Unisys Corp reports 4,465% Net Income growth in 2020 while 31.3% Revenue decline
02/22/2021 • About Unisys Corp (
$UIS) • By InTwits
Unisys Corp reported 2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Unisys Corp is a company in decline: 2020 revenue growth was -31.3%, 5 years revenue CAGR was -7.6%
- EBITDA Margin is quite volatile: 13.7% in 2020, 15.4% in 2019, 15.9% in 2018, 5.9% in 2017, 7.2% in 2016
- Unisys Corp has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.3%. At the same time it's in pair with industry average of 3.5%
- CAPEX is quite volatile: $57m in FY2020, $69m in FY2019, $68m in FY2018, $44m in FY2017, $26m in FY2016
- The company has highly profitable business model: ROIC is 1,463.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue dropped on 31.3%. Annual revenue decline showed slowdown in 20Q4 - revenue dropped on 22.2%. During 2016-2020 Revenue growth topped in 2019 at 4.4%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased slightly on 1.7 pp from 15.4% to 13.7% in 2020.
Gross Margin increased slightly on 1.2 pp from 22.6% to 23.8% in 2020. SG&A as a % of Revenue increased on 4.8 pp from 13.5% to 18.2% in 2020. During 2016-2020 SG&A as a % of Revenue bottomed in 2018 at 13.1% and was growing since that time.
Net Income margin surged on 37.6 pp from -0.58% to 37.0% in 2020.
Investments (CAPEX, working capital and M&A)
Unisys Corp's CAPEX/Revenue was 2.9% in 2020. Unisys Corp's CAPEX/Revenue decreased slightly on 1.2 pp from 4.1% in 2017 to 2.9% in 2020. Average CAPEX/Revenue for the last three years was 3.2%. During the last 5 years CAPEX as a % of Revenue topped in 2017 at 4.1% and was declining since that time.
Leverage (Debt)
Company's Net Debt / EBITDA is -0.6x and Debt / EBITDA is 2.6x. Debt decreased slightly on 0.52% while cash surged on 66.8%.
Unisys Corp has no short term refinancing risk: cash is higher than short term debt (642.2%).
Valuation and dividends
The company's trades at EV/EBITDA 5.1x and P/E 2.1x.
Management team
Peter A Altabef is a Unisys Corp's CEO. Peter A Altabef has spent 6 years with the company. The company's CFO Michael M Thomson "Mike" has spent 1 year with the company.
Financial and operational results
FY ended 12/31/2020
Unisys Corp ($UIS) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 2,821 | 2,742 | 2,825 | 2,949 | 2,026 | -31.3% |
| Gross Profit | 559 | 478 | 686 | 666 | 483 | -27.5% |
| SG&A | 456 | 427 | 370 | 397 | 369 | -6.9% |
| EBITDA | 203 | 161 | 448 | 455 | 278 | -38.8% |
| EBIT | 48 | 5 | 284 | | | |
| Interest expence | 27 | 53 | 64 | | | |
| Tax | 57 | -6 | 64 | | | |
| Net Income | -48 | -65 | 76 | -17 | 751 | |
| Stock Based Compensation | 10 | 11 | 13 | | | |
Balance Sheet
|
|---|
| Cash | 371 | 734 | 605 | 539 | 899 | 66.8% |
| Accounts Receivable | 506 | 503 | 509 | | | |
| Accounts Payable | 189 | 242 | 269 | | | |
| Short Term Debt | 106 | 11 | 10 | 84 | 140 | 67.5% |
| Long Term Debt | 194 | 634 | 643 | 650 | 590 | -9.3% |
Cash flow
|
|---|
| Capex | 84 | 112 | 109 | 87 | 58 | -33.4% |
Ratios
|
|---|
| Revenue growth | -6.4% | -2.8% | 3.0% | 4.4% | -31.3% | |
| EBITDA growth | 62.6% | -20.7% | 178.2% | 1.5% | -38.8% | |
|
|---|
| Gross Margin | 19.8% | 17.4% | 24.3% | 22.6% | 23.8% | 1.2% |
| EBITDA Margin | 7.2% | 5.9% | 15.9% | 15.4% | 13.7% | -1.7% |
| EBIT Margin | 1.7% | 0.2% | 10.1% | | |
| SG&A, % of revenue | 16.2% | 15.6% | 13.1% | 13.5% | 18.2% | 4.8% |
| SBC, % of revenue | 0.3% | 0.4% | 0.5% | | |
| Net Income Margin | -1.7% | -2.4% | 2.7% | -0.6% | 37.0% | 37.6% |
| CAPEX, % of revenue | 3.0% | 4.1% | 3.8% | 2.9% | 2.9% | -0.1% |
|
|---|
| ROIC | | | | | 1,463.1% | |
| Net Debt/EBITDA | -0.3x | -0.6x | 0.1x | 0.4x | -0.6x | -1.0x |
| Interest coverage ratio (ICR) | 1.7x | 0.1x | 4.4x | | |
| Interest expence / Average debt | 9.1% | 11.2% | 9.9% | | | |
People
|
|---|
| Insider ownership | 2.4% | 2.4% | 2.4% | | | |
| Employees | 21,000 | 20,000 | 22,000 | | | |
| Revenue/Employee, th. $ | 134 | 137 | 128 | | | |
Unisys Corp ($UIS) key quoterly financial indicators
| mln. $ | 20Q1 | 20Q2 | 20Q3 | 20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 515 | 439 | 495 | 577 | | -7.1% | -22.9% | -10.3% | -22.2% |
| EBITDA | 58 | 38 | 65 | 88 | | -3.0% | -64.8% | -39.3% | -6.2% |
| Net Income | 1,015 | -79 | -13 | -173 | | - | -400.0% | - | - |
Balance Sheet
|
|---|
| Cash | 790 | 782 | 774 | 899 | | 56.5% | 54.2% | 81.9% | 66.8% |
| Short Term Debt | 590 | 158 | 100 | 140 | | 1,008.3% | 112.4% | 21.1% | 67.5% |
| Long Term Debt | 101 | 95 | 98 | 590 | | -86.8% | -87.6% | -84.9% | -9.3% |
Ratios
|
|---|
| Gross Margin | 21.9% | 17.1% | 24.2% | 30.4% | | -0.6% | -9.7% | -1.1% | 10.1% |
| EBITDA Margin | 11.2% | 8.7% | 13.0% | 15.2% | | 0.5% | -10.3% | -6.2% | 2.6% |
| Net Income Margin | 197.0% | -17.9% | -2.6% | -30.0% | | 200.5% | -22.5% | -0.2% | -28.5% |
Peers in Software & Computer Services
Below we provide Unisys Corp benchmarking against other companies in Software & Computer Services industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| International Bus Mach Corp ($IBM) | - | -1.0% | 0.6% | -3.1% | -4.6% |
| |
|---|
| Median (1 company) | - | -1.0% | 0.6% | -3.1% | -4.6% |
|---|
| Unisys Corp ($UIS) | - | -2.8% | 3.0% | 4.4% | -31.3% |
Top companies by Gross margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| International Bus Mach Corp ($IBM) | 47.9% | 46.7% | 46.4% | 47.3% | 48.3% |
| |
|---|
| Median (1 company) | 47.9% | 46.7% | 46.4% | 47.3% | 48.3% |
|---|
| Unisys Corp ($UIS) | 19.8% | 17.4% | 24.3% | 22.6% | 23.8% |
Top companies by EBITDA margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| International Bus Mach Corp ($IBM) | 19.8% | 20.5% | 20.9% | 20.7% | 17.5% |
| |
|---|
| Median (1 company) | 19.8% | 20.5% | 20.9% | 20.7% | 17.5% |
|---|
| Unisys Corp ($UIS) | 7.2% | 5.9% | 15.9% | 15.4% | 13.7% |
Top companies by CAPEX/Revenue, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| International Bus Mach Corp ($IBM) | 4.5% | 4.1% | 4.3% | 3.1% | 4.1% |
| |
|---|
| Median (1 company) | 4.5% | 4.1% | 4.3% | 3.1% | 4.1% |
|---|
| Unisys Corp ($UIS) | 3.0% | 4.1% | 3.8% | 2.9% | 2.9% |
Top companies by ROIC, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| International Bus Mach Corp ($IBM) | 21.5% | 19.5% | 19.8% | 13.0% | 6.7% |
| |
|---|
| Median (1 company) | 21.5% | 19.5% | 19.8% | 13.0% | 6.7% |
|---|
| Unisys Corp ($UIS) | - | - | - | - | - |
Top companies by Net Debt / EBITDA
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| International Bus Mach Corp ($IBM) | 1.7x | 1.8x | 1.7x | 3.8x | 4.1x |
| |
|---|
| Median (1 company) | 1.7x | 1.8x | 1.7x | 3.8x | 4.1x |
|---|
| Unisys Corp ($UIS) | -0.3x | -0.6x | 0.1x | 0.4x | -0.6x |
