Unisys Corporation New · NYSE:UIS

Unisys Corporation New — Q2 2023 Earnings Presentation

20 slides from Unisys Corporation New's earnings presentation, Aug 2, 2023

  1. Slide 1: Second Quarter 2023 Financial Results

    Second Quarter Peter Altabef Chair and CEO 2023 Financial Results Deb McCann CFO AUG 1, 2023

  2. Slide 2: Disclaimer

    Disclaimer Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Unisys Co

  3. Slide 3: Performance Highlights 2Q 2023

    Performance Highlights 2Q 2023 Revenue Profitability Ex-L&S Revenue +4.9%, or +6.5% in constant currency Adj. EBITDA of $50.3M; Adj. EBITDA margin of 10.5% Total revenue (7.4%) YoY or (6.3%) in constant currency Non-GAAP operating profit of $16.3M; Non-GAAP operating margin of 3.4% vs. 9.0% in the p

  4. Slide 4: 2Q Revenue

    2Q Revenue ($M) COMPANY (7.4%) YoY DWS CA&I ECS (6.3%) cc YoY +4.9% YoY Up 2.6% in CC, or 1.9% as Down 27.0% in CC, or 27.6% as Up 7.7% in CC, or up 6.1% as +6.5% cc YoY reported reported reported $515 $477 $377 $396 $186 $127 $135 $130 $133 $135 2022 2023 2022 2023 2022 2023 2022 2023 2022 2023 1 T

  5. Slide 5: 2Q Gross Margins

    2Q Gross Margins COMPANY DWS CA&I ECS (450 bps) YoY 60 bps expansion 1,140 bps expansion 1,210 bps contraction +560 bps YoY 28.8% 24.3% 66.2% 16.0% 16.9% 54.1% 10.4% 13.0% 13.6% 5.5% 2022 2023 2022 2023 2022 2023 2022 2023 2022 2023 1 Total Company Ex-L&S

  6. Slide 6: 2Q Profitability & Free Cash Flow

    2Q Profitability & Free Cash Flow ($M) OPERATING PROFIT & EARNINGS PER SHARE, FREE CASH FLOW ADJ. EBITDA & MARGIN MARGIN (Non-GAAP)1 DILUTED (Non-GAAP)1 (Non-GAAP)1 9.0% 17.6% $47 3.4% 10.5% $90 $16 $50 $0.24 $25 ($0.09) ($59) 2022 2023 2022 2023 2022 2023 2022 2023 Declines driven by lower License

  7. Slide 7: 2Q23 EBITDA and Cash Flow Detail

    2Q23 EBITDA and Cash Flow Detail $M 2Q23 2Q22 EBITDA 1 $ 9.2 $ 51.6 ADJUSTED EBITDA 1 $ 50.3 $ 90.4 ADJUSTED EBITDA MARGIN 1 10.5% 17.6% OPERATING CASH FLOW $ 42.5 ($ 33.7) CAPITAL EXPENDITURES ($ 17.8) ($ 25.4) FREE CASH FLOW 1 $ 24.7 ($ 59.1) PRE-PENSION FREE CASH FLOW 1 $ 39.4 ($ 50.2) ADJUSTED F

  8. Slide 8: Leverage Detail

    Leverage Detail $M JUNE 30, 2023 SENIOR SECURED NOTES 1 $ 485.0 FINANCE LEASES AND OTHER DEBT 23.2 TOTAL DEBT $ 508.2 GLOBAL NET PENSION DEFICIT (AS OF DEC 31, 2022) 543.1 TOTAL DEBT INCLUDING PENSION DEFICIT $ 1,051.3 CASH $ 423.2 NET LEVERAGE $ 85.0 NET LEVERAGE INCLUDING PENSION DEFICIT $ 628.1 L

  9. Slide 9: Reiterating Financial Guidance

    (3%) - (7%)* Constant Currency Revenue YoY *Revenue guidance assumes ~$350M of License and Support (“L&S”) revenue; Reiterating Excluding L&S, revenue expected to grow (1%) to 4% YoY Financial 2% - 4% Guidance Non-GAAP Operating Margin Full-Year 2023 9.5% - 11.5% Adjusted EBITDA Margin

  10. Slide 10: Appendix

    Appendix UW unisys

  11. Slide 11: Unisys Segment and Solutions Map

    Unisys Segment and Solutions Map SEGMENT / REPORTING DESCRIPTION NEXT-GEN SOLUTIONS TRADITIONAL SOLUTIONS Modern Workplace: hybrid virtual desktop; Digital Workplace We deploy, integrate, and manage enterprise Traditional Workplace: field services, device-as-a-service; next-gen service desk; Solutio

  12. Slide 12: 2Q Revenue Profile

    2Q Revenue 16% 12% Profile 28% 14% SEGMENT GEOGRAPHY 46% 28% 37% 28% 28% NEXT-GEN MIX DWS CA&I ECS All Other US & Canada EMEA OF EX-L&S 63% Other Ex-L&S Solutions Next-Gen Solutions 22% 31% 40% 17% CLIENT REVENUE Ex-L&S MIX SECTOR TYPE OF TOTAL COMPANY 78% 83% 29% Commercial Recurring Non-Recurring

  13. Slide 13: Excluding License and Support (Ex-L&S)

    Excluding License and Support (Ex-L&S) $M 2Q23 2Q22 GAAP REVENUE $ 476.8 $ 515.0 L&S REVENUE 80.8 137.6 EX-L&S REVENUE (NON-GAAP) $ 396.0 $ 377.4 GAAP GROSS PROFIT $ 115.8 $148.1 L&S GROSS PROFIT 52.4 108.8 EX-L&S GROSS PROFIT (NON-GAAP) $ 63.4 $ 39.3 GAAP GROSS MARGIN 24.3% 28.8% AS A % OF REVENUE

  14. Slide 14: Non-GAAP Operating Profit

    Non-GAAP Operating Profit $M 2Q23 2Q22 GAAP OPERATING INCOME $ 0.1 $ 33.7 COST REDUCTION AND OTHER EXPENSES 1 15.8 12.3 POSTRETIREMENT EXPENSE 2 0.4 0.6 NON-GAAP OPERATING PROFIT $ 16.3 $ 46.6 REVENUE $ 476.8 $ 515.0 GAAP OPERATING PROFIT MARGIN 0.0% 6.5% NON-GAAP OPERATING PROFIT MARGIN 3.4% 9.0%

  15. Slide 15: Adjusted EBITDA Reconciliation

    Adjusted EBITDA Reconciliation $M 2Q23 2Q22 NET INCOME (LOSS) ATTRIBUTABLE TO UNISYS ($ 40.0) ($ 17.1) NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS 0.5 0.3 INTEREST EXPENSE, NET OF INTEREST INCOME OF $6.5 AND $3.4 RESPECTIVELY 1 1.0 4.9 PROVISION FOR INCOME TAX 15.4 20.3 DEPRECIATION 17.4 26.

  16. Slide 16: Non-GAAP Diluted Earnings Per Share

    Non-GAAP Diluted Earnings Per Share $M EXCEPT SHARE AND PER SHARE DATA 2Q23 2Q22 GAAP NET INCOME (LOSS) ATTRIBUTABLE TO UNISYS CORPORATION ($ 40.0) ($ 17.1) POST-RETIREMENT EXPENSE: PRETAX 10.6 12.5 TAX (0.2) -- NET OF TAX $ 10.8 $ 12.5 COST REDUCTION AND OTHER EXPENSE: PRETAX 23.4 20.8 TAX 0.3 -- N

  17. Slide 17: Adjusted Free Cash Flow

    Adjusted Free Cash Flow $M 2Q23 2Q22 CASH PROVIDED BY (USED FOR) OPERATIONS $ 42.5 ($ 33.7) ADDITIONS TO MARKETABLE SOFTWARE (11.0) (12.5) ADDITIONS TO PROPERTIES (4.6) (8.8) ADDITIONS TO OUTSOURCING ASSETS (2.2) (4.1) FREE CASH FLOW $ 24.7 ($ 59.1) POSTRETIREMENT FUNDING 14.7 8.9 PRE-PENSION FREE C

  18. Slide 18: Non-GAAP Net Income Margin

    Non-GAAP Net Income Margin $M 2Q23 2Q22 REVENUE $ 476.8 $ 515.0 NET INCOME (LOSS) ATTRIBUTABLE TO UNISYS ($ 40.0) ($ 17.1) NON-GAAP NET INCOME (LOSS) ATTRIBUTABLE TO UNISYS ($ 6.1) $ 16.2 NET INCOME (LOSS) (8.4%) (3.3%) AS A % OF REVENUE NON-GAAP NET INCOME (LOSS) ATTRIBUTABLE TO UNISYS (1.3%) 3.1%

  19. Slide 19: Definitions of Non-GAAP Financial Metrics

    Definitions of Non-GAAP Financial Metrics Non-GAAP operating profit – This measure excludes pretax postretirement expense and pretax charges in connection with cost-reduction activities and other expenses. EBITDA & adjusted EBITDA – Earnings before interest, taxes, depreciation and amortization (EBI

  20. Slide 20: Definitions of Other Metrics and Terms

    Definitions of Other Metrics and Terms Constant currency – A significant amount of the company’s revenue is derived from international operations. As a result, the company’s revenue has been and will continue to be affected by changes in the U.S. dollar against major international currencies. The co

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