Unisys Corporation New · NYSE:UIS
Unisys Corporation New — Unisys — Shareholder Meeting (April 2005)
21 slides from Unisys Corporation New's shareholder meeting presentation, Apr 21, 2005
Slide 1: 2005 Annual Meeting of Stockholders
2005 Annual Meeting of Stockholders April 21, 2005 Joe McGrath President and Chief Executive Officer
Slide 2: Disclaimer
Disclaimer Statements made by Unisys during today’s presentation that are not historical facts, including those regarding future performance, are forward-looking statements under the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations and assumptions
Slide 3: Services-Led, Value-Added Strategy
Services-Led, Value-Added Strategy 2004 Revenue = $5.82 Billion Strategy: provide value-added, end-to-end Services solutions in our 81% 24% TECHNOLOGY focused markets Services: the driver 76% SERVICES Technology Technology: the enabler 19% Consistent vision since 1997
Slide 4: Multi-Year Transformation of Model
Multi-Year Transformation of Model UNISYS IN 1997 UNISYS TODAY Technology centric 80%+ revenue from services Minimal consulting High-level consulting / capability integration capabilities Minimal annuity $1.7B outsourcing outsourcing base business Largely lower-end Leadership in homeland services bu
Slide 5: Accomplishments of Transformation
Accomplishments of Transformation We have rebuilt … • Management team • Skills base • Corporate culture • Services/solutions portfolio • Revenue mix • Balance sheet/financial structure Unisys today is a different company …
Slide 6: Next Steps in Unisys Evolution
Next Steps in Unisys Evolution Build on strategic foundation Continue moving up client value chain Step up sales and marketing Continue to drive down controllable costs Execute, execute, execute! Top Priority: Enhance Shareholder Value
Slide 7: 2004: Challenging Year
2004: Challenging Year Results impacted by: • Challenges in several outsourcing contracts • Significantly higher pension accounting expense • Weak demand for high-end servers Revenue declined 2% EPS (GAAP) of 11 cents in 2004 vs. 78 cents in 2003 • Excluding pension expense, EPS of 30 cents in 2004
Slide 8: Challenges Continued in 1Q05
Challenges Continued in 1Q05 Reported loss in 1Q05 • GAAP loss of 13 cents per share vs. EPS of 9 cents in 1Q04 • Excluding pension, 4 cent loss vs. EPS of 13 cents in 1Q04 • Revenue down 7% Positives in 1Q • Order growth in services, driven by strong order gains in outsourcing • Good growth in ES70
Slide 9: Forces Reshaping IT Market
Forces Reshaping IT Market Constantly evolving business model Global sourcing rapidly growing Open source movement accelerating Growth of business utilities and pay-per-use Continued industry overcapacity Requirements for sophisticated security solutions Budget constraints driven by CEO-CIO expectat
Slide 10: Worldwide IT Spending Trends
Worldwide IT Spending Trends $B $1,430B $1,500 CAGR % $1,200B 2004 – 2007 $1,250 59% 61% Services 7.0% $1,000 Technology 4.8% $750 $500 39% 41% $250 $0 2004 2007 Source: Unisys estimates based on data from IDC, Gartner, other analysts.
Slide 11: Outsourcing: Fastest-Growing Services Segment
Outsourcing: Fastest-Growing Services Segment $B WW Total IT Services $1,000 $871B CAGR % 2004 – 2007 37% $800 $712B Outsourcing 9.1% 35% Systems $600 Integration 5.9% 40% & Consulting $400 41% Other 5.6% $200 23% 24% $0 2004 2007 Source: Unisys estimates based on data from IDC, Gartner, other analy
Slide 12: Unisys Well Positioned to Benefit
Unisys Well Positioned to Benefit Right strategy: services-led, technology-enabled Well positioned in growing markets • Outsourcing, consulting / SI, homeland security, Federal, high-end open servers Right blend of assets • Highly skilled people • End-to-end services portfolio • Deep industry expert
Slide 13: 2005: Initiatives to Drive Improved Results
2005: Initiatives to Drive Improved Results Fix challenging contracts in outsourcing business … drive improved execution / delivery Execute cost reduction program Drive sales and marketing programs to grow the top line … particularly in outsourcing, enterprise servers
Slide 14: Initiative #1: Fix Outsourcing Issues
Initiative #1: Fix Outsourcing Issues Facing continued challenges in several transformational BPO operations Taking actions to improve execution: • Changed management in operations … upgraded skills • Put top performers in place to manage operations • Strengthened proposal bid / review practices • T
Slide 15: Initiative #2: Reduce Costs
Initiative #2: Reduce Costs Continue taking steps to reduce costs … 3Q04 initiative to save $70M of annualized costs Also initiating “Six Sigma Lean” program • Multi-year program to create data-driven, performance-based culture at Unisys • Ensure all activities are focused on delivering value for cl
Slide 16: Initiative #3: Grow Orders, Revenue
Initiative #3: Grow Orders, Revenue Reengineering sales process • Dedicated teams to serve top 50 accounts • Created “One Unisys” sales compensation program Improving delivery excellence • Building common set of delivery processes across organization • Allows use of best people / talent in engagemen
Slide 17: Marketing Focus Areas – 2005
Marketing Focus Areas – 2005 Unisys 3D Visible Enterprise • Innovative offering in marketplace • Strong interest from clients … ~75 engagements … 50+ workshops, another 65 in development Outsourcing • Transformational BPO … infrastructure outsourcing Security • Federal government: Dept. of Homeland
Slide 18: Priorities Focused on Driving Profitable Growth
Priorities Focused on Driving Profitable Growth Differentiation 3D-VE Industry Expertise Transformational Outsourcing Revenue Operating Margin Leverage Costs Cost Reduction Six Sigma Lean
Slide 19: Starting to See Results in Order Growth
Starting to See Results in Order Growth Signed $400M+ of multi-year contracts in 1Q05 Key contracts with: • New York City Transit • Resolution Life Group in the United Kingdom • A major U.S. financial services institution • A large U.S. city public entity In early April, won new contract with group
Slide 20: Summary
Summary Unisys transformation continues Taking specific, concrete actions to drive profitable growth and enhance shareholder value Seeing results in new order growth Optimistic about growth prospects in second-half 2005
Slide 21: 2005 Annual Meeting of Stockholders
2005 Annual Meeting of Stockholders April 21, 2005