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Unisys announces Q3 profit up as repositioning programme goes ahead

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Unisys has reported improved financial results for the third quarter of 2007 as the company continues to make progress in its multi-year repositioning programme.

Highlights of the quarter include:
* Operating profit increased to $43,6-million compared to an operating loss of $42,9-million a year ago;
* Services operating profit margin improved to 3,6%, up from a negative 1,3% a year ago; and
* Services orders showed continued growth.
Tax expense in the quarter increased to $36.8-million from $16-million in the third quarter of 2006. The company’s third-quarter 2007 results also included $19.3-million in Other Expense, compared with $0.4-million of Other Income in the year-ago quarter. Including these items, Unisys reported a third-quarter 2007 net loss of $31-million, or 9 cents per share.
These results compared with a third-quarter 2006 net loss of $77.5 million, or 23 cents per share, which included a pre-tax restructuring charge of $36.4-million.  Pre-tax retirement-related expense in the third quarter of 2007 was $22.8-million compared with $47.5-million a year ago.
Revenue for the third quarter of 2007 declined 1% to $1.39 billion from $1.41-billion in the year-ago quarter. Foreign currency exchange rates had an approximately three percentage-point positive impact on revenue in the quarter.
“We continue to make progress in enhancing the profitability of our business,” says Joseph McGrath, Unisys president and chief executive officer.
“Our operating profit rose to $44-million in the quarter, an $87-million improvement year-over-year.  In our services business, which represented 87% of our revenue in the quarter, we achieved an operating profit margin of 3.6%.  This is a 490 basis-point improvement from the third quarter of 2006.  Equally important, our services orders continued to grow, and we enter the fourth quarter with a strong pipeline of opportunities.
“We are laying the foundation for improved revenue trends in 2008,” McGrath says.  “We are focused on continuing to enhance our profitability in the fourth quarter and we continue to drive toward our goal of an 8%-10% operating profit margin, excluding retirement expense.”