisys Corporation LSE:USY London Ordinary Share COM STK US$0.01
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.0% 8.51 0.00 01:00:00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Software & Computer Services 2,825.0 143.2 148.0 5.8 360

Unisys Corp Second quarter financial results

05/08/2020 7:00am

UK Regulatory (RNS & others)


 
TIDMUSY 
 
Unisys Announces Second-Quarter Results 
 
Full-Year Revenue Expectations Unchanged, First Detailed Post COVID-19 
Perspective on Profitability Expectations, Sequential Services Margin Expansion 
and Strong Liquidity Position 
 
BLUE BELL, Pa., Aug. 4, 2020 /PRNewswire/ -- 
 
  * Full-year revenue expectations unchanged relative to end of Q1 at (10)% YoY 
  * Current expectations for full-year non-GAAP operating profit margin between 
    5.2% and 6.7% 
  * Services gross profit margin of 15.5%, up 260 basis points sequentially 
  * Strong cash balance of $782 million, relative to $790 million at the end of 
    the first quarter 
  * Total company revenue of $439 million, relative to $569 million in 
    prior-year period 
  * Total company operating profit margin of (1.9)%, relative to 9.3% in 
    prior-year period, largely due to timing of ClearPath Forward® renewals 
    within Technology 
  * Non-GAAP operating profit(5) margin of 0.2%, relative to 9.8% in prior-year 
    period 
  * Total company pipeline(2) up 10.1% sequentially versus the first quarter 
  * Services Total Contract Value(3) ("TCV") up 1.4% year over year 
 
Unisys Corporation (NYSE: UIS) today reported second-quarter 2020 financial 
results. "Our revenue expectations are unchanged for the full year 2020 and we 
now have enough visibility to provide profitability expectations for the year. 
Our client satisfaction is high, represented by an industry-leading Net 
Promoter Score, and our liquidity is strong coming out of the most challenging 
COVID-19 quarter." said Unisys Chairman and CEO Peter A. Altabef. 
"Approximately half of the year-over-year revenue decline in the quarter was 
due to COVID-related impacts within Services. The rest was driven by intra-year 
shifts in ClearPath Forward® renewal timing, currency movement and expected 
declines in our check-processing JV. While non-GAAP operating profit was down 
year over year, over 90 percent of this was due to lighter ClearPath Forward 
renewals in the quarter, which we view as a timing issue only." 
 
Second-Quarter 2020 Highlights 
 
                      YoY Revenue Growth                         YoY Profitability 
 
                  Revenue Services Technology           Operating    Net    EBITDA   Diluted 
                  Growth  Revenue   Revenue              Profit    Income   Margin     EPS 
                           Growth    Growth              Margin    Margin 
 
GAAP              (22.9%)  (17.7%)    (51.6%)  GAAP        (1.9%)  (17.4%)   (4.1%)  ($1.21) 
 
Constant-Currency (19.8%)  (14.4%)    (49.7%)   YoY       (1,120)  (1,750)  (1,430)      N/M 
(GAAP)                                          Change        bps      bps      bps 
 
Non-GAAP          (22.0%)  (16.5%)        N/A  Non-GAAP      0.2%   (2.2%)    11.4%  ($0.15) 
 
                                                YoY     (960) bps    (820)    (540)      N/M 
                                                Change                 bps      bps 
 
Beginning January 1, 2020, the historical results of the company's U.S. Federal 
business have been reflected in the company's consolidated financial statements 
as discontinued operations. Prior-period amounts have been reclassified to 
reflect the company's U.S. Federal business as discontinued operations. 
Throughout this release we only refer to the company's continuing operations. 
 
Summary of Second-Quarter 2020 Business Results 
 
Company: 
Second-quarter revenue was $438.8 million, versus $569.4 million in the 
prior-year period, down 22.9% year over year (down 19.8% on a constant-currency 
(1) basis). Non-GAAP adjusted revenue(4) was $438.8 million, relative to $562.9 
million in the prior-year period. Of the year-over-year declines, approximately 
half were due to impacts of COVID-19, including declines in field services, 
travel and transportation and volume-based BPO contracts; while the rest were 
due to the timing of ClearPath Forward contract renewals, currency movement and 
expected declines in the company's UK-based check-processing JV. 
 
Second-quarter total company operating profit was $(8.5) million, versus $53.0 
million in the prior-year period, and operating profit margin was (1.9)%, 
versus 9.3% in the second quarter of 2019. Total company non-GAAP operating 
profit was $0.8 million, versus $55.3 million in the prior-year period, and 
non-GAAP operating profit margin was 0.2%, versus 9.8% in the second quarter of 
2019. Of the year-over-year decline in non-GAAP operating profit, $50.2 million 
was attributable to the flow through effect of lower Technology revenue (due to 
ClearPath Forward renewal timing) on a relatively fixed base of software 
development and support costs. 
 
Net loss for the second quarter was $76.5 million versus net income of $0.7 
million in the prior-year period. Similarly, the loss per share was $1.21, 
compared to earnings per share of $0.01 in the prior-year period. These metrics 
were impacted by $66.8 million of charges ($1.06 per share) in the period, 
including $28.5 million related to the early extinguishment of debt associated 
with the repayment of the previously-outstanding senior secured notes. Non-GAAP 
net loss for the second quarter was $9.7 million, versus non-GAAP net income of 
$33.6 million in the prior-year period. Non-GAAP diluted loss per share(9) was 
$0.15, versus non-GAAP earnings per share of $0.52 in the prior-year period. 
These year-over-year declines were largely due to the issues noted above with 
respect to revenue and operating profit. 
 
Adjusted EBITDA(8) was $50.2 million, relative to $94.5 million in the 
prior-year period, due to the issues noted above with respect to revenue and 
operating profit. Net income margin was (17.4)%, compared to 0.1% in the 
prior-year period, due to the profitability and charges noted above. Adjusted 
EBITDA margin was 11.4%, relative to 16.8% in the prior-year period. 
 
Second-quarter cash used in operations was $14.2 million, versus operating cash 
flow of $50.9 million in the prior-year period. Adjusted free cash flow(11) was 
$(37.1) million, versus $14.3 million in the prior-year period. The 
year-over-year cash flow comparisons were impacted by significantly higher 
Technology revenue in the second quarter of 2019, based on ClearPath Forward 
renewal timing. At June 30, 2020, the company had $782.2 million in cash and 
cash equivalents, relative to $789.6 million at the end of the first quarter. 
 
Pipeline: 
Total company pipeline was up 10.1% sequentially versus the end of the first 
quarter. 
 
Full-Year Expectations: 
Full-year revenue expectations are unchanged relative to the end of the first 
quarter at (10)% YoY.  Profitability expectations were not provided in the 
first quarter; however, the company's current expectations for full-year 
non-GAAP operating profit margin are between 5.2% and 6.7%. 
 
Services: 
Services revenue in the second quarter was $396.0 million, relative to $481.0 
million in the prior-year period, down 17.7% year over year (down 14.4% in 
constant-currency). Services non-GAAP adjusted revenue was $396.0 million, 
relative to $474.5 million in the prior-year period. These declines were 
largely due to the COVID-19-related impact on field services, travel and 
transportation and volume-based BPO contracts, as well as anticipated declines 
in the company's UK-based check-processing JV. Services gross profit margin was 
15.5%, versus 16.5% in the second quarter of 2019 and up 260 basis points 
sequentially versus the first quarter. Non-GAAP adjusted Services gross profit 
margin(6) was up 20 basis points year over year to 15.5%, versus 15.3% in the 
prior-year period, and was up 280 basis points sequentially. Services operating 
profit margin was (0.4)%, versus 1.9% in the second quarter of 2019. 
Second-quarter non-GAAP adjusted Services operating profit(7) margin was (0.4) 
%, versus 0.5% in the prior-year period, and was up 310 basis points 
sequentially. The year-over-year declines in operating profit margin were 
largely due to the flow-through impact of lower revenues against SG&A costs 
that are more fixed in the short-term, relative to cost of revenue. Services 
backlog was $3.6 billion, relative to $3.7 billion at the end of the first 
quarter. Services TCV was up 1.4% year over year. 
 
Technology: 
Second-quarter Technology revenue was $42.8 million, relative to $88.4 million 
in the prior-year period, down 51.6% year over year (down 49.7% in constant 
currency), largely driven by intra-year timing shifts of four ClearPath Forward 
contract renewals. Two of these were signed earlier than expected as noted in 
the first quarter, and two were delayed from the second quarter and are now 
expected to be signed in the third quarter. Second-quarter Technology gross 
profit margin was 42.0%, compared to 78.1% in the prior-year period. Technology 
operating profit margin was 2.2%, versus 56.7% in the prior-year 
period. Technology costs are largely related to software development and 
overhead and so are relatively fixed in the short term. As a result, margins in 
Technology were down more significantly than the declines in Services. 
 
Select Second-Quarter Contract Signings: 
In the second quarter, the company entered into several noteworthy contracts: 
 
  * Focus on InteliServeT: Unisys has extended and expanded its relationship 
    with a leading provider of innovative technology solutions for the 
    treatment of cancer and brain disorders. Unisys will now deliver its 
    InteliServe solution alongside technology from ServiceNow® to enable 
    omnichannel service desk support for improved end user experience and lower 
    cost. The engagement is also designed with a focus on flexibility to allow 
    for the fast integration of new technology and services as the company 
    evolves its digital workplace and growth agendas. 
  * Focus on CloudForte®: Unisys entered into a new expanded contract with a 
    global commercial real estate services firm for whom Unisys had previously 
    been providing IT service management (ITSM) and managed services support. 
    Under this new-scope contract, Unisys will now provide a full suite of IT 
    outsourcing services, including CloudForte to optimize their cloud 
    environment. Unisys will also provide InteliServe to automate the client's 
    digital workplace support experience, highlighting Unisys' ability to 
    provide best-in-class solutions and services across a wide spectrum of 
    today's digital business needs. 
  * Focus on Security Services: A Unisys partner secured a multi-year contract 
    with a leading U.S.-based service organization to provide Unisys Stealth® 
    security software and deployment services, establishing a software-defined 
    perimeter that uses identity-based micro-segmentation to reduce their 
    attack surface globally and protect critical applications across an 
    assortment of IT infrastructures; including data centers, retail stores and 
    distribution centers. 
 
Tax Asset Plan Termination 
The company announced that its board of directors [unanimously] approved the 
early termination of its one-year Tax Asset Protection Plan (the "Plan"), 
adopted on February 5, 2020, advancing the expiration date from February 5, 
2021 to August 4, 2020. Stockholders do not have to take any action as a result 
of the early termination. The Plan was designed to protect Unisys' valuable tax 
assets in connection with the sale of its U.S. Federal business to Science 
Applications International Corp. (NYSE: SAIC), which was completed on March 13, 
2020 (the "Transaction"), by discouraging persons from acquiring more than 4.9% 
of Unisys' common stock. Following the completion of the Transaction, Unisys' 
board of directors determined that the Plan is no longer necessary to protect 
such tax assets and that termination of the Plan is in the best interests of 
its stockholders. Tax asset protection plans similar to the Plan may be adopted 
in the future if the board of directors determines that it is in the best 
interests of the company and its stockholders at that time. 
 
Conference Call 
Unisys will hold a conference call today at 5:00 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) 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. 
 
(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 revenue and charges that the company believes are 
not indicative of its ongoing operations and that can make its revenue, 
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 revenue, 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 adjusted revenue - In 2019 and 2020, the company's non-GAAP 
results reflect adjustments to exclude certain revenue and related profit 
relating to reimbursements from the company's check-processing JV partners for 
restructuring expenses included as part of the company's restructuring program. 
 
(5) Non-GAAP operating profit - The company recorded pretax post-retirement 
expense and pretax charges in connection with cost-reduction activities, debt 
exchange/extinguishment and other expenses. For the company, non-GAAP operating 
profit excluded these items. The company believes that this profitability 
measure is more indicative of the company's operating results and aligns those 
results to the company's external guidance, which is used by the company's 
management to allocate resources and may be used by analysts and investors to 
gauge the company's ongoing performance. During 2019 and 2020, the company 
included the non-GAAP adjustments discussed in (4) herein. 
 
(6)  Non-GAAP adjusted Services gross profit - During 2019 and 2020, the 
company included the adjustments discussed in (4) herein. 
 
(7)  Non-GAAP adjusted Services operating profit - During 2019 and 2020, the 
company included the adjustments discussed in (4) herein. 
 
(8) 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. During 2019 and 2020, the company 
included the adjustments discussed in (4) herein. 
 
(9) 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. During 2019 and 2020, the company included the adjustments 
discussed in (4) herein. 
 
(10) 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. 
 
(11) 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 information technology company that builds high-performance, 
security-centric solutions for the most demanding businesses and governments. 
Unisys offerings include security software and services; digital transformation 
and workplace services; industry applications and services; and innovative 
software operating environments for high-intensity enterprise computing. For 
more information on how Unisys builds better outcomes securely for its clients 
across the government, financial services and commercial 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 or other financial 
items; any statements of the company's plans, strategies or objectives for 
future operations; statements regarding future economic conditions or 
performance; and any statements of belief or expectation. All forward-looking 
statements rely on assumptions and are subject to various risks and 
uncertainties that could cause actual results to differ materially from 
expectations. In particular, statements concerning annual and total contract 
value are based, in part, on the assumption that each of those contracts will 
continue for their full contracted term. Risks and uncertainties that could 
affect the company's future results include, but are not limited to, the 
following: our business and results of operations and our financial condition 
has been and is expected to continue to be impacted by the outbreak of COVID-19 
and such impact could be materially adverse, our ability to improve revenue and 
margins in our services business; 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 significant pension 
obligations and required cash contributions and requirements to make additional 
significant cash contributions to our defined benefit pension plans; 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; the risks of doing business internationally when a 
significant portion of our revenue is derived from international operations; 
our ability to access financing markets; the adverse effects of a reduction in 
our credit rating; cybersecurity breaches could result in significant costs and 
could harm our business and reputation; we may not achieve the operational and 
financial results that we anticipate from the sale of our U.S. Federal 
business; the business and financial risk in implementing future acquisitions 
or dispositions; 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; our ability to attract, motivate and retain experienced and 
knowledgeable personnel in key positions; 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; our ability to use our net operating 
loss carryforwards and certain other tax attributes may be limited; an 
involuntary termination of the company's U.S. qualified defined benefit pension 
plans; 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.: 0804/9781 
 
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   Six Months Ended 
                                             June 30,            June 30, 
 
                                          2020      2019      2020      2019 
 
Revenue 
 
Services                                   $         $         $         $ 
                                           396.0     481.0     821.9     955.0 
 
Technology                                  42.8      88.4     132.3     168.9 
 
                                           438.8     569.4     954.2   1,123.9 
 
Costs and expenses 
 
Cost of revenue: 
 
Services                                   340.0     399.1     715.7     795.9 
 
Technology                                  23.9      17.7      50.5      50.3 
 
                                           363.9     416.8     766.2     846.2 
 
Selling, general and administrative         80.2      92.4     167.0     183.3 
 
Research and development                     3.2       7.2       9.4      16.2 
 
                                           447.3     516.4     942.6   1,045.7 
 
Operating income (loss)                    (8.5)      53.0      11.6      78.2 
 
Interest expense                             4.6      16.2      18.5      31.7 
 
Other expense, net                        (53.7)    (28.9)   (101.8)    (59.3) 
 
Income (loss) from continuing             (66.8)       7.9   (108.7)    (12.8) 
operations before income 
taxes 
 
Provision for income taxes                   9.7       3.6      20.5      13.0 
 
Consolidated net income (loss) from       (76.5)       4.3   (129.2)    (25.8) 
continuing operations 
 
Net income attributable to                     -       3.6       0.5       6.2 
noncontrolling interests 
 
Net income (loss) from continuing         (76.5)       0.7   (129.7)    (32.0) 
operations attributable 
to Unisys Corporation 
 
Income (loss) from discontinued            (2.1)      25.5   1,066.4      38.8 
operations, net of tax 
 
Net income (loss) attributable to        $         $           $       $ 
Unisys Corporation                        (78.6)      26.2     936.7       6.8 
 
Earnings (loss) per share attributable 
to Unisys Corporation 
 
Basic 
 
Continuing Operations                    $         $         $         $ 
                                          (1.21)      0.01    (2.06)    (0.62) 
 
Disontinuing Operations                  $         $           $       $ 
                                          (0.04)      0.50     16.97      0.75 
 
Total                                    $         $           $       $ 
                                          (1.25)      0.51     14.91      0.13 
 
Diluted 
 
Continuing Operations                    $         $         $         $ 
                                          (1.21)      0.01    (2.06)    (0.62) 
 
Disontinuing Operations                  $         $           $       $ 
                                          (0.04)      0.49     16.97      0.75 
 
Total                                    $         $           $       $ 
                                          (1.25)      0.50     14.91      0.13 
 
Shares used in the per share 
computations (in thousands): 
 
Basic                                     63,010    51,782    62,830    51,600 
 
Diluted                                   63,010    52,110    62,830    51,600 
 
 
 
                              UNISYS CORPORATION 
 
                                SEGMENT RESULTS 
 
                                  (Unaudited) 
 
                                  (Millions) 
 
                             Total     Eliminations    Services     Technology 
 
Three Months Ended June 
30, 2020 
 
Customer revenue              $        $                  $           $ 
                                438.8              -        396.0          42.8 
 
Intersegment                        -          (2.4)            -           2.4 
 
Total revenue                 $          $                $           $ 
                                438.8          (2.4)        396.0          45.2 
 
Gross profit percent           17.1 %                      15.5 %        42.0 % 
 
Operating profit (loss)        (1.9)%                      (0.4)%         2.2 % 
percent 
 
Three Months Ended June 
30, 2019 
 
Customer revenue              $        $                  $           $ 
                                569.4              -        481.0          88.4 
 
Intersegment                        -          (2.1)            -           2.1 
 
Total revenue                 $          $                $           $ 
                                569.4          (2.1)        481.0          90.5 
 
Gross profit percent           26.8 %                      16.5 %        78.1 % 
 
Operating profit percent        9.3 %                       1.9 %        56.7 % 
 
                             Total     Eliminations    Services     Technology 
 
Six Months Ended June 30, 
2020 
 
Customer revenue              $        $                  $             $ 
                                954.2              -        821.9         132.3 
 
Intersegment                        -          (4.9)            -           4.9 
 
Total revenue                 $          $                $             $ 
                                954.2          (4.9)        821.9         137.2 
 
Gross profit percent           19.7 %                      14.2 %        59.6 % 
 
Operating profit percent        1.2 %                      (1.9)%        31.5 % 
 
Six Months Ended June 30, 
2019 
 
Customer revenue                $      $                  $             $ 
                              1,123.9              -        955.0         168.9 
 
Intersegment                        -          (4.5)            -           4.5 
 
Total revenue                   $        $                $             $ 
                              1,123.9          (4.5)        955.0         173.4 
 
Gross profit percent           24.7 %                      15.8 %        68.6 % 
 
Operating profit percent        7.0 %                       0.8 %        45.9 % 
 
 
 
                              UNISYS CORPORATION 
 
                          CONSOLIDATED BALANCE SHEETS 
 
                                  (Unaudited) 
 
                                  (Millions) 
 
                                          June 30, 2020        December 31, 
                                                                   2019 
 
Assets 
 
Cash and cash equivalents                $                       $ 
                                                     782.2               538.8 
 
Accounts receivable, net                             364.5               417.7 
 
Contract assets                                       39.0                38.4 
 
Inventories                                           14.8                16.4 
 
Prepaid expenses and other current                   119.6               100.7 
assets 
 
     Current assets of discontinued                      -               109.3 
operations 
 
Total current assets                               1,320.1             1,221.3 
 
Properties                                           761.2               784.0 
 
Less-accumulated depreciation and                    652.7               668.0 
amortization 
 
Properties, net                                      108.5               116.0 
 
Outsourcing assets, net                              182.1               202.1 
 
Marketable software, net                             187.5               186.8 
 
Operating lease right-of-use assets                   66.3                71.4 
 
Prepaid postretirement assets                        136.1               136.2 
 
Deferred income taxes                                109.0               114.0 
 
Goodwill                                             108.6               110.4 
 
Restricted cash                                       10.2                13.0 
 
Other long-term assets                               170.9               198.9 
 
Long-term assets of discontinued                         -               133.9 
operations 
 
Total assets                                 $                     $ 
                                                   2,399.3             2,504.0 
 
Liabilities and deficit 
 
Current liabilities: 
 
Notes payable                            $                   $ 
                                                      60.3                   - 
 
Current maturities of long-term-debt                  97.5                13.5 
 
Accounts payable                                     161.6               204.3 
 
Deferred revenue                                     217.8               246.4 
 
Other accrued liabilities                            255.6               316.7 
 
    Current liabilities of discontinued                  -               146.4 
operations 
 
Total current liabilities                            792.8               927.3 
 
Long-term debt                                        47.3               565.9 
 
Long-term postretirement liabilities               1,574.4             1,960.2 
 
Long-term deferred revenue                           130.4               147.0 
 
Long-term operating lease liabilities                 47.9                56.0 
 
Other long-term liabilities                           45.2                47.6 
 
Long-term liabilities of discontinued                    -                28.3 
operations 
 
Commitments and contingencies 
 
Total Unisys Corporation stockholders'             (274.3)           (1,265.4) 
deficit 
 
Noncontrolling interests                              35.6                37.1 
 
Total deficit                                      (238.7)           (1,228.3) 
 
Total liabilities and deficit                $                     $ 
                                                   2,399.3             2,504.0 
 
 
 
                              UNISYS CORPORATION 
 
                     CONSOLIDATED STATEMENTS OF CASH FLOWS 
 
                                  (Unaudited) 
 
                                  (Millions) 
 
                                                             Six Months Ended 
                                                                 June 30, 
 
                                                             2020       2019 
 
Cash flows from operating activities 
 
Consolidated net loss from continuing operations                 $      $ 
                                                             (129.2)     (25.8) 
 
Income from discontinued operations, net of tax              1,066.4       38.8 
 
Adjustments to reconcile consolidated net loss to net cash 
used for operating activities: 
 
Gain on sale of U.S. Federal business                      (1,057.4)          - 
 
Loss on debt extinguishment                                     28.5          - 
 
Foreign currency translation losses                             15.3        5.3 
 
Non-cash interest expense                                        2.7        5.4 
 
Employee stock compensation                                      8.0        7.3 
 
Depreciation and amortization of properties                     15.6       17.8 
 
Depreciation and amortization of outsourcing assets             32.7       31.7 
 
Amortization of marketable software                             36.0       21.6 
 
Other non-cash operating activities                              1.3      (0.2) 
 
Loss on disposal of capital assets                               0.5        1.3 
 
Postretirement contributions                                 (333.0)     (47.7) 
 
Postretirement expense                                          48.4       47.1 
 
Deferred income taxes, net                                     (7.0)        2.7 
 
Changes in operating assets and liabilities: 
 
Receivables, net                                                39.6       10.1 
 
Inventories                                                      1.4      (0.3) 
 
Accounts payable and current liabilities                     (161.5)    (140.3) 
 
Other liabilities                                                2.6       16.9 
 
Other assets                                                   (3.0)     (11.2) 
 
Net cash used for operating activities                       (392.1)     (19.5) 
 
Cash flows from investing activities 
 
Net proceeds from sale of U.S. Federal business              1,159.4          - 
 
Proceeds from investments                                    1,735.3    1,704.1 
 
Purchases of investments                                   (1,755.9)  (1,706.9) 
 
Investment in marketable software                             (36.7)     (37.2) 
 
Capital additions of properties                               (10.6)     (20.8) 
 
Capital additions of outsourcing assets                       (15.8)     (39.7) 
 
Net proceeds from sale of properties                               -      (0.2) 
 
Other                                                          (0.2)      (0.4) 
 
Net cash provided by (used for) investing activities         1,075.5    (101.1) 
 
Cash flows from financing activities 
 
Proceeds from notes payable                                     60.3          - 
 
Proceeds from issuance of long-term debt                         4.0       28.1 
 
Payments of long-term debt                                   (448.4)     (10.5) 
 
Cash paid for debt extinguishment                             (23.7)          - 
 
Other                                                          (4.7)      (4.5) 
 
Net cash (used for) provided by financing activities         (412.5)       13.1 
 
Effect of exchange rate changes on cash, cash equivalents     (30.3)        0.9 
and restricted cash 
 
Increase (decrease) in cash, cash equivalents and              240.6    (106.6) 
restricted cash 
 
Cash, cash equivalents and restricted cash, beginning of       551.8      624.1 
period 
 
Cash, cash equivalents and restricted cash, end of period      $          $ 
                                                               792.4      517.5 
 
 
 
                              UNISYS CORPORATION 
 
        RECONCILIATIONS OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES 
 
                                  (Unaudited) 
 
                       (Millions, except per share data) 
 
                                             Three Months     Six Months Ended 
                                                 Ended 
 
                                               June 30,           June 30, 
 
                                             2020     2019      2020     2019 
 
GAAP net income (loss) from continuing      $        $           $      $ 
operations                                   (76.5)      0.7   (129.7)   (32.0) 
attributable to Unisys Corporation 
 
Postretirement expense:      pretax            24.9     23.6      48.4     47.1 
 
                             tax                0.4        -       0.7    (0.1) 
 
                             net of tax        24.5     23.6      47.7     47.2 
 
Debt extinguishment, cost    pretax            42.8      7.0      73.7     10.6 
reduction and other 
expenses: 
 
                             tax                0.5      0.3       1.1      1.0 
 
                             net of tax        42.3      6.7      72.6      9.6 
 
                             minority             -      2.6       0.4      3.3 
                             interest 
 
                             net of            42.3      9.3      73.0     12.9 
                             minority 
                             interest 
 
Non-GAAP net income (loss) from               (9.7)     33.6     (9.0)     28.1 
continuing operations 
attributable to Unisys Corporation 
 
Add interest expense on convertible notes         -      5.0         -     10.0 
 
Non-GAAP net income (loss) attributable     $        $         $        $ 
to Unisys                                     (9.7)     38.6     (9.0)     38.1 
Corporation for diluted earnings per 
share 
 
Weighted average shares (thousands)          63,010   51,782    62,830   51,600 
 
Plus incremental shares from assumed 
conversion: 
 
                             Employee             -      328                422 
                             stock plans 
 
                             Convertible          -   21,868         -   21,868 
                             notes 
 
Non-GAAP adjusted weighted average shares    63,010   73,978    62,830   73,890 
 
Diluted earnings (loss) per share from 
continuing operations 
 
GAAP basis 
 
GAAP net income (loss) from continuing      $        $           $      $ 
operations attributable                      (76.5)      0.7   (129.7)   (32.0) 
to Unisys Corporation for diluted 
earnings per share 
 
Divided by weighted average shares           63,010   52,110    62,830   51,600 
 
GAAP diluted earnings (loss) per share      $        $         $        $ 
                                             (1.21)     0.01    (2.06)   (0.62) 
 
Non-GAAP basis 
 
Non-GAAP net income (loss) from             $        $         $        $ 
continuing operations                         (9.7)     38.6     (9.0)     38.1 
attributable to Unisys Corporation for 
diluted earnings per share 
 
Divided by Non-GAAP adjusted weighted        63,010   73,978    62,830   73,890 
average shares 
 
Non-GAAP diluted earnings (loss) per        $        $         $        $ 
share                                        (0.15)     0.52    (0.14)     0.52 
 
 
 
                              UNISYS CORPORATION 
 
                      RECONCILIATIONS OF GAAP TO NON-GAAP 
 
                                  (Unaudited) 
 
                                  (Millions) 
 
                                FREE CASH FLOW 
 
                                         Three Months Ended   Six Months Ended 
 
                                              June 30,            June 30, 
 
                                           2020      2019      2020      2019 
 
Cash (used for) provided by operations    $         $           $       $ 
                                           (14.2)      50.9   (392.1)    (19.5) 
 
Additions to marketable software           (19.4)    (19.2)    (36.7)    (37.2) 
 
Additions to properties                     (5.0)    (10.1)    (10.6)    (20.8) 
 
Additions to outsourcing assets            (11.0)    (10.3)    (15.8)    (39.7) 
 
Free cash flow                             (49.6)      11.3   (455.2)   (117.2) 
 
Postretirement funding                        5.3      24.6     333.0      47.7 
 
Discontinued operations                     (0.1)    (34.0)     (9.1)    (51.7) 
 
Debt extinguishment, cost reduction and       7.3      12.4      17.1      21.9 
other payments, net of 
reimbursements 
 
Adjusted free cash flow                   $         $           $       $ 
                                           (37.1)      14.3   (114.2)    (99.3) 
 
 
 
                              UNISYS CORPORATION 
 
                      RECONCILIATIONS OF GAAP TO NON-GAAP 
 
                                  (Unaudited) 
 
                                  (Millions) 
 
                                    EBITDA 
 
                                      Three Months Ended     Six Months Ended 
 
                                           June 30,              June 30, 
 
                                       2020       2019       2020       2019 
 
Net income ( loss) from continuing     $        $              $        $ 
operations attributable                 (76.5)        0.7    (129.7)     (32.0) 
to Unisys Corporation 
 
Net income attributable to                   -        3.6        0.5        6.2 
noncontrolling interests 
 
Interest expense, net of interest          2.2       13.3       13.8       25.9 
income of $2.4, $2.9, $4.7, $5.8 
respectively* 
 
Provision for income taxes                 9.7        3.6       20.5       13.0 
 
Depreciation                              24.1       24.5       48.3       49.5 
 
Amortization                              22.4       12.1       36.0       21.6 
 
EBITDA                                 $          $          $          $ 
                                        (18.1)       57.8     (10.6)       84.2 
 
Postretirement expense                    24.9       23.6       48.4       47.1 
 
Debt extinguishment, cost reduction       42.8        7.0       73.7        9.5 
and other expenses** 
 
Non-cash share based expense               2.9        2.6        8.0        7.3 
 
Other expense, net adjustment***         (2.3)        3.5        2.1       11.1 
 
Adjusted EBITDA                        $          $            $          $ 
                                          50.2       94.5      121.6      159.2 
 
*Included in other expense, net on the consolidated statements of income 
 
**Reduced for depreciation and amortization included above 
 
***Other expense, net as reported on the consolidated statements of income less 
postretirement 
expense, interest income and items included in debt extinguishment, cost 
reduction and other 
expenses 
 
                                      Three Months Ended     Six Months Ended 
 
                                           June 30,              June 30, 
 
                                       2020       2019       2020       2019 
 
Revenue                                  $          $          $            $ 
                                         438.8      569.4      954.2    1,123.9 
 
Non-GAAP revenue                         $          $          $            $ 
                                         438.8      562.9      953.3    1,115.4 
 
Net income (loss) from continuing      (17.4)%      0.1 %    (13.6)%     (2.8)% 
operations attributable 
to Unisys Corporation as a 
percentage of revenue 
 
Non-GAAP net income (loss) from         (2.2)%      6.0 %     (0.9)%      2.5 % 
continuing operations 
attributable to Unisys Corporation 
as a percentage of Non- 
GAAP revenue 
 
Adjusted EBITDA as a percentage of      11.4 %     16.8 %     12.8 %     14.3 % 
Non-GAAP revenue 
 
 
 
                              UNISYS CORPORATION 
 
      RECONCILIATIONS OF SEGMENT REPORTING TO NON-GAAP SEGMENT REPORTING 
 
                                  (Unaudited) 
 
                                  (Millions) 
 
                                Three Months Ended         Six Months Ended 
 
Services Segment                     June 30,                  June 30, 
 
                                2020         2019         2020         2019 
 
GAAP total revenue                 $            $            $            $ 
                                   396.0        481.0        821.9        955.0 
 
Restructuring                          -        (6.5)        (0.9)        (8.5) 
reimbursement 
 
Non-GAAP revenue             $     396.0  $     474.5  $     821.0  $     946.5 
 
GAAP gross margin                $            $              $            $ 
                                    61.5         79.3        116.4        150.8 
 
Restructuring                          -        (6.5)        (0.9)        (8.5) 
reimbursement 
 
Non-GAAP gross margin            $            $        $     115.5  $     142.3 
                                    61.5         72.8 
 
GAAP operating profit          $            $              $          $ 
                                   (1.6)          9.0       (15.6)          7.6 
 
Restructuring                          -        (6.5)        (0.9)        (8.5) 
reimbursement 
 
Non-GAAP operating profit      $            $              $          $ 
(loss)                             (1.6)          2.5       (16.5)        (0.9) 
 
GAAP gross margin %                15.5%        16.5%        14.2%        15.8% 
 
Non-GAAP gross margin %            15.5%        15.3%        14.1%        15.0% 
 
GAAP operating profit %           (0.4)%         1.9%       (1.9)%         0.8% 
 
Non-GAAP operating profit         (0.4)%         0.5%       (2.0)%       (0.1)% 
(loss) % 
 
                                Three Months Ended         Six Months Ended 
 
Total Unisys                         June 30,                  June 30, 
 
                                2020         2019         2020         2019 
 
GAAP total revenue                 $            $            $              $ 
                                   438.8        569.4        954.2      1,123.9 
 
Restructuring                          -        (6.5)        (0.9)        (8.5) 
reimbursement 
 
Non-GAAP revenue             $     438.8  $     562.9  $     953.3  $   1,115.4 
 
GAAP gross margin                $              $            $            $ 
                                    74.9        152.6        188.0        277.7 
 
Restructuring                          -        (6.5)        (0.9)        (8.5) 
reimbursement 
 
Cost reduction expense               6.9        (1.0)         12.8        (4.7) 
 
Non-GAAP gross margin            $        $     145.1  $     199.9  $     264.5 
                                    81.8 
 
GAAP operating profit          $              $            $            $ 
                                   (8.5)         53.0         11.6         78.2 
 
Restructuring                          -        (6.5)        (0.9)        (8.5) 
reimbursement 
 
Postretirement expense               0.8          0.8          1.6          1.6 
 
Cost reduction and other             8.5          8.0         17.0         10.6 
expense 
 
Non-GAAP operating profit      $              $            $            $ 
                                     0.8         55.3         29.3         81.9 
 
GAAP gross margin %                17.1%        26.8%        19.7%        24.7% 
 
Non-GAAP gross margin %            18.6%        25.8%        21.0%        23.7% 
 
GAAP operating profit %           (1.9)%         9.3%         1.2%         7.0% 
 
Non-GAAP operating profit %         0.2%         9.8%         3.1%         7.3% 
 
CONTACT: Investors: Courtney Holben, Unisys, 215-986-3379, 
courtney.holben@unisys.com; Media: John Clendening, Unisys, 214-403-1981, 
john.clendening@unisys.com 
 
 
 
END 
 

(END) Dow Jones Newswires

August 05, 2020 02:00 ET (06:00 GMT)

1 Year Unisys Chart

1 Year Unisys Chart

1 Month Unisys Chart

1 Month Unisys Chart
ADVFN Advertorial
Your Recent History
LSE
USY
Unisys
Register now to watch these stocks streaming on the ADVFN Monitor.

Monitor lets you view up to 110 of your favourite stocks at once and is completely free to use.

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V:gb D:20201022 09:59:12