Unisys Corporation New · NYSE:UIS
Unisys Corporation New — Unisys — Q1 2004 Earnings Presentation
23 slides from Unisys Corporation New's earnings presentation, Apr 15, 2004
Slide 1: 1Q 2004 Financial Release
1Q 2004 Financial Release April 15, 2004 Larry Weinbach Janet Haugen Jack McHale Chairman & CEO CFO IRO & VP, Investor Relations
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: Strategic Review
Strategic Review Larry Weinbach Chairman & CEO
Slide 4: 1Q04 Overview
Slide 1 1Q04 Overview 30% growth in EPS excluding pension accounting Met earnings targets provided in January 2004 1Q04 Estimate 1Q04 Actual EPS – Excluding Pension .11 - .13 .13 EPS – GAAP Basis .07 - .09 .09 Strong cash flow from operations ... generated $16M of free cash flow in quarter; $170M im
Slide 5: 1Q04 Financial Highlights
Slide 2 1Q04 Financial Highlights 1Q04 1Q03 % Change Revenue $1,463M $1,399M +5% Services $1,165M $1,107M +5% Technology $298M $292M +2% Net Income – Excluding Pension $44M $34M +29% EPS – Excluding Pension 13 cents 10 cents +30% Net Income – As Reported $29M $39M -25% EPS – As Reported 9 cents 12 c
Slide 6: Marketplace Environment
Slide 3 Marketplace Environment Gradual improvement in overall demand conditions U.S. market continues to lead rebound ... some improvement seen in Europe, South Pacific Federal market remains strong
Slide 7: Major 1Q04 Orders and Awards
Slide 4 Major 1Q04 Orders and Awards Interpay, Netherlands – 5-year, estimated $110M BPO payment processing DoD Counterintelligence Field Activity – 5-year order worth up to $345M Notified by state of Louisiana of intent to award Unisys contract as Louisiana’s Medicaid fiscal agent ... contract bein
Slide 8: 1Q04 Review – Services
Slide 5 1Q04 Review – Services Continued to enhance operating margin, excluding pension accounting • 120 basis-point improvement in operating margin to 4.1% Announced 3-D Visible Enterprise • Deepens Business Blueprinting capabilities Acquired former KPMG Consulting Spain • Niche acquisition that en
Slide 9: 2004 Focused Services Growth Areas
Slide 6 2004 Focused Services Growth Areas Business process outsourcing • Continued strong pipeline of $100M+ deals Consulting and systems integration • 3D-VE, Check 21 services Federal government business • Major opportunities in security, managed services Infrastructure security • Significant pipe
Slide 10: 1Q04 Review – Technology
Slide 7 1Q04 Review – Technology Two-pronged strategy: Modernize ClearPath base while growing ES7000 ClearPath: Continued good management of business and customer base • Major new product enhancements in 2004 • Pay-for-use metering, modularity, Web-ready ES7000: Double-digit revenue growth • Good ac
Slide 11: Focused on 2004 Strategic Objectives
Slide 8 Focused on 2004 Strategic Objectives Double-digit growth in annuity/BPO revenue Drive continued growth in services margins Double-digit growth in enterprise security Double-digit growth in ES7000 volume Enhance global brand awareness of Unisys
Slide 12: 2004 Financial Outlook
Slide 9 2004 Financial Outlook Reiterate previous guidance Full year 2004: • Mid single-digit revenue growth • EPS of 83 – 87 cents excluding impact of pension accounting • $100M+ free cash flow Second-quarter 2004: • Single-digit revenue growth • EPS of 14 – 17 cents excluding impact of pension acc
Slide 13: Financial Review
Financial Review Janet Haugen Chief Financial Officer
Slide 14: 1Q04 Revenue by Geography
Slide 10 1Q04 Revenue by Geography Revenue: $1,463 Million Americas Pacific 7% 1Q04 % Change Customer Asia vs. 1Q03 Revenue 13% United States United States $682M +3% Europe/ 47% Africa International $781M +6% 33%
Slide 15: 1Q04 Revenue by Business Segment
Slide 11 1Q04 Revenue by Business Segment Revenue: $1,463 Million 1Q04 % Change Customer Services Revenue vs. 1Q03 80% Services $1,165M +5% Technology $298M +2% Overall $1,463M +5% Technology 20%
Slide 16: 1Q04 Services Revenue Breakdown
Slide 12 1Q04 Services Revenue Breakdown Customer Revenue: $1,165 Million 1Q04 Core Customer % Change Maint. vs. 1Q03 Revenue 12% Consulting/ Consulting/SI $377M +6% Infrastr. Systems Int. Services 33% Outsourcing $443M +8% 17% Infrastructure $200M -1% Services Core $145M +3% Outsourcing Maintenance
Slide 17: 1Q04 Technology Revenue Breakdown
Slide 13 1Q04 Technology Revenue Breakdown Customer Revenue: $298 Million 1Q04 % Change Customer vs. 1Q03 Revenue Specialized Enterprise $202M -7% Technology Servers 32% Enterprise Specialized $96M +30% Technology Servers 68% Overall $298M +2%
Slide 18: 1Q04 Expense Trends
Slide 14 1Q04 Expense Trends 1Q04 1Q03 % Change SG&A Expense – Reported $261M $244M +7% SG&A as % Revenue – Reported 17.9% 17.4% +0.5 pts SG&A Expense – Excl. Pension $256M $246M +4% SG&A as % Revenue – Excl. Pension 17.5% 17.6% -0.1 pts R&D – Reported $72M $67M +7% R&D – Excl. Pension $70M $70M --
Slide 19: 1Q04 Operating Margins
Slide 15 1Q04 Operating Margins Pension Accounting Impact Reported (GAAP) Excluding Pension Accounting 8% 8% 7% 7% 6% 6% 5% 5.5% 5% 5.5% 5.0% 4% 4% 4.0% 3% 3% 2% 2% 1% 1% 0% 0% 1Q03 1Q04 1Q03 1Q04 Please refer to reconciliation of GAAP to non-GAAP financial information available on the Unisys Invest
Slide 20: 1Q04 Services Operating Margins
Slide 16 1Q04 Services Operating Margins Pension Accounting Impact Reported (GAAP) Excluding Pension Accounting 8% 8% 7% 7% 6% 6% 5% 5% 4% 4% 4.1% 3% 3% 3.1% 2.9% 2% 2.5% 2% 1% 1% 0% 0% 1Q03 1Q04 1Q03 1Q04 Please refer to reconciliation of GAAP to non-GAAP financial information available on the Unis
Slide 21: 1Q04 Technology Operating Margins
Slide 17 1Q04 Technology Operating Margins Pension Accounting Impact Reported (GAAP) Excluding Pension Accounting 20% 20% 16% 16% 12% 12% 11.1% 8% 8% 9.9% 8.6% 9.5% 4% 4% 0% 0% 1Q03 1Q04 1Q03 1Q04 Please refer to reconciliation of GAAP to non-GAAP financial information available on the Unisys Invest
Slide 22: 1Q04 Cash Flow Highlights
Slide 18 1Q04 Cash Flow Highlights 1Q04 1Q03 Cash Flow From Operations $116M ($65M) Capital Expenditures $100M $89M % Revenue-Generating Cap Ex 64% 65% Free Cash Flow / (Usage) $16M ($154M) Depreciation & Amortization $89M $80M Please refer to reconciliation of GAAP to non-GAAP financial information
Slide 23: Questions & Answers
ion Answer Consulting. Systems Integration Outsourcing. infrastructure. Vvviviviv UNISYS ee Imagine ite Done