Shares of Unisys Corp. (UIS) plunged more than 14 percent in extended trade on Tuesday after the information technology company reported results for the first quarter that missed analysts' expectations. The company also slipped to a loss for the quarter, reflecting significantly lower margins and a double-digit revenue drop.
"This was a difficult quarter for us as lower revenue impacted our bottom-line results. We saw lower revenue in our technology business following a strong fourth quarter in 2012 where we benefited from some earlier-than-expected ClearPath revenue," Chairman and CEO Ed Coleman said in a statement.
The Blue Bell, Pennsylvania-based company reported a net loss of $33.9 million or $0.77 per share for the first quarter, compared to net income of $13.4 million or $0.30 per share in the prior-year quarter.
Results for the latest quarter primarily include $22.3 million of pension expense and a $6.5 million loss associated with a Venezuelan currency devaluation, while the year-ago results included $24.6 million of pension expense and a $7.2 million debt reduction charge.
Excluding items, adjusted net loss for the quarter was $11.6 million or $0.26 per share, compared to net income of $49.2 million or $0.97 per share in the year-ago quarter.
On average, four analysts polled by Thomson Reuters expected earnings of $0.59 per share for the quarter. Analysts' estimates typically exclude one-time items.
Revenues for the quarter declined 13 percent to $810.4 million from $928.40 million in the same quarter last year, and missed four Wall Street analysts' consensus estimate of $852.25 billion.
U.S. revenue declined 15 percent, and international revenue declined 11 percent or 9 percent on a constant currency basis, with declines in all regions except for Latin America.
Services revenue declined 12 percent year-over-year to $723 million, reflecting declines in systems integration, infrastructure services, and core maintenance, partially offset by revenue growth in IT outsourcing.
Technology revenue also decreased 18 percent to $87 million, driven by lower sales of ClearPath enterprise software and servers.
Gross margin for the quarter was 19.9 percent, down 440 basis points from last year's 24.3 percent.
"We expect continuing challenges as we work through softness in our services business and recognize the need to maintain a competitive cost structure in line with our revenue performance," Coleman added.
UIS closed Tuesday's regular trading session at $20.57, up $0.50 or 2.49% on a volume of 1.01 million shares. However, the stock plunged $2.97 or 14.44% in extended hours trading.
For comments and feedback: editorial@rttnews.com