Unisys(UIS) - 2023 Q4 - Annual Results

Revenue Performance - Revenue for Q4 2023 was $557.6 million, a 0.1% YoY increase, but a 2.1% decline in constant currency[3][4] - Revenue for Q4 2023 was $557.6 million, a slight increase from $557.0 million in Q4 2022[24] - Full-year 2023 revenue reached $2,015.4 million, up from $1,979.9 million in 2022[24] - Full-year 2023 revenue was $2,015.4 million, compared to $1,979.9 million in 2022[41] - Full-year revenue growth of 1.8% YoY, or 1.6% in constant currency; Ex-L&S revenue growth of 4.9% YoY[46] - 4Q revenue up 0.1% YoY, a decline of 2.1% in constant currency; 4Q Ex-L&S revenue growth of 6.8% YoY, or 4.3% in constant currency[46] Ex-L&S Revenue - Ex-L&S revenue increased 6.8% YoY to $413.3 million, driven by New Business with existing clients[3][4] - Excluding License and Support (Ex-L&S) revenue for Q4 2023 was $413.3 million, up from $386.9 million in Q4 2022[44] - Ex-L&S Non-GAAP gross profit for Q4 2023 was $68.4 million, compared to $45.7 million in Q4 2022[44] - Ex-L&S Total Contract Value (TCV) increased 27% YoY for the full-year and 137% YoY in the fourth quarter, including New Business TCV growth of 18% YoY for the full-year and 84% YoY in the fourth quarter[46] L&S Revenue - L&S revenue declined 15.2% YoY to $144.3 million, primarily due to the timing of software license renewals[3][4] Digital Workplace Solutions (DWS) - Digital Workplace Solutions (DWS) revenue grew 8.9% YoY to $139.2 million, with a gross profit margin of 15.3%[6][7] Cloud, Applications & Infrastructure Solutions (CA&I) - Cloud, Applications & Infrastructure Solutions (CA&I) revenue was flat at $138.9 million, with a gross profit margin of 16.3%[6][8] Enterprise Computing Solutions (ECS) - Enterprise Computing Solutions (ECS) revenue declined 10.0% YoY to $203.0 million, with a gross profit margin of 67.4%[6][9] Operating Income and Net Loss - Operating income for Q4 2023 was $44.0 million, down from $50.0 million in Q4 2022[24] - Full-year 2023 operating income was $76.9 million, compared to $52.2 million in 2022[24] - Consolidated net loss for Q4 2023 was $164.2 million, compared to a net income of $8.8 million in Q4 2022[24] - Full-year 2023 consolidated net loss was $427.1 million, compared to a net loss of $104.9 million in 2022[24] - Net loss attributable to Unisys Corporation for Q4 2023 was $165.3 million, compared to a net income of $8.5 million in Q4 2022[37] - Full-year 2023 net loss attributable to Unisys Corporation was $430.7 million, compared to a net loss of $106.0 million in 2022[37] Gross Profit and Margins - Gross profit percentage for Q4 2023 was 32.5%, down from 34.1% in Q4 2022[30] - Full-year 2023 gross profit percentage was 27.4%, up from 26.7% in 2022[30] - Full-year operating profit margin of 3.8%; non-GAAP operating profit margin of 7.0%[46] Cash Flow and Free Cash Flow - Full-year 2023 free cash flow improved by $68.7 million YoY to ($4.5) million, driven by working capital improvements[10] - Net cash provided by operating activities for 2023 was $74.2 million, compared to $12.7 million in 2022[34] - Full-year 2023 free cash flow improved by nearly $70 million year-over-year, reaching $120.5 million[45] - Full-year operating cash flow of $74.2 million compared to $12.7 million for 2022, and free cash flow of ($4.5) million compared to ($73.2) million for 2022[46] - Free cash flow represents cash flow from operations less capital expenditures[47] - Adjusted free cash flow excludes postretirement funding, legal matters, environmental costs, and cost-reduction activities[47] Backlog and Contract Value - Backlog increased to $3.01 billion in Q4 2023, up from $2.92 billion in Q4 2022, driven by Ex-L&S contract renewals and New Business signings[15] - New Business Total Contract Value (TCV) increased by 18% year-over-year in 2023[45] Pension and Non-Cash Losses - Non-cash pension settlement losses of $348.2 million were recorded in 2023 due to the purchase of annuity contracts[12] - Pension liabilities of approximately $500 million were transferred to a third-party insurer through annuity purchases in 2023[45] Guidance and Future Expectations - 2024 revenue growth guidance is (1.5)% to 1.5% in constant currency, with Ex-L&S revenue growth expected to be 1.5% to 5.0%[16] - Full-year 2024 guidance of (1.5)% to 1.5% YoY constant currency revenue growth and 5.5% to 7.5% non-GAAP operating profit margin[46] - Constant currency revenue guidance implies (1.0)% to 2.0% revenue growth as reported, with Ex-L&S full-year revenue growth of 1.5% to 5.0% and L&S revenue of approximately $375 million[46] Non-GAAP Metrics - Non-GAAP net income attributable to Unisys Corporation for Q4 2023 was $35.4 million, down from $82.8 million in Q4 2022[37] - Adjusted EBITDA for Q4 2023 was $100.4 million, down from $148.7 million in Q4 2022[41] - Non-GAAP net income and diluted EPS exclude postretirement expense, legal matters, environmental costs, and cost-reduction activities[47] Cash and Cash Equivalents - Cash and cash equivalents at the end of 2023 were $387.7 million, slightly down from $391.8 million at the end of 2022[32]