Quite impressive and bright future for UIS. You have to read the following:
Tuesday May 4, 7:49 pm Eastern Time
Unisys CEO sees revenues above $11 billion in 2002
By Eric Auchard
NEW YORK, May 4 (Reuters) - Reflecting growing confidence in the staying power of its corporate turnaround, Unisys Corp. (UIS - news) projected accelerating growth of 13 percent to 14 percent per year in 2002, its chairman said on Tuesday.
Larry Weinbach, also the chief executive of the Blue Bell, Pa.-based company, said he expected revenues of more than $11 billion three years from now, up from the $7.2 billion in revenues the computer services company reported in 1998.
Weinbach made the comments at the company's annual briefing for Wall Street analysts and reporters held here Tuesday.
He disclosed Unisys financial targets through the Year 2002, for the first time putting specific percentage growth goals on the vague double-digit revenue growth he had previously promised to deliver within the next two years.
Near-term, Weinbach said he was feeling more confident in its profit outlook for the rest of 1999 than he had been just three weeks ago.
''We believe the 8 to 10 percent forecast (for 1999 year revenue growth) really looks good at this point and time,'' he said.
By contrast, Unisys posted a string of losses and revenue growth of 2 percent annually in the five years up to 1997, linked to staggering debt payments left over from a 1986 merger of mainframe makers Burroughs and Sperry that formed Unisys.
In 2000, he expected revenues to gain momentum, growing at least 10 percent from 1999 levels. In 2001 and 2002, growth would again accelerate to annual growth of 13 percent to 14 percent, putting Unisys over $11 billion in revenues, he said.
''We are going to get into the double-digits in 2000 and then you are going to see some pick-up'' to the 13 percent to 14 percent range by 2002, Weinbach said.
He reiterated his pledge that ''bottom-line'' profits will steadily grow at twice the level of ''top-line'' revenues, which would translate into earnings per share growth of 26 percent to 28 percent per year by 2002.
Weinbach also pledged to finish the financial restructuring of the company, lifting the overhang of debt and preferred stock that is the legacy of the 1986 Unisys merger.
Since Weinbach joined the company 18 months ago and embarked on a financial turnaround at the loss-making computer services and hardware supplier, Unisys has slashed $1.2 billion in debt and retired $400 million in preferred shares.
Twenty million preferred shares remain, which when retired, would eliminate $76 million in dividends, and directly boosting future earnings per share.
Weinbach hinted that further share repurchases could be imminent, saying that Unisys is watching the price of its stock closely to gauge when it will be most opportune to buy back another $200 million to $300 million of preferred stock.
''We will be very aggressive,'' he said.
After indicating he was comfortable with the higher range of 1999 profit expectations he had encouraged analysts to adopt several weeks ago, Weinbach said any new preferred stock redemptions would provide a further boost to 1999 earnings.
Analysts currently forecast Unisys to report earnings of $1.35 per share to $1.50 per share this year, with the mean estimate of $1.42 per share, according to First Call Inc., which compiles brokerage estimates.
''Should we do anything additional this year with preferred stock,'' Weinbach said. ''That would be add-on'' to the current range of earnings estimates, he said.
Weinbach also disclosed a new commercial contract win and projected potential returns from a government contract reported last week.
He said Unisys had won an additional $300 million, 5-year contract to manage computer operations for British Telecommunications Plc's (quote from Yahoo! UK & Ireland: BT.L) Concert venture, which comes on top of an existing $200 million, 5-year deal with BT.
Weinbach also confirmed that Unisys was among 12 contractors named by the U.S. government's purchasing agency to compete for computer technology services contracts worth up to $25 billion over then next ten years.
''We feel we are reasonably conservative at $445 million to $450 million,'' the Unisys executive said of his company's projected revenues from the new deal over five years. |
