Other 3.0 2.2 Changes in certain assets and liabilities Trade receivables (1.3) (8.0) Inventories (60.2) (33.9) Accounts payable 64.1 47.3 Income taxes (8.5) 31.8 Deferred revenue 32.2 66.4 Warranty liability (0.4) (3.6) Certain other assets and liabilities (131.8) (126.4) Net cash provided (used) by operating activities (65.2) (78.2) Cash flow from investing activities Capital expenditures (2.5) (5.4) Capitalized software development (5.9) (5.1) Proceeds from divestitures, net of cash divested - (38.5) Net short-term investment activity 11.6 (4.4) Net cash provided (used) by investing activities 3.2 (53.4) Cash flow from financing activities Debt issuance costs - (3.8) Net debt borrowings (repayments) (31.8) 322.8 Contributions from noncontrolling interest holders 12.7 - Other (5.8) (5.0) Net cash provided (used) by financing activities (24.9) 314.0 Effect of exchange rate changes on cash and cash equivalents (1.8) (15.6) Change in cash and cash equivalents (88.7) 166.8 Add: Cash included in assets held for sale at beginning of period 2.7 97.2 Less: Cash included in assets held for sale at end of period 3.7 32.8 Cash and cash equivalents at the beginning of the period 324.5 280.9 Cash and cash equivalents at the end of the period USD 234.8 USD 512.1 Notes for Non-GAAP Measures To supplement our condensed consolidated financial statements presented in accordance with GAAP, the company utilizes certain financial measures that are not prepared in accordance with GAAP, including non-GAAP results, EBITDA and Adjusted EBITDA, adjusted earnings per share, free cash flow/(use) and net debt. 1. Profit/loss summary (Dollars in millions): Q1 2021 Q1 2020 Gross % of % of Gross % of % of Net Sales Profit Sales OPEX OP Sales Net Sales Profit Sales OPEX OP Sales GAAP Results USD 943.9 USD 273.2 28.9 % USD 237.0 USD 36.2 3.8 % USD 910.7 USD 226.8 24.9 % USD 252.8 USD (26.0) (2.9) % Restructuring and DN Now transformation expenses - 0.5 (22.6) 23.1 - 0.9 (40.7) 41.6 Amortization of Wincor Nixdorf purchase accounting intangible assets (non-cash) - - (19.9) 19.9 - 3.2 (18.2) 21.4 Non-routine income/ expense: Legal/deal expense - - (0.6) 0.6 - - (2.4) 2.4 Costs related to previously divested business in Germany - - - - - 4.8 - 4.8 Divestitures and fixed asset sales - - 0.5 (0.5) - - 1.7 (1.7) Loss making contracts related to discontinued offering - - - - - 12.0 - 12.0 Inventory charge/gain - - - - - 3.7 - 3.7 Other - (0.3) - (0.3) - 2.7 (2.1) 4.8 Non-routine expenses, net - (0.3) (0.1) (0.2) - 23.2 (2.8) 26.0 Non-GAAP Results USD 943.9 USD 273.4 29.0 % USD 194.4 USD 79.0 8.4 % USD 910.7 USD 254.1 27.9 % USD 191.1 USD 63.0 6.9 % Q1 2021 Q1 2020 Services Products Software Total GP Services Products Software Total GP GAAP Gross Profit USD 142.3 USD 74.6 USD 56.3 USD 273.2 USD 117.9 USD 64.2 USD 44.7 USD 226.8 Restructuring and DN Now transformation expenses 0.1 0.4 - 0.5 0.6 - 0.3 0.9 Amortization of Wincor Nixdorf purchase accounting intangible assets (non-cash) - - - - - 1.5 1.7 3.2 Non-routine income/expense: Costs related to previously divested business in Germany - - - - - 4.8 - 4.8 Loss making contract related to discontinued offering - - - - 12.0 - - 12.0 Inventory charge/gain - - - - 3.8 (0.1) - 3.7 Other (1.7) 0.1 1.3 (0.3) 1.9 0.8 - 2.7 Non-routine expenses, net (1.7) 0.1 1.3 (0.3) 17.7 5.5 - 23.2 Non-GAAP Gross Profit USD 140.7 USD 75.1 USD 57.6 USD 273.4 USD 136.2 USD 71.2 USD 46.7 USD 254.1 Restructuring and DN Now transformation expenses relate to the business transformation plan focused on driving connected commerce, finance, sales and operational excellence, business integration and global workforce alignment, including GAAP restructuring costs, as well as the third-party costs of the DN Now transformation program and accelerated depreciation. The Wincor Nixdorf intangible asset amortization relates to the intangible assets established in purchase accounting as management believes that this is useful information to investors by highlighting the impact on the company's operations. Legal and deal expense primarily relates to third-party expenses and fees paid by the company for M&A activity. The divestitures and fixed asset sales relates primarily to the divestitures of non-core businesses in both 2021 and 2020. The loss making contracts represent charges incurred in 2020 for expected losses through the contractual service period. The inventory charge/gain relates to the company's re-assessment of primarily finished goods and service parts due to contract cancellations, and excess and obsolete inventory as a result of streamlining the company's product portfolio and optimizing its manufacturing footprint. With respect to 2021, other includes the impact of certain costs related to a divested business, offset by subsidies received related to the COVID-19 pandemic, and for 2020 includes incremental payments made to essential service technicians for their contributions during the COVID-19 pandemic and certain IT projects. 1. Reconciliation of GAAP net income (loss) to EBITDA and Adjusted EBITDA (Non-GAAP measures) (Dollars in millions): Q1 2021 Q1 2020 TTM 3/31/2021 Net loss USD (8.1) USD (93.4) USD (182.5) Income tax expense (benefit) 1.2 20.0 (19.8) Interest income (1.7) (1.1) (7.4) Interest expense 48.7 48.0 293.4 Depreciation and amortization 39.7 49.3 170.8 EBITDA 79.8 22.8 254.5 Share-based compensation 3.5 4.0 14.4 Foreign exchange (gain) loss, net (5.7) (0.4) 9.1 Miscellaneous, net 0.7 0.9 (7.0) Equity in (loss) earnings of unconsolidated subsidiaries 1.1 - 0.4 Restructuring and DN Now transformation expenses 21.1 36.2 152.0 Non-routine (income)/expense, net (0.2) 26.0 40.4 Adjusted EBITDA USD 100.3 USD 89.5 USD 463.8
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