Ncr Voyix Corporation · NYSE:VYX
Ncr Voyix — NCR — Investor Day (December 2008)
102 slides from Ncr Voyix's investor day presentation, Dec 4, 2008
Slide 1: NCR Analyst Day December 4, 2008
NCR Analyst Day December 4, 2008 New York Stock Exchange New York, New York Exhibit 99.1
Slide 2: Experience a new world of interaction
@NcrR Experience a new world of interaction TNcR
Slide 3: Agenda – December 4, 2008
Thursday, December 4, 2008 NCR Business Strategy Bill Nuti – Chairman & CEO Q & A Product Development Strategy Alan Chow – SVP, Product Development & CTO Operations Strategy Peter Dorsman – SVP, Operations Services Strategy Chris Wallace – SVP, Services NCR Business Model Tony Massetti – SVP, CFO
Slide 4: Note to Investors
NCR Confidential Note to Investors Certain non-GAAP financial information regarding NCR’s operating results may be discussed during this presentation. Reconciliations of the differences between GAAP and non-GAAP measures are available on the Investor page of NCR’s website at www.ncr.com. Remarks and
Slide 5: NCR Business Strategy
NCR Confidential NCR Business Strategy Bill Nuti Chairman & CEO
Slide 6: Creating Shareholder Value – A Look Back at 2007
NCR Confidential Creating Shareholder Value – A Look Back at 2007
Slide 7: NCR Analyst Day 2007: Key Take-Aways
NCR Confidential NCR Analyst Day 2007: Key Take-Aways • NCR can grow the top line; we’re on a strong foundation • A growing addressable market • Expanding consumer demand for self-service channels • Experienced management team dedicated to improve execution
Slide 8: Revenue, NPOI, EPS and Margin Targets
Revenue Non-Pension Operating Income Low Mid 8%-9% Mid Teens, Teens Teens 2% Growth? Growth 349 joe Me Growth * $24g $276 rT | | i 2004 2005 2006 2007E 2007 2008E 2008E seh, 5%-6% 94370 i $4,561 $4,582 | Ii 2004 ©2005-2006» 2007E «2007 2008E =. 2008E EPS - Non-GAAP $1.20 $1.4t $55 40.73 $0.86 oil 20
Slide 9: Creating Shareholder Value – 2008 Update
NCR Confidential Creating Shareholder Value – 2008 Update
Slide 10: Over the Past Year NCR Continues to Execute
NCR Confidential Over the Past Year NCR Continues to Execute Dynamic environment…things outside of our control • Unprecedented dislocation in global economy • Our largest end-markets (Financial & Retail) have been significantly impacted • Poor financial market returns signal higher pension expense •
Slide 11: Creating Shareholder Value
NCR Confidential Creating Shareholder Value
Slide 12: Our Vision & Mission
NCR Confidential Our Vision & Mission Our Vision Our Mission “Leading how the world “Leading how the world connects, interacts, connects, interacts, and transacts with and transacts with business” business” “Provide our customers with the “Provide our customers with the next generation of productivi
Slide 13: Our Business Strategy
NCR Confidential Expand and strengthen geographic presence & Sales coverage Penetrate adjacent single and multi- channel self-service solution segments Travel & Lodging Healthcare & Public Sector Telecommunications & Technology GAIN PROFITABLE SHARE Market share, wallet share, and mind share in our
Slide 14: Self-Service: Consumers Demand It, Businesses Depend On It
NCR Confidential Self-Service: Consumers Demand It….Businesses Depend On It. March 24, 2008
Slide 15: Consumers Choose Self-Service Across Industries
NCR Confidential Consumers Choose Self-Service for Speed, Convenience and Ease-of-Use Across Industries Financial Retail Travel Healthcare Faster More Convenient Easier 61% 60% 57% 53% 52% 54% 57% 46% 46% 47% 48% 45% • 11% increase in likelihood to use self-service over 2007 survey results • 67% mor
Slide 16: Consumers Are Becoming Multi-Channel
NCR Confidential …And Consumers Are Becoming Multi-Channel Multi-channel consumers spend 30% more Banking Retail Travel Hotel Healthcare To what degree would you personally use a combination of self-service devices… to perform a transaction? A Great Deal Somewhat Not at all Source: Buzzback Market R
Slide 17: A financial crisis unmatched since the Great Depression
A financial crisis unmatehed since the [Great Depression, saya TNcR
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Slide 21: Now More Than Ever…Self-Service
NCR Confidential Now More Than Ever…Self-Service • Reduces operating costs; increases productivity and efficiency • Increases revenue • Enables businesses to differentiate and deliver consistent customer service • “Good” capex "... customer-facing projects were only half as likely to be cut as those
Slide 22: Financial Industry Profile
NCR Confidential Financial Industry Profile
Slide 23: Financial Services: NCR Addressable Market
NCR Confidential Financial Services: NCR Addressable Market 2008 Addressable Market: $9.2B Core Markets: $7.8B Adjacent Markets: $1.4B
Slide 24: Financial Industry Profile
NCR Confidential Financial Industry Profile Value proposition remains strong globally • billion ATM cash withdrawals worldwide • A new ATM is installed every minutes • By maximizing the functionality of the existing ATM network in the U.S., the U.S. banking industry could save $2.25 billion per year
Slide 25: Emerging Regions will Continue to Grow
NCR Confidential Emerging Regions will Continue to Grow Only 27 ATM markets globally have reached a developed state . . . Still potential for another 1.4 million ATMs in emerging regions *Based on penetration of ATMs per 100k people for developed & emerging countries by region. Source: Worldbank Dat
Slide 26: Mobile Banking Users Regional Forecast 2007-2011
Je 3.1 Mobile Phone Users (%) Who use Mobile Banking - Regional Forecast 2007-2011 2008 200920102011 Norch America ee ae eed South America 22% 45K 100%, Wese Europe 9% 169% Esse Europe 4m 10am Far Ea & China 126% 196% Indian Sub Continent 0K 92% Rest of Aaa Pac em 116 ‘rien & idle East FE sax 96% ve
Slide 27: Extending Beyond ATM with Multi-Channel Applications
NCR Confidential Extending Beyond ATM with Multi-Channel Applications Online Banking Mobile Banking • 40% of U.S. households banking online, growing at over 27% • Online banking represents 20% of overall retail revenue • 64% of institutions see strong retention after customers become online banking
Slide 28: NCR Moves into Cash Management
NCR Confidential NCR Moves into Cash Management • Acquired the leading provider of teller connectivity software • Introducing new, purpose-built hardware solutions • Multiple pilots underway in U.S. and Europe • Technology applies to multiple industries Retail Healthcare Gaming Travel
Slide 29: Proven Leadership in Services
NCR Confidential Proven Leadership in Services • #1 Global ATM Service Provider Servicing 350,000+ ATMs in 100 countries High Availability monitoring of more than 110,000 ATMs Service Provider of Choice for 19 of the world’s top 20 Banks • #1 Provider of Outsourced, Channel Operational Services > 35
Slide 30: Confirmed at Recent BAI Conference
NCR Confidential ….Confirmed at Recent BAI Conference Our investment plans for self-service over the next 12-18 months will: Source: NCR Survey of 50 financial institutions at BAI Conference; Orlando, FL, November 18-20 Our investment plans for self-service over the next 12-18 months will: Source: N
Slide 31: Focused NCR Investments Against Market Priorities
NCR Confidential ….Focused NCR Investments Against Market Priorities Integrate multi - channel delivery for a seamless customer experience Implement managed services/outsourcing for flexible access to best-in-class resources Deploy new transactions or channels through hosted services/software as a s
Slide 32: Research Shows NCR Continues to Lead Global ATM Market
Drea xing Reser Research Shows NCR Continues to Lead Global ATM Market TNcR NCR Continues to Lad Global ATM Market, Research Says Les FORTUNE FORTUNE China magazine gives NCR design ‘award for SelfServ ATM ev ~ Nem comp, announced that its NCR Ser 25 ATM Ras toon named warn tho computer and uses pro
Slide 33: Retail Industry Profile
NCR Confidential Retail Industry Profile
Slide 34: Retail: NCR Addressable Market
NCR Confidential Retail: NCR Addressable Market 2008 2009 2010 2011 Adjacent Self-Service Markets: $.5B 2008 Addressable Market: $9.4B Core Markets: $8.9B -.5% 2.2% 10.8%
Slide 35: Self-Service Has Become a Retail Imperative
NCR Confidential Self-Service Has Become a Retail Imperative NCR SelfServ Checkout • Self-checkout now accounts for 20% of Tesco’s transactions in U.K., and 100% in US Fresh & Easy subsidiary • "The retailer (ASDA) is saving money with the shift to self-scan checkouts - with staff deployed elsewhere
Slide 36: Retail Kiosks Create New Interactions
NCR Confidential Retail Kiosks Create New Interactions In-Store Kiosk Applications • Loyalty Programs • Product Information • Pre-Order (deli, bakery) • Prescription Drop-off/Pick-Up North America 35% Europe 29% APAC 24% ROW 12% Source: Frost & Sullivan 2007 2008 Revenue Forecast Total Market < $1B
Slide 37: Retail Point-of-Service Innovation Continues
NCR Confidential Retail Point-of-Service Innovation Continues NCR RealPOS 80XRT Modular POS • First to market with Intel Core2 Duo vPro/AMT technology with advanced manageability features • Competing well in global retail market • Significant installations with The Home Depot, Macy's, Target, and US
Slide 38: NCR Consumables Strategy
NCR Confidential NCR Consumables Strategy Up to a 45% Reduction “Sainsbury’s with NCR for Sainsbury’s halves receipt paper usage” (As Published by 2008 European Retail Solutions Awards) Driving profitable growth • 2ST licenses and royalties • Receipt on Label (RoL) • Labels • Channel and geographic
Slide 39: Entertainment Industry Profile
NCR Confidential Entertainment Industry Profile
Slide 40: Entertainment Market
NCR Confidential Entertainment Market Buy/Sell/Trade ePlay Digital Media Delivery MOD Rental Touch Automation Ambient Source: Citibank Research and Sutton & Associates Vending Rental Channel Share (%) Stores Online CAGR -7% 3% 56% 2006 2010 Segments NCR Investments ISO Partners TNR ePlay
Slide 41: Differentiated Entertainment Solutions
NCR Confidential Differentiated Entertainment Solutions • DVD Rental • Packaged Media Sell-Through • Buy / Sell / Trade • Digital Download • In-store Kiosk • Digital Portability • Home NCR Application Capabilities
Slide 42: Emerging Industry Profiles
NCR Confidential Healthcare & Public Sector Travel & Lodging Telecommunications & Technology #1 in Healthcare Self-Service Patient Registration 4 of the Top 10 QSR Operators Most widely deployed CUSS platform Largest Global Postal Deployment #2 in Airline Check-in - Emerging Industry Profiles • $45m
Slide 43: NCR is Well Positioned to Deliver
NCR Confidential NCR is Well Positioned to Deliver
Slide 44: Creating Shareholder Value
NCR Confidential Creating Shareholder Value
Slide 45: Evolution of Our Cost Structure
NCR Confidential Evolution of Our Cost Structure Cost Savings Phase I and II • Phase I – G&A focused, completed 2007, $400mm • Phase II – Operations focused, started in 2007 • High Cost to Low Cost Regions • Manufacturing Restructuring • BPO • $150 – 200mm total savings; $75 – 100mm NPOI improvement
Slide 46: Evolution of Our Cost Structure
NCR Confidential Evolution of Our Cost Structure Phase I and II • Phase I – G&A focused, completed 2007, $400mm • Phase II – Operations focused, started in 2007 • High Cost to Low Cost Regions • Manufacturing Restructuring • BPO • $150 – 200mm total savings; $75 – 100mm NPOI improvement from 2008 -
Slide 47: Evolution of Our Cost Structure
NCR Confidential Evolution of Our Cost Structure Cost Savings Strategic Initiatives Operations • Value Engineering • Lean Enterprise • Low Cost Region Sourcing & Manufacturing Product Development • Value Engineering • Product Lifecycle Management (DFx) • Engineering Productivity Phase I and II • Pha
Slide 48: Evolution of Our Cost Structure
NCR Confidential Evolution of Our Cost Structure Cost Savings Strategic Initiatives Services • Service Parts & Logistics • Productivity • Design for Serviceability Product Development • Value Engineering • Product Lifecycle Management (DFx) • Engineering Productivity Operations • Value Engineering •
Slide 49: Evolution of Our Cost Structure
NCR Confidential Evolution of Our Cost Structure Cost Savings Strategic Initiatives G&A Infrastructure • Back office • Real estate • Productivity Product Development • Value Engineering • Product Lifecycle Management (DFx) • Engineering Productivity Operations • Value Engineering • Lean Enterprise •
Slide 50: Evolution of Our Cost Structure
NCR Confidential Evolution of Our Cost Structure Cost Savings Strategic Initiatives Continuous Improvement • Institutionalize within NCR culture and operating model • Organization Design • Business Process Outsourcing (BPO) • Business Process Improvement (BPI) Product Development • Value Engineering
Slide 51: Creating Shareholder Value
NCR Confidential Creating Shareholder Value
Slide 52: Capital Structure Strategy Update
NCR Confidential Capital Structure Strategy Update • Board Authorized $583mm buy-back that we executed over the past year • Regular and ongoing evaluation of optimal capital structure strategy…follows business strategy • Capital allocation decision factors (ROIC): Pension Working capital Credit mark
Slide 53: NCR Executive Leadership Team
NCR Confidential NCR Executive Leadership Team Peter Dorsman SVP Operations Malcolm Collins SVP Sales John Bruno EVP Industry Solutions Group Alan Chow SVP CTO Andrea Ledford SVP Human Resources Chris Wallace SVP Services Peter Lieb SVP General Counsel Mel Walter VP Business Development Bill Nuti Ch
Slide 54: Summary
NCR Confidential Summary • We’ve done “what we said we would do” • Confident in our strategy • We will course correct to the realities of the markets • We’re confident in the long term
Slide 55: Product Development Strategy
NCR Confidential Product Development Strategy Alan Chow SVP, Product & Solutions Development
Slide 56: NCR Product & Solutions Development
NCR Confidential NCR Product & Solutions Development • Innovation is alive and well at NCR • Focus on solution and process innovation • Savings recycled to fuel additional growth • Aligned with Operations and Services
Slide 57: Solution Innovation
NCR Confidential Solution Innovation Best-in-Class New Products NCR RealPOS 70 XRT • 30% faster with ~50% less energy consumption • 1 Intel Vpro Core integrated POS terminal NCR 2ST Printers • Reduced Paper Cost • Fewer roll changes • Environmental benefit • Ability to print promotions, surveys etc.
Slide 58: Process Innovation
NCR Confidential Process Innovation • Dedicated Value Engineering Teams • Product Lifecycle Management • Disruptive Technologies • Radical Redesign of Components • Common Platforms • SKU Reduction Common Application Software Platform Common Hardware Platform
Slide 59: NCR Improving Time To Market
NCR Confidential NCR Confidential Improving Time To Market Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2002 2003 2004 2005 2006 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2007 2008 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2000 2001 7878 Scanner 2-Sided Receipt Printer 5th Generation Family Less Than 2 Years of Developm
Slide 60: Alignment with Operations and Services
NCR Confidential Alignment with Operations and Services Design for Manufacturability Design for Serviceability Product Lifecycle Management • Reduced assembly time on NCR SelfServ Checkout by 20% • 27% fewer unique parts on NCR SelfServ 20 / 30 ATMs • Freight savings > 30% via bulk pack of POS termi
Slide 61: NCR Product & Solutions Development
NCR Confidential NCR Product & Solutions Development • Innovation is alive and well at NCR • Focus on solution and process innovation • Savings recycled to fuel additional growth • Aligned with Operations and Services
Slide 62: Operations Strategy
Operations Strategy Peter Dorsman SVP, Operations
Slide 63: Operations Mission
Operations Mission NCR Confidential Delivering products more efficiently, with a higher degree of quality and reliability than our competition
Slide 64: Operations Focus
Operations Focus NCR Confidential
Slide 65: Operations Functions
Operations Functions Product Development Information Technology Continuous Improvement Customer Services Fulfillment Make Source Plan New Product Intro NCR Confidential Product Development Manufacturing Operations Demand Planning Sourcing Manufacturing Operations Warehousing and Logistics Customer S
Slide 66: Manufacturing Network
Manufacturing Network Contract Manufacturing NCR Manufacturing Facilities NCR Fulfillment Centers Flex-Columbia, SC Dundee Puducherry Budapest Beijing Flex-Plano, TX Flex-Guadalajara Flex-Sorocaba Ebina Rotterdam Atlanta, GA MAC-Atlanta, GA Flytech-Taiwan TEC-Singapore GES Venture-Singapore NCR Conf
Slide 67: Manufacturing Model
Manufacturing Model NCR Confidential • Dedicated New Product Introduction (NPI) and Rapid Prototyping Centers • Regional High Volume Production facilities • In-Theater final touch/configuration • Centralized Low-Cost Region (LCR) Global Support Organization • Flexible Labor Model (Core and Buffer)
Slide 68: Manufacturing Network and Supplier Base
Contract Manufacturing NCR Manufacturing Facilities NCR Fulfillment Centers Flex-Columbia, SC Dundee Puducherry Budapest Beijing Flex-Plano, TX Flex-Guadalajara Flex-Sorocaba Ebina Rotterdam Atlanta, GA MAC-Atlanta, GA TEC-Singapore GES Venture-Singapore Supplier Network Contract Manufacturing NCR M
Slide 69: Cost Improvements
Cost Improvements Facility Consolidation Process Standardization Value Engineering LEAN Enterprise Practices Flexible Workforce Supplier Collaboration & Consolidation Low Cost Region Sourcing Outsourcing NCR Confidential
Slide 70: Value Engineering
Value Engineering Engineering Manufacturing SLM Product Mgmt Engineering Manufacturing SLM Product Mgmt Engineering Manufacturing SLM Product Mgmt Engineering Manufacturing SLM Product Mgmt Engineering Manufacturing SLM Product Mgmt Engineering Manufacturing SLM Product Mgmt NCR Confidential • Align
Slide 71: Warehouse Consolidation
Warehouse Consolidation NCR Confidential • Reduce cost associated with multiple locations, shipments, and handoffs • Eliminate higher cost local staging • Improve overall quality with standardized/controlled approach • Reduce total capital invested in finished goods inventory • Improve customer expe
Slide 72: Working Capital - Inventory
Working Capital - Inventory NCR Confidential • Warehouse Consolidation • Sales and Operations Planning • Demand Planning • VMI / Hubbing • Supplier Campuses • SKU Reduction • Lean Practices 2007 2008 2009 Raw Materials Finished Goods
Slide 73: Customer Experience End-to-End Quality Approach
Customer Experience “End-to-End” Quality Approach Product Installation Delivery Order Management Design NCR Confidential
Slide 74: Slide 74
Slide 75: Operations Functions
Operations Functions Product Development Information Technology Continuous Improvement Customer Services Fulfillment Make Source Plan New Product Intro NCR Confidential Manufacturing Operations Demand Planning Sourcing Manufacturing Operations Warehousing and Logistics
Slide 76: Services Strategy
NCR Confidential Chris Wallace SVP, Services Services Strategy
Slide 77: Services Overview
NCR Confidential Services Overview Significant margin improvement; on track to achieve double digit return Ten consecutive quarters of service revenue growth Strengthened Customer & Employee relationships Productivity: 15% increase in CS revenue per employee over last 3 years Greater than 95% custom
Slide 78: Services Overview
NCR Confidential Services Overview Innovative, end-to-end Service Portfolio Hardware + Software + Managed Services Differentiators: Why Customers choose NCR Significant margin improvement; on track to achieve double digit return Ten consecutive quarters of service revenue growth Strengthened Custome
Slide 79: Organized Around the Customer Experience
NCR Confidential Organized Around the Customer Experience Centers of Excellence (COE) Global technology platform Consistent management discipline Global customer satisfaction measurement Business analytics powered by one of the world’s largest CS data warehouses Region-aligned to improve customer ex
Slide 80: What Customers Value… $8.2B Addressable Services Market
NCR Confidential What Customers Value… $8.2B Addressable Services Market by 2011 • High Availability • Technology driven opportunity • Cost reduction • Operational efficiency • Security / Privacy • Single service source • Focus on customer travel experience • Proactive incident mgmt. • Cost reductio
Slide 81: Leveraged across New Industries
NCR Confidential …can be Leveraged across New Industries Media Replenishment Consumer Help Desk Asset Acquisition New for this industry Network Design Services Site Assessment & Preparation Staging (preloading SW) Onsite Installation Project Management Electronic Journal HW Maintenance SW Maintenanc
Slide 82: Innovation Centers of Excellence
NCR Confidential Innovation Centers of Excellence Remote Monitoring and Management Proactive / Predictive Availability New software support services Driving growth and efficiency Cost Optimization Rate, Mix, Productivity Remote Resolution Common Service Platform Parts & Logistics Cost obsession and
Slide 83: Continuous Improvement Culture
Continuous Improvement Culture
Slide 84: Service Innovations – APTRA Vision
NCR Confidential Service Innovations – APTRA Vision Proactive / Predictive Availability Incident Management Plus Transaction Monitoring Account Inquiry Envelope Deposit Withdrawal Transaction Thresholds/ Rules Dispatch & Repair/Replace 1. When threshold met 2. During remedial call to repair differen
Slide 85: Services Margin Evolution
NCR Confidential Services Margin Evolution Reactive Proactive Predictive Key Assumptions for Expansion • New industry penetration and leverage • Software support & maintenance growth • Retention through stellar customer satisfaction • Productivity gains through disciplined operations • APTRA Vision
Slide 86: Services Conclusions
NCR Confidential Services Conclusions • Customer Services is a strong and stable business Designed to grow/scale capability/leverage into new industries • Integrally linked with Engineering and Operations to deliver shareholder value • More than just service products - strategically critical to NCR’
Slide 87: NCR Business Model
NCR Confidential NCR Business Model Tony Massetti CFO
Slide 88: Financial Overview – Key Discussion Points
Financial Overview – Key Discussion Points NCR Confidential • NCR is executing well on its shareholder value levers, with strong YTD 2008 performance • Improving gross margin and significant cost reduction opportunities drive favorable NPOI growth outlook through 2011 • Working capital improvements
Slide 89: Creating Shareholder Value
NCR Confidential Creating Shareholder Value
Slide 90: NCR Revenue Trends
NCR Confidential NCR Revenue Trends Revenue - $ Millions Geographic Diversity (2008 Q3 YTD) Strong Growth
Slide 91: Profitable Revenue Growth - 2007 to 2011
NCR Confidential Profitable Revenue Growth - 2007 to 2011 Core Solutions Emerging Industry Growth New Service Offers & Improved Attach Adjacent Solutions ~$375M ~$150M ~$375M ~$150M
Slide 92: Revenue/Gross Margin by Geography
NCR Confidential Revenue/Gross Margin by Geography Revenue 2006 2007 2008 Q3 YTD Americas 2,096 $ 2,148 $ 1,685 $ EMEA 1,675 $ 1,906 $ 1,508 $ APJ $ $ $ Total 4,582 $ 4,970 $ 3,894 $ GM% 2006 2007 2008 Q3 YTD Americas 20.4% 20.1% 18.8% EMEA 22.9% 25.4% 27.1% APJ 24.0% 23.6% 24.5% Total 21.9% 22.8% 2
Slide 93: Creating Shareholder Value
NCR Confidential Creating Shareholder Value
Slide 94: Optimizing Cost Structure – 2007 to 2011
NCR Confidential Optimizing Cost Structure – 2007 to 2011 • Value engineering • Product Lifecycle Management / DFx • Engineering productivity • Value engineering • Lean enterprise • Low cost region sourcing and manufacturing • Service Parts & Logistics • Productivity • Design for serviceability • Pe
Slide 95: Creating Shareholder Value
NCR Confidential Creating Shareholder Value
Slide 96: Strong Balance Sheet
NCR Confidential Strong Balance Sheet 9/30/08 Cash balance $733 Debt balance $308 Net cash position $425 Near term objectives • Stability • Liquidity • Financial Flexibility • Working Capital Improvements ( $ Millions)
Slide 97: NCR Pension Discussion
NCR Confidential NCR Pension Discussion NCR Historical Pension Results 2002 2003 2004 2005 2006 2007 2008 Expense/(income) (74) 25-30 2002-2004 not adjusted for discontinued operations Cash Funding for Pension Plans 2005 2006 2007 2008E 2009E 2010E International & Executive 105-115 115-125 US Qualif
Slide 98: Revenue & NPOI Growth
NCR Confidential Revenue & NPOI Growth Revenue, $ Millions NPOI, $ Millions YoY Growth % of Revenue 8 – 9% 0.5% $4,582 8.5% $4,970 6.0% $276 7.0% $349 7 - 8% ’07–2011e CAGR = ~5% 2011e = ~10% * NPOI excludes pension expense and non-operational items
Slide 99: Working Capital Improvements
NCR Confidential Working Capital Improvements Focus on working capital … … has yielded solid improvements in 2008 2007 2008 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Accounts Receivable 1,007 1,014 1,167 1,048 Days Sales Outstanding Inventory Balance Inventory Turns (rolling 4 qtr avg) 5.6 5.5 5.5 5.5 5.5 5.6 5.8
Slide 100: Free Cash Flow Generation
NCR Confidential Free Cash Flow Generation Cash flow from operations Capital Expenditures *NCR calculates Free Cash Flow as cash provided by operating activities less capital expenditures for PP&E and additions to capitalized software ( $ Millions) 2006 2007 2008 Q3 YTD Free Cash Flow* … and a signi
Slide 101: In Summary
In Summary NCR Confidential • NCR is executing well on its shareholder value levers • Increased cost reduction targets provide additional support to NPOI growth outlook • We will manage the balance sheet for flexibility and liquidity in the near term, focusing on continued working capital improvemen
Slide 102: Questions
NCR Confidential Questions