Unisys Corporation — 2012 Form 10-K Summary
Reporting period: Fiscal year ended December 31, 2012. Unisys is a worldwide IT company operating in Services and Technology, serving commercial clients and government agencies. Its offerings include outsourcing, systems integration and consulting, infrastructure and maintenance services, servers, and related software.
Financial performance and liquidity
The supplied filing text incorporates the financial statements and management’s discussion from the 2012 Annual Report to Stockholders but does not reproduce their figures. Revenue, earnings, cash flow, margins, debt balances, cash and liquidity measures therefore cannot be stated from the provided text; it also does not provide a clear comparative financial-performance summary.
- Services firm-order backlog was $5.1 billion at year-end 2012, down from $5.5 billion a year earlier. About $2.1 billion, or 41%, of 2012 backlog was expected to be filled in 2013.
- Company-sponsored research and development costs were $81.5 million in 2012, compared with $76.1 million in 2011 and $78.9 million in 2010.
- Sales to U.S. government agencies represented approximately 14% of 2012 consolidated revenue. No single customer accounted for more than 10%.
- Unisys had approximately 44.0 million common shares outstanding at December 31, 2012. It had not paid common-stock cash dividends since 1990 and did not anticipate doing so in the foreseeable future.
Changes, outlook and risks
- The Services backlog declined by $400 million year over year. Backlog may be cancelled; government contracts may also be terminated or lose funding, subject to applicable payment for work completed and allowable costs.
- On December 10, 2012, the board authorized purchases of up to $50 million of common and mandatory convertible preferred stock through December 31, 2014. No such shares were repurchased in the fourth quarter of 2012.
- Management identified focus areas including security, data-center transformation, end-user outsourcing and applications modernization. The supplied text does not provide quantified financial guidance or a detailed 2013 outlook.
- Disclosed business risks include intense competition, rapid technological change, reliance on single or limited suppliers for certain components, government-contract termination or funding risks, international-business risks, and the possibility of backlog cancellations. Detailed risk-factor and litigation disclosures are incorporated by reference and are not included in the supplied text.
- Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2012; KPMG audited internal control over financial reporting. No material quarterly changes in those controls were reported.
Important facts for investors to verify
- Review the incorporated annual-report financial statements and MD&A for revenue, operating results, cash flows, margins, debt maturities, liquidity and year-over-year drivers.
- Check the detailed segment and geographic results, including Services and Technology performance and the composition and expected conversion of backlog.
- Examine the incorporated risk-factor and litigation disclosures, pension and other contingencies, and terms of the 6.25% mandatory convertible preferred stock.
- Verify subsequent developments and any use of the $50 million repurchase authorization.