- Q2 Earnings per Share from
Continuing Operations of $0.10 includes Cumulative Impact of
Certain Items of $(0.51) per Share
- Q2 Non-GAAP Earnings per Share from
Continuing Operations was $0.61, compared with $0.55 in prior
year
- Income from Continuing Operations of
$21 Million includes Certain Items of $(73) Million
- Consolidated Segment Commercial
Operating Income of $109 Million, adjusted for Certain Items is
$171 Million and Consolidated Segment Commercial Operating Margin
on the same basis is 9.1%, compared with 9.9% in the prior
year
- Q2 Net Cash from Operating
Activities of $192 Million
- Adjusted Free Cash Flow of $75
Million for Q2
- FY17 Non-GAAP EPS from Continuing
Operations Target Remains $2.75 to $3.00
CSC (NYSE: CSC) today reported results for the second quarter of
fiscal year 2017.
“In the second quarter, CSC delivered revenue growth and
sequential margin improvement as we continue to execute on our
transformation strategy," said Mike Lawrie, chairman, president and
CEO. "We have integrated our recent acquisitions, and are
growing our next generation offerings, such as Business
Process Services. Recent wins such as MetLife are a strong
confirmation of our leadership in the insurance market and other
sectors. Today, we announced a global alliance with PwC to deliver
end-to-end digital transformation solutions to our clients.
Finally, we remain on track to close our proposed merger with the
Enterprise Services business of Hewlett Packard Enterprise on or
about April 1st.”
Financial Highlights
- Diluted earnings per share from
continuing operations were $0.10 in the second quarter, compared
with $0.66 in the year-ago period. Diluted earnings per share from
continuing operations included $(0.13) per share of restructuring
costs and $(0.38) per share of transaction and other
integration-related costs.
- Non-GAAP diluted earnings per share
from continuing operations excluding these items were $0.61,
compared with $0.55 in the prior period.
- (Loss) income from continuing
operations before taxes was $(1) million for the second quarter,
compared with $47 million in the prior year and includes $(25)
million of restructuring and $(78) million of transaction and other
integration-related costs. Excluding the impact of these items,
non-GAAP income from continuing operations, before taxes was $102
million compared with $95 million a year ago.
- Consolidated segment adjusted
commercial operating income, which includes GBS and GIS, excluding
certain items, was $171 million compared with $173 million in the
second quarter of fiscal 2016. Consolidated segment adjusted
commercial operating margin on the same basis was 9.1% compared to
9.9% in the prior year.
- Net cash provided by operating
activities was $192 million in the second quarter, compared to $122
million in the prior year.
- Adjusted free cash flow was $75 million
in the second quarter, compared to $58 million in the prior year.
During the second quarter of fiscal 2016, CSC’s net cash provided
by operating activities and adjusted free cash flow included the
results of its since-divested U.S. federal IT services business,
CSRA.
Global Business Services
GBS revenue of $1,035 million in the quarter compares with $891
million in the year ago quarter, an increase of 16.2%. GBS revenue
increased 19.2% year-over-year in constant currency. The GBS
revenue increase included the contributions of our recent
acquisitions. GBS consolidated segment operating margin in the
quarter, excluding the impact of certain items, was 10.1% compared
to 12.3% in the prior year. New business awards for GBS were $2
billion in the second quarter.
Global Infrastructure Services
GIS revenue of $836 million in the quarter compares with $854
million in the year-ago quarter, a decrease of 2.1%. GIS revenue
increased 1.1% year-over-year in constant currency. The GIS revenue
increase was driven by the growth in our next generation offerings
and the inclusion of our recent acquisitions. GIS consolidated
segment operating margin in the quarter, excluding the impact of
certain items, was 7.9% up from 7.4% in the prior year. New
business awards for GIS were $0.5 billion in the second
quarter.
Returning Capital to Shareholders
During the second quarter, CSC returned $20 million to
shareholders consisting of common stock dividends.
CSC had 140,770,133 basic shares outstanding on September 30,
2016.
Earnings Conference Call and Webcast
CSC senior management will host a conference call and webcast
today at 5 p.m. EDT. The dial-in number for domestic callers is
800-218-2154. Callers who reside outside of the United States or
Canada should dial 913-981-5550. The passcode for all participants
is 7167172. The webcast audio and any presentation slides will be
available on CSC’s Investor Relations website.
A replay of the conference call will be available from
approximately two hours after the conclusion of the call until
November 15, 2016. The replay dial-in number is 888-203-1112 for
domestic callers and 719-457-0820 for callers who reside outside of
the United States and Canada. The replay passcode is also 7167172.
A replay of this webcast will also be available on CSC’s
website.
Non-GAAP Measures
In an effort to provide investors with additional information
regarding the Company’s preliminary and unaudited results as
determined by U.S. generally accepted accounting principles (GAAP),
the Company has also disclosed in this press release preliminary
non-GAAP information and certain further adjustments thereto, which
management believes provides useful information to investors,
including: constant currency, consolidated segment operating
income, consolidated segment commercial operating income,
consolidated segment commercial operating margin, consolidated
segment adjusted operating income, consolidated segment operating
and adjusted operating margin, earnings before interest and taxes
(EBIT), adjusted EBIT, EBIT and adjusted EBIT margin, adjusted free
cash flow and non-GAAP results including non-GAAP income from
continuing operations and non-GAAP diluted earnings per share from
continuing operations. Reconciliations of the preliminary non-GAAP
measures to the respective and most directly comparable GAAP
measures, as well as the rationale for management’s use of non-GAAP
measures are included below.
About CSC
CSC (NYSE: CSC) leads clients on their digital transformation
journeys. The company provides innovative next-generation
technology services and solutions that leverage deep industry
expertise, global scale, technology independence and an extensive
partner community. CSC serves leading commercial and international
public sector organizations throughout the world. CSC is a Fortune
500 company and ranked among the best corporate citizens. For more
information, visit the company's website at www.csc.com.
All statements in this press release and in all future press
releases that do not directly and exclusively relate to historical
facts constitute “forward-looking statements.” These statements
represent the Company’s intentions, plans, expectations and
beliefs, and are subject to risks, uncertainties and other factors,
many of which are outside the Company’s control. These factors
could cause actual results to differ materially from such forward
looking statements. For a written description of these factors, see
the section titled “Risk Factors” in CSC’s Form 10-K for the fiscal
year ended April 1, 2016 and any updating information in subsequent
SEC filings. The Company disclaims any intention or obligation to
update these forward-looking statements whether as a result of
subsequent events or otherwise, except as required by law.
Note: On November 27, 2015, CSC completed the
separation of CSRA. The Company’s results of operations for the
second quarter and first six months of fiscal 2016 have been
adjusted to reflect the separation.
Business Segment Revenues, Consolidated Segment Operating
Income and Consolidated Segment Operating Margins(preliminary
and unaudited)
Revenues by
Segment
Three
Months Ended (in millions)
September 30,2016
October 2,2015
% Change
% Change
atConstantCurrency(1)
Global Business Services $ 1,035 $ 891 16.2 % 19.2 % Global
Infrastructure Services 836 854 (2.1 )% 1.1 % Total
Revenues $ 1,871 $ 1,745 7.2 % 10.3 %
Revenues by
Segment
Six
Months Ended (in millions)
September 30,2016
October 2,2015
% Change
% Change
atConstantCurrency(1)
Global Business Services $ 2,084 $ 1,810 15.1 % 17.8 % Global
Infrastructure Services 1,717 1,739 (1.3 )% 1.4 %
Total Revenues $ 3,801 $ 3,549 7.1 % 9.7 %
(1) Selected references are made on a “constant currency basis”
so that certain financial results can be viewed without the impact
of fluctuations in foreign currency rates, thereby providing
comparisons of operating performance from period to period.
Financial results on a “constant currency basis” are non-U.S.
Generally Accepted Accounting Principle (GAAP) measures calculated
by translating current period activity into U.S. dollars using the
comparable prior period’s currency conversion rates. This approach
is used for all results where the functional currency is not the
U.S. dollar.
Consolidated Segment Operating Income and Consolidated
Segment Operating Margins by Segment
Three Months Ended September 30, 2016
October 2, 2015 (in millions)
ConsolidatedSegmentOperatingIncome
ConsolidatedSegmentOperatingMargin
ConsolidatedSegmentOperatingIncome
ConsolidatedSegmentOperatingMargin
Global Business Services $ 83 8.0 % $ 101 11.3 % Global
Infrastructure Services 26 3.1 % 64 7.5 %
Consolidated Segment Commercial Operating Income 109 5.8 % 165 9.5
% Corporate (11 ) — (35 ) — Total Consolidated Segment Operating
Income $ 98 5.2 % $ 130 7.4 %
Six
Months Ended September 30, 2016 October
2, 2015 (in millions)
ConsolidatedSegmentOperatingIncome
ConsolidatedSegmentOperatingMargin
ConsolidatedSegmentOperatingIncome
ConsolidatedSegmentOperatingMargin
Global Business Services 156 7.5 % $ 198 10.9 % Global
Infrastructure Services 22 1.3 % 117 6.7 %
Consolidated Segment Commercial Operating Income 178 4.7 % 315 8.9
% Corporate (28 ) — (41 ) — Total Consolidated Segment Operating
Income $ 150 3.9 % $ 274 7.7 %
Condensed Consolidated Statements of
Operations
(preliminary and unaudited)
Three Months Ended Six Months Ended (in
millions, except per-share amounts)
September 30,2016
October 2,2015
September 30,2016
October 2,2015
Revenues $ 1,871 $ 1,745 $ 3,801 $
3,549 Costs of services (excludes depreciation and
amortization and restructuring costs) 1,363 1,237 2,784 2,509
Selling, general and administrative (excludes depreciation and
amortization and restructuring costs) 293 269 598 540 Depreciation
and amortization 167 168 333 342 Restructuring costs 25 5 82 5
Interest expense 29 29 54 59 Interest income (8 ) (7 ) (18 ) (18 )
Other expense (income), net 3 (3 ) 5 (7 ) Total costs
and expenses 1,872 1,698 3,838 3,430
(Loss) income from continuing operations, before taxes (1 )
47 (37 ) 119 Income tax benefit (22 ) (46 ) (38 ) (39 ) Income from
continuing operations 21 93 1 158 Income from discontinued
operations, net of taxes — 84 — 186 Net
income 21 177 1 344 Less: net income attributable to noncontrolling
interest, net of tax 6 6 7 10 Net
income (loss) attributable to CSC common stockholders $ 15 $
171 $ (6 ) $ 334 Earnings (loss) per common
share Basic: Continuing operations $ 0.11 $ 0.68 $ (0.04 ) $ 1.14
Discontinued operations — 0.56 — 1.28 $
0.11 $ 1.24 $ (0.04 ) $ 2.42 Diluted:
Continuing operations $ 0.10 $ 0.66 $ (0.04 ) $ 1.12 Discontinued
operations — 0.55 — 1.24 $ 0.10
$ 1.21 $ (0.04 ) $ 2.36 Cash dividend per
common share $ 0.14 $ 0.23 $ 0.28 $ 0.46 Weighted average
common shares outstanding for: Basic EPS 140.53 138.30 139.76
138.11 Diluted EPS 143.78 140.85 139.76 141.27
Selected Balance Sheet Data
(preliminary and unaudited)
As of (in millions)
September 30, 2016
April 1, 2016 Assets Cash and cash
equivalents $ 1,054 $ 1,178 Receivables, net 1,893 1,831 Prepaid
expenses and other current assets 379 403 Total current
assets 3,326 3,412 Intangible assets, net 1,882 1,328
Goodwill 1,843 1,277 Deferred income taxes, net 327 345 Property
and equipment, net 984 1,025 Other assets 457 349 Total
Assets $ 8,819 $ 7,736 Liabilities Short-term debt
and current maturities of long-term debt 794 710 Accounts payable
281 341 Accrued payroll and related costs 285 288 Accrued expenses
and other current liabilities 787 720 Deferred revenue and advance
contract payments 537 509 Income taxes payable 17 40 Total
current liabilities 2,701 2,608 Long-term debt, net
of current maturities 2,506 1,934 Non-current deferred revenue 313
348 Deferred tax liabilities 221 181 Non-current income tax
liabilities 184 175 Other liabilities 569 458 Total
Liabilities 6,494 5,704 Total Equity 2,325 2,032
Total Liabilities and Equity $ 8,819 $ 7,736
Condensed Consolidated Statements of Cash
Flows
(preliminary and unaudited)
Six Months Ended (in millions)
September 30,2016
October 2,2015
Cash flows from operating activities: Net income $ 1 $ 344
Adjustments to reconcile net loss income to net cash provided by
operating activities: Depreciation and amortization 339 410
Stock-based compensation 35 7 Gain on dispositions — (55 )
Unrealized foreign currency exchange loss 90 7 Other non-cash
charges, net — 12 Changes in assets and liabilities, net of
acquisitions and dispositions: Decrease in assets 64 176 Decrease
in liabilities (287 ) (417 ) Net cash provided by operating
activities 242 484 Cash flows from investing
activities: Purchases of property and equipment (143 ) (184 )
Payments for outsourcing contract costs (49 ) (53 ) Software
purchased and developed (78 ) (104 ) Payments for acquisitions, net
of cash acquired (434 ) (236 ) Business dispositions — 34 Proceeds
from sale of assets 9 50 Other investing activities, net (26 ) 12
Net cash used in investing activities (721 ) (481 )
Cash flows from financing activities: Borrowings of commercial
paper 1,163 299 Repayments of commercial paper (1,058 ) (84 )
Borrowings under lines of credit 920 1,310 Repayment of borrowings
under lines of credit (529 ) (1,150 ) Debt borrowings 107 — Debt
repayments (188 ) (461 ) Proceeds from stock options 42 45 Taxes
paid related to net share settlements of stock-based compensation
awards (12 ) (27 ) Repurchase of common stock — (118 ) Dividend
payments (39 ) (64 ) Other financing activities, net (30 ) (6 ) Net
cash provided by (used in) financing activities 376 (256 )
Effect of exchange rate changes on cash and cash equivalents (21 )
(27 ) Net decrease in cash and cash equivalents (124 ) (280 ) Cash
and cash equivalents at beginning of year 1,178 2,098
Cash and cash equivalents at end of period $ 1,054 $ 1,818
Non-GAAP Financial Measures
We present non-GAAP financial measures of performance which are
derived from the condensed consolidated financial information of
CSC. These non-GAAP financial measures include consolidated segment
operating income and margin, consolidated segment adjusted
operating income and margin, consolidated segment commercial
operating income and margin, earnings before interest and taxes
(EBIT), adjusted EBIT, EBIT and adjusted EBIT margin, non-GAAP
income from continuing operations before taxes, non-GAAP net income
from continuing operations, non-GAAP EPS from continuing operations
and adjusted free cash flow.
We present these non-GAAP financial measures to supplement
financial information presented on a GAAP basis. Non-GAAP financial
measures exclude certain items from GAAP which management believes
are not indicative of core operating performance. These non-GAAP
financial measures allow management to better understand the
consolidated financial performance of the Company exclusive of
corporate wide strategic decisions. Management believes that
adjusting for certain items not indicative of our core operating
performance provides investors with additional measures to evaluate
our operating financial performance on a more comparable basis. We
believe the non-GAAP measures we provide are also considered
important measures used by financial analysts covering CSC and its
peers.
There are limitations to the use of the non-GAAP financial
measures we present. One of the limitations is that they do not
reflect complete financial results. We compensate for this
limitation by providing a reconciliation between our non-GAAP
financial measures and the respective most directly comparable
financial measure calculated and presented in accordance with GAAP.
Additionally, other companies, including companies in our industry,
may calculate non-GAAP financial measures differently than we do,
limiting the usefulness of those measures for comparative
purposes.
Reconciliation of Non-GAAP Financial Measures
Our non-GAAP adjustments include:
- Restructuring costs - Reflects
restructuring costs related to workforce optimization and real
estate charges.
- Transaction and other
integration-related costs - Reflects costs related to (1) the
Separation, (2) integration planning, financing and advisory fees
associated with the proposed merger with the Enterprise Services
segment of HPE, and (3) acquisitions and related amortization.
- Certain overhead costs - Reflects costs
historically allocated to CSRA but not included in discontinued
operations due to accounting rules. These costs are expected to be
largely eliminated on a prospective basis.
- U.S. Pension and OPEB - Reflects the
impact of certain U.S. pension and other postretirement benefit
(OPEB) plans historically included in CSC financial results that
have been transferred to CSRA as part of the separation.
- SEC settlement-related items - Reflects
costs associated with certain SEC charges and settlements.
- Tax adjustment - Reflects the adoption
of a new accounting standard in fiscal 2016 changing excess tax
benefits on stock-based compensation to be recorded as a reduction
to income tax expense, the release of tax valuation allowances in
certain jurisdictions, and the application of an approximate 20%
tax rate for fiscal 2016 periods, which is at the low end of the
prospective targeted effective tax rate range of 20% to 25% and
effectively excludes the impact of discrete tax adjustments for
those periods.
Reconciliation of Non-GAAP Financial Measures(preliminary
and unaudited)
Consolidated Segment Operating Income
and Consolidated Segment Adjusted Operating Income
We define consolidated segment operating income as revenue less
costs of services, depreciation and amortization expense,
restructuring costs and segment SG&A expenses. Consolidated
segment operating income excludes corporate G&A and pension and
OPEB actuarial and settlement losses. A reconciliation of
consolidated segment operating income and consolidated segment
adjusted operating income to (loss) income from continuing
operations, before taxes is as follows:
Three Months Ended Six Months
Ended (in millions)
September 30,2016
October 2,2015
September 30,2016
October 2,2015
Consolidated segment adjusted operating income $ 160 $ 156 $ 304 $
304 Restructuring costs (25 ) (20 ) (82 ) (20 ) Transaction and
integration-related costs (37 ) (2 ) (72 ) (2 ) Certain overhead
costs — (18 ) — (36 ) U.S. Pension and OPEB — 14 —
28 Consolidated segment operating income 98 130 150
274 Corporate G&A (75 ) (64 ) (145 ) (121 ) Pension and OPEB
actuarial and settlement losses — — (1 ) — Interest expense (29 )
(29 ) (54 ) (59 ) Interest income 8 7 18 18 Other (expense) income,
net (3 ) 3 (5 ) 7 (Loss) income from continuing
operations, before taxes $ (1 ) $ 47 $ (37 ) $ 119
Consolidated segment adjusted operating margin 8.6 % 8.9 %
8.0 % 8.6 % Consolidated segment operating margin 5.2 % 7.4 % 3.9 %
7.7 %
Earnings Before Interest and Taxes and
Adjusted Earnings Before Interest and Taxes
A reconciliation of EBIT and adjusted EBIT to net (loss) income
is as follows:
Three Months Ended Six Months
Ended (in millions)
September 30,2016
October 2,2015
September 30,2016
October 2,2015
Adjusted EBIT $ 120 $ 117 $ 226 $ 233 Restructuring costs (25 ) (20
) (82 ) (20 ) Transaction and integration-related costs (75 ) (7 )
(145 ) (10 ) Certain overhead costs — (33 ) — (66 ) U.S. Pension
and OPEB — 14 — 28 SEC settlement-related items — (2 ) —
(5 ) EBIT $ 20 $ 69 $ (1 ) $ 160 Interest expense (29 ) (29
) (54 ) (59 ) Interest income 8 7 18 18 Income tax benefit 22
46 38 39 (Loss) income from continuing
operations $ 21 $ 93 $ 1 $ 158 Income from discontinued operations,
net of taxes — 84 — 186 Net income $ 21
$ 177 $ 1 $ 344 Adjusted EBIT
margin 6.4 % 6.7 % 5.9 % 6.6 % EBIT margin 1.1 % 4.0 % — % 4.5 %
Adjusted Free Cash
Flow(preliminary and unaudited)
A reconciliation of net cash provided by operating activities to
adjusted free cash flow is as follows:
Three Months Ended Six Months
Ended (in millions)
September 30,2016
October 2,2015
September 30,2016
October 2,2015
Net cash provided by operating activities $ 192 $ 122 $ 242 $ 484
Net cash used in investing activities (154 ) (397 ) (678 ) (481 )
Acquisitions, net of cash acquired 11 236 434 236 Business
dispositions — — — (34 ) Short-term investments — — — — Payments on
capital leases and other long-term asset financings (50 ) (42 ) (95
) (111 ) Payments on transaction and integration-related costs 50
49 143 60 Payments on restructuring costs 26 32 61 51 SEC
settlement-related payments — 1 — 187 Sale of NPS accounts
receivables $ — $ 57 $ — $ (176 ) Adjusted
free cash flow $ 75 $ 58 $ 107 $ 216
(1) Excludes capital expenditures financed through CSC Finco and
other investments.
Consolidated Segment Adjusted Operating
Income and Consolidated Segment Adjusted Operating
Margin
A reconciliation of consolidated segment operating income to
consolidated segment adjusted operating income is as follows:
Three months ended September 30, 2016 (in
millions)
ConsolidatedSegmentOperatingIncome
Restructuringcosts
Transaction
andintegration-related costs
ConsolidatedSegmentAdjustedOperatingIncome
ConsolidatedSegmentAdjustedOperatingMargin
Global Business Services $ 83 $ (2 ) $ (20 ) $ 105 10.1 % Global
Infrastructure Services 26 (23 ) (17 ) 66 7.9 % Total
Commercial 109 (25 ) (37 ) 171 9.1 % Corporate (11 ) — —
(11 ) — Total $ 98 $ (25 ) $ (37 ) $ 160 8.6 %
Six months ended September 30, 2016 (in
millions)
ConsolidatedSegmentOperatingIncome
Restructuringcosts
Transaction
andintegration-related costs
ConsolidatedSegmentAdjustedOperatingIncome
ConsolidatedSegmentAdjustedOperatingMargin
Global Business Services $ 156 (22 ) (37 ) $ 215 10.3 % Global
Infrastructure Services 22 (60 ) (35 ) 117 6.8 %
Total Commercial 178 (82 ) (72 ) 332 8.7 % Corporate (28 ) —
— (28 ) — Total $ 150 $ (82 ) $ (72 ) $ 304
8.0 %
Three months ended October 2, 2015
(in millions)
ConsolidatedSegmentOperatingIncome
Certainoverhead costs
U.S. Pensionand OPEB
Restructuringcosts
Transactionandintegration-related
costs
ConsolidatedSegmentAdjustedOperatingIncome
ConsolidatedSegmentAdjustedOperatingMargin
Global Business Services $ 101 — 4 $ (12 ) $ (1 ) $ 110 12.3 %
Global Infrastructure Services 64 — 10 (8 ) (1
) 63 7.4 % Total Commercial 165 — 14 (20 ) (2 ) 173 9.9 %
Corporate (35 ) (18 ) — — — (17 ) — Total $
130 $ (18 ) $ 14 $ (20 ) $ (2 ) $ 156 8.9 %
Six months ended October 2, 2015 (in
millions)
ConsolidatedSegmentOperatingIncome
Certainoverhead costs
U.S. Pensionand OPEB
Restructuringcosts
Transactionandintegration-related
costs
ConsolidatedSegmentAdjustedOperatingIncome
ConsolidatedSegmentAdjustedOperatingMargin
Global Business Services $ 198 — 8 (12 ) (1 ) $ 203 11.2 % Global
Infrastructure Services 117 — 20 (8 ) (1 ) 106
6.1 % Total Commercial 315 — 28 (20 ) (2 ) 309 8.7 %
Corporate (41 ) (36 ) — — — (5 ) — Total $ 274
$ (36 ) $ 28 $ (20 ) $ (2 ) $ 304 8.6 %
Non-GAAP Results
A reconciliation of non-GAAP results to the respective most
directly comparable financial measure calculated and presented in
accordance with GAAP is as follows:
Three months ended September 30, 2016 (in
millions, except per-share amounts) As reported
Restructuringcosts
Transactionandintegration-related
costs
Non-GAAPresults
Costs of services (excludes depreciation and amortization
and restructuring costs) $ 1,363 $ — $ — $ 1,363 Selling,
general and administrative (excludes depreciation and amortization,
restructuring costs and transaction costs) 293 — (53 ) 240
(Loss) income from continuing operations, before taxes (1 ) (25 )
(78 ) 102 Income tax (benefit) expense (22 ) (6 ) (24 ) 8
Income from continuing operations 21 (19 ) (54 ) 94
Net income 21 (19 ) (54 ) 94 Less: net income
attributable to noncontrolling interest, net of tax 6 —
— 6 Net income attributable to CSC common
stockholders $ 15 $ (19 ) $ (54 ) $ 88
Effective Tax Rate n/m 7.8 % Basic EPS from continuing
operations $ 0.11 $ (0.14 ) $ (0.38 ) $ 0.63 Diluted EPS from
continuing operations $ 0.10 $ (0.13 ) $ (0.38 ) $ 0.61
Weighted average common shares outstanding for: Basic EPS 140.53
140.53 140.53 140.53 Diluted EPS 143.78 143.78 143.78 143.78
Six months ended September 30, 2016 (in millions,
except per-share amounts) As reported
Restructuringcosts
Transactionandintegration-related
costs
Non-GAAPresults
Costs of services (excludes depreciation and amortization
and restructuring costs) 2,784 $ — $ — $ 2,784 Selling,
general and administrative (excludes depreciation and amortization,
restructuring costs and transaction costs) 598 — (109 ) 489
(Loss) income from continuing operations, before taxes (37 ) (82 )
(148 ) 193 Income tax (benefit) expense (38 ) (18 ) (43 ) 23
Income from continuing operations 1 (64 ) (105 ) 170
Net income 1 (64 ) (105 ) 170 Less: net income
attributable to noncontrolling interest, net of tax 7 —
— 7 Net (loss) income attributable to CSC
common stockholders $ (6 ) $ (64 ) $ (105 ) $ 163
Effective Tax Rate 102.7 % 11.9 % Basic EPS from continuing
operations $ (0.04 ) $ (0.46 ) $ (0.75 ) $ 1.17 Diluted EPS from
continuing operations $ (0.04 ) $ (0.45 ) $ (0.73 ) $ 1.14
Weighted average common shares outstanding for: Basic EPS 139.76
139.76 139.76 139.76 Diluted EPS 139.76 143.14 143.14 143.14
Three months ended October 2, 2015 (in millions,
except per-share amounts)
Asreported
Certainoverheadcosts
U.S.Pensionand
OPEB
Restructuringcosts
Transactionandintegration-related
costs
SECsettlement-relateditems
Taxadjustment
Non-GAAPresults
Costs of services (excludes depreciation and amortization
and restructuring costs) $ 1,237 $ (17 ) $ 12 $ — $ — $ — $ — $
1,232 Selling, general and administrative (excludes
depreciation and amortization and restructuring costs) 269 (16 ) 2
— (7 ) (2 ) — 246 Income from continuing operations, before
taxes 47 (33 ) 14 (20 ) (7 ) (2 ) — 95 Income tax (benefit) expense
(46 ) (13 ) 6 (6 ) (3 ) (1 ) (46 ) 17 Income from
continuing operations 93 (20 ) 8 (14 ) (4 ) (1 ) 46 78 Net
income 177 (20 ) 8 (14 ) (4 ) (1 ) 46 162 Less: net income
attributable to noncontrolling interest, net of tax 6 —
— — — — — 6 Net
income attributable to CSC common stockholders $ 171 $ (20 )
$ 8 $ (14 ) $ (4 ) $ (1 ) $ 46 $ 156
Effective Tax Rate (97.9 )% 17.9 % Basic EPS from continuing
operations $ 0.68 $ (0.14 ) $ 0.06 $ (0.10 ) $ (0.03 ) $ (0.01 ) $
0.33 $ 0.56 Diluted EPS from continuing operations $ 0.66 $ (0.14 )
$ 0.06 $ (0.10 ) $ (0.03 ) $ (0.01 ) $ 0.33 $ 0.55 Weighted
average common shares outstanding for: Basic EPS 138.30 138.30
138.30 138.30 138.30 138.30 138.30 138.30 Diluted EPS 140.85 140.85
140.85 140.85 140.85 140.85 140.85 140.85
Six
months ended October 2, 2015 (in millions, except per-share
amounts)
Asreported
Certainoverheadcosts
U.S.PensionandOPEB
Restructuringcosts
Transactionandintegration-relatedcosts
SECsettlement-relateditems
Taxadjustment
Non-GAAPresults
Costs of services (excludes depreciation and amortization
and restructuring costs) $ 2,509 $ (34 ) $ 24 $ — $ — $ — $ — $
2,499 Selling, general and administrative (excludes
depreciation and amortization and restructuring costs) 540 (32 ) 4
— (10 ) (5 ) — 497 Income from continuing operations, before
taxes 119 (66 ) 28 (20 ) (10 ) (5 ) — 192 Income tax expense (39 )
(26 ) 11 (6 ) (4 ) (2 ) (60 ) 48 Income from
continuing operations 158 (40 ) 17 (14 ) (6 ) (3 ) 60 144
Net income 344 (40 ) 17 (14 ) (6 ) (3 ) 60 330 Less: net income
attributable to noncontrolling interest, net of tax 10 —
— — — — — 10 Net
income attributable to CSC common stockholders $ 334 $ (40 )
$ 17 $ (14 ) $ (6 ) $ (3 ) $ 60 $ 320
Effective Tax Rate (32.8 )% 25.0 % Basic EPS from continuing
operations $ 1.14 $ (0.29 ) $ 0.12 $ (0.10 ) $ (0.04 ) $ (0.02 ) $
0.43 $ 1.04 Diluted EPS from continuing operations $ 1.12 $ (0.28 )
$ 0.12 $ (0.10 ) $ (0.04 ) $ (0.02 ) $ 0.42 $ 1.02 Weighted
average common shares outstanding for: Basic EPS 138.11 138.11
138.11 138.11 138.11 138.11 138.11 138.11 Diluted EPS 141.27 141.27
141.27 141.27 141.27 141.27 141.27 141.27
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version on businesswire.com: http://www.businesswire.com/news/home/20161103006724/en/
CSCRichard Adamonis, Corporate Media
Relations862-228-3481radamonis@csc.comorNeil DeSilva, Global
M&A and Investor Relations703-245-9700neildesilva@csc.com
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