Slide 1: DXC Investor Day
DXC Investor Day June 17, 2021 © 2021 DXC Technology Company. All rights reserved.
Slide 2: Non-GAAP Financial Measures
Non-GAAP Financial Measures In an effort to provide investors with supplemental financial information, in addition to the preliminary and unaudited financial information presented on a GAAP basis, we have also disclosed in this press release preliminary non-GAAP information including: earnings befor
Slide 3: 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 4: Our New Brand
DXC Investor Day Our New Brand © 2021 DXC Technology Company. All rights reserved. 4
Slide 5: Delivering eXcellence for our Customers and Colleagues
DXC Investor Day We are DXC Delivering eXcellence for our Customers and Colleagues Mission Values Be an IT services company using the power of Deliver... We do what we Care... We take care of each technology to build better futures for our say we are going to do. other and foster a culture customers
Slide 6: Playbook Phases
DXC Investor Day Playbook Phases Complete FY23/FY24 FY22 FY21 ACCELERATION PHASE FOUNDATION PHASE STABILIZATION PHASE We are here © 2021 DXC Technology Company. All rights reserved. 6
Slide 7: FY21 Accomplishments
DXC Investor Day FY21 Accomplishments Past Today People / Culture Attrition Inspired / Engaged Customers Challenged Positive Revenue / Margin Trajectory Declining Improving Marketplace Losing Winning Balance Sheet Highly Leveraged Strong Balance Sheet © 2021 DXC Technology Company. All rights reserv
Slide 8: FY21 Evidence
DXC Investor Day FY21 Evidence People Customers Revenue Employee Engagement Net Promoter Score (NPS) Margin Book-to-Bill Debt © 2021 DXC Technology Company. All rights reserved. 8
Slide 9: Our Transformation Journey Steps – Foundation (FY22)
DXC Investor Day Our Transformation Journey Steps – Foundation (FY22) Inspire and Take Care Focus on Optimize Costs Seize the Market Financial Foundation of our Colleagues Customers Increase Employee Stabilize Year over Expand Adjusted Book-to-Bill: Financial Goals Engagement: Year Organic EBIT Marg
Slide 10: Today's Agenda
DXC Investor Day Today’s Agenda 1 Inspire and Take Care of our Colleagues 2 Focus on Customers 3 Optimize Costs - Delivery 4 Seize the Market – Enterprise Technology Stack 5 Financials © 2021 DXC Technology Company. All rights reserved. 10
Slide 11: Inspire and Take Care of our Colleagues
Inspire and Take Care of our Colleagues © 2021 DXC Technology Company. All rights reserved.
Slide 12: Our People First Strategy
Inspire and Take Care of our Colleagues Our People First Strategy Listen. Seek to understand. Act at pace. © 2021 DXC Technology Company. All rights reserved. 12
Slide 13: Our Global Leadership Team
Inspire and Take Care of our Colleagues Our Global Leadership Team CEO Mike Salvino Region & Business Leadership Analytics & Insurance & Modern Americas Americas EMEA Asia Pacific Security Engineering BPO Workplace Jim Brady Tom Pettit Steve Turpie Seelan Nayagam Mark Hughes Dmitry Loschinin David S
Slide 14: Our Focus
Inspire and Take Care of our Colleagues Our Focus Rewards and Transparent Career Growth Recognition Decision Making © 2021 DXC Technology Company. All rights reserved. 14
Slide 15: Our Evidence
Inspire and Take Care of our Colleagues Our Evidence 56 72 Engagement 35 80 CEO Approval © 2021 DXC Technology Company. All rights reserved. 15
Slide 16: Focus on Customers
Focus on Customers © 2021 DXC Technology Company. All rights reserved.
Slide 17: DXC's Uniqueness as Defined by Our Customers
Focus on Customers DXC’s Uniqueness as Defined by Our Customers • Customer intimacy and seeing the “new DXC” • Institutional knowledge to run the mission critical systems • Business impact through technology © 2021 DXC Technology Company. All rights reserved. 17
Slide 18: Customer Accounts
Focus on Customers Customer Accounts 175 $5.9B 2675 $16.7* $6.4B $10.8B $7.5B 2500 $16.7* Number of Accounts Revenue by Account Type Platinum Rest of Portfolio $2.8B Platinum Rest of Portfolio Revenue by Region Americas APAC EMEA *FY21 revenues excluding dispositions ($B) © 2021 DXC Technology Compa
Slide 19: Americas Platinum Accounts
Focus on Customers Americas Platinum Accounts 6 9 40 69 14 Zurich By Account Size Insurance Group Ltd. >$200M $100M-$200M $50M-$99M <$50M Representative sample © 2021 DXC Technology Company. All rights reserved. 19
Slide 20: EMEA Platinum Accounts
Focus on Customers EMEA Platinum Accounts 2 9 40 72 21 By Account Size >$200M $100M-$200M $50M-$99M <$50M Representative sample © 2021 DXC Technology Company. All rights reserved. 20
Slide 21: DXC Operating Model
Focus on Customers DXC Operating Model A CUSTOMER’S PERSPECTIVE © 2021 DXC Technology Company. All rights reserved. 21
Slide 22: Investments in our Customers
Focus on Customers Investments in our Customers Platinum Customer 1 Relationships 2 Account Management Technical Sales Consultants 3 on all Platinum Accounts © 2021 DXC Technology Company. All rights reserved. 22
Slide 23: Optimize Costs - Delivery
Optimize Costs - Delivery © 2021 DXC Technology Company. All rights reserved.
Slide 24: Stabilized Delivery
Optimize Costs Stabilized Delivery Priority 1 (P1) Mean time to restore (MTTR) Service level agreement (SLA) penalties MTTR reduced by 17% SLA penalties reduced by 96% P1s reduced by 54% from >250 mins in FY20 to ~210 mins in FY21 from ~$20M at FY20 start to $0.7M in Q4 FY21 from 87/mo. in Q1 FY20 t
Slide 25: Driving Business to Global Innovation & Delivery Centers (GIDC)
Optimize Costs Driving Business to Global Innovation & Delivery Centers (GIDC) India New Delhi Regional GIDCs 47,000 Colleagues Hyderabad Delivery Centers 14,000 Colleagues Bangalore Chennai Eastern Europe Warsaw, Poland Newcastle, UK Wroclaw, Poland Bratislava, Slovakia Dalian, China Sofia, Bulgari
Slide 26: Optimizing Costs in Four Key Areas
Optimize Costs Optimizing Costs in Four Key Areas Real Estate Contractors GIDC Automation 40% 30% 35% 25% 465 12,000 500 30% 20% 23% 15% 10,000 25% 15% 400 8,000 20% 17% 10% 300 15% 6,000 5% 10% -7% 4,000 200 0% 1,600 5% 2,000 -5% 100 0% -10% 0 FY20 FY21 FY22 FY20 FY21 FY22 FY21 FY22 0 Buildings Hea
Slide 27: DXC Platform X
Optimize Costs DXC Platform X • A single, unified platform that provides the foundation for DXC services • Enables a unique view of technology Anomaly performance across the stack, using a rich Detected Server / VM Database data model to fuel AI capabilities Network • Full stack engineers work hand-
Slide 28: Simplified Experience
Optimize Costs Simplified Experience Easier to Work Simplified Tools, Easier to do @ DXC Processes, and Business with for Technology our Customers © 2021 DXC Technology Company. All rights reserved. 28
Slide 29: DXC's Technology Journey
Optimize Costs DXC’s Technology Journey Data-based Decision Making Measuring NPS from our colleagues to drive our programs and processes. Data drives decisisons. Experience- Employee Integrated Happy driven Satisfaction Security Customers Processes Virtual Digital Workplace Invest in our digital wor
Slide 30: Seize the Market – Enterprise Technology Stack
Seize the Market – Enterprise Technology Stack © 2021 DXC Technology Company. All rights reserved.
Slide 31: Enterprise Technology Stack
Seize the Market Enterprise Technology Stack FY21 GROWTH FY24 REVENUE ($B) OPPORTUNITIES GROWTH • Insurance Data & Analytics INSURANCE GBS $1.5 • Insurance BPO BPaaS AND BPO • Horizontalal + Vertical Expansion ANALYTICS & GBS $1.8 • Analytics ENGINEERING • Data Cleansing & Management • Custom Applic
Slide 32: Financials
Financials © 2021 DXC Technology Company. All rights reserved.
Slide 33: FY21 Evidence
Financials FY21 Evidence Revenue Margin Book-to-Bill Debt © 2021 DXC Technology Company. All rights reserved. 33
Slide 34: Moving From Sequential to YoY Organic Growth
Financials Moving From Sequential to YoY Organic Growth Sequential Organic Growth % Change YoY Organic Growth % Change Q1 FY21 Q2 FY21 Q3 FY21 Q4 FY21 Q1 FY21 Q2 FY21 Q3 FY21 Q4 FY21 1.7% 0.4% (2.4%) (6.8%) (7.0%) (9.8%) (11.0%) (10.5%) © 2021 DXC Technology Company. All rights reserved. 34
Slide 35: FY22 Financial Targets
Financials FY22 Financial Targets YoY Adjusted EPS Annual FCF Organic Revenue EBIT Margin (Non-GAAP) (CFO less Cap. Ex.) Growth (1%) – (2%) 8.2% – 8.7% $3.45 – $3.65 $500M © 2021 DXC Technology Company. All rights reserved. 35
Slide 36: Delivering on Our Commitments
Financials Delivering on Our Commitments Sequentially Winning in the Stabilized Quarterly Expanding Margins Optimizing Costs Marketplace Revenues Last 4 quarters Last 3 Last 3 ~$550M >1x quarters quarters savings in FY21 book-to-bill Compelling Evidence © 2021 DXC Technology Company. All rights rese
Slide 37: FY24 Outlook
Financials FY24 Outlook YoY Organic Adjusted Non-GAAP Annual FCF Revenue EBIT Margin EPS (CFO less Cap. Ex.) Growth 1% – 3% 10% – 11% $5.00 – $5.25 ~$1.5B Longer-Term Financial Targets © 2021 DXC Technology Company. All rights reserved. 37
Slide 38: Financial Foundation Priorities
Financials Financial Foundation Priorities 1 2 3 4 5 Strengthen Restructuring Cash Capital Foundation Balance Sheet & TSI Generation Allocation - True earnings power - Maintain investment - Reduce expense to - Improve cash flow - Investing in our grade credit rating ~$550M in FY22 generation people
Slide 39: Financial Foundation
Financials Financial Foundation • Remediating our material weakness Talent • ~75% new finance leadership • Dedicated team experienced transforming Culture Accountability processes, controls and remediating material weaknesses • Improving financial disclosure: IR website, enhanced earnings materials,
Slide 40: Environment, Social & Governance Highlights
Financials Environment, Social & Governance Highlights 1.8M+ 100K+ 20% 12% hours of noncompliance people benefited from 24 reduction in reduction in energy formal learning in DXC community development projects greenhouse gas consumption University completed by in India to improve education, emission
Slide 41: Strengthened the Balance Sheet
Financials Strengthened the Balance Sheet Outstanding Debt • Committed to investment grade; $12.0B demonstrated by our actions $9.7B • Reduced debt by $6.5 billion in past 3 $6.2B $5.5B quarters • Expect to approach $5 billion in debt outstanding in Q1 FY22 Q1 FY21 Q2 FY21 Q3 FY21 Q4 FY21 • Relative
Slide 42: Restructuring and TSI
Financials Restructuring and TSI $1,148M $866M $909M $570M $550M $300M $100M FY18 FY19 FY20 FY21 FY22 FY23 FY24 Lower Restructuring & TSI Expense Drive >$500 million in FCF in 3 Years © 2021 DXC Technology Company. All rights reserved. 42
Slide 43: Cash Flow Opportunities
Financials Cash Flow Opportunities ($ in M unless noted otherwise) Low High Reduce TSI and Restructuring to ~$100M by FY24 $650 $750 Implement Disciplined Capital Budgeting 150 250 Facilities Optimization 100 300 Reduce Capital Leases 100 200 Working Capital Optimization 100 200 Unwind Take-or-Pay P
Slide 44: Longer-Term Capital Allocation
Financials Longer-Term Capital Allocation Capital allocation tethered to free cash Invest in the Lease flow to protect investment grade credit rating Business 10% Repayment Priorities: • Invest in the business Free Cash • Share buybacks while valuation Flow remains attractive 35% 55% Allocation • Di
Slide 45: Financial Goals
Financials Financial Goals ✓ ❑ Win in the market – book to bill >1 ✓ ❑ Sequential revenue stability ✓ ❑ Strengthen the balance sheet ❑ Achieve organic revenue growth of (1%) to (2%) in FY22 ❑ Remediate material weakness and improve governance score ❑ Reduce restructuring and TSI ❑ Continued margin e
Slide 46: © 2021 DXC Technology Company. All rights reserved.
© 2021 DXC Technology Company. All rights reserved. 46
Slide 47: Financial Exhibits
Financial Exhibits © 2021 DXC Technology Company. All rights reserved.
Slide 48: Non-GAAP Reconciliation: Organic Revenue
Supplemental Financial Information Non-GAAP Reconciliation: Organic Revenue Year-Over-Year Organic Revenue Growth Q1 FY21 Q2 FY21 Q3 FY21 Q4 FY21 Total FY21 Total Revenue Growth (7.9)% (6.1)% (14.6)% (8.9)% (9.4)% Foreign Currency (1) 2.0% (1.6)% (2.3)% (4.6)% (1.7)% Acquisitions (3.8)% (0.3)% (0.1)
Slide 49: Non-GAAP Reconciliation: Organic Revenue
Supplemental Financial Information Non-GAAP Reconciliation: Organic Revenue Sequential Organic Revenue Growth Q1 FY21 Q2 FY21 Q3 FY21 Q4 FY21 Total Revenue Growth (6.5)% 1.2% (5.8)% 2.3% Foreign Currency (1) 0.8% (3.1)% (1.3)% (1.6)% Acquisitions (0.1)% — % — % (0.3)% Dispositions (1.0)% (0.5)% 8.8%
Slide 50: EBIT to Adjusted EBITDA Reconciliation
Supplemental Financial Information EBIT to Adjusted EBITDA Reconciliation EBIT to Adjusted EBIT (in millions) Q1 FY21 Q2 FY21 Q3 FY21 Q4 FY21 Total FY21 Net (loss) income $(199) $(246) $1,103 $(804) $(146) Income tax (benefit) expense (26) (60) 875 11 800 Interest income (23) (25) (28) (22) (98) Int
Slide 51: Non-GAAP and Other Definitions
Supplemental Financial Information Non-GAAP and Other Definitions Segment profit: Segment revenue less costs of services, segment selling, general and administrative, depreciation and amortization, and other income, excluding the movement in foreign currency exchange rates on our foreign currency de