Business Context and Reporting Period
This Form 8-K Current Report was filed by Diebold, Incorporated on June 25, 2010. The filing addresses a material event involving the Company's subsidiary, Procomp Amazonia Industria Eletronica S.A. ("Procomp"), and its ongoing contract with the Superior Electoral Court ("TSE") of Brazil for the supply of electronic voting machines.
Key Financial Metrics
The filing does not provide comprehensive financial statements, revenue totals, profit margins, cash flow, or debt levels for the reporting period. The only specific financial metric disclosed is the projected revenue associated with a new order:
- Projected Revenue: Approximately US$18 million (based on current exchange rates) from an additional order of 30,000 terminals.
Material Changes
On June 25, 2010, the TSE placed an additional order for 30,000 voting terminals under the existing contract terms. This order is expected to be delivered in the third quarter of 2010. Consequently, the total potential purchase under the agreement has increased, allowing the TSE to acquire up to an additional 55,000 terminals through 2010, bringing the total potential contract volume closer to the original cap of 250,000 units.
Guidance, Outlook, and Risks
The filing contains forward-looking statements regarding the expectation that the TSE will purchase the additional terminals. Management notes that actual results may differ materially from these expectations due to several risks and uncertainties, including:
- Final purchasing decisions made by the TSE.
- Potential budgetary constraints faced by the TSE.
- General uncertainties inherent in international government contracts.
Investor Verification Checklist
- Confirm the final delivery schedule for the additional 30,000 terminals in Q3 2010.
- Monitor the TSE's budgetary status and final purchasing decisions for the remaining potential 55,000 units.
- Verify the actual revenue recognition timing and any impact of exchange rate fluctuations on the US$18 million projection.
- Review subsequent filings for updates on the total contract volume realized versus the 250,000 unit cap.