NCR Voyix Corporation (previously known as NCR Corporation)
(NYSE: VYX) reported preliminary financial results today for the
three months ended September 30, 2023. Third quarter preliminary
results reflect the legacy NCR business, inclusive of NCR Atleos,
which was separated as an independent, publicly traded company on
October 16, 2023.
- Revenue of $2 billion, increase of 2% on a constant currency
basis
- Net income (loss) from continuing operations attributable to
NCR of $(124) million
- Adjusted EBITDA of $404 million, increase of 5% on a
constant currency basis
- GAAP diluted EPS from continuing operations $(0.91);
Non-GAAP diluted EPS of $0.95
“This is an exciting time as we launch NCR Voyix and NCR Atleos
from their strong foundational heritage. I am proud of how the NCR
Voyix team successfully executed this transaction, while also
driving strong financial performance and continuing to provide the
highest standard of customer service. I would like to thank our
employees for their dedication and engagement,” said David
Wilkinson, NCR Voyix Chief Executive Officer. “NCR Voyix has a
clear strategy, and we are confident that we have the right team to
execute and continue to win across our markets.”
Tim Oliver, NCR Atleos Chief Executive Officer said, “Across the
first three quarters of 2023, the NCR Atleos team simultaneously
executed against our financial commitments, advanced our strategy,
and completed a transformational separation. Our momentum is
consistent with the expectations we described to investors as we
prepared for the separation. I appreciate the exceptional
commitment and effort that our employees demonstrated.” Oliver
added, “We are energized by our launch as a pure-play public
company and will focus all of our resources on meeting our ATM
customers' needs and extending our leadership position in
digital-to-physical transactions.”
Due to the finalization of certain accounting items relating to
the spin-off of NCR Atleos that was completed on October 16, 2023,
NCR Voyix will file an extension for the filing of its Quarterly
Report on Form 10-Q for the quarterly period ended September 30,
2023, which will align the timeline for filing the Form 10-Q to the
anticipated filing for NCR Atleos’ Form 10-Q for the same
period.
In this release, we use certain non-GAAP measures, including
presenting certain measures on a constant currency basis. These
non-GAAP measures include “Adjusted EBITDA,” “non-GAAP diluted EPS”
and others with the words “non-GAAP” or “constant currency” in
their titles. These non-GAAP measures are listed, described and
reconciled to their most directly comparable GAAP measures under
the heading “Non-GAAP Financial Measures” later in this
release.
2023 Third Quarter
Earnings Conference Call
NCR Voyix management will host a conference call today at 4:30
p.m. Eastern Time to discuss the NCR Voyix segment results and key
performance indicators for the third quarter 2023. Access to the
conference call and accompanying slides, as well as a replay of the
call, are available on the Company’s web site at
http://investor.ncrvoyix.com. Participants may access the live call
by dialing 888-820-9413 (United States/Canada Toll-free) or
786-460-7169 (International Toll) and entering the participant
passcode 9757431.
More information on the Company’s third quarter earnings,
including additional financial information and analysis, is
available on the NCR Voyix Investor Relations website at
http://investor.ncrvoyix.com/.
About NCR Voyix
NCR Voyix Corporation (NYSE: VYX) is a leading global provider
of digital commerce solutions for the retail, restaurant and
digital banking industries. NCR Voyix transforms retail stores,
restaurant systems and digital banking experiences with
comprehensive, platform-led SaaS and services capabilities. NCR
Voyix is headquartered in Atlanta, Georgia, with over 16,000
employees in 35 countries across the globe.
Website: www.ncrvoyix.com
Twitter: @NCR_Voyix
Facebook: www.facebook.com/ncrvoyix
Instagram: www.instagram.com/ncrvoyix
LinkedIn: https://www.linkedin.com/company/ncrvoyix
YouTube: www.youtube.com/user/ncrvoyix
Cautionary Statements
This release contains “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995 (the “Act”). Forward-looking
statements use words such as “expect,” “anticipate,” “outlook,”
“intend,” “plan,” “confident,” “believe,” “will,” “should,”
“would,” “potential,” “positioning,” “proposed,” “planned,”
“objective,” “likely,” “could,” “may,” and words of similar
meaning, as well as other words or expressions referencing future
events, conditions or circumstances. We intend these
forward-looking statements to be covered by the safe harbor
provisions for forward-looking statements contained in the Act.
Statements that describe or relate to Voyix’s plans, goals,
intentions, strategies, or financial outlook, and statements that
do not relate to historical or current fact, are examples of
forward-looking statements. Examples of forward-looking statements
in this release include, without limitation, statements regarding
the impact of the separation of Voyix from NCR Atleos, including,
but not limited to, statements regarding the future commercial
performance of Voyix (or its business) following such transaction
and value creation and ability to innovate and drive growth
generally as a result of such transaction, and statements regarding
the expected timing to file our Quarterly Report on Form 10-Q for
the quarter ended September 30, 2023. Forward-looking statements
are based on our current beliefs, expectations and assumptions,
which may not prove to be accurate, and involve a number of known
and unknown risks and uncertainties, many of which are out of
Voyix’s control. Forward-looking statements are not guarantees of
future performance, and there are a number of important factors
that could cause actual outcomes and results to differ materially
from the results contemplated by such forward-looking statements,
including those factors relating to:
- Strategy and Technology: transforming our business model;
development and introduction of new solutions; competition in the
technology industry; integration of acquisitions and management of
alliance activities; our multinational operations;
- Business Operations: domestic and global economic and credit
conditions; risks and uncertainties from the payments-related
business and industry; disruptions in our data center hosting and
public cloud facilities; retention and attraction of key employees;
defects, errors, installation difficulties or development delays;
failure of third-party suppliers; a major natural disaster or
catastrophic event, including the impact of the coronavirus
(COVID-19) pandemic and geopolitical and macroeconomic challenges
(such as the Israel-Hamas conflict); environmental exposures from
historical and ongoing manufacturing activities; and climate
change;
- Data Privacy & Security: impact of data protection,
cybersecurity and data privacy including any related issues,
including the April 2023 ransomware incident;
- Finance and Accounting: our level of indebtedness; the terms
governing our indebtedness; incurrence of additional debt or
similar liabilities or obligations; access or renewal of financing
sources; our cash flow sufficiency to service our indebtedness;
interest rate risks; the terms governing our trade receivables
facility; the impact of certain changes in control relating to
acceleration of our indebtedness, our obligations under other
financing arrangements, or required repurchase of our senior
unsecured notes; any lowering or withdrawal of the ratings assigned
to our debt securities by rating agencies; our pension liabilities;
and write down of the value of certain significant assets;
- Law and Compliance: allegations or claims by third parties that
our products or services infringe on intellectual property rights
of others, including claims against our customers and claims by our
customers to defend and indemnify them with respect to such claims;
protection of our intellectual property; changes to our tax rates
and additional income tax liabilities; uncertainties regarding
regulations, lawsuits and other related matters; and changes to
cryptocurrency regulations;
- Governance: impact of the terms of our Series A Convertible
Preferred (“Series A”) Stock relating to voting power, share
dilution and market price of our common stock; rights, preferences
and privileges of Series A stockholders compared to the rights of
our common stockholders; and actions or proposals from stockholders
that do not align with our business strategies or the interests of
our other stockholders;
- Separation: that the potential strategic benefits, synergies or
opportunities expected from the separation may not be realized or
may take longer to realize than expected; the potential inability
to access or reduced access to the capital markets or increased
cost of borrowings, including as a result of a credit rating
downgrade; the incurrence of significant costs in connection with
the separation; the potential adverse reactions to the separation
by customers, suppliers, strategic partners or key personnel and
potential difficulties in maintaining relationships with such
persons and risks associated with third party contracts containing
consent, and/or other provisions that may be triggered by the
separation; unforeseen tax liabilities or changes in tax law;
non-compete restrictions in the separation agreement entered into
in connection with the separation; and requests, requirements or
penalties imposed by any governmental authorities related to
certain existing liabilities.
Should one or more of these risks or uncertainties materialize,
or should underlying assumptions prove incorrect, actual results
may vary materially from those set forth in the forward-looking
statements. There can be no guarantee that stockholders will
achieve any particular level of stockholder returns. Nor can there
be any guarantee that following the separation, Voyix and Atleos
will be able to realize any of the strategic benefits, synergies,
or opportunities from the separation or that the separation will
maximize value for stockholders, or that Voyix or any of its
divisions will be commercially successful in the future, or achieve
any particular credit rating or financial results.
Additional information concerning these and other factors can be
found in Voyix’s filings with the U.S. Securities and Exchange
Commission, including Voyix’s most recent annual report on Form
10-K, quarterly reports on Form 10-Q and current reports on Form
8-K. Any forward-looking statement speaks only as of the date on
which it is made. Voyix does not undertake any obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise, except
as required by law.
SPIN-OFF INFORMATION. On October 16, 2023, we completed
the Atleos spin-off, which included our ATM-focused business,
including its self-service banking, payments & network and
telecommunications and technology businesses. The historical
financial results of Atleos are included in our condensed
consolidated financial statements for the quarter ended September
30, 2023. Subsequent to the spin-off, and in future filings, the
historical results of Atleos will be reflected as discontinued
operations in our consolidated financial statements. Accordingly,
this presentation does not recast our historic financial results to
reflect Atleos as discontinued operations.
PRELIMINARY UNAUDITED RESULTS AND 10-Q EXTENSION.
As noted above, due to the finalization of certain accounting items
relating to the spin-off of NCR Atleos that was completed on
October 16, 2023, NCR Voyix will file an extension for the filing
of its Quarterly Report on Form 10-Q for the quarterly period ended
September 30, 2023, which will align the timeline for filing the
Form 10-Q to the anticipated timing for NCR Atleos’ Form 10-Q for
the same period. The separation accounting work being finalized
relates to items included in the consolidated balance sheet and
consolidated statement of cash flows. Accordingly, the Company is
announcing preliminary results for the third quarter, which are
based on currently available information and are subject to
revision as the Company completes its internal review. The
Company’s independent registered public accounting firm has not
finalized its review of these preliminary financial results. This
release is not a comprehensive statement of the Company’s financial
results for the third quarter ended September 30, 2023, and
excludes the consolidated balance sheet and consolidated statement
of cash flows. Actual results may differ from these preliminary
financial results and other financial information due to the
completion of the Company’s quarterly internal procedures, final
adjustments and other developments that may arise between now and
the time the results are finalized. Further disclosure will be
included on Form 12b-25 to be filed with the Securities and
Exchange Commission. NCR Voyix expects to file its Form 10-Q for
the quarterly period ended September 30, 2023 by November 14,
2023.
Non-GAAP Financial Measures
Non-GAAP Financial Measures. While NCR reports its results in
accordance with Generally Accepted Accounting Principles in the
United States, or GAAP, in this release NCR also uses the non-GAAP
measures listed and described below.
Non-GAAP Diluted Earnings Per Share (EPS). The Company
determines Non-GAAP EPS by excluding, as applicable, pension
mark-to-market adjustments, pension settlements, pension
curtailments and pension special termination benefits, as well as
other special items, including amortization of acquisition related
intangibles, stock-based compensation expense, separation-related
costs, cyber ransomware incident recovery costs, and transformation
and restructuring activities, from the Company’s GAAP earnings per
share. Due to the non-operational nature of these pension and other
special items, the Company's management uses these non-GAAP
measures to evaluate year-over-year operating performance. The
Company believes this measure is useful for investors because they
provide a more complete understanding of the Company's underlying
operational performance, as well as consistency and comparability
with the Company's past reports of financial results.
Adjusted Earnings Before Interest, Taxes, Depreciation and
Amortization (Adjusted EBITDA). The Company determines Adjusted
EBITDA for a given period based on its GAAP net income from
continuing operations attributable to NCR plus interest expense,
net; plus income tax expense (benefit); plus depreciation and
amortization; plus stock-based compensation expense; plus other
income (expense); plus pension mark-to-market adjustments, and
other special items, including amortization of acquisition related
intangibles, separation-related costs, cyber ransomware incident
recovery costs, and transformation and restructuring charges (which
includes integration, severance and other exit and disposal costs),
among others. The Company uses Adjusted EBITDA to manage and
measure the performance of its business segments. The Company also
uses Adjusted EBITDA to manage and determine the effectiveness of
its business managers and as a basis for incentive compensation.
The Company believes that Adjusted EBITDA provides useful
information to investors because it is an indicator of the strength
and performance of the Company’s ongoing business operations,
including its ability to fund discretionary spending such as
capital expenditures, strategic acquisitions and other
investments.
Special Item Related to Russia. The war in Eastern Europe and
related sanctions imposed on Russia and related actors by the
United States and other jurisdictions required us to commence the
orderly wind down of our operations in Russia in the first quarter
of 2022. As of September 30, 2023, we have ceased operations in
Russia and are in process of dissolving our only subsidiary in
Russia. As a result, for the three and nine months ended September
30, 2022, our non-GAAP presentation of the measures described above
exclude the immaterial impact of our operating results in Russia,
as well as the impact of impairments taken to write down the
carrying value of assets and liabilities, severance charges, and
the assessment of collectability on revenue recognition. No charges
have been recognized for the three and nine months ended September
30, 2023. We consider this to be a non-recurring special item and
management has reviewed the results of its business segments
excluding these impacts.
Constant Currency. The Company presents certain financial
measures, such as period-over-period revenue growth, on a constant
currency basis, which excludes the effects of foreign currency
translation by translating prior period results at current period
monthly average exchange rates. Due to the overall variability of
foreign exchange rates from period to period, NCR’s management uses
constant currency measures to evaluate period-over-period operating
performance on a more consistent and comparable basis. The
Company’s management believes that presentation of financial
measures without this result may contribute to an understanding of
the Company's period-over-period operating performance and provides
additional insight into historical and/or future performance, which
may be helpful for investors.
The Company’s definitions and calculations of these non-GAAP
measures may differ from similarly-titled measures reported by
other companies and cannot, therefore, be compared with
similarly-titled measures of other companies. These non-GAAP
measures should not be considered as substitutes for, or superior
to, results determined in accordance with GAAP.
Reconciliation of Net Income
from Continuing Operations Attributable to NCR (GAAP) to Adjusted
Earnings Before Interest, Depreciation, Taxes and Amortization
(Adjusted EBITDA)
$ in millions
Q3 2023
Q3 2022
Net Income (Loss) from Continuing
Operations Attributable to NCR (GAAP)
$
(124
)
$
69
Transformation and restructuring costs
8
17
Acquisition-related amortization of
intangibles
43
44
Acquisition-related costs
—
1
Pension mark-to-market adjustments
19
—
Separation costs
76
—
Cyber ransomware incident recovery
costs
12
—
Depreciation and amortization (excluding
acquisition-related amortization of intangibles)
109
107
Gain on terminated interest rate
derivative agreements
(85
)
—
Interest expense
85
74
Interest income
(5
)
(3
)
Income tax expense (benefit)
236
43
Stock-based compensation expense
30
28
Adjusted EBITDA (Non-GAAP)
$
404
$
380
Reconciliation of Diluted
Earnings Per Share from Continuing Operations (GAAP) to Non-GAAP
Diluted Earnings Per Share from Continuing Operations
(Non-GAAP)
Q3 2023
Q3 2022
Diluted Earnings Per Share from
Continuing Operations (GAAP) (1)
$
(0.91
)
$
0.46
Transformation and restructuring costs
0.05
0.11
Stock-based compensation expense
0.18
0.16
Acquisition-related amortization of
intangibles
0.26
0.23
Acquisition-related costs
—
0.01
Separation costs
1.65
—
Gain on terminated interest rate
derivative agreements
(0.56
)
—
Cyber ransomware incident recovery
costs
0.07
—
Pension mark-to-market adjustments
0.10
—
Diluted Earnings Per Share from
Continuing Operations (Non-GAAP) (1)
$
0.95
$
0.96
(1)
Non-GAAP diluted EPS is determined using
the conversion of the Series A Convertible Preferred Stock into
common stock in the calculation of weighted average diluted shares
outstanding. GAAP EPS is determined using the most dilutive
measure, either including the impact of dividends or deemed
dividends on the Company's Series A Convertible Preferred Stock in
the calculation of net income or loss available to common
stockholders or including the impact of the conversion of the
Series A Convertible Preferred Stock into common stock in the
calculation of the weighted average diluted shares outstanding.
Therefore, GAAP diluted EPS and non-GAAP diluted EPS may not
mathematically reconcile.
Reconciliation of As Reported Growth %
(GAAP) to Growth Constant Currency % (Non-GAAP)
Three months ended September
30, 2023
Nine months ended September
30, 2023
$ in millions
As Reported
Growth %
Favorable
(Unfavorable)
FX Impact
Growth %
Constant
Currency (non-
GAAP)
As Reported
Growth %
Favorable
(Unfavorable)
FX Impact
Growth %
Constant
Currency (non-GAAP)
Revenue by segment
Retail
(1
)%
1
%
(2
)%
1
%
(1
)%
2
%
Hospitality
—
%
—
%
—
%
1
%
—
%
1
%
Digital Banking
7
%
—
%
7
%
5
%
—
%
5
%
Payments & Network
6
%
1
%
5
%
5
%
—
%
5
%
Self-Service Banking
4
%
—
%
4
%
1
%
(1
)%
2
%
Other
(9
)%
—
%
(9
)%
(14
)%
(1
)%
(13
)%
Eliminations
—
%
—
%
—
%
9
%
—
%
9
%
Total revenue
2
%
—
%
2
%
1
%
(1
)%
2
%
Recurring Revenue
7
%
—
%
7
%
5
%
(1
)%
6
%
Adjusted EBITDA
6
%
1
%
5
%
11
%
(2
)%
13
%
NCR VOYIX CORPORATION
CONSOLIDATED STATEMENTS OF
OPERATIONS
(Unaudited)
(in millions, except per share
amounts)
Schedule A
For the Periods Ended
September 30
Three Months
Nine Months
2023
2022
2023
2022
Revenue
Product
$
560
$
590
$
1,657
$
1,720
Service
1,457
1,382
4,237
4,115
Total Revenue
2,017
1,972
5,894
5,835
Cost of products
465
524
1,399
1,560
Cost of services
925
957
2,864
2,902
Total gross margin
627
491
1,631
1,373
% of Revenue
31.1
%
24.9
%
27.7
%
23.5
%
Selling, general and administrative
expenses
331
264
956
886
Research and development expenses
54
40
175
164
Income (loss) from operations
242
187
500
323
% of Revenue
12.0
%
9.5
%
8.5
%
5.5
%
Interest expense
(85
)
(74
)
(259
)
(204
)
Other income (expense), net
(44
)
(1
)
(55
)
9
Total interest and other expense, net
(129
)
(75
)
(314
)
(195
)
Income (loss) from continuing
operations before income taxes
113
112
186
128
% of Revenue
5.6
%
5.7
%
3.2
%
2.2
%
Income tax expense (benefit)
236
43
280
56
Income (loss) from continuing
operations
(123
)
69
(94
)
72
Income (loss) from discontinued
operations, net of tax
—
—
(1
)
5
Net income (loss)
(123
)
69
(95
)
77
Net income (loss) attributable to
noncontrolling interests
1
—
1
1
Net income (loss) attributable to
NCR
$
(124
)
$
69
$
(96
)
$
76
Amounts attributable to NCR common
stockholders:
Income (loss) from continuing
operations
$
(124
)
$
69
$
(95
)
$
71
Dividends on convertible preferred
stock
(4
)
(4
)
(12
)
(12
)
Income (loss) from continuing operations
attributable to NCR common stockholders
(128
)
65
(107
)
59
Income (loss) from discontinued
operations, net of tax
—
—
(1
)
5
Net income (loss) attributable to NCR
common stockholders
$
(128
)
$
65
$
(108
)
$
64
Income (loss) per share attributable to
NCR common stockholders:
Income (loss) per common share from
continuing operations
Basic
$
(0.91
)
$
0.47
$
(0.76
)
$
0.43
Diluted (1)
$
(0.91
)
$
0.46
$
(0.76
)
$
0.42
Net income (loss) per common
share
Basic
$
(0.91
)
$
0.47
$
(0.77
)
$
0.47
Diluted (1)
$
(0.91
)
$
0.46
$
(0.77
)
$
0.45
Weighted average common shares
outstanding
Basic
140.9
137.0
140.3
136.4
Diluted (1)
140.9
140.3
140.3
140.9
(1) Diluted EPS is determined using the most dilutive measure,
either including the impact of the dividends and deemed dividends
on NCR's Series A Convertible Preferred Shares in the calculation
of net income or loss per common share from continuing operations
and net income or loss per common share or including the impact of
the conversion of such preferred stock into common stock in the
calculation of the weighted average diluted shares outstanding.
NCR VOYIX CORPORATION
REVENUE AND ADJUSTED EBITDA
SUMMARY
(Unaudited)
(in millions)
Schedule B
For the Periods Ended
September 30
Three Months
Nine Months
2023
2022
%
Change
% Change
Constant
Currency
2023
2022
%
Change
% Change
Constant
Currency
Revenue by segment
Retail
$
568
$
575
(1
)%
(2
)%
$
1,696
$
1,683
1
%
2
%
Hospitality
238
238
—
%
—
%
696
687
1
%
1
%
Digital Banking
147
137
7
%
7
%
423
404
5
%
5
%
Payments & Network
357
336
6
%
5
%
1,013
967
5
%
5
%
Self-Service Banking
666
640
4
%
4
%
1,940
1,930
1
%
2
%
Other (1)
53
58
(9
)%
(9
)%
161
187
(14
)%
(13
)%
Eliminations
(12
)
(12
)
—
%
—
%
(35
)
(32
)
9
%
9
%
Other adjustment (2)
—
—
n/m
n/m
—
9
n/m
n/m
Total revenue
$
2,017
$
1,972
2
%
2
%
$
5,894
$
5,835
1
%
2
%
Adjusted EBITDA by segment
Retail
$
132
$
128
3
%
$
352
$
299
18
%
Retail Adjusted EBITDA margin %
23.2
%
22.3
%
20.8
%
17.8
%
Hospitality
59
51
16
%
172
138
25
%
Hospitality Adjusted EBITDA margin %
24.8
%
21.4
%
24.7
%
20.1
%
Digital Banking
58
60
(3
)%
160
172
(7
)%
Digital Banking Adjusted EBITDA margin
%
39.5
%
43.8
%
37.8
%
42.6
%
Payments & Network
120
114
5
%
302
309
(2
)%
Payments & Network Adjusted EBITDA
margin %
33.6
%
33.9
%
29.8
%
32.0
%
Self-Service Banking
169
150
13
%
476
404
18
%
Self-Service Banking Adjusted EBITDA
margin %
25.4
%
23.4
%
24.5
%
20.9
%
Eliminations
(9
)
(11
)
(18
)%
(26
)
(25
)
4
%
Corporate and Other (3)
(125
)
(112
)
12
%
(341
)
(307
)
11
%
Total Adjusted EBITDA
$
404
$
380
6
%
5
%
$
1,095
$
990
11
%
13
%
Total Adjusted EBITDA margin %
20.0
%
19.3
%
18.6
%
17.0
%
(1) Other revenue represents certain other immaterial business
operations that do not represent a reportable segment.
(2) Other adjustment reflects the revenue attributable to the
Company's operations in Russia for the three and nine months ended
September 30, 2022 that were excluded from management's measure of
revenue due to our previous announcement to suspend sales to Russia
and orderly wind down of our operations in Russia beginning in the
first quarter of 2022. Refer to the section entitled "Non-GAAP
Financial Measures" for additional information.
(3) Corporate and Other includes income and expenses related to
corporate functions that are not specifically attributable to an
individual reportable segment along with any immaterial operating
segment(s).
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version on businesswire.com: https://www.businesswire.com/news/home/20231109990707/en/
News Media Contact Lee Underwood
lee.underwood@ncrvoyix.com
Investor Contacts Michael Nelson
michael.nelson@ncrvoyix.com
Alan Katz Alan.Katz@ncrvoyix.com
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