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) July 20, 2005
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UNISYS CORPORATION
_______________________________________________________________________________
(Exact Name of Registrant as Specified in its Charter)
Delaware 1-8729 38-0387840
_______________________________________________________________________________
(State or Other (Commission File Number) (IRS Employer
Jurisdiction of Identification No.)
Incorporation)
Unisys Way,
Blue Bell, Pennsylvania 19424
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(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 July 20, 2005, Unisys Corporation issued a news release to report
its financial results for the quarter ended June 30, 2005. 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 July 20, 2005, 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: July 20, 2005 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 July 20, 2005, of Unisys Corporation.
News Release UNISYS Media Contacts: Elizabeth Douglass, 215-986-6583 elizabeth.douglass@unisys.com Jacqueline Lewis, 215-986-5204 jacqueline.lewis@unisys.com Investor Contact: Jim Kerr, 215-986-5795 jim.kerr@unisys.com UNISYS ANNOUNCES SECOND-QUARTER 2005 FINANCIAL RESULTS BLUE BELL, Pa., July 20, 2005 - Unisys Corporation (NYSE: UIS) today reported a second-quarter 2005 net loss of $27.1 million, or a loss of 8 cents per share, compared with second-quarter 2004 net income of $19.4 million, or 6 cents per share. The second-quarter 2005 results included pre-tax pension expense of $45.8 million, or 9 cents per share, compared with pension expense of $24.8 million, or 5 cents per share, in the year-ago quarter. Excluding the impact of pension expense in both periods, second-quarter 2005 net income was $4.1 million, or 1 cent per share, compared with net income of $36.3 million, or 11 cents per share, in the second quarter of 2004. Revenue for the second quarter of 2005 increased 3% to $1.44 billion from $1.39 billion in the year-ago quarter. Currency had a 3 percentage-point positive impact on the company's revenue in the second quarter, reflecting a weak U.S. dollar against most major currencies worldwide. COMMENTS FROM PRESIDENT AND CEO JOSEPH W. MCGRATH "Our second-quarter 2005 results came in as expected," said Joseph W. McGrath, Unisys President and Chief Executive Officer. "As was the case in the first quarter, our results were impacted by the continuing challenges of several transformational business process outsourcing contracts as well as weak demand for enterprise servers. Our results in the quarter were also impacted by a substantial increase in pension expense. Excluding pension expense, we posted a small profit in the quarter. "There were a number of positives in the quarter. Our services business showed good revenue growth, driven by double-digit growth in our outsourcing business. Our orders also increased double-digits with services orders showing strong growth for the second consecutive quarter. We were particularly encouraged by the improvement in our systems integration and consulting business, which saw substantial order gains and good revenue growth in the quarter. In our technology business, while our results were impacted by lower-than-expected volumes of enterprise server sales, we did see good growth in orders for ES7000 server products. Overall, our order picture continues to improve as customers respond favorably to our services, products, and solutions." Significant contracts signed in the quarter included: * a three-year contract extension from the state of New Jersey valued at approximately $90 million to continue managing the state's Medicaid administration services; Unisys has been the state's Medicaid fiscal agent since 1989; * a five-year, $68 million contract with a group of U.S. telecommunications companies for IT infrastructure outsourcing services; * a contract with China's Beijing Capital International airport to develop and integrate the core operational system for the airport's new international terminal, which is being built in preparation for the 2008 Olympic Games; * outsourcing contracts from Cadbury Schweppes, Andersen Corporation, Tre- For in Denmark, TeliaSonera and Mercuri Urval in Sweden, and other leading organizations. SECOND-QUARTER COMPANY RESULTS The company reported strong growth in overall orders in the second quarter. Services orders showed double-digit gains, driven by order growth for infrastructure services and systems integration and consulting. Technology orders showed high single-digit gains over the prior-year period, reflecting order gains for ES7000 servers and specialized equipment. Revenue in the U.S. increased 6% to $671 million. Revenue in international markets was up 1% in the quarter to $765 million. The company's gross profit margin and operating profit margin in the quarter were 19.3% and -3.9%, respectively, compared with 26.4% and 1.6% in the second quarter of 2004. The year-over-year margin declines were principally due to the impact of the challenging outsourcing contracts, lower sales of enterprise servers, and higher pension expense. The company continued to make progress in reducing its costs despite an increase in pension expense. SG&A expense and R&D expense represented 18.6% and 4.6% of revenue, respectively, in the second quarter of 2005 compared with 19.7% and 5.1% of revenue in the year-ago quarter. SECOND-QUARTER BUSINESS SEGMENT RESULTS Customer revenue in the company's services segment increased 7% in the second quarter of 2005 compared with the year-ago period. The services revenue growth was driven by double-digit growth in outsourcing and single-digit growth in systems integration and consulting and infrastructure services. Growth in these areas was partially offset by a double-digit revenue decline in core maintenance. On a reported basis, gross profit margin in the services business declined to 12.2% from 18.5% a year ago, while the services operating margin was -3.7% compared with 0.7% a year ago. The services margin declines in the quarter primarily reflected the impact of the challenging outsourcing contracts as well as the increase in pension expense. Excluding the impact of pension expense in both periods, services gross profit margin declined to 14.7% from 20.0% a year ago, while services operating margin declined to -0.6% compared with 2.5% a year ago. On a sequential basis, services operating margins excluding pension expense improved to -0.6% from -3.2% in the first quarter of 2005. Customer revenue in the company's technology segment declined 13% in the second quarter. Sales of specialized equipment and enterprise servers both showed double-digit declines in the quarter. Within enterprise servers, sales of ClearPath systems declined by a double-digit percentage, while ES7000 revenue showed a high single-digit increase. On a reported basis, technology gross margin declined to 44.6% from 53.3% a year ago, and technology operating margin declined to -4.8% from 5.4% a year ago. Excluding the impact of pension expense in both periods, the technology gross margin decreased to 44.9% in the second quarter of 2005 from 53.5% in the year-ago quarter and the technology operating margin declined to -2.1% compared with 6.7% in the year-ago period. The weak results in technology in the quarter reflected lower sales and margin in high-end enterprise servers and specialized equipment. CASH FLOW RESULTS Unisys generated $64 million of cash from operations in the quarter compared with $108 million in the year-ago quarter. The decline in operational cash flow year-over-year was primarily driven by lower net income. Capital expenditures in the second quarter of 2005 were $112 million, including $76 million invested in revenue-generating projects. Unisys ended the quarter with $399 million of cash on hand. BUSINESS OUTLOOK "Our sequential profit improvement will continue in the third quarter," McGrath said, "as we look for earnings per share, excluding pension expense, of between 4 to 6 cents. Revenue is expected to be up mid single-digits over the prior- year quarter. For the full year of 2005, while we continue to look for a strong fourth quarter of the year, we are tempering our previous full-year outlook principally due to negotiations on our challenging outsourcing operations taking longer than we expected. Excluding pension expense, we now expect full-year 2005 earnings per share of between 33 - 38 cents on low single- digit revenue growth over 2004. We continue to address the issues in our challenging outsourcing operations with the goal to resolve the issues and be in an improved position by the end of 2005." CONFERENCE CALL Unisys will hold a conference call today at 8:15 a.m. Eastern Time 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. Our people combine expertise in consulting, systems integration, outsourcing, infrastructure and server technology with precision thinking and relentless execution to help clients, in more than 100 countries, quickly and efficiently achieve competitive advantage. 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, contract values 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 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 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; the company's ability to maintain tight cost controls; the risks of doing business internationally and the potential for infringement claims to be asserted against the company or its clients. Statements in this release regarding contract values are based upon various assumptions, which are subject to change, including the projected volume of products and services to be provided by Unisys, the contracts continuing for their full term, and for contracts with governmental entities, the availability of appropriated funds. Accordingly, the contract values are not guaranteed. 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. PRESENTATION OF INFORMATION IN THIS PRESS RELEASE This release presents information that excludes pension expense. This financial measure is considered non-GAAP. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows where amounts are either excluded or included not in accordance with generally accepted accounting principles. A reconciliation of this non- GAAP measure to the most directly comparable GAAP measure, as well as disclosure of the reasons why the company uses this measure, is included in the financial information accompanying this release. .. ### RELEASE NO: xxxx/xxxx (See accompanying financial information) 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 (Millions, except per share data) Three Months Six Months Ended June 30 Ended June 30 ------------------ ------------------ 2005 2004 2005 2004 -------- -------- -------- -------- Revenue Services $1,236.0 $1,158.8 $2,343.7 $2,323.8 Technology 199.5 229.3 458.4 527.2 -------- -------- -------- -------- 1,435.5 1,388.1 2,802.1 2,851.0 Costs and expenses Cost of revenue: Services 1,063.4 930.2 2,044.8 1,855.9 Technology 94.7 90.8 219.6 236.5 -------- -------- -------- -------- 1,158.1 1,021.0 2,264.4 2,092.4 Selling, general and administrative 267.4 272.9 529.0 534.1 Research and development 66.6 71.3 131.5 142.8 -------- -------- -------- -------- 1,492.1 1,365.2 2,924.9 2,769.3 -------- -------- -------- -------- Operating income (loss) (56.6) 22.9 (122.8) 81.7 Interest expense 15.2 18.2 27.8 35.2 Other income (expense), net 32.0 24.0 32.5 24.6 -------- -------- -------- -------- Income (loss) before income taxes (39.8) 28.7 (118.1) 71.1 Provision (benefit) for income taxes (12.7) 9.3 (45.5) 22.8 -------- -------- -------- -------- Net income (loss) ($27.1) $19.4 ($72.6) $48.3 ======== ======== ======== ======== Earnings (loss) per share Basic ($ .08) $ .06 ($ .21) $ .14 ======== ======== ======== ======== Diluted ($ .08) $ .06 ($ .21) $ .14 ======== ======== ======== ======== Shares used in the per share computations (thousands): Basic 340,047 334,411 339,147 333,567 ======== ======== ======== ======== Diluted 340,047 338,767 339,147 338,407 ======== ======== ======== ========
UNISYS CORPORATION SEGMENT RESULTS (Millions) Elimi- Total nations Services Technology -------- -------- -------- ---------- Three Months Ended June 30, 2005 - ------------------ Customer revenue $1,435.5 $1,236.0 $199.5 Intersegment ($75.7) 4.9 70.8 -------- -------- -------- -------- Total revenue $1,435.5 ($75.7) $1,240.9 $270.3 ======== ======== ======== ======== Gross profit percent 19.3% 12.2% 44.6% ======== ======== ======== Operating profit (loss) percent (3.9%) (3.7%) (4.8%) ======== ======== ======== Three Months Ended June 30, 2004 - ------------------ Customer revenue $1,388.1 $1,158.8 $229.3 Intersegment ($57.3) 4.5 52.8 -------- -------- -------- -------- Total revenue $1,388.1 ($57.3) $1,163.3 $282.1 ======== ======== ======== ======== Gross profit percent 26.4% 18.5% 53.3% ======== ======== ======== Operating profit percent 1.6% 0.7% 5.4% ======== ======== ======== Six Months Ended June 30, 2005 - ------------------ Customer revenue $2,802.1 $2,343.7 $458.4 Intersegment ($135.6) 9.7 125.9 -------- -------- -------- -------- Total revenue $2,802.1 ($135.6) $2,353.4 $584.3 ======== ======== ======== ======== Gross profit percent 19.2% 11.6% 46.2% ======== ======== ======== Operating profit (loss) percent (4.4%) (5.2%) 1.1% ======== ======== ======== Six Months Ended June 30, 2004 - ------------------ Customer revenue $2,851.0 $2,323.8 $527.2 Intersegment ($103.0) 9.3 93.7 -------- -------- -------- -------- Total revenue $2,851.0 ($103.0) $2,333.1 $620.9 ======== ======== ======== ======== Gross profit percent 26.6% 18.8% 50.6% ======== ======== ======== Operating profit percent 2.9% 1.6% 7.1% ======== ======== ========
UNISYS CORPORATION CONSOLIDATED BALANCE SHEETS (Millions) June 30, December 31, 2005 2004 ---------- ---------- Assets Current assets Cash and cash equivalents $398.9 $660.5 Accounts and notes receivable, net 1,073.1 1,136.8 Inventories Parts and finished equipment 87.6 93.7 Work in process and materials 118.1 122.4 Deferred income taxes 292.4 291.8 Prepaid expense and other current assets 153.9 112.4 ---------- ---------- Total 2,124.0 2,417.6 ---------- ---------- Properties 1,331.7 1,305.5 Less accumulated depreciation and amortization 922.8 881.4 ---------- ---------- Properties, net 408.9 424.1 ---------- ---------- Outsourcing assets, net 432.2 431.9 Marketable software, net 337.1 336.8 Investments at equity 213.9 197.1 Prepaid pension cost 45.3 52.5 Deferred income taxes 1,394.6 1,394.6 Goodwill 188.8 189.9 Other long-term assets 160.2 176.4 ---------- ---------- Total $5,305.0 $5,620.9 ========== ========== Liabilities and stockholders' equity Current liabilities Notes payable $1.4 $1.0 Current maturities of long-term debt 400.5 151.7 Accounts payable 431.6 487.4 Other accrued liabilities 1,189.1 1,382.7 ---------- ---------- Total 2,022.6 2,022.8 ---------- ---------- Long-term debt 499.4 898.4 Accrued pension liabilities 610.6 537.9 Other long-term liabilities 694.2 655.3 Stockholders' equity Common stock 3.4 3.4 Accumulated deficit (448.8) (376.2) Other capital 3,907.0 3,883.8 Accumulated other comprehensive loss (1,983.4) (2,004.5) ---------- ---------- Stockholders' equity 1,478.2 1,506.5 ---------- ---------- Total $5,305.0 $5,620.9 ========== ==========
UNISYS CORPORATION CONSOLIDATED STATEMENT OF CASH FLOWS (Millions) Six Months Ended June 30 ------------------ 2005 2004 ------- ------- Cash flows from operating activities Net income (loss) ($72.6) $48.3 Add (deduct) items to reconcile net income (loss) to net cash provided by operating activities: Equity income (11.6) (14.3) Depreciation and amortization of properties 61.8 68.9 Depreciation and amortization of outsourcing assets 65.6 59.0 Amortization of marketable software 59.2 62.9 Increase in deferred income taxes, net (.6) (2.4) Decrease in receivables, net 73.6 185.3 Decrease in inventories 10.4 6.4 Decrease in accounts payable and other accrued liabilities (249.3) (194.1) Increase in other liabilities 122.6 3.5 Increase in other assets (24.8) (7.8) Other 56.4 21.6 ------- ------- Net cash provided by operating activities 90.7 237.3 ------- ------- Cash flows from investing activities Proceeds from investments 3,709.4 2,878.8 Purchases of investments (3,698.8) (2,879.0) Investment in marketable software (63.3) (60.5) Capital additions of properties (59.4) (74.5) Capital additions of outsourcing assets (86.3) (92.3) Purchases of businesses (.5) (12.6) ------- ------- Net cash used for investing activities (198.9) (240.1) ------- ------- Cash flows from financing activities Net proceeds from (reduction in) short-term borrowings .5 (10.6) Proceeds from employee stock plans 12.8 24.0 Payments of long-term debt (150.7) (1.7) ------- ------- Net cash (used for) provided by financing activities (137.4) 11.7 ------- ------- Effect of exchange rate changes on cash and cash equivalents (16.0) (1.4) ------- ------- (Decrease) increase in cash and cash equivalents (261.6) 7.5 Cash and cash equivalents, beginning of period 660.5 635.9 ------- ------- Cash and cash equivalents, end of period $398.9 $643.4 ======= =======
Reconciliation of GAAP to Non-GAAP Financial Information The preceding release presents information with and without pension expense. Unisys believes that this information will enhance an overall understanding of its financial performance due to the significant change in pension expense from period to period and the non-operational nature of pension expense. The presentation of non-GAAP information is not meant to be considered in isolation or as a substitute for results prepared in accordance with accounting principles generally accepted in the United States.
UNISYS CORPORATION RECONCILIATION OF GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF INCOME (Millions, except per share data) Three Months Ended June 30, 2005 ---------------------------- US GAAP Less Without as Pension Pension Reported Expense Expense -------- -------- -------- Revenue $1,435.5 $1,435.5 Costs and expenses Cost of revenue 1,158.1 ($32.0) 1,126.1 Selling, general and administrative 267.4 (8.9) 258.5 Research and development 66.6 (4.9) 61.7 -------- -------- -------- 1,492.1 (45.8) 1,446.3 -------- -------- -------- Operating income (loss) (56.6) 45.8 (10.8) Interest expense 15.2 15.2 Other income (expense), net 32.0 32.0 -------- -------- -------- Income (loss) before income taxes (39.8) 45.8 6.0 Provision (benefit) for income taxes (12.7) 14.6 1.9 -------- -------- -------- Net income (loss) ($27.1) $31.2 $4.1 ======== ======== ======== Earnings (loss) per share ($ .08) $ .09 $ .01 ======== ======== ======== Three Months Ended June 30, 2004 ---------------------------- US GAAP Less Without as Pension Pension Reported Expense Expense -------- -------- -------- Revenue $1,388.1 $1,388.1 Costs and expenses Cost of revenue 1,021.0 ($17.8) 1,003.2 Selling, general and administrative 272.9 (4.8) 268.1 Research and development 71.3 (2.2) 69.1 -------- -------- -------- 1,365.2 (24.8) 1,340.4 -------- -------- -------- Operating income 22.9 24.8 47.7 Interest expense 18.2 18.2 Other income (expense), net 24.0 24.0 -------- -------- -------- Income before income taxes 28.7 24.8 53.5 Provision for income taxes 9.3 7.9 17.2 -------- -------- -------- Net income $19.4 $16.9 $36.3 ======== ======== ======== Earnings per share $ .06 $ .05 $ .11 ======== ======== ========
UNISYS CORPORATION RECONCILIATION OF GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF INCOME (Millions, except per share data) Six Months Ended June 30, 2005 ---------------------------- US GAAP Less Without as Pension Pension Reported Expense Expense -------- -------- -------- Revenue $2,802.1 $2,802.1 Costs and expenses Cost of revenue 2,264.4 ($64.8) 2,199.6 Selling, general and administrative 529.0 (18.0) 511.0 Research and development 131.5 (9.8) 121.7 -------- -------- -------- 2,924.9 (92.6) 2,832.3 -------- -------- -------- Operating income (loss) (122.8) 92.6 (30.2) Interest expense 27.8 27.8 Other income (expense), net 32.5 32.5 -------- -------- -------- Income (loss) before income taxes (118.1) 92.6 (25.5) Provision (benefit) for income taxes (45.5) 29.6 (15.9) -------- -------- -------- Net income (loss) ($72.6) $63.0 ($9.6) ======== ======== ======== Earnings (loss) per share ($ .21) $ .18 ($ .03) ======== ======== ======== Six Months Ended June 30, 2004 ---------------------------- US GAAP Less Without as Pension Pension Reported Expense Expense -------- -------- -------- Revenue $2,851.0 $2,851.0 Costs and expenses Cost of revenue 2,092.4 ($33.3) 2,059.1 Selling, general and administrative 534.1 (9.7) 524.4 Research and development 142.8 (4.0) 138.8 -------- -------- -------- 2,769.3 (47.0) 2,722.3 -------- -------- -------- Operating income 81.7 47.0 128.7 Interest expense 35.2 35.2 Other income (expense), net 24.6 24.6 -------- -------- -------- Income before income taxes 71.1 47.0 118.1 Provision for income taxes 22.8 15.0 37.8 -------- -------- -------- Net income $48.3 $32.0 $80.3 ======== ======== ======== Earnings per share $ .14 $ .10 $ .24 ======== ======== ========
UNISYS CORPORATION RECONCILIATION OF GAAP TO NON-GAAP SEGMENT RESULTS OF OPERATIONS (Millions) Three Months Ended June 30, 2005 --------------------------- Less Without As Pension Pension Reported Expense Expense -------- -------- -------- Services Segment Total revenue $1,240.9 $1,240.9 Gross profit 151.1 ($31.1) 182.2 % of revenue 12.2% 14.7% Operating income (loss) (46.4) (38.5) (7.9) % of revenue -3.7% -0.6% Technology Segment Total revenue 270.3 270.3 Gross profit 120.5 (0.9) 121.4 % of revenue 44.6% 44.9% Operating income (loss) (12.9) (7.3) (5.6) % of revenue -4.8% -2.1% Total Company Total revenue 1,435.5 1,435.5 Gross profit 277.4 (32.0) 309.4 % of revenue 19.3% 21.6% Operating income (loss) (56.6) (45.8) (10.8) % of revenue -3.9% -0.8% Three Months Ended June 30, 2004 --------------------------- Less Without As Pension Pension Reported Expense Expense -------- -------- -------- Services Segment Total revenue $1,163.3 $1,163.3 Gross profit 214.9 ($17.4) 232.3 % of revenue 18.5% 20.0% Operating income 8.2 (21.1) 29.3 % of revenue 0.7% 2.5% Technology Segment Total revenue 282.1 282.1 Gross profit 150.4 (0.4) 150.8 % of revenue 53.3% 53.5% Operating income 15.1 (3.7) 18.8 % of revenue 5.4% 6.7% Total Company Total revenue 1,388.1 1,388.1 Gross profit 367.1 (17.8) 384.9 % of revenue 26.4% 27.7% Operating income 22.9 (24.8) 47.7 % of revenue 1.6% 3.4%
UNISYS CORPORATION RECONCILIATION OF GAAP TO NON-GAAP SEGMENT RESULTS OF OPERATIONS (Millions) Six Months Ended June 30, 2005 ----------------------------- Less Without As Pension Pension Reported Expense Expense -------- -------- -------- Services Segment Total revenue $2,353.4 $2,353.4 Gross profit 273.3 ($62.9) 336.2 % of revenue 11.6% 14.3% Operating income (loss) (121.5) (77.9) (43.6) % of revenue -5.2% -1.9% Technology Segment Total revenue 584.3 584.3 Gross profit 270.2 (1.9) 272.1 % of revenue 46.2% 46.6% Operating income 6.4 (14.7) 21.1 % of revenue 1.1% 3.6% Total Company Total revenue 2,802.1 2,802.1 Gross profit 537.7 (64.8) 602.5 % of revenue 19.2% 21.5% Operating income (loss) (122.8) (92.6) (30.2) % of revenue -4.4% -1.1% Six Months Ended June 30, 2004 ----------------------------- Less Without As Pension Pension Reported Expense Expense -------- -------- -------- Services Segment Total revenue $2,333.1 $2,333.1 Gross profit 437.8 ($32.6) 470.4 % of revenue 18.8% 20.2% Operating income 37.4 (40.4) 77.8 % of revenue 1.6% 3.3% Technology Segment Total revenue 620.9 620.9 Gross profit 314.2 (0.7) 314.9 % of revenue 50.6% 50.7% Operating income 44.3 (6.6) 50.9 % of revenue 7.1% 8.2% Total Company Total revenue 2,851.0 2,851.0 Gross profit 758.6 (33.3) 791.9 % of revenue 26.6% 27.8% Operating income 81.7 (47.0) 128.7 % of revenue 2.9% 4.5%
UNISYS CORPORATION RECONCILATION OF GAAP TO NON-GAAP FORWARD-LOOKING ESTIMATED EARNINGS (LOSS) PER SHARE Three Twelve Months Months Ending Ending 9/30/2005 12/31/2005 ---------- ---------- Earnings (loss) per share- on a GAAP basis (.05)-(.03) (.03)-.02 Add back estimated pension expense, net of tax .09 .36 --------- --------- Earnings per share- on a NON-GAAP basis (excluding pension expense) .04 - .06 .33 -.38 ========= ========= NOTE: See section in press release entitled "Forward-Looking Statements".