UIS - Earnings call transcript Q3 2017

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Operator

Good day everyone, and welcome to the Unisys Corporation Third Quarter 2017 Earnings Conference Call. All participants will be in listen-only-mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] I would now like to turn the conference over to Courtney Holben, Vice President of Investor Relations. Please go ahead.

Courtney Holben

operator. you, Thank everyone. Good afternoon, Courtney Holben, Investor is President Vice Relations. This of joining Thank us. for you Earlier XXXX third its today, released Unisys quarter financial results. I’m results by CEO; to discuss our afternoon our and Singh, and joined President Inder Peter this Altabef, CFO. those

Before details. few cover we I’d begin, to a like

Investor call Unisys today’s via conference are webcast the and First, session Q&A being the website.

to can slides guide be relating will afternoon to third that our other find as our using we earnings as to visit. release press on website, the you performance we Second, and presentation well discussion, our the quarter which you this information Investor encourage

Third, reconciliations measures. the earnings The within the presentation, measures, to press financial have is measures GAAP non-GAAP reconciled presentation. been some today’s complementary non-GAAP the which provided release, we’ve to related includes and

factors conference the Unisys and may or company’s company’s enhance items from as of and per share, Generally Such EBITDA free date diluted often charges its its specific periods, operating to provide expected difficult to of constant over necessary, as only the SEC that its prior our and other these future investors, this and Although you analysts the earnings adjusted call order manner also Accepted filings. reflect exclude financial year-over-year of company reaffirm, the finally, are are along by industry, of EBITDA available statements future during can Regulation pension remind then, to non-GAAP update, non-GAAP as utilized other and each believes to Peter. free call materially FD. only of management, consist could performance the comment in of guidance, ongoing well the is that the with liquidity anticipated items various period company’s deems profitability actual companies supplemental guidance time-to-time, and that of Unisys the not prior Management compare materials evaluation that cause expense. our generally future I’d results company’s made expectations. the I’d on or like or Management The and in presentation the to Unisys performance. are enhance trends Principles, except currency. results of I uncertainties provided on use by the and These the differ Accounting and and make cash more that to subject not reduction of in complies can following comparability company’s in performance. results cash discussed fully profit, results, to Investor measures comparativeness be prior of results. enhanced are forward-looking flow, These these regarding a with and like any risks believes impact that visibility earlier, will now, associated results flow cost to SEC, and under its to items can SEC with the given. the in believes adjusted results ongoing indicative the that Unisys compare turn those release and periods distort appropriate effective items otherwise to and operations from mentioned competitors’ results. are From And on all its consistency other financial And reports with website. Copies to to earnings

Peter Altabef

third to results. all quarter discuss Thank for joining financial our you, and today Courtney us thank you

and pleased strong our We’re believe our improving that and on efforts on our results quarter with progress both marked profitability. go-to-market

in for down the and business a XXX-basis-point higher rate is the new with period. which signings for see the Forward improvement X, you approximately technology ClearPath X.X% can that decline slide We versus which Looking revenue quarter led year-over-year, of discuss was quarter prior at strong ACV, revenue. We total up company quarter a I’ll by saw year-over-year, significantly strong shortly. another saw year

we of to versus offerings our to set our solutions Security, Stealth competitors. our broader into differentiate continue Regarding build

saw traction seeing with new standalone Stealth quarter-to-date. new a gain wins basis, also to signings We a continue Stealth most on in the

year-to-year for just As Services progress our a We of you of our growth the sequential one and know, significant Stealth saw segment, our on is security a in in focus component we profitability saw basis. overall. and pipeline both security

should to our in meaningful was quarter large To of prior period to While which compare me do to due longer taken for we we the yielding the important $XXX Services, a results that million which to number are let against achieve work term X. in have more progress, impact margin turn down steps we for our still a the quarters. have TCV have year slide a tough illustrate, XX-year go-to-market largely and in a signed goals contract. of year-over-year, Total coming

period logo a growth discussed, overall. from have period important business new TCV in business to cycles, of business which million. year-over-year we think XX% also why new to increase includes We is of renewal and lumpy important the new can be scope to consider. TCV new total which company is is to As new to we $XXX Growth due TCV saw

this kind to So of see progress. we’re pleased

the annual of first revenue rate ACV company year-over-year. up commencement are expected we revenue run signing often there our recognition. revenue as and million, new XX% necessarily a is the In as months delay ACV to not contracts, external $XXX the recognized a represent ACV months which of be total more a is signing XX was or to XX contract. between ACV Additionally, quarter, represents the value. following does the during previously contract turning we full contract third metrics mentioned, for of a the

year-over-year. million a to of We’d ACV up XXX% some also sales business New our regarding like share over $XXX information was pipeline.

or our billion, because a which XX% have we earnings The prospective our submitted pipeline approximately not consider pursuing that level company have of we $XX.X and for the total sales this we be aggregate represents background which to on detail, bids. a discussed year in opportunities our opportunities pipeline previously at As ago. value from pipeline we increase are is calls of

grew new at our than $XXX to which pipeline $X.X year-over-year quarter year-over-year XX% security Our ending pipeline, billion. the grew more Stealth, encompasses business million. XX% over Also, by

Of for course all indicator opportunities translate not leading is in will revenue, but our pipeline to pipeline we a look into that growth.

industry of industry as Additionally, a effort our have previously IP-led discussed, drive we products help have to launched as we such Elevate. go-to-market number application

end pipeline X% sequentially related the third grew to of million products Our these and as for the of quarter. services $XXX

only who other specific but these for specific not are to We solutions cross-selling those in create offerings these to expect opportunities solutions industries. clients interested

Lastly, approximately focus year-over-year. total company XX% slide, revenue industry saw on this we X% revenue grow at of

and operating the adjusted as leading cash based our are track, revenue, profit go As guidance detail a free our result year-to-date for reaffirming indicators for flow the Inder full and we more XXXX of non-GAAP on we in in, year performance will of shortly.

Turning now Services. to

We the improving Services have several of at profitability aimed initiatives segment. our

one for year productivity rates. the key of has this item focus For second been half example, to improve

FTEs to managed During in improve the third believe business, we improve devices we Services quarter, our profitability. our to ratio of will which worked dedicated

over year on further by count remain rates. to the bring quarter, during Enterprise industry our ratio XXX third in by in We improving productivity associates standards this is focused goal Services reduced sequentially, end. Solutions, with line Our head and

growth future will existing trends gross drive Forward a artificial which margins and that and also over productivity to time. investments these percent revenue help accounts mid positive in Services Services low revenue rates double-digit We for automation Services with for continues single-digit double intelligence those and ClearPath roughly overall. believe of demonstrate

Infrastructure and our by within been cloud Winner’s Research. has infrastructure IT HfS Cloud a Services us Additionally, just and and for work, in our the was infrastructure focus IT Enterprise for key transformation business, placed Circle Management

Moving Technology. to now

growth XX I segment. with As strong were progress on for in overall. signings Stealth We client in quarter mentioned, pleased saw with we new wins the this

time, four As in signings in at time of we we the had by the earnings call our quarter the last July. noted

of quarter. So the the number of acceleration course over that the signings indicates in

quarter, adaptive LogRhythm in launched work services and In to clients, Stealth have we previously our of XXXX. of an delivery first We discussed for into architecture. availability consulting global expected LogRhythm the quarter with security with third the incorporate select managed

extend cyber analytics. with platform’s security closely working to our the also We’re capabilities using LogRhythm

some U.S. Federal. now on to sectors, color our various Turning

growth typical government than business Federal some solid X% to U.S. continues later quarter, to delays signings. appropriations, led demonstrate Revenue over year-over-year was which for performance. Our budget a the despite new in third

quarter with our eight marks the we the backlog, years. of calendar which Services third level its and is Federal The over highest new pleased year, at government’s fiscal fiscal government during in are end year, the

for result strong As U.S. this a a expecting performance Federal to-date, we’re and XXXX [Inaudible]. of

and Navy to Stealth the a its During partner, the environment. pilot Unisys solution center quarter, implement a we engagement for U.S. in with an data collaboration won

Border solutions to our Protection, biometric added States non-U.S. also with Department the to pedestrian provide United and part We the of Homeland checkpoints. of work airports new scope from Security, Customs departing and to land citizens identify

a address to security Agency software a element Unisys key selected Stealth Lastly, identifiers Security as integrate a biometric core to National various was architectural need. by

us our revenue sector Victoria the employee workplace new Australia, encouraging program. the our a logo. for the signings. supporting work agency’s GovConnectNSW we the State as quarter, cloud New a for road X,XXX saw new in Wales workforce. state-of-the-art well in but public of into network expanded represented Stealth offerings, Our also win awarded challenging had Government digital to Stealth as services This network quarter, incorporating regarding their we contract in VicRoads, the under in solutions a Australia, and a manages Also trends contract provide approximately South are which as

wastewater us provide analytics expanded biggest Services Brazil the ClearPath treatment Forward services. companies in with and its of one Additionally, data relationship to

quarter, this received and Our solution, In transportation quarter, global Software travel commercial sector award ICMG. our the was for cargo business. our strength travel flat Digistics, Best by and Architecture the driven in from third relatively transportation

mobile at During and a a the U.S. to smartphones using other a cargo leading WAMS to airline quarter, solution, automate with processes mobility contract devices. signed and warehouses we launch

also travel Unisys digital as Additionally, airlines. services InfoSky InfoSky by agreement is to for quarter, saw a of the Unisys in an devices. largest requirements solutions it of outside new and Digistics client, the and strength Financial industry. of and than commercial travel in services of the growth more information provider driven expanded second provide banking. technology and China’s tourism drugstore And air that signed but in its solutions offers hosted transportation, XX,XXX this for leading application support cargo retail a Brazil chain lastly, workspace for services TravelSky, to subsidiary China’s for DPSP, commercial next-generation

bank’s During disaster the set recovery help applications quarter, its within better as system. these a Zealand banking applications we to integrate channels, signed a a maintain the up bank and core New to well manage contract digital and with to as

digital of new in the for Additionally, enhanced ClearPath Asia a their solutions bank of services support contract delivery provider to transformation new lastly, workplace and we part its Unisys digital as with of provide a Pacific a Security the leading with customers Forward to to Managed of strategy. consumer bank’s suite extended services, And Services. including products a signed logo contract full credit

thank after Finally, expertise Battersby role us management contributions Shalabh risk With We’d this Avon quarter, and of to Treasurer, all turn the recently in on and his I’ll a that, and occasions where Inder. strategies. to Unisys mid-August, Treasurer. Scott joined as for XX-year extensive company. recognized succeeding the and to most over formally President innovative from tenure. Gupta Vice has Products he in Scott the pension Shalabh welcome served has to Shalabh like Corporate in funding multiple to He things pension been joined role for

Inder Singh

us everyone, afternoon. comparisons Hello, thank basis. Peter. on I’ll GAAP In my joining comments provide you today, non-GAAP this and for Thanks and a

results reduction, expense, you, remind pension cost non-GAAP exclude and other to Just charges. the

the detail results first our X, progress of in a achievements provide had with slides. in following I more As then pleased summarize the we some these Peter made. and on and the number will third of discussed, we’re positive quarter, we slide on

third As we individually. as on as for progress which slide line and $XXX overall segments X the Total the for the is was quarter flat in Services shows, well revenue Technology saw sequentially. million, each business top the of

is this X.X%, down again was what XXX a versus Services While we points revenue we better year a it than year what saw ago. is a XXX-basis-point basis year-over-year, X.X% down saw ago. improvement represents which

Technology and pleased XX% was quarter, than strong We results. for expected these segment. year-over-year quarter see a also Technology revenue the revenue we better the for we’re up with to had

cost margins points have made operating our Services business. by a with to this pleased in improved structure of basis improved also quarter XX as We to We’re Services the sequentially margins result points the and progress basis by of improvements year-over-year. XXX saw

in progress margin sequentially margin XXX points continued expansion planning basis is time. margins the Services improvement the over drive basis profit overall business We points margins We non-GAAP in company. operating to of better X.X%, are this saw of also still This and XX which to year-over-year. contributed for higher

execution I we our that million benefit Based project. and expect the working the improving are executing, related a project process We this quarter XXXX on the also efficiency. XXXX and capital improvements exceeding to we from in continued on described a see last system $XXX to deployments

progress revolving replace new into XXXX. the five-year June on making We next facility coming due entered a continued we in Finally, which to capital our old of credit one was year structure.

exposure Additionally, plans benefit we including last our in plan. continue pension funding freezing significant to open reduce future European pension the defined

our overall quarter updated we results. provide will fourth for As our we usual, when estimates announce obligation pension

trends, the quarter. GAAP decline won’t to margin so non-GAAP by also income. interest just Turning up income was in was Asia net Adjusted operating expense year-over-year new to margins can basis down margin. see bonds non-GAAP those up here. year-over-year higher EBITDA the you $XX taxes as net and of was increase our was The year-over-year. by XX Adjusted to driven some I for slide results an repeat revenue We discussed in EBITDA key due X, million, points slightly helped were Pacific. year-over-year and the

Lastly, year-over-year, on more shortly. give XX% cash slide, which will on was operating I color up this flow

Turning X. to slide

on of You XX to level quarter. segment, region next third of and and mix more can type. high please a sector for geography, for by see a quarter slides, turn the and three is for This I’ll view more so every provide the detailed for slide revenue color summary sector business revenue the the

validation Latin The XX% by both America and Services driven for has revenue this particular. both the our region, believe terms third segments. Technology improved quarter year-over-year. our and in continued regions shown, one revenue is good was progress of also the America a better and grew strong focus for performance Latin profitability, in year-over-year, and Margins of have America We in sequentially Latin Asia by our a Pacific region. in

see its that to in in delivered trends, and region strong revenue our pleased the across region improvement in also also Technology. Services which Services but still low growth the We’re revenue EMEA performance Asia with saw both single-digits. Pacific on down,

encouraged the to However, quarter services saw with Public flat were financial wins year. the a the right-hand the commercial in but and Technology page, as in slightly which breakdown a new and as EMEA, on sector the during it term saw public With revenue to Federal business. sector year-over-year, U.S. of declined year-over-year year-over- side point decline Peter by U.S. quarter which did sector longer flat region. to across the mentioned, third Canada client respect we’re up revenues healthy

our results, to segment Moving please to XX. turn slide

profit of saw Gross for key discussed in up remains sequentially our a I front. the quarter, XXX which profitability Services progress margins improving As Services operating earlier, basis by XX or XXX basis cost basis we Services key indicating remain points third year-over-year. the on points sequentially to focus, points focus. this were an segment and progress on profit standpoint, From XX.X% which year-over-year, controls slightly improved down a was margin

see we to took in third pleased yielding actions the quarter We’re are results. the

We there’s do still segment had the to as will XX% However, expect that Technology we impact fourth larger not the resulting our Technology solid be quarter’s up in for as signed the fourth half continue in being last quarter, to With to call. quarter be performance strong second a than deals this to in respect Technology, in discussed noted, expected rather, on deals quarter, we done. we many planned work expected. year-over-year, ended the of as anticipate grew

elements, during quarter. hardware higher and the third-party The third quarter some weighed margins on which included

is While sell requirements. we of as not and our based third-party as hardware of to so on needed do strategy it products, more part demands will, course, client

As one continue as a than the stronger and solid I’ve fourth we for well. noted, already believe expected Tech saw be we to quarter will quarter that

in we planning color same of range always achieve fourth would expecting. million implied about quarter $XXX which an the the quarter. revenue in Technology fourth expect quarter, for QX, Last to expecting still is We on $XXX the quarter calculate we the deals signing as We’re of you as million have deals led still to similar timing are level have gave we the a range. fourth for been the that dependent to

As you significantly Technology higher in know, margins for Services. are than those

would our our benefit quarter, year-over-year, the requirements last grew fourth plan fourth for we cash the as working expect the the well. as third million Slide approach Operating slightly and manual sequentially. backlog upgrades the the I $XXX have XXXX. impact saw was were at quarter improved IT our improvements, flow includes plan So third time. billion. replacing processes we expect In of some for this positive worldwide DSOs Services we level backlog a to flow mentioned, lower, the over operating Operating ended among of up into Of cash cash since $X.X program our quarter XX nine other the versus in the cash quarter quarter capital quarter XX% third convert margin on of saw Services third flow. which at also quarter restructuring to revenue systems conclusion overall. amount, quarter we days highlights by

flow basis, flow. also due which in from see expect We a to to this cash program quarter on cash more for adjusted CapEx was increase time. an down impacted benefits over the Free free year-over-year

benefits this our strategy CapEx time. from over and continue to light expect see We

manual scanners in from check processing for check related third the our the expenditures the upgrades However, processes to recognition UK. $XX are These UK. iPSL, for joint in quarter, in requirements for funding to venture million in systems converting we optical had processing approximately

spending, amount and quarter typically ended in our in iPSL, $XXX million for than these with happens that iPSL to quarter later. quarter but the the expenditures is XXXX in The payments of systems this when pay upgrade about third iPSL scheduled should the related share expenditures by their XXXX the banking partners capital be the with process is complete. cash. one agreement Therefore, to of slightly prior end year early us lower total We period. excluding were Our

turn guidance. now me Let to

company one saw pleased performance quarter business. with the was across strong and the third for we the a The we’re

both full outlook to we operating feel good about therefore, the our As guidance year here from sit we profit. fourth meet quarter revenue the today, and, and also for ability non-GAAP the

the I meaningful to strong to the be are the for one year. given will highlight fourth on we of be attached Tech, these first typically close year substantial signed As margins to noted, full I the respect quarter in which of fourth that this a deals which could say timing the significant next another quarter technology the top quarter will governs of I that expect collections The cash of contracts portion of we line a good that with end contributor business. guidance. when the year visibility means profit operating non-GAAP either happen, have or cash and be collected year. to would

which end end which we are flow closer to good lower to would mentioned we for basis quarter. versus non-GAAP that billion guidance With $X.XX year-over-year $XXX is operating range, to the feel a of quarter, of and Overall, guide adjusted billion, where million, at strong range respect the could margins decline X.XX%. to $X.XX last is guidance which influence a deals we of timing while moment. reaffirming our to million of reiterating you whether about on X% revenue $XXX the shows the to X.XX% currency today, of So we cash improvement our and free up we X% I constant profit are the of year, that range

done Peter. With goals, the look is I’ll year, to there based of we we our turn be to that, back remainder to today. still we As the but to work good on where feel achieve the are call

Peter Altabef

Thank you, open now line Inder. for the Operator, we will questions.

Operator

you. Thank

Instructions] question-and-answer Vafi Joseph will And ahead. the first questioner begin Please today be go now will We [Operator with the Capital. Loop session.

Joe Vafi

just deals strength. Nice are afternoon. new we What if us a results. Thanks. could in? you’re And to some of this some and Good wondering the everyone. signing could bringing new Hey, Then, of deals new have that I’ll of P&L these a sense maybe kinds business you this jump TCV was into of if follow-up. ACV, you’re structure business see signing? solid give I a margin on

Peter Altabef

question. Yeah. Joe thanks. That’s a good

margin ACV, on on Inder start I’ll up So then and follow can the structure.

not is many TCV So Historically, lumpy it probably metric first is think that’s is that is isn’t sense And the ACV get the indicator telling can of with than year. There I’m in from tends think leading it now. We is, the to ways, the you numbers. as around TCV a know, out going – TC metric, actually year this takes did in ACV the renewals more to this TCV given very we’ve metric that. right? that to way be extensions on and business renewals. clouded as That renewals year and new renewals, a company that

on a we would me the then, you’re on little I the side across new focus board. the seeing more ACV, is the kind to strength really TCV say that. So of focus of on and business extent

business. strength going of One will I that see us is fourth interesting year a well of next think as the public into for as quarter lot the the in you areas

due very of this significantly end signings are some quarter is And because still the I these continue run-offs deal talking lost sector that look think challenged, to our revenue strong. deals will from standpoint, a If they a think that I focused I’ve business mentioned. particularly that our solutions in that the you was time I I to in in numbers about mentioned, hitting from ago. the quarter, still public in LA But strong. be And part of long been, were XXXX, at it’s LEADER, tired but headwinds. lost as us has that of having public get as

LineSight solutions. million. represent It’s of that by next early still eight we much So And kind focused doesn’t a an launching for exactly pipeline. how seven year. seven are fruition, eighth now but early it. get public pipeline we’re And $XXX see of days – outlined of that we’ve to Those those called until by to there that a encouraged about encouraged comes us was

So strong that I’d large ACV. new TCV of of the throughout. largely or because headwind count with XX-year a contract renewed quarter very whether And strong one-time to say ACV, that On TCV last business, hurt third signings, respect the on you very was year. really

Inder Singh

I question Joe, add I the on on a we company would margin portfolio. your just on that, mean margin. on focus as

As the the well Peter elements TCV of we’re trying and maintain new as drive a as of are ACV outlined, and the number discipline across renewals logo. across of try as contracts margins to Services. and company we to And for margin

business renewals us. our margin increases are extensions and Federal in and scope high Our in Federal for

So and we’re calorie discipline the TCV. at business, call look but maintain good we empty around it, signing, as not I’ll business, calorie ACV the trying to

Joe Vafi

Great.

Peter Altabef

did a question? you Joe, have follow-up

Joe Vafi

Yeah.

quarter, maybe that I’ve and Stealth. deal were in could, there interest maybe a the we some Just little Navy that a if deals in just And then, about standalone with partner. you talk got sounds about signed talked this was like it

Stealth So I some this fit sales? standalone these you’re Stealth building? greater new partners get I standalone mean where in a of sales do you’re software But putting maybe a that could are of Thanks. occurring? of Is And kind part install be that channel on how these these in.

Peter Altabef

Yeah.

at or really months. three Stealth. for in And last So from quarter least go-to-market, really we’ve a five avenues added we now the one have

through avenues And Federal We kind we but a our have. that have sales Solutions of Stealth distribution team sales tiger companies for channel channels the our really three existing what created distribution have wider sell through sell Enterprise call channel team. through the through we team. we that team tiger through focused that we are whales, than then, of on is So other extending that

So let me a you the tease VicRoads a that little example is of first. out good for bit.

put I Stealth. workplace services It’s a Australia. agency in X,XXX at of who can services managed reason was An of particular It’s that workplace sale. differentiator solution digital efforts, VicRoads was – right? work would example you, sale that sales Stealth that our deal have We a sale. there, and overall that – the are of heart Stealth doubt deal, right? of put tell in that we So to. we expansion, it in people also a why in leading an is that’s VicRoads an in Australia. for no in mind, the a was integrating we put And And differentiated there’s example that a Federal Enterprise So we in referred kind Solution partner my example the be won into that was a fact a Stealth our

pure-play I So the and with were categorize that Fed were Stealth. company a on But would we And was themselves a distinguish very particular partnered helped deal. way company as by a we our they prime the that sub. they strong again, of use

And so, that was deal. a very important part particular of that

also sub that strategically. we’re good where sub in Federal But and was willing we to the a work strategically business. prime we our amount Now, of one

example whales. So the the third

about? that. LogRhythm good is example So of what that Well, a pretty is

cyber in a security So a They go-to-market. structure, that’s where an example this their have has LogRhythm case offerings.

build offering Stealth their and as API kind to have We put their it of part of built solution. to seamlessly an channel into

this So for executives distribution Stealth our saying, only executives in bigger we as sales as Solutions like integrated teams now, a it okay, and do not in have running we’ve pie. company of LogRhythm we’re and and the the sell a you to client so now yours, a part Federal go turning Enterprise and business,

want big It different that that into say, offerings that Stealth other their be to into those opportunities let’s at the looking be take like are or and in, universe for players other Internet whales offerings. companies ways. their several companies Things those can that build We’re could of build opportunities IoT Stealth it could

four months. that the third relatively new, five its to current if whale is that, that and incarnation you channel I last as So say in channel, will,

Joe Vafi

very Thanks Peter. much, helpful, that’s

Peter Altabef

you. I that helped hope

Joe Vafi

great. was you. that Thank Yeah,

Peter Altabef

Great. for your Thanks comments.

Operator

Atkins And go ahead. the questioner Frank will with be next SunTrust. Please

Frank Atkins

how Thanks business about Latin for there America little first forward? some sustainable you that type and coming taking my questions. and talk opportunity strong can going out and Wanted of to development there is the a Asia, bit there what is, demand ask of teams

Peter Altabef

both market good than America Yeah. kind whole Pacific topsy-turvy. a in that in little grow being given we think geographies. faster just Asia deals. be I of to Again, think used there’s that had We have Latin others, And not ought the to new terms a Asia Pacific kind assertive really in think we of has in than is years, turned strong more a team and but it the opportunity us, the over last leadership couple the much of I but past finding of

in recognition in team in strong, new got Pacific America we’ve way, leadership the Asia and Latin America. a Latin name is very by Our

so, would teams really which say, of And those specific very a combination really proud now, and solutions. I’m we’re leadership focusing of very on I assertive

So historically we’re kind We using client just leading new into base of base. as solutions into them that that solutions us. a has the there new didn’t sell lights client these have and taking been to for

and we’re And so, as we’re existing clients we’re will, that us, giving finding really like is that interestingly, that client us kind knows and new of, doing then, if along. base – that, rebirth you a to tagging

it’s pretty so, cool. And

nut kind ask, EMEA, didn’t both of we about We’re – our getting in think the but of we issues. you geographies. think to bullish are We in

fourth beginning to anything We’re about quarter work call, are you stuff. EMEA but cost I on the discuss and on Not redistribution continuing on this on hear there, really some call, nice good in can it we business. will but it’s to new wins see

we the have very I in a that some beginning our Joe’s like in U.S., to instigated been strong brought we’re EMEA around has such. because some in I leadership question, too turn to think business and things ways there. we’ve LEADER team that is headwinds hardest, still there see as LA mentioned Canada by a So

because I So the focused the of difficult the our well. be believe fruit U.S., Canada strategy is as numbers bear can that to in But headwinds. of do going offerings

the next numbers, So anticipate that I’m kind although you decline a about significant year-to-year a going don’t not although see we pretty quarter in forward, in of decline quarter particular. speaking

Frank Atkins

how the on kind Treasurer, know or new the the Okay. with treasurer strategies that but to not, in don’t might things, be and pension experience under employ highlight maybe to of new gentleman. Battersby, if Great. terms helpful? bit the could I pension And or side of you of philosophy the shift some the little you wanted on the of any to sort change Scott I you pension a would deal call helpful. the bringing expect his in transition and of he’s on That’s

Inder Singh

Yeah.

this So and your to it. to then, it, I’ll ask Inder, for I’ll join in add is Shalabh Frank. Thanks and start question.

already XX to So pension over make as next looking obligations, years really our call, on we’re X and progress that the at front. on the is to noted I starting managing what we’re

that are think focus few as goal that assets at our de-risking seeing making years, we next look on liabilities return and the we’re I that on the the is sure to optimized.

specifics, you talk the today, going here, to in of for the I’m it join to who’s strategy a a early color and but ask about from to frame So, about to for on standpoint. additional call thinking you us Shalabh it. about we’re with actually terms way us let’s in how thinking provide little he’s It’s

Shalabh Gupta

everyone. Hello,

As couple months you know, of a joined just ago. I Unisys

of I Unisys understanding important key clearly a that’s additionally, prior strategies. at risk is here LDI looking develop would trying be that think to of perspective. And a Essentially, at in the experience my the efficiency, process I’m looking what and strategy implementing Unisys the in asset risk, going component been obviously, it, has So still but forward.

So forward. we’re at as as well implementing looking LDI going that strategies

still process the and developing early. analyzing again, couple So it’s strategies said, been in I this as It’s months, of at point. a still of

Inder Singh

I the of cash have being he we with over now liabilities and driving things well deployed as looking through against Shalabh time the to us working making sure that joining our focus that to make It’s cash of look started pleased being today announce we necessarily, on the progress Frank, also on put we that assets made the for terms to that modest is XX just been at focus Frank, he’s out at and for well as obligations that’s those few but to look years you nothing – know operations. flow pension assets the as as our very the X as we we’re are this think, can flow. already. Again, drive bit very, have sure few this, we’re with the we little months. that next we And at in And a as look volume a for

Peter Altabef

hit This is second on Shalabh. a He Yeah. I endorsement number just has is Inder’s working and Peter. running of ground the opportunities. of

In us fully longer opportunities, And while also a pension on the addition are take there Shalabh those, well. opportunities side, seem are side. as pension It Unisys. for the has as to drop will but not as near little might on develop the those for taxes for taken radar over responsibility that to a taxes

Frank Atkins

Okay. Great. very much. Thank you

Inder Singh

Thank you, Frank.

Operator

will And be with next questioner go Please & our Tong Joan ahead. Company. Sidoti

Joan Tong

Sidoti Good Company. afternoon. & Tong with Joan It’s

offerings the those to sense been of demand And past in new couple just offerings more of would bit give that you want quarters. in like the the can have so, you little in ask I progress stimulating service a just you out about get rolling guys new of I for detail? terms a Unisys, to us

Peter Altabef

being much very know as you for and do thank you – Thanks the Joan. Joan. kind Yeah, about We name. around

explore that and in any little me Inder then have he Let bit jump would like. a way

the really that for in and about we’re that little one and Digital of And what talked for to cost on work over terms opportunity an of now you the terms automation we’re talk in have a offerings. There services two with time. bit into user the of end our, things part or our of which services call, last offerings, the base now Workplace. doing as kind huge what part been and used plan we’re has was heard that that. of was quarter a as me we’ve And drive the efficiency about we in work Digital amount and always Workplace calling doing that bringing margin So new a to of experience always of of AI

re-engineering AI and is business the apace. automation are ongoing, of So that but

the intensive And that’s productivity and with from we’re quarter, hit out think We important. longer individuals order going to from business. in new think just Digital a to XXX things the to no sequentially, on linear And second people body revenues away of revenue. on for break an we to as extra a framework, that Workplace, the extra of if in order we to the we’re out for not not going But work kind that and the get hit model like be ever to get us to have about to it’s need for way. targets in and so third quarter us, just saw you us, quality by individuals

that’s So marketplace. on in going what’s that

We being We’re successful that margin wins over it. in new model. able And time, be our there. new drive from like we’ll we think to

ClearPath for services I continued initiatives other a we as successful to which the of actually launched is initiative, Services. has mentioned One year, last us which be Forward

As growing faster profitable it than whole. than in the company I my comments, it’s noted and as is a more as the Services a whole, business

In fact, as rest the the of it’s twice Services profitable business. about as

teams literally customers what top and is of many applications either those on in on going ClearPath that many, base, teams to or they third thousands own because run that do Forward So about party Forward. applications to is all of cases, ClearPath that ClearPath there Forward our out have using modernization are their smaller

us them going it to services, forward. for but we So very, going well them can know a do application that work for we’re long-term not services, for give that really managed do that’s only we and development an know where know effort we to well, time comfort very well long it

their three giving is traditional support profitability. it’s like lines consider this to I’d a their for that, mechanism. growth Joan. good outline and makes the what strategy. folks of and revenue us own good That’s the both Defensively, because a our technology support also defensive only it stronger, items ClearPath of not I own offensive them Offensively, an us for Forward kind but you, So as providing second of we’re and

Joan Tong

Okay.

Peter Altabef

The okay. third –

Joan Tong

Yeah.

Peter Altabef

Do the want to me third? you do

Joan Tong

Yeah. Please go ahead.

Peter Altabef

All right.

are and accompany in that refreshed industry to that third will products The we services the the call. new referred

to services. So industry pipeline of $XXX about these I on referred million and products

million $XXX as refers also software services the service to So associated a licensing, or that. with but both

products, So these These software. are of intensive shrink-wrapped software services are not right? kind IP-led

IP over software that the revenue. with you along We’ll expect time what so And means what or revenue percentage is to the see Services come is.

license substantially revenue, more more. expect Services We revenue than

we services that be again, Services application pipeline it. And margin lot revenue our related again, it’s So that has $XXX a higher work would Services work. to to like revenue than more million IP, because ClearPath expect managed Services that is of development Forward generic or in revenue

to that he hope then add I’m Joan, going you helps I Inder So, a and bit. let anything wishes,

Inder Singh

services, as that focus at our would new a Joan, strategy. natural it’s software-led that think we I great evolution launched, summary. just was these add we’ve services, of look next that I the industry

– Officer, got we’re more but we’re know, year the we’re at industry domain Wednesday in Day our focus, right and away. at industry. what you’ll many, through clients. is, Chief Financial experts, them. of associated these matter off with building really got way, one new our Doesn’t for hear here, our each would and doing this, sharpened offers many rattle signs mentioned. as the Investor that it So Marketing about revenue Ruckstuhl, from look year by healthy into you a that already – then, If focus into very this ago, on we the Peter turns our interest mean Analyst experts, very neatly when offers, showing they subject was year are Ann focusing. And These you the she of But areas built last several fall into statistics

them be higher step time. focus so are launch these those So the software-led, one, software-based, offers And do expect industries. we industries. noted, to over establish new Peter margin two, Step into as

Peter Altabef

is security. fourth just a would Yeah. ,And I which item, Joan, add

Stealth, technology eight So the obviously, products, there licensing to for again akin also is a element work. which around the industry Stealth. managed the would be sense the of But to a services security, but it, around both services services has in it, security element to

weeks the also is that Head outstanding. a him issued as tell have built we Security we guess, I could seen two He’s our underneath have team new press we may appointed Goldberger outstanding release ago only, where Jonathan and us. of Services I for you You that

as well. area in that growth So do expect we really

Joan Tong

for And or about close very for a you pain to you That’s and, has then, been guys. getting follow-up Peter, you Europe my helpful. mentioned obviously, is, that point inflecting area

remarks, another are the this mentioned to with Inder you. you as current restructure concluding area done in or is is lifting? heavy restructuring much think restructuring, your on going we as there you like are So prepared the you that need pretty plan Thank that it, the earlier forward all

Peter Altabef

have Yeah. restructuring tail. Europe the some year. And in is It do next expect we’ll to continue I

order to If not I think a we it in you in about some point, is you about let better we we But done expect still that. we little be this will are do focused At much to work about clear of Europe, of but but bit, the do increase that is we’ve I been will tell and budget. more are. know, the we still size very where restructuring there magnitude. it feel we overall much

Inder Singh

I would just add to that.

I through talked manual associated think with the I going which talking iPSL about Peter is joint of probably a our case, that modest upgrade that the is automated. venture its increase in that to is, from system about,

the better could somewhere charge, to would good I that And hopefully, not overall. XXX XXX, we’ve been go that range, other Joan. The So our a news our surprised. in very business with on on side be efficient is, side, upgrade, the of restructuring

of happy that we that now $XXX we we’ve expect exit So annualized say number $XXX of savings. to this to is you to more in be million likely with exit million told I’m year annualized as the XXXX. past, that savings,

Joan Tong

you. Thank Okay.

Peter Altabef

comment. thanks for your Joan,

Operator

And there no further be looks questions. to

any conclude question-and-answer conference for So this like the over closing to to will Peter the remarks. I Altabef, turn would session. back

Peter Altabef

focused next well We do you look the us opportunity next continue out from keenly to call note Will, quarter we we’ve particularly quarter. again results rest into you, this to forward this last we’re to the to work like to I’d year the year. and with sequentially progress position Thank with remain need We again pleased for and made handling strongly the the to speaking close heading on us. to for for that quarter. that and of

Operator

And the attending presentation. for conference concluded. you, has today’s all, Thank now

disconnect. may You now

Unisys (UIS) 30 Oct 172017 Q3 Earnings call transcript