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Technology Stocks : NCR Corporation: An AT&T Spinoff -- Ignore unavailable to you. Want to Upgrade?

To: Shibumi who wrote (175)	1/22/1998 10:33:00 AM
From: judge	Respond to of 379

FYI NCR REPORTED AN OPERATING LOSS FOR 1997, ALTHOUGH THE COMPANY EARNED A NET PROFIT. Operating income decreased from $75 million in 1996 to an operating loss of $19 million in 1997. Net income was $7 million for 1997, compared to a loss of $82 million for 1996. 1997 earnings were $.07 per share, compared with a per-share loss of $.81 in the previous year. For 1997, orders, revenue and gross margins decreased, compared to 1996. On a local currency basis, orders were flat and revenue was down 1 percent. (Comparisons do not include the impact in the fourth quarter of 1996 of a $55 million pre-tax release of restructuring reserves or the adverse impact of an $82 million tax adjustment associated with restructuring.) * FOR THE FOURTH QUARTER OF 1997, OPERATING INCOME DECREASED, COMPARED TO THE FOURTH QUARTER OF 1996. Operating income for the fourth quarter of 1997 was $34 million, compared to $72 million in the final quarter of 1996. Net income for the fourth quarter was $36 million or $.35 per share, compared to net income of $34 million or $.34 per share in 1996. Orders for financial products achieved the largest fourth-quarter increase on record, but total orders declined, compared to last year's quarter. On a local currency basis, the percentage decrease for total orders was in the high single digits. Revenue for the fourth quarter was 2 percent lower than the fourth quarter of 1996. However, on a local currency basis, it was up 3 percent. Revenue gains of 14 percent for financial products, 13 percent for PCs and entry-level servers, 9 percent for retail products and 5 percent for Professional Services were posted, compared to the year-earlier period. These gains were offset by declines in revenue from computers, Systemedia and customer services. Revenue increased in EMEA but declined in Asia/Pacific and the Americas. On a local currency basis, revenue increased 10 percent in Asia Pacific and increased 12 percent in EMEA. Gross margins in the quarter declined 2.2 percentage points, compared to the fourth quarter of 1996. (Comparisons do not include the impact in the fourth quarter of 1996 of a $55 million pre-tax release of restructuring reserves or the adverse impact of an $82 million tax adjustment associated with restructuring.)

To: Shibumi who wrote (175)	1/24/1998 7:47:00 PM
From: Mister T	Read Replies (2) \| Respond to of 379

I believe that the sales plan has stayed the same concerning margin. That split is 70% Revenue, 30% Margin. This plan is changed to the opposite, 30% Rev. 70% Margin for the managers who manage the sales people, therefore providing checks and balances. The plus side of this is that you are paid 30% of your compensation up front at order signing, which is a significant change. My belief with the decrease in operating income and revenue is largely due to the communications industry in NCR and the split off from AT&T and Lucent. If you take 1996, the Communication Industry which included AT&T and Lucent provided approximately $750,000,000 to the bottom line in revenue with around a 33% Gross Margin. During this time AT&T and Lucent were buying like crazy to bolster the financial state of NCR. After trivestiture during 1997, The Communications industry only saw about $350,000,000 with most of the drop coming from AT&T due to their cost restructuring. But absolutely, without a doubt, AT&T and Lucent did not buy as much from NCR because they no longer had to. This trend will most likely continue, although Lucent is doing some significant business worldwide with NCR in the area of Professional Services and Outsourcing. If you add $400,000,000 Rev with 33% Gross Margin to the 1997 bottom line. NCR would be kicking ass!!! I don't understand why the analysts have not caught onto this as of yet, but this is where I truly see the problem. I think the Communication industry is reaching a flattening out point at $300,000,000 this year. But think about it, without Communication Industry Numbers in '96 and '97 results, NCR would definitely be showing an improvement. I would like to hear comments on this post. Thanks, Mister T.