NCR reports revenue decline, 91% net loss for the year

 
July 23, 2009 | by Tracy Kitten
The economic crunch is taking its toll on ATM manufacturers. Earlier this week, Germany-based Wincor Nixdorf announced significant income dips for the second quarter of the year, and now Duluth, Ga.-based NCR Corp. reports similar results.
 
At the close of Q2, which ended June 30, NCR's revenue for the quarter was down 16 percent from the same period last year and down 6 percent for the year. But net income took an even greater hit, falling from $44 million, 26 cents per share, in Q2 2008 to $23 million, 14 cents per share, for Q2 2009. For the year, net income is down 91 percent, from $92 million, 53 cents per share, to 8 million, 5 cents per share.
 
Bill Nuti, NCR's chairman and chief executive, says the company continues, despite its revenue and net income dips, to see positive results in certain areas:
 
While NCR continues to operate in a challenging environment for the core end markets we serve, our solutions are generating results in the areas where our customers are investing. In the meantime, we are executing on our vision to lead the self-service revolution in customer transactions, as evidenced by our entry into the entertainment kiosk market, and we are winning business in other new industry verticals as well.
 
We have also taken steps to enhance our global competitive position through major investments in our infrastructure in both the U.S. and South America. These initiatives will strengthen our manufacturing and sourcing capabilities and further improve our innovation, productivity and ability to meet customer needs.
 
NCR says the downturn in the global economy and its impact on capital spending in the financial services, retail and hospitality industries is to blame for the year-over-year revenue decreases. The company's revenues in the Americas was down 13 percent for the year because of decreased product sales, NCR says.
 
In Europe, the Middle East and Africa, revenue is down 25 percent for the year; and in Asia-Pacific, it's down 2 percent. Overall, however, sales to the retail and hospitality regions increased in Southern Asia Pacific and Japan for the first six months of 2009 when compared with the first six months of 2008.
 
On a positive note, NCR says Q2 brought about a number of internal changes to strengthen the company's global position through refined infrastructure and sourcing facilities across the entertainment, travel and healthcare industries.
 
NCR says it also plans to create a new global self-service headquarters and a separate clean-energy manufacturing facility in Columbus, Ga., for the next generation of the SelfServ ATM line. NCR plans to open a new manufacturing and research and development center in Brazil, where ATMs for Brazil, Latin America and the Caribbean markets will be manufactured.
 
NCR expects both facilities to be operational by year-end 2009. The company also expects that the facility in Brazil will expand over time to include self-service technologies for a variety of industries.
 
NCR says other highlights for the year, such as the company's acquisition of TNR Holdings and a self-service deal with Delta Airlines, should not go unnoticed:
 
NCR made further progress implementing its entertainment kiosk strategy during the second quarter. In April, NCR purchased TNR Holdings Corp., the second-largest DVD kiosk operator in North America, with the goal of expanding the NCR SelfServ Entertainment portfolio across the continent as part of its strategic partnership with Blockbuster Inc. In addition, another kiosk business in which NCR is invested, e-Play, has made strategic progress in its efforts to move beyond movies and leverage its self-service capabilities to enter the video game trade and resale market. Delta Airlines, a long-time kiosk customer, became the first airline to shift to NCR's highly advanced TouchPort 70 check-in kiosk, which greatly accelerates the check-in process. NCR also saw the first deployment of its TouchPort airline kiosks in China, as China Southern Airlines deployed kiosks across several of its major hubs. The partnership strengthens NCR's global airline check-in business and establishes a presence in the world's second largest airline market and one where passengers exhibit a strong preference for interacting via self-service channels.
 
Conifer Health Solutions also began deploying NCR MediKiosks and the NCR Patient Portal across its hospitals and health systems.

Topics: Asia & Pacific Rim , ATMs , Entertainment & Gaming , Europe , Health Care , Latin America , Middle East & Africa , North America , Retail , Tourism & Travel

Companies: NCR Corporation , Wincor Nixdorf International


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