Unisys On The Watch List - Stocks To Watch
10/13/2009 7:52:31 AM(RTTNews) Information technology company Unisys Corp. (UIS), the object of a turnaround program, said Monday that it won a contract extension worth over $40 million from the Australian Department of Immigration and Citizenship or or DIAC.
Unisys said it has been awarded a two year extension to continue to provide outsourced desktop services to DIAC through June 2013. The contract extension is valued at $39.7 million. DIAC has also awarded Unisys a 12- month contract extension to continue to provide biometric identity authentication solutions through August 2010. The deal will allow DIAC to purchase up to about $2.3 million of biometric identity services from Unisys.
The company posted a surprise profit for the most recent second quarter, signaling that its turnaround efforts announced two quarters ago may be paying off. Selling, General and Administrative expenses for the quarter came down by 33% to $169.2 million from $251 million last year.
Net income for the quarter was $38.1 million or 10 cents per share, compared to year-ago loss of $14 million or 4 cents per share. Analysts were looking for a loss of a penny a share. Revenue declined 16% to $1.13 billion, while excluding the effect of foreign exchange, the decline would have been only 8%, according to the company. Gross margin improved to 23.9% from 22.7%.
The company has been bagging some contracts during the recently ended September quarter, including a five-year information technology outsourcing services contract from Henkel AG & Co. KGaA, a global manufacturer of industrial, personal and household products. Other contracts include the ones from the U.S. Joint Forces Command and the U.S. Agriculture Department. Unisys has also been selected to compete for IT operations and maintenance work for the Federal Emergency Management Agency or FEMA.
Early August, the company announced the availability of Unisys Secure Cloud Solution. The company claims that this product addresses concerns for data security in a cloud computing environment without costly, time-consuming rewrites or other alterations.
Cloud computing is on-demand access to information technology services and is seen as a major trend for the future. However, concerns about the security of sensitive data are delaying wide adoption of the technology. Unisys says it has arrived at the right place and the right time with its Secure Cloud offerings.
During the quarter, Unisys has also introduced a next generation family of image capture devices that allow banks and corporate clients to process checks and other payment items remotely at faster speeds and more efficiently and securely than earlier generation devices.
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