CNDT - Earnings call transcript Q4 2019

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Operator

Good day, and welcome to the Conduent Fourth Quarter 2019 Earnings Conference Call and Webcast. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded.

I would now like to turn the conference over to Alan Katz, Vice President of Investor Relations. ahead. go Please

Alan Katz

and XXXX ladies welcome Conduent's to Good call. gentlemen, quarter earnings fourth evening, and

Joining call on Walsh me today's Conduent's and Conduent's CFO. Brian CEO, is Cliff Skelton,

Relations call will Following a remarks, used detailed of well are this during section filed sheet copy take afternoon, is was slides also available call financial on the your of our metrics website. the being we the Conduent for as questions. with prepared this those A webcast. as Investor This the download SEC slides

We will also post later this a week. transcript

management's that call certain the this Conduent Act their expectations During factors executives Litigation of are materially to may statements assumptions matters XXXX Securities from beliefs, Statements XX, February those in These of and make results as today, may are comments uncertain. subject in defined address that a and future by and statements. nature contain as XXXX, Reform differ cause actual Forward-Looking are reflect to of that number Private that the current

information developments these included by statements filed not future in XX-K Report Form We on SEC. of the or required with to is concerning result new a update events these intend factors as except Conduent's forward-looking as Annual Information or law. do

today prepared reported in to presented and Company's as with measures accordance non-GAAP not should the these includes viewed accordance calculated Information results addition in financial substitute U.S. with not they are because measures, be U.S. GAAP, in a GAAP. for

comparative see press of and issued SEC limitations X-K. to we them was was on as use to regarding please this as information how our the definitions for usefulness furnished as more non-GAAP our which afternoon and measures For Form release, their well purposes,

will Cliff turn call With Cliff. remarks. his for that, to prepared over I the

Clifford Skelton

strategic the the we and our guidance, and our discuss to will call. go Q&A. will will we Thank we will Brian provide XXXX quick of then will some operational with on overview with XXXX more the Welcome earnings Alan. over Good afternoon, and results and I close results QX full-year start detail everyone. today QX of a you, review. and highlights financial

for that we the the on that I the based adjusted would of the hoped. end near of have we Despite than midpoint EBITDA year and full-year started revenue achieved have right range set signings We guidance top CEO. the been as for the at weaker when range

seeing very are in initial We strong performance signings QX.

new business January came signs anticipated. stronger in than

too be our confidence, to may of While early is still the call beginning client turnaround it these journey. increased signs early more than of it

results out growth, the I of launch operational strategic the to of Last a efficiency of with to turn quality three and focus we on want Program we delivery. Systemic point the highlights. review, prong Before quarter, our Transformation some announced additional

strategic across tactical, series used the has and in will of all This The areas. result execution a our and our and for ubiquitous businesses and focus of operational will and as strategic arm review be products. is projects, framework

Some quality and We end users. delivery for produced improvements quick early improved and some our clients IT in performance, efforts their wins. resulting

points net proof in developed not well both and consistent satisfaction rating. feedback positive anecdotal promoter the in indicated to We trends. our have yet are simply client are see beginning and signs These as early score by

drive people talent our change transformation us efforts. of several brought We rebuilding on senior help initiative our part to as and in help

a new and managers, the among of Officer In addition new have HR, General Officer, key to our Chief new added others. Counsel general and several Head Revenue we Chief Information

and culture and base, significant engagement developing client associate in We teamwork improvements performance, are associate with driving a our and satisfaction, in prioritizes clients intended to that increased result retention. both

and and results retention business is expansion efficiency in opportunities our stabilization, invest of certain others, operational revenue business new the strategic a clear and review, expansion we via completed businesses signings. growth believe for to in will We result the and plan in margin review the opportunities which also in

categories, offerings which go the into in through segmented have I We next detail will three slide. on the

As could a be near-term and consideration improved a part of divestiture discussed of our be earnings we shareholder value calls, possible component believe in that strategic set. should previous

As considered including create about, through tight see part we inbound utilize even by selling criteria inquiries disposition of shareholder and retaining. the to would feel we review, value it great us business business, than a would divestitures a more

divestiture shareholder growth. will believe our which we opportunistic, overtime us not to value, our position our we to efforts portfolio continue While and a meaningful is improved current coupled top-line do goal. necessarily to will We leadership, our well drive transformation be need drive EBITDA with and

to move of strategic on view let's the the details X. Now Slide

we in where As earnings calls, determine proposition. business our mentioned and review maximize to undertook our investments the past into value to two to this the focus we

ensure well-positioned valuation months Given six a evaluated of to spent our the performance by completing in that each Conduent be forward current lines for go analysis market, we would business assigned the our of thorough success. and

from investment. at We a look that our and worked at took spin. what would and has processes areas areas has different benefit looked would that not We since hard benefit from

the to future. to will and is the industry strength advantage well stabilize our to revenue. trends invest portfolio stronger take of other as or to for cash optimize and offerings Company and increase We flow in This offerings enhanced positioned to build and investment

meaningful terms cash use expect expenditures. to In can to fund in we on of operating transformation, both have the which generate funding we capital XXXX cash of hand, flow and

undrawn a leverage have an balance revolver debt with also and We ratios. reasonable sheet, strong

We continue funding possible well. consider will feature divestitures other or to options as

company. strategy for to X Now, let's turn to the go-forward our Slide discuss

optimization the outcomes retention have thus and productivity we where the of improving drive offerings we to for currently creating into First, can; increase Regarding clients. better margin, company, our spectrum our within assets

where and lastly, offerings expand Second, we the markets, invest we in new adjacent technologies. current meaningful more services where through amount in solutions have and enhancements. product And we grow retain leveraging and can can to

improve where scale, and of share. the of delivery, we user significant cost capture more generally process our expand end and clients believe our The experience, reduce can areas that consolidation, optimized improvements, margins, additional retain automation, we with businesses are volume technology

market the to to our markets enhance modest share client see and in. and solutions tend businesses where a we relationships the investment, servicing potential operate we of have strong The history long with

However, that or modernized. needs refreshed be we to have technology

will of capabilities, is in and the we But business the where Lastly, market investment. more with provide by opportunities augmented our new These perhaps additional see modest see areas to growth expand payback businesses, a dynamics require may the meaningful capabilities supplemented opportunities. acquisitions, address we significant.

provide optimized a quick now an expansion and business will business. I of example an

services healthcare opportunity, the and employees. scale care ecosystem capabilities employers as pharmaceutical third-party leverage companies, companies identified healthcare significant expansion across insurance with health administrators, insurance currently We We health for universe. to have an provide providers, of the core healthcare across entire our provide their

of medical administration and companies. integrity services eight bill services and to of clinical provide We top review to XX the patient nine support health pharma trial We top payment XX offer the insurers.

also million billions We medical year. clients of saving per over process XX year dollars bills each our

in This grow X% market a more projected to than that is annually. is tremendous scale

process create We have and bundle transact see and offerings, competitive market an value down and opportunity share. and capture to up analytics leverage chain unique to value the our existing insights add current services,

intensive lower transaction spectrum, processing, labor challenged side as trends. with more fairly business an currently margin the other of secular On and example a is the

commercial government this and organizations alike. However, provides business critical are core to capabilities that

our We machine with believe solutions, and We thus and it an tools. intake learning AI lower automate and quality, data into by investment with creating leveraging more and cost. can higher consistency that entry

is way more into These it business. grow, deliver deliver. allocating about are quality, not two also deliver just intend we to and to become we efficient capital of just Along but the in how is examples how the it we are what thinking will order

program a We oversight specific prioritize but sequence better systemic governance, optimize, also the established allocation. and for efforts. program focused management and will our efforts, on both measurement, have transformation execution, enhance expand and to capital allow program This disciplined business

to X we will manage how this transformation. Slide to and turn success for measure Let's discuss

With strategy increases, series the backdrop, grow, projects the have levels begun increase in quality. with of efficient, increasing we as aforementioned more investment launch to become funding and to as a

in these measure shifts to bellwether and The projects improved retention, client top-line will metrics margins. ability of revenue, marketplace, quality and success be reference the the necessary associate reputation and metrics in improved

will produce pivot our mission cases, better have. project cases, what these a investment govern operate And some fully In we In game to to a some to brand funded, will plan. new a projects execute all enable suite. oriented, us cases, is or or in simply and product enhanced project growth

to subsequent We calls. project examples will earnings have on more share specific in

lot. a matter talent in people Finally,

Resources, hiring on to of attrition new assign a a addition and Human uniquely leader engagement. focused to will we be senior head In associated soon

retain improving We teammates practices. and and initiatives so client thus will relationships. endeavors to motivate, hiring different workplace better implement Focused important our to and as

also come should into attrition we cash decline, invest business. freeing As costs back the to employee see down, up

our and these of all metrics and These will measurable and incorporated clear tracking KPIs. are into recognition measurements reward We programs. with initiatives be

and strategy encouraged have to complete We believe will I’m to to we to we It win. completion. the this planning is Overall, motivated execute the and and in through rest. the project and allocation planned all what place that have time for people funding have see right the soon right

turn an XXXX for X. the Brian. on call now the beginning overview financials to Brian provide to over outlook and I our will Slide of

Brian Walsh

Thank you, Cliff.

by numbers will begin and which presentation appendix, provide provide note in and we clean I this of completed. compare I will the that divestitures removing the GAAP the we impact exhibits throughout in that Before the a will adjusted both have

an on financial the full-year overview X start Let's results. Slide of with

revenue with divestitures at compared revenue ranges. currency we top completed for our XXXX. the On ended constant adjusted Chris As a full-year mentioned, basis year revenue of down $X.X range. in-line billion, and end Adjusted guidance EBITDA our X% was which adjusted down guidance the X.X% excludes the year, with was and with

Declines by business pressure and the in volume commercial sectors, and in partially business new commercial from from sector. government in were and transportation pressure lost impacts were government our growth driven by our business. renewals price the in offset These sectors primarily commercial

million Adjusted full-year even XXXX. And compared at year, approximately the from impact midpoint X.X% guidance. for was the divestitures $XXX down also excludes completed of the with which

driven reduction XX and billion, by XX.X%, adjusted point Operating Full-year adjusted in were by corporate partially primarily EBITDA representing other EBITDA programs basis was $X.X impairments, efficiency cost offset income an or goodwill spend. by in the real was declines loss including impairment in driven margin full-year IT, year revenue, Year-over-year for estate a savings year-over-year. QX. approximately lower and a

our pressure and lost summary came associated X. the for in X.X% few with constant on billion volume Commercial business, challenges are revenue driven Let's and primarily X.X% down $X.X year in by clients care down the renewal. declines move at price on large a customer Slide large for with year These one to segments currency.

IT labor, year for $XXX reduce down XX.X% Adjusted for by driven pressure, XX were and was was estate the EBITDA spend. million real points. offset margins This adjusted partially down X.X% Commercial EBITDA year. the basis revenue by

the Government the revenue X.X% for year billion year. down was for $X.X

and the or year. renewal basis While for in up was down X.X% from were the revenue lost Adjusted adjusted XXXX points by a had segment EBITDA the driven for when year. margins compared $XXX declines primarily EBITDA results. adjusted business large and million to price pressure earlier EBITDA The XX we XX.X%, full-year

X.X% to Transportation year This grew million, is or international primarily currency. in constant was revenue tolling increase the which volumes. and increased $XXX by new transit business domestic for up driven X.X%

year corporate year EBITDA driven by represents Unallocated corporate margins to costs XX share down EBITDA decrease and up $XXX were over $XXX in year reductions the Adjusted functions primarily and infrastructure the was for Adjusted compared to X% segment growth. segment spend. a for XXXX. for X.X% million, points this this due basis XX.X% were million revenue

cash turn full-year and XX Let's discuss to to results. quarterly now Slide

of at sheet Our to cash million the fourth balance of end quarter. be with continues the XXX healthy

of and around with Our at undrawn came of in X.X current XXX remains December leverage million net available ratio capacity as approximately our terms revolver right XXst. our target

the flow cash free of was a revenue strong quarter X.X% year short by adjusted both the was few CapEx. million the spend million X.X% XXX of and driven flow expectations, XX timing cash year-over-year, of or were items but operating QX higher and for or revenue. for of CapEx fell our and

by XXX however, of timing. capital percent was in the a CapEx million the better lower nine XX quarter driven in basis same came than million CapEx Adjusted higher. XXXX free than XXXX, of quarterly about flow XX points cash as inflow actions and quarter, was in million working revenue an

largely flow due cash was million full-year EBITDA, not XX the some are free timing benefiting and is XXXX. than agreement or XXX EBITDA cash worse million lower but Adjusted flow that items of This for some year service payments. to transition the non-cash

January. we payments with excludes settlement. balance in million final bring in fluctuations XXX the working made impact payment capital flow QX. million Texas along in XXX We free normal the made the adjusted payment cash of Our will XXXX in recently This cash related litigation down the the to

XXXX I updates our for year to get metrics like would and we guidance, the on key our quarter Before the some to sales provide Slide on XX.

Our are the contributors rates renewal The was sized the that and approximately contract below loss end-user percentage Medicaid XX%, California the experience the of The renewal of our to was full-year an was renewal quarter XX%. impact for the the rate off rate five contract. lower points. targeted tooling medium XX% contract for

business a deal for It were signings while XXXX. year is as important also year-over-year, down compare quarter for our we the the note million, of New were business difficult low. new $XXX signed in TCV quarter QX for business we that to new had signings largest the

signings Cliff quarter-over-quarter and QX the signings to a expect XXXX business we While new numbers as year-over-year. mentioned, strong start grow both disappointing, we to had QX the are year and

success contract and A to experience a revenue a attributable our client. client of encouraged team returning. are plan We million contract a we four $XX part former ramp large former winning the to see to this be will to support quickly to year end-user

that, move month to addition we the on to rolling note in pipeline. the Let's discuss XX business new included total pipeline. will the I pipeline have

actually will be reality. what deals the the seeing month the out seems we of RFPs than forward, we can Moving window total of in pipeline. focus new to of are Movement volatility view what on XX create more business going and

Nonetheless, pipeline see we beginning to definitions, with stabilization. both are

the of increase business billion, quarter, a end was As new quarter total pipeline same XX% of representing in XXXX. our the the XX from

QX sales organization. We as are encouraged to transform see we some our in signs progress of

Our currently attract at hire we is sales to new QX level talent. begin highest as and headcount its since and

Slide XX XXXX. on guidance move to discuss Let's for to

we guidance provided is outlook quarter. with last consistent Our XXXX a preliminary

will we XXXX, be For estimate constant between currency. X% and down revenue X% at

at EBITDA a to the XX.X% be to relatively is XX.X%. flat range, adjusted margin expect between We which midpoint of

the We the down in expect the guidance. the the points of midpoint to first be in margins XX half second half points the up of and of year of calendarization basis at basis XX year,

XXXX. cash to XX% of This expect the by free EBITDA XX% is Lastly, additional we in convert rate to adjusted cycle into in being flow impacted conversion adjusted an year. payroll

strategic their result a move to incremental I Q&A, any investments review. guidance growth on note we excludes Before as will of the

within ROI As phase. outlook see the plan very some these as are we still discussed, opportunities. the we investment But business. opportunities Cliff in attractive we high We planning investment better to a fund

some We transformation come. to to phase have progress progress initial show in the quarters made next continuing great to looking and forward of and our

for Operator. We some up the open will questions. lines now

Operator

Thank you.

session. We Instructions]. will now [Operator begin question-and-answer the

question first will Puneet Our Morgan. with from Jain come JP

Puneet Jain

divestments? there. given move group my taking shred question. I businesses approach potential all Hey view think thanks have you Cliff from the like in sense. for makes But And that a as away Should you that this we

Clifford Skelton

think Puneet. narrative I I mentioned know, as You the in

narrative, your want optionality First When to math a for divestitures mentioned possible we if maintain as I the it way look pretty to value, shareholder was for question. as will. equation, in we you But a at simple increase sure. thanks

created asset. words, internally other the that And particular leakage. are the asset compare disentanglement do cost, all look to at the not we of course, what we tax equal. to In scalability are wanted could that And grow implications assets to minus minus tax of

the this see to described But at what narrative. we particular I that we wanted grow want stage. reemphasize compartmented and to do grow set at asset the and the we way have stage, in our are this We ability least to that I asset to what finding,

readily but opportunistic want shareholder selling process sure. more we value and than remain that asset, to with create the As a in seen way iterative examination to for

Puneet Jain

businesses Got it. revenue are of shares one of individual those And each like some buckets. margins two the growth new in of those

So are goals what we track there? how doing, your can you is

Clifford Skelton

Yes, absolutely get as this. we

into XX, the dollars is XX%, investment XX% we businesses, those buckets. percentage XX, of I as see a as left kind will, enhance began if kind expand to you goes the to what investment and and of And stratify right. have said We of optimize, XX% XX,

the I are businesses forward on we - happy that the are some say basis respective certainly of timelines But And where the that with business cases, as to we would be developed a returns, in is that margins -. wouldn't margins And the opportunity optimized lower. share go as projects those is. clear but and

Brian Walsh

on metrics our the on go Yes. cut of like include a data We file businesses to forward based would basis. in those a

Puneet Jain

as will one well by one will win. like Got sales improve XQ Should begin know Brian, underlying the driven is momentum or expect like XX QX year-on-year to investments driven a on be as throughout operational you it. the and improve And returns generate off said we bookings and deal. like as on totally, sequential both by new million I year last

Clifford Skelton

output sort we linear. I will see I continue QX to see can would to Puneet, well. be strong. somewhat we But the And Yes, we are do but turn lumpy, to the performance linear. QX somewhat new of if quotas answer be as The QX, be expect to see to somewhat say that. in linear it and bookings right it now in terms we

Puneet Jain

like it improve underlying seems. momentum lumpy. Yes, should can be I agree But bookings

Clifford Skelton

Absolutely. question. Absolutely I That right. your understand now is

Brian Walsh

the We to off expect deliver full-year. by a quarter, Could we to year-on-year be start. for this strong growth year but are lumpy

Clifford Skelton

right. is That

Puneet Jain

it. Got you. thank Alright,

Clifford Skelton

Thank You bet. you.

Operator

will Research. Please question the ahead. Shannon come next Cross with from go Our Cross

Shannon Cross

and thinking idea where curious, Thank to you as need is you maybe then bit a us you a to you investment? that XXXX? the thinking can are of not be of Since that making? the of question. you more incremental about you numbers some approaching included for an that. And will obviously can it think debt I'm is of in us the give of give investment how coming refinance my about specifics be XXXX, size taking how if follow-up, also the necessarily little sort that due in some will are just you as targeting you idea the

to You always good have prepared. it but is be some time,

So, thank you.

Brian Walsh

Yes.

Okay, thanks Shannon.

we are half What million million And So, back the investment. a would XXX the to years. and likely half XXX we in prioritizing still are two the sequencing approximately of year. and in earmarking this planning over start of phase incremental

would be we to internally our We still XX% CapEx and about are on or be XX% working restructuring. Board, with this expect to OpEx

and year, we five this we But provide if just update OpEx, to an it. we again, guidance are XX would we through linear. incremental process, math of to the of this the And that, incremental if will between year was XX all our did still it potentially XX the once working math be necessary. if restructuring CapEx of on and But are on

and In term in from matures debt loan XXXX December loan term a maturity perspective, revolver A December B in XXXX, mature in of of XXXX. the

our to in maturity we time, start advance it and have So of well do we still dates. obviously opportunities some year next we will early the but refinancing want looking at

Shannon Cross

you. Thank

Clifford Skelton

Thanks Shannon.

Operator

from Our come Bergin will ahead. Cowen. next go Please Bryan question with our next

Jared Levine

this actually Bryan. is Hi, Jared Levine on for

So across year first how fiscal commercial discuss XXXX? Can growth and for government kind transportation, you your of look for

Brian Walsh

to XXXX. we just the so Sure, saw of will talk I trends kind compared in

as we renewal anticipate referenced we loss that the contracts rolls some growth So will lapse in that rate were in ramping we our the last business tolling XXXX, off. and year, transportation new dampen

more anticipate pressure we XX% revenue to government, be over likely declines. In down

Medicaid year-over-year, Caymus, And of contract rolling impact off. XXXX. X% full-year down California then about currency the was in commercial get revenue constant for we As

get as the the we on flat in and XXXX that better of expect segments just for revenue year. offset in new and declines impact losses then with anticipate to improvements. some moderating And we up prior business, we as be slightly the And we lapse margins, to overall the efficiency we margins declined of performance our

Clifford Skelton

growing They dampening and within were business, as are or there of or equal somewhat all know, four growth growing you And in a that some transportation not the the sub slowly businesses. really is handsomely. little really created terms quite Others more are dampened.

Jared Levine

notable divestitures stay were BPO came then it potential resulting a in for local And there you. specifically challenges to Got sale potential health? any from assets when other

Clifford Skelton

inquiries in set bumps No. and stoppers spectrum We inbound or no found our many had show anywhere assets there. the speed across of really we

we earlier, we market those said was like it have internally what I As what we assets in-house. the can do of are versus and think on worth more we what

Jared Levine

great. guys. you Okay, Thank

Clifford Skelton

Thank you.

Operator

Mayank Our question from will with ahead. Please come Needham. next, the go Tandon

Mayank Tandon

what of the could for over Thank about to you you. the talk of business of evening. the just that is a a in the the then portfolio, course churn ongoing or you bit Maybe Cliff level Good Brian, year. Brian, provided also little the given And and maybe revenue? on revenue guidance line the the trend visibility

sense the how of helpful You about get some of as course margins, did year over will the revenue talk be it the of seasonality but trend well. on the would a to

Brian Walsh

Thanks Okay. Mayank.

So, to it budget we visibility the of with targets. and internal internal our aligns midpoint have guidance our plans, our

guidance drive still We with but to signings of given, work year, think will new year. we business we that the good a believe business strong see of is in and do have indication will new side on the have we the start we comfortable are the we a kind that to revenue QX range current

we a we quarter, as progresses about will see the maybe get decline business. as year, bit impact we the as moderate And then, revenue more get think believe QX as we it the from new revenue last through you into

improve turning to as rate the XXXX, as And XXXX. that would can about And significantly in next and planned. believe decline think get everything then, we see maybe growth add, if flat even into we revenue goes we just of deliver we and year

Mayank Tandon

Great.

at with least you generate to that a able improvement this able us to spot, the bookings to need you potentially, see mind in note, sense or to just that not number that on growth year bookings in be relative you of share put show year, what you level have the or a you to XXXX? would a generate So dollar maybe but of have revenue would to XXXX flat on could in this that

Clifford Skelton

in Mayank. as to what resonating way flat improved and as The And is bookings. growth more at to year our retention this in significantly it great I is question growth - well would bookings XXX% look explicit expect That be from XXXX year, targets both XXXX last say. as a is be we

we that on of if that, reduction know losses kind it expansion what depends those to new lag coupled And achieve a versus bookings. a we because is a the with well of bit in is little But, bookings we achieve goal. need

stay And are if what to achieve in very on-track with with we and year so, XXXX, we slight consistent achieve improvements. that next again modest for

We are to where to we need be be. going

Mayank Tandon

Brian want color Okay and and of some on margin expansion final is the in terms margins. expect to I that I call margins terms key overtime. margins, the question you provide for how the to year? on run over should in that of Any puts Maybe revenue takes of out be to we can going think realize course the

Brian Walsh

those the you are will in will we automation. didn't client, offset bring and Yes, efficiency year to employee last some by the because revenue on those other by the and offset And we with estate to to issuers. in that that have they doing corporate we I drivers drive but functions the performance. our savings, we also and for things and will the be say do we have would optimized some be deal portfolios it back margins, in know have costs first, businesses of of real things

remarks margin half We believe XX year, my guidance, at up first down. through be the will about in half. as points again we points the see in the XX in basis then And midpoint the and to basis then progress second prepared of

Mayank Tandon

Okay, guys. great. you That is helpful color. Thank

Clifford Skelton

Thank you.

Operator

Instructions]. [Operator

Ashwin question Citi. from Shirvaikar next ahead. go Please come with will Our

Ashwin Shirvaikar

regards is getting pillars happened chart how of the that of maybe offering, I'm Cliff, of in before? to understanding. that the disciplined than transformational to of same to be this market of there guys mind of you I’m process Hi of some repositioning, initiatives not don't is through hi of Brian. than seem past the Thank over The may a more And the be few how necessarily with some you. and things nuance different those improvements you wondering, have question years that But out? put is sort kind this development different terms local if going kind

Clifford Skelton

them. you happy Yes, that asked

would in space was So And get of hardware endeavors through primarily here, focus cases, and upgrading of people lot the some investments. the My efficiency we of in enable some previous view those building finding always new a of play and that in be and to the technology the right efforts in didn't technology frankly ways capabilities. out consolidation software utilization process, in put to hardware.

but only at to a a from angles. money. very is different two a we is where not very approach different to approach spend This different intend is the execution, it looked very different to approach it We

plan, or is sales specifics points continuum. pain or to solutions systemic are certain go the our to it whether is in our angle sales market across One service And or there where success, operations. architecture hurdles to

and for identified in that solutions We have result points those have we projects identified that pain points is part pain one. will

in up. we against making driving categorization a in the to more to technology that the more and business make cases, that we unit Part be earlier In clients to is order retain business simply are around are will cases the a in efficient some the some have tweak juxtaposed margins two promised. narrative, mentioned is delivering sure it that what simply where business needs I

as different there before cases have fall that all It value business thought market quite enhance rigorous we chain where opportunities cases share. and we with before. didn't through cases, as approaches. Those weren't we new up In did. were wasn't other steal can down and But to the we the is a business product go those

is set of And project then through finally, and program. follow the the execution of very a different

routines didn't inspection Enterprise business didn't that before, environment have Management functional led It had We an have than have before, completely now, different that it we units, have by before. metrics. is cross a we we we is Project the Office

the as well. efforts and So are quite different

Ashwin Shirvaikar

it maybe Got bucket seems think how it. useful quite the terms I buckets, to I find to more forward I enhance hence And to correspond to the then of you maybe you talk how think I and much problems on regards is to say most business, of in mean that have have Conduent reading of businesses. Am too optimize, the expend with you it if your one. problems and optimized Maybe growth. into I the looking

more margins. are on you So focused

Your Is on be A you at useful. fair that more bit at it. might transportation way look be offerings little and developed. arrived color these commercial might to more a how

Brian Walsh

those we is product businesses where I you I it characterize it don't new way the are way need No, of a The necessarily. fine. Yes. to The in characterize not would as would the did Think win. products business. optimize

What to efficient more offs. in a and refinement. we need that it both our put need drive with and we - AI rebuild, self-service not capabilities, fuel our learning hand margins. is don't and it clients and value process to we is we But machine to is And a

is, sure enhancement if and you market. are you grow order to the business not to stay the bucket, with need second them and up modify us our more your look where market, ahead technology do to The telling with of are order the us, these in offerings to some and units clients bucket tweaks get offerings, products retain in us, to make

model. And different so that is quite a

take flow. are competition third the space. value capability, within is, share Up And chain and if There the we example, healthcare different in particular claims the the are take chain model to of a product. the opportunities value a down in for they market had then and process the

would expand unit. that of example an business an so be And

simplify margin businesses I improvement as businesses So not different, of or but optimize of or would at the problem more all, very but optimized or kinds businesses. like drive characterize sort

Ashwin Shirvaikar

maybe more peaceful one on question. in, just is if building I that just a squeeze previous it could And Got hear.

still down the is it need have to you basically in margin growth improvement mean. make X% projection, do to flattish, from X% a You to maybe you are in keeping target. - margin XXXX perspective see accomplishment deliverable of exit want you What terms an revenue

Brian Walsh

around is make our to to So next in to be the year going the revenue two, or focus investments. right turn

when to we we of will growth, actually revenue relatively prioritize as be couple next as for margin improvement. margin is to revenue. able so see And see we years start the And that get range-bound we

average, business we need turning see this we business. making as and the a we in the to XX% no which get margin, focus investments the view top-line meantime, long-term, And can't reason around in to the but industry

Ashwin Shirvaikar

Understood. Thank you.

Clifford Skelton

we of be a with lot to grow respect forgiven, you sins know, margin. as if can top-line And Ashwin

So, that one. number mission is

that where we So, going. are is

Ashwin Shirvaikar

Thanks. Absolutely. Absolutely.

Operator

This will closing remarks. the any conclude to today's question-and-answer session. I turn back Cliff over would for to like Skelton conference

Clifford Skelton

Well, all you thank in listen for today.

a proud growth. of team difficult our in at I'm of heard. pivot are here go XXXX. support to as of lot have a time appreciate this Conduent, on It quite proud our certainly has of you journey continue We the very the hard all year for forward I a I'm stakeholders their work. team. our in and we as to we been going exciting just

all thank So, you bye. much. very Good

Operator

is now attending you conference The concluded. now for today's Thank presentation and you disconnect. may

Conduent (CNDT) 20 Feb 202019 Q4 Earnings call transcript