AP News, October 31st, 2007
NCR Corp., which makes automated teller machines, said Wednesday that its third-quarter earnings fell 63 percent, reflecting the spinoff of its Teradata unit. But the results beat Wall Street estimates, and NCR's stock jumped 9 percent.
NCR said it earned $33 million, or 18 cents a share, in the quarter ended Sept. 30, compared with $89 million, or 49 cents a share, for the same period in 2006.
Excluding the costs of spinning off the Teradata Corp. on Oct. 1 and NCR's manufacturing realignment, earnings would have been 39 cents per share for the quarter compared with 21 cents a share a year ago.
NCR reported revenue of $1.28 billion, up 12 percent from revenue of $1.14 billion in the year ago quarter.
Analysts surveyed by Thomson Financial expected earnings of 27 cents a share on revenue of $1.19 billion. The estimate usually excludes one-time charges.
NCR stock jumped $2.06, or 8.1 percent, to close at $27.59 Wednesday. The stock has traded between $23 and $29.01 since the spinoff.
"With the Teradata separation behind us, NCR's focus on the implementation of our long-term vision and business strategy will sharpen, as will the focus of our overall cost structure," said Bill Nuti, chairman and chief executive.
NCR announced plans for the Teradata spinoff in January, saying it would allow each company to better concentrate on its individual customer base, business strategy and operational needs.
The manufacturing realignment has included outsourcing production of its automated teller machines in the Americas and shuffling the manufacturing of ATMs among its overseas plants to save money.
For the first nine months of 2007, NCR made $165 million, or 90 cents a share, compared with earnings of $208 million, or $1.13 a share, in 2006. Revenue of $3.45 billion for the year to date was up from $3.24 billion in 2006.
NCR makes ATMs and checkout scanners for the retail industry. It employs about 21,000 workers worldwide.
Dayton-based Teradata, which makes data warehousing software, said Tuesday in its first earnings report that its profits dropped 79 percent. Teradata earned $9 million, or 5 cents a share, in the three months ended Sept. 30, compared with $43 million, or 24 cents a share, in the same period of 2006.
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