Slide 1: 4th Quarter FY 2018 Earnings Presentation
4th Quarter FY 2018 Earnings Presentation May 24, 2018
Slide 2: Pro forma combined company financial information
Pro forma combined company financial information In an effort to provide investors with additional information, we are disclosing certain unaudited pro forma combined company financial information of DXC for the three and twelve months ended March 31, 2017 (the “pro forma combined company” informati
Slide 3: Non-GAAP financial measures
Non-GAAP financial measures We present non-GAAP financial measures of performance which are derived from the statements of operations and unaudited pro forma statement of operations of DXC. These non-GAAP financial measures include earnings before interest and taxes (“EBIT”), EBIT margin, adjusted E
Slide 4: Forward-looking statements
Forward-looking statements All statements in this presentation that do not directly and exclusively relate to historical facts constitute “forward looking statements.” These statements represent current expectations and beliefs, and no assurance can be given that the results described in such statem
Slide 5: 4th Quarter FY 2018 – Mike Lawrie, Chairman, President and CEO
4th Quarter FY 2018 Earnings Presentation Mike Lawrie Chairman, President and Chief Executive Officer
Slide 6: Key messages
Key messages Delivered on financial targets for fiscal 2018 Q4 revenue up 4.3% YoY; fiscal 2018 revenue of $24.6 billion Digital revenue up 21.6% YoY in Q4 and 17% for fiscal 2018 Achieved more than $1.1B of in-year and $1.6B exit run-rate synergies FY19 non-GAAP EPS(1) target of $7.75 – $8.15 1 Exc
Slide 7: 4th Quarter FY 2018 – Paul Saleh, EVP and CFO
4th Quarter FY 2018 Earnings Presentation Paul Saleh Executive Vice President and Chief Financial Officer
Slide 8: Financial presentation
Financial presentation • Pro forma results conform with the methodology used in the Form S-4 Fiscal 2017 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter CSC July 1, 2016 September 30, 2016 December 30, 2016 March 31, 2017 HPES April 30, 2016 July 31, 2016 October 31, 2016 January 31, 2017 • Prior ye
Slide 9: Reconciliation of non-GAAP results
Reconciliation of non-GAAP results Q4 FY18 Transaction, Pension and Amortization of Restructuring separation and OPEB actuarial Tax Non-GAAP (in millions except EPS) GAAP costs integration- acquired and settlement adjustment results intangible assets related costs gains Income before taxes 661 208 1
Slide 10: 4th quarter results
4th quarter results Q4 Full Year Pro forma Pro forma combined combined FY18 FY18 company company FY17 FY17 Revenue ($M) $ 6,294 $ 6,036 $ 24,556 $ 25,394 – YoY Growth - GAAP 4.3% (3.3%) – YoY Growth - cc (1.3%) (4.8%) – QtQ Growth - GAAP 1.7% — – QtQ Growth - cc (0.2%) — Adjusted EBIT ($M) 1,017 615
Slide 11: Global Business Services (GBS)
Global Business Services (GBS) Pro forma Pro forma combined combined Q4 FY18 FY18 company company Q4 FY17 FY17 Revenue ($M) $ 2,361 $ 2,285 $ 9,254 $ 9,530 – YoY growth - GAAP 3.3% (2.9%) – YoY growth - cc (2.2%) (4.6%) – QtQ growth - GAAP 2.0% — – QtQ growth - cc (0.1%) — GBS Profit ($M) 470 284 1,
Slide 12: Global Infrastructure Services (GIS)
Global Infrastructure Services (GIS) Pro forma Pro forma combined combined Q4 FY18 FY18 company company Q4 FY17 FY17 Revenue ($M) $ 3,223 $ 3,112 $ 12,479 $ 13,018 – YoY growth - GAAP 3.6% (4.1%) – YoY growth - cc (3.2%) (5.9%) – QtQ growth - GAAP 2.5% — – QtQ growth - cc 0.1% — GIS Profit ($M) 477
Slide 13: U.S. Public Sector (USPS)
U.S. Public Sector (USPS) Pro forma Pro forma combined combined Q4 FY18 FY18 company company Q4 FY17 FY17 Revenue ($M) $ 710 $ 639 $ 2,823 $ 2,846 – YoY growth - GAAP 11.1% (0.8%) – QtQ growth - GAAP (2.2%) — USPS Profit ($M) 121 63 417 310 USPS Profit Margin (%) 17.0% 9.9% 14.8% 10.9% Bookings ($B)
Slide 14: Financial highlights
Financial highlights Q4 FY18 FY18 Cash Flow ► Adjusted Free Cash Flow $557M $2,427M Performance ► Cap Ex — Including Capital Leases $471M $1,760M ► Cap Ex as a % of Revenue 7.5% 7.2% Q4 FY18 FY18 Capital to Capital to ► Cash Dividends $51M $174M Shareholders Shareholders $72M $137M ► Share Repurchas
Slide 15: FY 2019 targets
FY 2019 targets Revenue $21.5B – $22.0B Non-GAAP EPS(1) $7.75 – $8.15 Adjusted Free Cash Flow 90%+ of Adj. Net Income(1) 1 Excludes restructuring costs, transaction, separation and integration-related costs, amortization of acquired intangible assets, pension and OPEB actuarial and settlement gains,
Slide 16: Bookings
Bookings(1) FY17 FY18 $B 7.0 $6.3 $5.9 $5.9 $6.0 6.0 $5.4 5.0 $2.4 $2.2 $2.5 $3.3 $2.0 4.0 3.0 $2.6 2.0 $3.7 $2.8 $2.9 $2.2 1.0 $1.1 $0.2 $0.6 $0.5 $0.5 0.0 Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 GBS Global Business Services GIS Global Infrastructure Services USPS U.S. Public Sector 1 The summation
Slide 17: Supplemental Information
4th Quarter FY 2018 Earnings Presentation Supplemental Information
Slide 18: Non-GAAP reconciliations
Non-GAAP reconciliations EBIT and Adjusted EBIT Pro forma Pro forma combined combined (in millions) Q4 FY18 FY18 company company Q4 FY17 FY17 Net income (loss) $ 565 $ 255 $ 1,782 $ (23) Income tax expense (benefit) 96 (20) (111) 233 Interest income (30) (22) (89) (81) Interest expense 104 89 335 34
Slide 19: Non-GAAP reconciliations
Non-GAAP reconciliations Segment profit Pro forma Pro forma combined combined (in millions) Q4 FY18 FY18 company company Q4 FY17 FY17 GBS profit $ 470 $ 284 $ 1,563 $ 1,156 GIS profit 477 355 1,699 1,325 USPS profit 121 63 417 310 All other loss (51) (95) (180) (461) Interest income 30 22 89 81 Inte
Slide 20: Q4 FY18 non-GAAP results
Q4 FY18 non-GAAP results Transaction, Amortization of Pension and Restructuring separation and acquired OPEB actuarial Tax Non-GAAP (in millions except EPS) GAAP costs integration- intangible and settlement adjustment results related costs assets gains Cost of services (excludes depreciation and amo
Slide 21: FY18 non-GAAP results
FY18 non-GAAP results Transaction, Amortization of Pension and Restructuring separation and acquired OPEB actuarial Tax Non-GAAP (in millions except EPS) GAAP costs integration- intangible and settlement adjustment results related costs assets gains Cost of services (excludes depreciation and amorti
Slide 22: Q4 FY17 non-GAAP results
Q4 FY17 non-GAAP results Transaction, Amortization of Pension and Certain Restructuring separation and acquired OPEB actuarial Tax Non-GAAP (in millions except EPS) GAAP overhead costs integration- intangible and settlement adjustment results costs related costs assets gains Cost of services (exclud
Slide 23: FY17 non-GAAP results
FY17 non-GAAP results Transaction, Amortization of Pension and Certain Restructuring separation and acquired OPEB actuarial Tax Non-GAAP (in millions except EPS) GAAP overhead costs integration- intangible and settlement adjustment results costs related costs assets losses Cost of services (excludes
Slide 24: Adjusted free cash flow
Adjusted free cash flow (in millions) Q4 FY18 FY18 Net cash provided by operating activities $ 701 $ 3,243 Net cash used in investing activities(1) (246) (26) Acquisitions, net of cash acquired 46 (735) Payments on capital leases and other long-term asset financings (328) (1,060) Payments on transac
Slide 25: Non-GAAP and other definitions
Non-GAAP and other definitions Segment profit: Segment revenue less costs of services, segment selling, general and administrative, and depreciation and amortization (excluding amortization of acquired intangible assets) Segment profit margin: Segment profit as a percentage of revenue Earnings befor
Slide 26: DXC.technology
v DXC.technology BD,