News

NCR revenue decreases in 3Q; retail store automation partly to blame

October 24, 2002

DAYTON, Ohio -- NCR Corporation (NYSE:NCR) announced that revenue for the third quarter ended Sept. 30 was $1.38 billion, a decrease of 5 percent versus the year-earlier quarter. When adjusted for foreign-currency fluctuations, revenue declined 7 percent.

Net income for the third quarter was $41 million, or 42 cents per diluted share. In third-quarter 2001, NCR reported a net loss of $6 million, or 7 cents per diluted share. Excluding goodwill amortization and special items, third-quarter 2001 net income and earnings per diluted share would have been $40 million and 40 cents a share, respectively.

Retail Store Automation solution revenue declined 13 percent, falling from $207 million in 2001's third quarter to $181 million in 2002's third quarter.

According to the release, Retail Store Automation solution revenue declined as retailers continued to delay purchases of both traditional point-of-sale equipment and newer store automation solutions.

NCR's star performer for the quarter was its Data Warehousing division. Compared to 2001's third quarter, Data Warehousing solution revenue was up 14 percent, increasing from $250 million in 2001's third quarter to $286 million in this year's third quarter.

Financial Self Service solution revenue decreased 3 percent, or 7 percent when adjusted for foreign-currency fluctuations, falling from $297 million in 2001's third quarter to $289 million in 2002's third quarter. Customer Service/Maintenance revenue was flat at $126 million.

According to a news release, Financial Self Service generated strong growth in the Asia-Pacific and Americas regions. The growth partially offset the effects of unfavorable economic conditions in Europe and the related competitive pressure.

Lars Nyberg, NCR's chairman and chief executive officer, said in the release, "We have not seen signs of an improving market environment, but we have opportunities for both gaining market share in our core businesses and optimizing operating efficiencies as we intensify our focus on aggressive cost and expense control through process improvement."

Looking ahead to 2002's fourth quarter, NCR said it expects revenue to be down 0 percent to 5 percent compared to 2001's fourth quarter. By solution, Data Warehousing and Retail Store Automation revenues are expected to increase approximately 5 percent to 10 percent, while Financial Self Service is expected to be roughly flat.

NCR expects operating income in the fourth quarter to be in the $100 million to $115 million range, with earnings per share to be in the 70 cents to 80 cents range for the quarter, or $1.41 to $1.51 for the year.