UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported) April 30, 2008
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UNISYS CORPORATION
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(Exact Name of Registrant as Specified in its Charter)
Delaware 1-8729 38-0387840
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(State or Other (Commission File Number) (IRS Employer
Jurisdiction of Identification No.)
Incorporation)
Unisys Way,
Blue Bell, Pennsylvania 19424
_______________________________________________________________________________
(Address of Principal Executive Offices) (Zip Code)
(215) 986-4011
_______________________________________________________________________________
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions (see General Instruction A.2. below):
\ \ Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
\ \ Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
\ \ Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b)
\ \ Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition.
On April 30, 2008, Unisys Corporation issued a news release to report
its financial results for the quarter ended March 31, 2008. The release is
furnished as Exhibit 99 to this Current Report.
The information in this Current Report, including the Exhibit attached hereto
shall not be deemed "filed" for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended, or otherwise subject to the liabilities of
that section. The information contained herein and in the accompanying Exhibit
shall not be incorporated by reference into any registration statement or other
document filed with the Securities and Exchange Commission by Unisys
Corporation, whether before or after the date hereof, regardless of any general
incorporation language in such filing, except as shall be expressly set forth
by specific reference in such filing.
Item 9.01. Financial Statements and Exhibits.
(c) The following exhibit is being furnished herewith:
99 News Release, dated April 30, 2008, of Unisys Corporation
SIGNATURE
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
UNISYS CORPORATION
Date: April 30, 2008 By: /s/ Janet B. Haugen
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Janet B. Haugen
Senior Vice President and
Chief Financial Officer
EXHIBIT INDEX
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Exhibit
No.
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99 News Release, dated April 30, 2008, of Unisys Corporation.
News Release Investor Contact: Jack McHale, 215-986-6050 Jack.McHale@unisys.com Media Contacts: Jim Kerr, 215-986-5795 Jim.Kerr@unisys.com Danielle D'Angelo, 914-262-9834 Danielle.Dangelo@unisys.com UNISYS ANNOUNCES FIRST-QUARTER 2008 FINANCIAL RESULTS COMPANY REPORTS $28.0 MILLION OPERATING PROFIT, DOUBLE-DIGIT SERVICES ORDERS GROWTH BLUE BELL, Pa., April 30, 2008 - Unisys Corporation (NYSE: UIS) today reported a first-quarter 2008 operating profit of $28.0 million compared with a first- quarter 2007 operating loss of $29.6 million. Revenue for the first quarter of 2008 declined 3 percent to $1.30 billion from $1.35 billion in the year-ago quarter. Foreign currency exchange rates had an approximately 5 percentage- point positive impact on revenue in the quarter. "We continued to improve our operating profit in the first quarter despite some weakness in our U.S. business," said Unisys President and Chief Executive Officer Joseph W. McGrath. "Our federal business was impacted by contracting delays at certain agencies, and we saw some impact in our U.S. technology sales as organizations tightened spending on IT projects due to economic concerns. Even with this, we were able to continue improving profit margins in our services business as a result of our repositioning actions over the past two years. "We were also pleased with continued revenue growth in outsourcing and double- digit gains in services orders in the quarter," McGrath said. "Based on this order strength and a strong pipeline, we look for our federal business to recover in the second quarter and for our services business to return to growth as we move through the year." Unisys reported pretax income of $0.4 million in the first quarter of 2008 compared with a pretax loss of $23.0 million in the first quarter of 2007. The company incurred $23.8 million of tax expense in the current quarter compared with a $26.6 million tax benefit in the year-ago period, which included a $39.4 million benefit for settlement of a tax audit. After taxes, the company reported a first-quarter 2008 net loss of $23.4 million, or diluted loss per share of 7 cents, compared with net income of $3.6 million, or diluted earnings of 1 cent per share, in the year-ago period. Unisys results in the year-ago period included a $32.7 million pre-tax restructuring charge and a $23.7 million pre-tax gain on the sale of a business. Pretax retirement-related expense in the first quarter of 2008 was $0.6 million compared with $23.5 million in the year-ago period. FIRST-QUARTER COMPANY RESULTS Services orders showed substantial double-digit gains in the first quarter, driven by order gains for outsourcing and systems integration and consulting. Services order backlog at March 31, 2008 was $6.97 billion, up 2 percent from $6.86 billion at year-end 2007. Revenue in the United States declined 11 percent in the quarter to $537 million, reflecting declines in the company's technology and federal businesses. Revenue in international markets increased 3 percent to $764 million. On a constant currency basis, international revenue declined 6 percent in the quarter. The company's gross profit margin and operating profit margin in the first quarter of 2008 improved to 22.5 percent and 2.2 percent, respectively. These compared with gross and operating profit margins of 19.1 percent and (2.2) percent, respectively, in the first quarter of 2007. FIRST-QUARTER BUSINESS SEGMENT RESULTS Unisys has a long-standing policy to evaluate business segment performance on operating income exclusive of restructuring charges and unusual and non- recurring items. Therefore, the comparisons below exclude these items. Customer revenue in the company's services segment declined 1 percent in the first quarter of 2008 compared with the year-ago period. The company reported revenue growth in outsourcing, which was more than offset by revenue declines in infrastructure services and core maintenance. Systems integration and consulting revenue was flat in the quarter. Gross profit margin in the services business improved to 18.5 percent compared with 15.0 percent a year ago. Services operating margin improved to 2.3 percent compared with (1.0) percent a year ago. Customer revenue in the company's technology segment declined 16 percent from the first quarter of 2007, reflecting double-digit declines in both enterprise servers and specialized technologies. The technology revenue decline was centered in the company's U.S. and federal businesses; international technology revenue grew in the quarter. Gross profit margin in the technology business was 42.9 percent compared with 43.3 percent a year ago. Technology operating margin in the quarter was 0.8 percent compared with 3.5 percent in the first quarter of 2007. CASH FLOW AND BALANCE SHEET HIGHLIGHTS Unisys used $49 million of cash from operations in the first quarter of 2008 compared with operational cash usage of $104 million in the year-ago quarter. The company used approximately $21 million of cash in the first quarter of 2008 for restructuring payments compared to approximately $50 million in the year-ago period. Capital expenditures in the first quarter of 2008 were $65 million compared to $83 million in the year-ago quarter. After deducting for capital expenditures, Unisys used $114 million of free cash in the quarter compared with free cash usage of $187 million in the first quarter of 2007. During the quarter the company redeemed at par all $200 million of its 7 7/8% senior notes due 2008. The company ended the quarter with $490 million of cash on hand. CONFERENCE CALL Unisys will hold a conference call today at 8:15 a.m. EST to discuss its results. The listen-only Webcast, as well as the accompanying presentation materials, can be accessed via a link on the Unisys Investor Web site at www.unisys.com/investor. Following the call, an audio replay of the Webcast, and accompanying presentation materials, can be accessed through the same link. ABOUT UNISYS Unisys is a worldwide information technology services and solutions company. We provide consulting, systems integration, outsourcing and infrastructure services, combined with powerful enterprise server technology. We specialise in helping clients use information to create efficient, secure business operations that allow them to achieve their business goals. Our consultants and industry experts work with clients to understand their business challenges and create greater visibility into critical linkages throughout their operations. For more information, visit www.unisys.com FORWARD-LOOKING STATEMENTS Any statements contained in this release that are not historical facts are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, any projections of earnings, revenues, or other financial items; any statements of the company's plans, strategies or objectives for future operations; statements regarding future economic conditions or performance; and any statements of belief or expectation. All forward-looking statements rely on assumptions and are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. Risks and uncertainties that could affect the company's future results include general economic and business conditions; the effects of aggressive competition in the information services and technology markets on the company's revenues, pricing and margins and on the competitiveness of its product and services offerings; the level of demand for the company's products and services and the company's ability to anticipate and respond to changes in technology and customer preferences; the company's ability to successfully implement its repositioning strategy; the company's ability to retain significant clients; the company's ability to grow outsourcing and infrastructure services and its ability to effectively and timely complete the related solutions implementations, client transitions to the new environment and work force and facilities rationalizations; the company's ability to continue to effectively address its challenging outsourcing operations through negotiations or operationally and to fully recover the associated outsourcing assets; the company's ability to drive profitable growth in consulting and systems integration; the level of demand for the company's high-end enterprise servers and maintenance on those servers; the risk that the company's contracts may not be as profitable as expected or provide the expected level of revenues and that contracts with U.S. governmental agencies may be subject to audits, criminal penalties, sanctions and other expenses and fines; the risk that the company may face damage to its reputation or legal liability if its clients are not satisfied with its services or products; the performance and capabilities of third parties with whom the company has commercial relationships; the risks of doing business internationally; the potential business and financial risk in implementing future acquisitions or dispositions and the potential for infringement claims to be asserted against the company or its clients. Additional discussion of these and other factors that could affect Unisys future results is contained in its periodic filings with the Securities and Exchange Commission. Unisys assumes no obligation to update any forward-looking statements. ### RELEASE NO.: 0430/8875 http://www.unisys.com/about__unisys/news_a_events/04308875.htm Unisys is a registered trademark of Unisys Corporation. All other brands and products referenced herein are acknowledged to be trademarks or registered trademarks of their respective holders.UNISYS CORPORATION CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Millions, except per share data) Three Months Ended March 31 ------------------- 2008 2007 -------- -------- Revenue Services $1,137.1 $1,152.9 Technology 164.2 195.1 -------- -------- 1,301.3 1,348.0 Costs and expenses Cost of revenue: Services 922.2 993.9 Technology 85.9 96.7 -------- -------- 1,008.1 1,090.6 Selling, general and administrative 232.5 244.6 Research and development 32.7 42.4 -------- -------- 1,273.3 1,377.6 -------- -------- Operating profit (loss) 28.0 (29.6) Interest expense 21.6 18.9 Other income (expense), net (6.0) 25.5 -------- -------- Income (loss) before income taxes 0.4 (23.0) Provision (benefit) for income taxes 23.8 (26.6) -------- -------- Net income (loss) ($23.4) $3.6 ======== ======== Earnings (loss) per share Basic ($ .07) $ .01 ======== ======== Diluted ($ .07) $ .01 ======== ======== Shares used in the per share computations (thousands): Basic 354,798 346,421 ======== ======== Diluted 354,798 348,338 ======== ========
UNISYS CORPORATION SEGMENT RESULTS (Unaudited) (Millions) Elimi- Total nations Services* Technology* -------- -------- -------- ---------- Three Months Ended March 31, 2008 - ------------------ Customer revenue $1,301.3 $1,137.1 $164.2 Intersegment ($43.7) 2.7 41.0 -------- -------- -------- -------- Total revenue $1,301.3 ($43.7) $1,139.8 $205.2 ======== ======== ======== ======== Gross profit percent 22.5% 18.5% 42.9% ======== ======== ======== Operating profit percent 2.2% 2.3% 0.8% ======== ======== ======== Three Months Ended March 31, 2007 - ------------------ Customer revenue $1,348.0 $1,152.9 $195.1 Intersegment ($40.1) 3.9 36.2 -------- -------- -------- -------- Total revenue $1,348.0 ($40.1) $1,156.8 $231.3 ======== ======== ======== ======== Gross profit percent 19.1% 15.0% 43.3% ======== ======== ======== Operating profit (loss) percent (2.2%) (1.0%) 3.5% ======== ======== ======== * Results exclude cost reduction actions
UNISYS CORPORATION CONSOLIDATED BALANCE SHEETS (Millions) March 31, 2008 December 31, (Unaudited) 2007 ---------- ---------- Assets Current assets Cash and cash equivalents $490.2 $830.2 Accounts and notes receivable, net 1,031.7 1,059.2 Inventories Parts and finished equipment 90.9 91.9 Work in process and materials 84.1 79.2 Deferred income taxes 18.0 18.0 Prepaid expense and other current assets 150.4 133.7 ---------- ---------- Total 1,865.3 2,212.2 ---------- ---------- Properties 1,354.3 1,336.9 Less accumulated depreciation and amortization 1,030.5 1,004.7 ---------- ---------- Properties, net 323.8 332.2 ---------- ---------- Outsourcing assets, net 391.4 409.4 Marketable software, net 261.0 268.8 Prepaid postretirement assets 529.8 497.0 Deferred income taxes 93.8 93.8 Goodwill 201.2 200.6 Other long-term assets 125.0 123.1 ---------- ---------- Total $3,791.3 $4,137.1 ========== ========== Liabilities and stockholders' equity Current liabilities Notes payable $0.1 $0.1 Current maturities of long-term debt 3.7 204.3 Accounts payable 379.9 419.6 Other accrued liabilities 1,214.6 1,272.0 ---------- ---------- Total 1,598.3 1,896.0 ---------- ---------- Long-term debt 1,061.3 1,058.3 Long-term postretirement liabilities 414.1 420.7 Other long-term liabilities 367.3 395.5 Stockholders' equity Common stock 3.6 3.6 Accumulated deficit (2,489.3) (2,465.9) Other capital 4,026.6 4,011.8 Accumulated other comprehensive loss (1,190.6) (1,182.9) ---------- ---------- Stockholders' equity 350.3 366.6 ---------- ---------- Total $3,791.3 $4,137.1 ========== ==========
UNISYS CORPORATION CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) (Millions) Three Months Ended March 31 ------------------- 2008 2007 ------- ------- Cash flows from operating activities Net income (loss) ($23.4) $3.6 Add (deduct) items to reconcile net income (loss) to net cash used for operating activities: Employee stock compensation expense 6.0 2.3 Company stock issued for U.S. 401(k) plan 8.8 9.5 Depreciation and amortization of properties 26.7 27.4 Depreciation and amortization of outsourcing assets 42.4 38.0 Amortization of marketable software 30.5 33.4 Gain on sale of assets (23.7) Increase in deferred income taxes, net (2.3) Decrease (increase) in receivables, net 42.5 (5.3) Increase in inventories (2.2) (11.9) Decrease in accounts payable and other accrued liabilities (129.0) (135.3) Decrease in other liabilities (14.5) (29.2) Increase in other assets (42.5) (13.1) Other 5.4 2.3 ------- ------- Net cash used for operating activities (49.3) (104.3) ------- ------- Cash flows from investing activities Proceeds from investments 1,646.6 1,922.4 Purchases of investments (1,675.9) (1,925.4) Investment in marketable software (22.4) (24.3) Capital additions of properties (14.6) (19.3) Capital additions of outsourcing assets (27.9) (39.3) Purchases of businesses (.4) (1.2) Proceeds from sale of assets 28.3 ------- ------- Net cash used for investing activities (94.6) (58.8) ------- ------- Cash flows from financing activities Net reduction in short-term borrowings (1.1) Proceeds from exercise of stock options 7.0 Payments of long-term debt (200.0) Financing fees (.8) ------- ------- Net cash (used for) provided by financing activities (200.8) 5.9 ------- ------- Effect of exchange rate changes on cash and cash equivalents 4.7 2.1 ------- ------- Decrease in cash and cash equivalents (340.0) (155.1) Cash and cash equivalents, beginning of period 830.2 719.3 ------- ------- Cash and cash equivalents, end of period $490.2 $564.2 ======= =======