DieboldNixdorf.com
Investment Community
Conference Call
First Quarter 2020 Earnings
May 5, 2020
Use of non-GAAP Financial Information
To supplement our condensed consolidated financial statements presented in accordance with GAAP, the company considers certain financial measures that are not prepared in accordance with GAAP, including non-GAAP results, adjusted diluted earnings per share, free cash flow/(use), net debt, EBITDA, adjusted EBITDA and constant currency results. The company calculates constant currency by translating the prior year results at the current year exchange rate. The company uses these non-GAAP financial measures, in addition to GAAP financial measures, to evaluate our operating and financial performance and to compare such performance to that of prior periods and to the performance of our competitors. Also, the company uses these non-GAAP financial measures in making operational and financial decisions and in establishing operational goals. The company also believes providing these non-GAAP financial measures to investors, as a supplement to GAAP financial measures, helps investors evaluate our operating and financial performance and trends in our business, consistent with how management evaluates such performance and trends. The company also believes these non-GAAP financial measures may be useful to investors in comparing its performance to the performance of other companies, although its non-GAAP financial measures are specific to the company and the non-GAAP financial measures of other companies may not be calculated in the same manner. We provide EBITDA and Adjusted EBITDA because we believe that investors and securities analysts will find EBITDA and adjusted EBITDA to be useful measures for evaluating our operating performance and comparing our operating performance with that of similar companies that have different capital structures and for evaluating our ability to meet our future debt service, capital expenditures and working capital requirements. We are also providing EBITDA and adjusted EBITDA in light of our credit agreement and the issuance of our 8.5% senior notes due 2024. For more information, please refer to the section, "Notes for Non-GAAP Measures.
1 | DIEBOLD NIXDORF
Forward-looking Statements
This document contains statements that are not historical information are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding potential impact of the ongoing coronavirus (COVID-19) pandemic, anticipated revenue, future liquidity and financial position. Statements can generally be identified as forward looking because they include words such as "believes," "anticipates," "expects," "could," "should" or words of similar meaning. Statements that describe the company's future plans, objectives or goals are also forward-looking statements. Forward-looking statements are subject to assumptions, risks and uncertainties that may cause actual results to differ materially from those contemplated by such forward-looking statements. The factors that may affect the company's results include, among others: the ultimate impact of the ongoing COVID-19 pandemic on the company's business, results of operations, financial condition and liquidity; the ultimate impact of the appraisal proceedings initiated in connection with the implementation of the domination and profit and loss transfer agreement with Diebold Nixdorf AG and the merger squeeze- out; the company's ability to achieve benefits from its cost-reduction initiatives and other strategic initiatives, such as DN Now, including its planned restructuring actions, and its incremental cost savings actions, as well as its business process outsourcing initiative; the success of the company's new products, including its DN Series line; the company's ability to comply with the covenants contained in the agreements governing its debt; the company's ability to successfully refinance its debt when necessary or desirable; the ultimate outcome of the company's pricing, operating and tax strategies applied to former Diebold Nixdorf AG and the ultimate ability to realize cost reductions and synergies; changes in political, economic or other factors such as currency exchange rates, inflation rates, recessionary or expansive trends, taxes and regulations and laws affecting the worldwide business in each of the company's operations; the company's reliance on suppliers and any potential disruption to the company's global supply chain; the impact of market and economic conditions, including any additional deterioration and disruption in the financial and service markets, including the bankruptcies, restructurings or consolidations of financial institutions, which could reduce our customer base and/or adversely affect our customers' ability to make capital expenditures, as well as adversely impact the availability and cost of credit; interest rate and foreign currency exchange rate fluctuations, including the impact of possible currency devaluations in countries experiencing high inflation rates; the acceptance of the company's product and technology introductions in the marketplace; competitive pressures, including pricing pressures and technological developments; changes in the company's relationships with customers, suppliers, distributors and/or partners in its business ventures; the effect of legislative and regulatory actions in the United States and internationally and the company's ability to comply with government regulations; the impact of a security breach or operational failure on the company's business; the company's ability to successfully integrate other acquisitions into its operations; the company's success in divesting, reorganizing or exiting non-core and/or non-accretive businesses; the company's ability to maintain effective internal controls; changes in the company's intention to further repatriate cash and cash equivalents and short-term investments residing in international tax jurisdictions, which could negatively impact foreign and domestic taxes; unanticipated litigation, claims or assessments, as well as the outcome/impact of any current/pending litigation, claims or assessments; the investment performance of the company's pension plan assets, which could require the company to increase its pension contributions, and significant changes in healthcare costs, including those that may result from government action; the amount and timing of repurchases of the company's common shares, if any; and other factors included in the company's filings with the SEC, including its Annual Report on Form 10-K for the year ended December 31, 2019 and in other documents that the company files with the SEC. You should consider these factors carefully in evaluating forward- looking statements and are cautioned not to place undue reliance on such statements. The company assumes no obligation to update any forward-looking statements, which speak only to the date of this document.
2 | DIEBOLD NIXDORF
Our Priorities During the COVID-19 Crisis
Guided by Diebold
Nixdorf values
- Protecting the health and well-being of employees
- Fulfilling our mission as an essential business provider
~100% of banking and ~65% of our retail revenue is from customers who are running essential businesses
- Consistently delivering strong service levels
- Strengthening Diebold Nixdorf via operational rigor while maintaining adequate liquidity
3 | DIEBOLD NIXDORF
Responding with a Comprehensive Set of Actions
Customers & Solutions
- Delivering strong service levels - even in the hardest hit regions
- Reinforces the criticality of ATM/retail checkout channels
- Further differentiating our solutions with DN Series, self- checkout solutions and the AllConnect Data Engine
- Broad-basedpositive customer feedback during crisis
"We want to thank your tech team for their continued support of our ATMs. We really appreciate how your team is able to safely service our machines and keep them up and running for our customers and associates. Access to cash is essential and I want you all to know how much we appreciate your partnership during this time."
-Large US financial institution
"I want to express my thanks and gratitude for the excellent level of support that we are receiving from Diebold Nixdorf at this extremely difficult time. Our stores are busier than ever and our supply chain is operating right on the edge of capacity. Without your teams providing us excellent support centrally and remotely we would not be able to cope."
-Major European grocer
4 | DIEBOLD NIXDORF
Employees & Communities
- Proactively caring for 22,000 employees
- Leveraging our manufacturing capabilities to produce protective gear and medical components
- Strong engagement and resourcefulness
Supply Chain & Manufacturing
- Proactively managing the supply chain - avoided major disruptions to date from COVID-19
- All manufacturing facilities on-line and operating well
Operational Rigor
- Efficient management of inventory, receivables and payables
- Leveraging DN Now framework to reduce costs further
- Maintaining adequate liquidity & financial flexibility
- Executing business resiliency plans
Diebold Nixdorf's Business Model is Resilient
Services | Products | Software | |
Strong, multi-year recurring | Strong product backlog and | Mix of recurring revenue from | |
Key characteristics | revenue from maintenance & | solid sales pipeline entering | licenses/ maintenance and |
managed services | Q2-20 | project-based revenue | |
% of 2019 Revenue | 51% | 39% | 11% |
Expected Impact of | Mild | Moderate | Mild |
COVID-19 | |||
Banking is expected to be more resilient than Retail | |||
~74% of Revenue from Banking | ~26% from Retail |
Continuing to Take Decisive Action to Strengthen Diebold Nixdorf
Numbers may not add due to rounding
5 | DIEBOLD NIXDORF
Sustained Momentum in Strengthening Diebold Nixdorf
Continued solid execution of
Targeting gross savings of ~$130M during 2020
- Leveraging operational rigor and net working capital efficiencies
- Progressing on all DN Now initiatives
- Mild impact of COVID-19 on select work streams
- Accelerating G&A efficiencies
- finance transformation
- reduction of indirect spend
Incremental Actions Underway
Targeting incremental savings
of $80M - $100M
- Suspended major internal capital projects
- Reduced annual bonus expense
- Paused merit increases
- Implemented hiring freeze
- Reduced indirect spend
- Further consolidation of real estate
6 | DIEBOLD NIXDORF
Actions Are Driving Higher Quality Revenue
Revenue
Total | Services | Products | Software | |||
Q1-19 Revenue | $1,028 | $544 | $376 | $108 | ||
Divestitures | ($13) | ($7) | $0 | ($6) | ||
In-line with | Reducing low-margin | |||||
pre-COVID | ($17) | ($15) | ($2) | ($1) | ||
business | ||||||
plan | ||||||
Non-recurringQ1-19 | ||||||
revenue partially offset | ($31) | ($2) | ($37) | $8 | ||
by incremental business | ||||||
Foreign currency | ($23) | ($11) | ($9) | ($4) | ||
COVID-19 | ($33) | ($5) | ($28) | $0 | ||
Q1-20 Revenue | $911 | $504 | $300 | $106 | ||
Gross Profit1
$247 | $254 | Includes $7M of FX | |
headwinds YoY | |||
$135 | $136 | Services | |
$82 | $74 | Products |
$31 | $44 | Software |
Q1-19Q1-20
Gross Margin %1 | |
27.9% | |
24.1% | Significant YoY gains from |
all 3 business lines | |
Services + 230 bps | |
Products +280 bps | |
Software +1,270 bps | |
Q1-19 | Q1-20 |
- Non-GAAPmetric
7 | DIEBOLD NIXDORF Note: Differences may occur due to rounding.
Harvesting Efficiencies from Functional G&A Costs in 2020
Focus areas
- Finance Transformation - regionalizing, centralizing and automating core functions
- Optimizing Information Technology Spend - optimizing legacy platforms and enhancing digital capabilities
- Streamlining Procurement - applying global spend analytics to reduce indirect spend
- Consolidating Real Estate - better utilization of office space and embracing a more agile work environment
Delivering meaningful reductions to Operating Expense1
$220 | $209 | ||
$209 | $203 | ||
$191 | |||
$184 | $172 | $173 | $169 | ||
$160 | SG&A | ||||
$37 | $36 | $37 | $33 | $31 | R&D | ||
Q1-19 | Q2-19 | Q3-19 | Q4-19 | Q1-20 | |||
8 | DIEBOLD NIXDORF | 1) Non-GAAP metric | ||||||
Numbers may not add due to rounding |
Q1 2020 Financial Highlights
$ millions | Q1-20 | Q1-19 | YoY variance | |
Revenue | $911 | $1,028 | In-line with expectations | |
• $67M from planned reduction of low-margin business and non-recurring projects | ||||
• | $13M from divestitures | |||
• $19M growth from incremental volume | ||||
• $33M from COVID-19; $23M currency headwind | ||||
Gross Profit1 | $254 | $247 | DN Now initiatives drive gross profit & margin growth | |
• | Higher quality revenue | |||
Gross Margin1 | 27.9% | 24.1% | • | Services modernization plan |
• | Software excellence | |||
• | Favorable software mix and improving labor cost management | |||
Operating Expense1 | $191 | $220 | DN Now initiatives plus incremental actions | |
Operating Profit1 | $63 | $27 | • | Reduced operating expense by 13% YoY |
• Increased operating profit by 133% YoY | ||||
Operating Margin1 | 6.9% | 2.6% | • | Expanded operating margin by 430 bps YoY |
Adjusted EBITDA1 | $89 | $65 | DN Now initiatives plus incremental actions | |
Adjusted EBITDA Margin1 | 9.8% | 6.3% | • | Increased adjusted EBITDA by 37% YoY |
• Expanded adjusted EBITDA margin by 350 bps YoY | ||||
9 | DIEBOLD NIXDORF | 1) Non-GAAP metric |
Eurasia Banking Highlights
Revenue ($M)
Gross Profit ($M) and Gross Margin1
$383$360
$311
Q1-19 | Q1-19 adj 1 | Q1-20 |
$109$104
$90
28.5% | 29.0% | 28.9% |
Q1-19 | Q1-19 adj 1 | Q1-20 |
Deliberate actions to drive higher quality revenue
- Divestitures
- Planned reduction of low-margin business Additional factors include
- Non-recurringprojects as planned; partially offset by incremental activity
- COVID-19
Maintaining gross margin due to
- Benefits from DN Now
- Reducing low-margin business
- Includes $4M currency headwind YoY
10 | DIEBOLD NIXDORF | 1) Non-GAAP metric adjusted for foreign currency and divestitures |
Americas Banking Highlights
Revenue ($M)
Gross Profit ($M) and Gross Margin1
$363 | $356 | $345 | |
Q1-19 | Q1-19 adj 1 | Q1-20 |
$104
$82$80
30.3%
22.7%22.7%
Q1-19 | Q1-19 adj 1 | Q1-20 |
- Deliberate actions to drive higher quality revenue
- Non-recurringprojects in North America; partially offset by growth in US regional financial institutions
- Software growth
YoY increase due to:
- Favorable customer mix
- DN Now Services Modernization Plans
- Higher Profit from Software licenses volume
11 | DIEBOLD NIXDORF | 1) Non-GAAP metric adjusted for foreign currency and divestitures |
Retail Highlights
Revenue ($M)
Gross Profit ($M) and Gross Margin1
$283 | $275 | $256 | |
Q1-19 | Q1-19 adj 1 | Q1-20 |
$56 | $60 | |
$54 | ||
23.4% | ||
19.7% | 19.8% | |
Q1-19 | Q1-19 adj 1 | Q1-20 |
YoY variance from
- Non-recurringPOS installations in Europe as planned
- Partially offset by SCO and software growth
- COVID-19
YoY increase driven by
- Favorable revenue mix
- DN Now Services Modernization Plans
- Software Excellence
12 | DIEBOLD NIXDORF | 1) Non-GAAP metric adjusted for foreign currency and divestitures |
Net Working Capital and Cash Update
Net Working Capital as a % of TTM Revenue1 | Free Cash Flow2 |
22.5% | 24.0% | -580 bps | |||||||||||||||||||||||||
22.1% | |||||||||||||||||||||||||||
19.1% | |||||||||||||||||||||||||||
18.3% | 17.7% | ||||||||||||||||||||||||||
15.6% | 13.9% 13.3% | ($72) | ($65) | ||||||||||||||||||||||||
Q1-18Q2-18Q3-18Q4-18Q1-19Q2-19Q3-19Q4-19Q1-20 | Q1-19 | Q1-20 |
YoY drivers
- Higher adjusted EBITDA
- Net working capital improvements
- Reduced capex and restructuring
~$35M of higher bonus payments in Q1-20 versus Q1-19
Delivering high quality earnings
Key Drivers of Cash3 During Q1-2020
$386 | $89 | Maintaining adequate | |||||||||||
$71 | liquidity | ||||||||||||
$388 | $65 | 558 | $549 | ||||||||||
317 | |||||||||||||
252 | 252 | ||||||||||||
Beginning Cash | Contractural | Q1-20 Adj. Free | Revolver Draw | Divestitures, | Ending Cash | ||||||||
Debt Repayment | Cash Flow 2 | FX & Other |
- Net working capital is the sum of the trade receivables and inventories less accounts payable divided by trailing 12 months (TTM) GAAP revenue
- Free cash flow (FCF) is a non-GAAP financial measure defined as net cash (used in) provided by operating activities from continuing operations (excluding assets held for sale) less capital expenditures.
- Cash, cash equivalents, restricted cash, short-term investments, and cash expected to be realized from assets held for sale. Ending cash balance excludes ~$9M of cash in assets held for sale which is not
13 | DIEBOLD NIXDORF | expected to be realized as of March 31, 2020. Differences may occur due to rounding. |
Debt Maturities and Leverage
Debt Maturity Schedule (M) | Leverage Ratio2 |
$1,400
$1,200
$1,000
$800
$600
$400
$200
$0
$344 Revolver1 and $359
Term Loan A maturing
April 30th
$570 Term Loan A-1 maturing August 30th
2020 | 2021 | 2022 | 2023 | 2024 |
5.6x
5.0x
4.7x
4.4x 4.4X
Q1-19 | Q2-19 | Q3-19 | Q4-19 | Q1-20 |
- Net debt3 of $1,908M
- Leverage ratio is unchanged as adjusted EBITDA gains offset seasonal use of cash and mandatory debt repayments
- Revolving credit facility was fully drawn in March 2020 as a precautionary response to the uncertain impact of COVID-19
- Leverage ratio is defined as net debt to trailing 12-month calculated adjusted EBITDA
- Net Debt is a non-GAAP financial measure defined as notes payable plus long-term debt less cash, cash equivalents, restricted cash, short-term investments, and cash expected to be realized from assets held for sale. Ending cash balance excludes ~$9M of cash in assets held for sale which is not expected to be realized as of March 31, 2020.
14 | DIEBOLD NIXDORF
Under Challenging Scenarios, Diebold Nixdorf's Model Remains Resilient
Services | Products | Software | ||||
2019 | ||||||
Revenue (M) | $2,231 | $1,710 | $469 | |||
Gross Margin1 | 26.5% | 21.3% | 33.1% | |||
Revenue Impact | Mild 2 | Moderate | Mild | |||
2020 | Expectations | Gross Margin1 | Improved | Broadly stable | Improved | |
+ Services modernization plans | + Variable cost structure | + Improved project execution | ||||
‒ Some higher freight costs | & labor utilization | |||||
Drivers of Operating Profit1 | DN Now savings target of ~$130M & incremental actions of $80M - $100M | |||||
Free Cash Flow1 | Targeting break-even for 2020 | |||||
Numbers may not add due to rounding | ||
1) | Non-GAAP | |
15 | DIEBOLD NIXDORF | 2) | Excludes ~$110M of 2019 services revenue which is being divested during 2020. |
Diebold Nixdorf is Well-Positioned to Persevere
- Designated as Essential Service Provider to banks and retailers
- Criticality of ATM, POS & self-checkout channels have been reaffirmed
- Strong recurring revenue streams - trusted technology partner
- Resilient leadership team with a demonstrated track record of execution
- DN Now operating rigor & incremental cost actions further strengthen the resiliency of the company
16 | DIEBOLD NIXDORF
Supplemental
Schedules
YoY Revenue Variance for FX, Divestitures and Related Actions
Reconciliation GAAP to non-GAAP ($Millions)
Segments | Business Lines |
$Millions | Q1-20 | Q1-19 | Variance F/(U) | Variance % | ||||
Eurasia Banking Revenue (GAAP) | 311 | 383 | (72) | -18.9% | ||||
FX Impact | - | (9) | 9 | n/a | ||||
Divestitures and Related Actions | - | (13) | 13 | n/a | ||||
Eurasia Banking Adjusted Revenue (Non-GAAP) | 311 | 360 | (49) | -13.7% | ||||
Americas Banking Revenue (GAAP) | 345 | 363 | (18) | -4.9% | ||||
FX Impact | - | (6) | 6 | n/a | ||||
Divestitures and Related Actions | - | (0) | 0 | n/a | ||||
Americas Banking Adjusted Revenue (Non-GAAP) | 345 | 356 | (12) | -3.3% | ||||
Retail Revenue (GAAP) | 256 | 283 | (27) | -9.7% | ||||
FX Impact | - | (7) | 7 | n/a | ||||
Divestitures and Related Actions | - | - | - | n/a | ||||
Retail Adjusted Revenue (Non-GAAP) | 256 | 275 | (20) | -7.2% | ||||
Total Revenue (GAAP) | 911 | 1,028 | (117) | -11.4% | ||||
Fx Impact | - | (23) | 23 | n/a | ||||
Divestitures and Related Actions | - | (13) | 13 | n/a | ||||
Total Adjusted Revenue | 911 | 991 | (81) | -8.1% |
$Millions | Q1-20 | Q1-19 | Variance F/(U) | Variance % | ||||
Services Revenue (GAAP) | 504 | 544 | (40) | -7.4% | ||||
FX Impact | - | (11) | 11 | n/a | ||||
Divestitures and Related Actions | - | (7) | 7 | n/a | ||||
Services Adj. Revenue (Non-GAAP) | 504 | 526 | (22) | -4.2% | ||||
Products Revenue (GAAP) | 300 | 376 | (75) | -20.0% | ||||
FX Impact | - | (9) | 9 | n/a | ||||
Divestitures and Related Actions | - | - | - | n/a | ||||
Products Adj. Revenue (Non-GAAP) | 300 | 367 | (67) | -18.2% | ||||
Software Revenue (GAAP) | 106 | 108 | (2) | -1.6% | ||||
FX Impact | - | (4) | 4 | n/a | ||||
Divestitures and Related Actions | - | (6) | 6 | n/a | ||||
Software Adj. Revenue (Non-GAAP) | 106 | 98 | 8 | 8.6% | ||||
Total Revenue (GAAP) | 911 | 1,028 | (117) | -11.4% | ||||
FX Impact | - | (23) | 23 | n/a | ||||
Divestitures and Related Actions | - | (13) | 13 | n/a | ||||
Total Adjusted Revenue | 911 | 991 | (81) | -8.1% |
18 | DIEBOLD NIXDORF
Note: Differences may occur due to rounding.
YoY Gross Profit Variance for FX, Divestitures and Related Actions
Reconciliation GAAP to non-GAAP ($Millions)
Segments | Business Lines | |||||||||||||||||||
$Millions | Q1-20 | Q1-19 | Variance F/(U) | Variance % | $Millions | Q1-20 | Q1-19 | Variance F/(U) | Variance % | |||||||||||
Eurasia Banking Gross Profit (Non-GAAP) | 90 | 109 | (19) | -17.8% |
FX Impact | - | (4) | 4 | n/a |
Divestitures and Related Actions | - | (1) | 1 | n/a |
Eurasia Banking Adjusted Gross Profit (Non-GAAP) | 90 | 104 | (15) | -14.1% |
Americas Banking Gross Profit (Non-GAAP) | 104 | 82 | 22 | 27.2% |
FX Impact | - | (2) | 2 | n/a |
Divestitures and Related Actions | - | 0 | (0) | n/a |
Americas Banking Adjusted Gross Profit (Non-GAAP) | 104 | 80 | 24 | 29.8% |
Retail Gross Profit (Non-GAAP) | 60 | 56 | 4 | 7.3% |
FX Impact | - | (1) | 1 | n/a |
Divestitures and Related Actions | - | - | - | n/a |
Retail Adjusted Gross Profit (Non-GAAP) | 60 | 54 | 5 | 10.0% |
Services Gross Profit (Non-GAAP) | 136 | 135 | 2 | 1.2% |
FX Impact | - | (3) | 3 | n/a |
Divestitures and Related Actions | - | (0) | 0 | n/a |
Services Adj. Gross Profit (Non-GAAP) | 136 | 132 | 5 | 3.5% |
Products Gross Profit (Non-GAAP) | 74 | 82 | (8) | -9.9% |
FX Impact | - | (2) | 2 | n/a |
Divestitures and Related Actions | - | (0) | 0 | n/a |
Products Adj. Gross Profit (Non-GAAP) | 74 | 80 | (6) | -7.6% |
Software Gross Profit (Non-GAAP) | 44 | 31 | 13 | 42.1% |
FX Impact | - | (2) | 2 | n/a |
Divestitures and Related Actions | - | (1) | 1 | n/a |
Software Adj. Gross Profit (Non-GAAP) | 44 | 28 | 16 | 55.4% |
Total Gross Profit (Non-GAAP) | 254 | 247 | 7 | 2.7% | Total Gross Profit (Non-GAAP) | 254 | 247 | 7 | 2.7% | |||||||||
Fx Impact | - | (7) | 7 | n/a | FX Impact | - | (7) | 7 | n/a | |||||||||
Divestitures and Related Actions | - | (1) | 1 | n/a | Divestitures and Related Actions | - | (1) | 1 | n/a | |||||||||
Total Adjusted Gross Profit | 254 | 240 | 14 | 5.9% | Total Adjusted Gross Profit | 254 | 240 | 14 | 5.9% | |||||||||
19 | DIEBOLD NIXDORF
Note: Differences may occur due to rounding.
Q1 2019 Profit & Loss Statement
Reconciliation GAAP to non-GAAP ($Millions)
Restructuring and | Wincor Nixdorf | |||||||||
DN Now | Divestitures | purchase | Other | |||||||
2019 | % of Net | transformation | Legal / deal | and fixed | accounting | Inventory | non-routine | 2019 | % of Net | |
(GAAP) | Sales | expenses | expense | asset sale | adjustments | charge/gain | inc/exp | (non-GAAP) | Sales | |
Services | ||||||||||
544 | 52.9% | - | - | - | - | - | - | 544 | 52.9% | |
Products | 376 | 36.5% | - | - | - | - | - | - | 376 | 36.5% |
Software | 108 | 10.5% | - | - | - | - | - | - | 108 | 10.5% |
Total Revenue | 1,028 | 100.0% | - | - | - | - | - | - | 1,028 | 100.0% |
Services | 133 | 24.5% | 1 | - | - | - | (0) | - | 135 | 24.7% |
Products | 84 | 22.3% | 0 | - | - | 2 | (4) | - | 82 | 21.8% |
Software | 29 | 26.8% | 0 | - | - | 2 | - | - | 31 | 28.7% |
Total Gross Profit | 246 | 23.9% | 2 | - | - | 3 | (4) | - | 247 | 24.1% |
Operating Expenses | ||||||||||
230 | (14) | (9) | - | (21) | - | (3) | 184 | |||
Selling, G & A | ||||||||||
R , D & E | 37 | (0) | - | - | - | - | - | 37 | ||
(Gain)/Loss on Assets | 3 | - | - | (3) | - | - | - | 0 | ||
Impairment of Assets | - | - | - | - | - | - | - | - | ||
Total Operating Expense | 21.4% | |||||||||
271 | 26.3% | (14) | (9) | (3) | (21) | - | (3) | 220 | ||
Total Operating Profit (loss) | (24) | -2.4% | 15 | 9 | 3 | 25 | (4) | 3 | 27 | 2.6% |
20 | DIEBOLD NIXDORF Note: Differences may occur due to rounding.
Q1 2020 Profit & Loss Statement
Reconciliation GAAP to non-GAAP ($Millions)
Restructuring and | Wincor Nixdorf | Loss making | ||||||||||
DN Now | Divestitures | purchase | Costs related to | contract related to | Other | |||||||
2020 | % of Net | transformation | Legal / deal | and fixed | accounting | previously divested | Inventory | discontinued | non-routine | 2020 | % of Net | |
(GAAP) | Sales | expenses | expense | asset sale | adjustments | business in Germany | charge/gain | offering | inc/exp | (non-GAAP) | Sales | |
Services | ||||||||||||
504 | 55.3% | - | - | - | - | - | - | - | - | 504 | 55.3% | |
Products | 300 | 33.0% | - | - | - | - | - | - | - | - | 300 | 33.0% |
Software | 106 | 11.7% | - | - | - | - | - | - | - | - | 106 | 11.7% |
Total Revenue | 911 | 100.0% | - | - | - | - | - | - | - | - | 911 | 100.0% |
Services | 118 | 23.4% | 1 | - | - | - | - | 4 | 12 | 2 | 136 | 27.0% |
Products | 67 | 22.2% | - | - | - | 2 | 5 | (0) | - | 1 | 74 | 24.6% |
Software | 42 | 39.6% | 0 | - | - | 2 | - | - | - | - | 44 | 41.4% |
Total Gross Profit | 227 | 24.9% | 1 | - | - | 3 | 5 | 4 | 12 | 3 | 254 | 27.9% |
Operating Expenses | ||||||||||||
222 | (39) | (2) | - | (18) | - | - | - | (2) | 160 | |||
Selling, G & A | ||||||||||||
R , D & E | 33 | (2) | - | - | - | - | - | - | - | 31 | ||
(Gain)/Loss on Assets | (2) | - | - | 2 | - | - | - | - | - | (0) | ||
Impairment of Assets | - | - | - | - | - | - | - | - | - | - | ||
Total Operating Expense | 253 | 27.8% | (41) | (2) | 2 | (18) | - | - | - | (2) | 191 | 21.0% |
Total Operating Profit (loss) | (26) | -2.9% | 42 | 2 | (2) | 21 | 5 | 4 | 12 | 5 | 63 | 6.9% |
21 | DIEBOLD NIXDORF Note: Differences may occur due to rounding.
Gross Profit and Operating Expense Reconciliation
Reconciliation GAAP to non-GAAP ($Millions)
Gross Profit - Segment View
Operating Expense
Q1-19 | Q2-19 | Q3-19 | Q4-19 | 2019 | Q1-20 | |||||
Revenue (GAAP) | $1,028 | $1,150 | $1,079 | $1,152 | $4,409 | $911 | ||||
Total Operating Expense (GAAP) | $271 | $272 | $248 | $303 | $1,094 | $253 | ||||
Selling and administrative expense | 184 | 172 | 173 | 169 | 697 | 160 | ||||
Research, development and engineering expense | 37 | 36 | 37 | 33 | 142 | 31 | ||||
Other | 0 | 1 | (0) | 1 | 1 | (0) | ||||
Total Restructuring and DN Now Transformation Expenses | 14 | 26 | 18 | 48 | 105 | 41 | ||||
Total Non-Routine Expense | 37 | 37 | 21 | 53 | 148 | 21 | ||||
Total Restructuring, DN Now Transformation & Non-Routine Expense | 50 | 63 | 39 | 100 | 253 | 62 | ||||
Total Operating Expense (non-GAAP) | $220 | $209 | $209 | $203 | $841 | $191 | ||||
Non-GAAP operating expense as a % of GAAP Revenue | 21.4% | 18.2% | 19.4% | 17.6% | 19.1% | 21.0% | ||||
22 | DIEBOLD NIXDORF | Note: Differences may occur due to rounding. |
Adjusted EBITDA
Reconciliation GAAP to non-GAAP ($Millions)
$Millions | Q1-18 | Q2-18 | Q3-18 | Q4-18 | Q1-19 | Q2-19 | Q3-19 | Q4-19 | Q1-20 | |||
Revenue (GAAP) | $1,064 | $1,106 | $1,119 | $1,290 | $1,028 | $1,150 | $1,079 | $1,152 | $911 | |||
Net income (loss) | ($66) | ($116) | ($220) | ($128) | ($132) | ($55) | ($35) | ($123) | ($93) | |||
Income tax (benefit) expense | 19 | (30) | 45 | 3 | 60 | 9 | 5 | 42 | 20 | |||
Interest income | (4) | (2) | (2) | (1) | (3) | (2) | (2) | (2) | (1) | |||
Interest expense | 26 | 28 | 45 | 55 | 51 | 50 | 52 | 50 | 48 | |||
Depreciation & amortization1 | 62 | 58 | 58 | 57 | 53 | 52 | 49 | 49 | 49 | |||
EBITDA | $38 | ($61) | ($74) | ($14) | $30 | $54 | $70 | $16 | $23 | |||
Share-based compensation | 14 | 7 | 7 | 9 | 9 | 5 | 5 | 5 | 4 | |||
Foreign exchange gain (loss), net | 1 | 3 | (2) | 0 | (3) | 5 | 2 | 1 | (0) | |||
Miscellaneous, net | 0 | 3 | 2 | (0) | 1 | 0 | 1 | 1 | 1 | |||
Equity in earnings (loss) of unconsolidated | ||||||||||||
subsidiaries, net | (1) | (1) | (3) | 18 | 0 | 0 | (1) | (1) | 0 | |||
Restructuring and DN Now Transformation | ||||||||||||
Expenses2 | 4 | 2 | 41 | 32 | 15 | 28 | 20 | 49 | 36 | |||
Non-routine expenses, net3 | 6 | 88 | 123 | 78 | 12 | 14 | 0 | 60 | 26 | |||
Adjusted EBITDA | $62 | $41 | $93 | $124 | $65 | $107 | $98 | $131 | $89 | |||
Adjusted EBITDA % GAAP revenue | 5.8% | 3.7% | 8.3% | 9.6% | 6.3% | 9.3% | 9.1% | 11.4% | 9.8% |
Trailing 12-month Reconciliation
$Millions | Q1-19 | Q2-19 | Q3-19 | Q4-19 | Q1-20 | ||
Revenue (GAAP) | $4,543 | $4,587 | $4,547 | $4,409 | $4,291 | ||
Net income (loss) | ($595) | ($534) | ($350) | ($345) | ($306) | ||
Income tax (benefit) expense | 78 | 117 | 77 | 117 | 76 | ||
Interest income | (8) | (8) | (8) | (9) | (8) | ||
Interest expense | 180 | 201 | 209 | 203 | 200 | ||
Depreciation & amortization1 | 226 | 220 | 212 | 204 | 200 | ||
EBITDA | ($119) | ($4) | $140 | $170 | $163 | ||
Share-based compensation | 32 | 30 | 29 | 24 | 19 | ||
Foreign exchange gain (loss), net | (2) | 0 | 4 | 5 | 7 | ||
Miscellaneous, net | 5 | 3 | 3 | 4 | 3 | ||
Equity in earnings (loss) of unconsolidated | |||||||
subsidiaries, net | 15 | 16 | 18 | (1) | (1) | ||
Restructuring and DN Now Transformation | |||||||
Expenses2 | 91 | 117 | 96 | 113 | 134 | ||
Non-routine expenses, net3 | 301 | 227 | 104 | 86 | 101 | ||
Adjusted EBITDA | $323 | $389 | $394 | $401 | 425 | ||
Adjusted EBITDA % GAAP revenue | 7.1% | 8.5% | 8.7% | 9.1% | 9.9% |
- Deferred financing fees have been removed from depreciation and amortization.
- Excludes accelerated ERP depreciation, included in depreciation and amortization
- Net non-routine expenses excludes the Wincor Nixdorf purchase accounting adjustments, which are
included in depreciation and amortization. Note: Differences may occur due to rounding.
23 | DIEBOLD NIXDORF
Free Cash Flow and Net Debt Reconciliations
($Millions)
Q1-18 | Q2-18 | Q3-18 | Q4-18 | 2018 | Q1-19 | Q2-19 | Q3-19 | Q4-19 | 2019 | 1Q-20 | ||||
Net cash provided by (used in) operating activities - | ||||||||||||||
continuing - GAAP | ($142) | ($114) | ($115) | $268 | ($104) | ($57) | ($11) | $75 | $128 | $136 | ($80) | |||
Excluding the impact of changes in assets held for sale | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $20 | |||
Capital expenditures | (20) | (10) | (10) | (18) | (59) | (15) | (6) | (10) | (13) | (43) | (5) | |||
Free cash flow (use) (non-GAAP measure) | ($163) | ($125) | ($125) | $250 | ($163) | ($72) | ($16) | $65 | $116 | $93 | ($65) | |||
Add Back: Cash Interest Expense | (15) | (34) | (18) | (56) | (123) | (40) | (54) | (37) | (52) | (183) | (34) | |||
Unlevered Free cash flow (use) (non-GAAP measure) | ($148) | ($91) | ($107) | $306 | ($40) | ($32) | $38 | $102 | $168 | $275 | ($31) |
Trailing 12-month Reconciliation
Q1-19 | Q2-19 | Q3-19 | Q4-19 | 1Q-20 | |||
Net cash provided by (used in) operating activities - | |||||||
continuing - GAAP | ($19) | $85 | $275 | $136 | $113 | ||
Excluding the impact of changes in assets held for sale | $0 | $0 | $0 | $0 | $20 | ||
Capital expenditures | (53) | (48) | (48) | (43) | (34) | ||
Free cash flow (use) (non-GAAP measure) | ($72) | $37 | $227 | $93 | $100 | ||
Add Back: GAAP P&L Interest Expense | (148) | (168) | (186) | (183) | (177) | ||
Unlevered Free cash flow (use) (non-GAAP measure) | $76 | $205 | $413 | $275 | $277 |
Net Debt Reconciliation
$Millions | 3/31/2020 | 3/31/2019 |
Cash, cash equivalents, restricted cash and short | ||
term investments (GAAP measure) | 526 | 409 |
Cash included in assets held for sale | 23 | 5 |
Debt instruments | (2,457) | (2,238) |
Net debt (non-GAAP measure) | (1,908) | (1,824) |
- Free cash flow (FCF) is a non-GAAP financial measure defined as net cash provided by (used in) operations less capital expenditures.
- Adjusted free cash flow excludes cash used by assets held for sale (AHFS).
- Cash, cash equivalents, restricted cash, short-term investments, cash included in assets held for sale (GAAP Measure). Differences may occur due to rounding. Ending excludes ~$9M of cash in assets held for sale.
24 | DIEBOLD NIXDORF
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Diebold Nixdorf Inc. published this content on 05 May 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 05 May 2020 10:43:03 UTC