Diebold Nixdorf (DBD) Q4 2013 earnings summary

Executive summary

• FY2013 revenue fell 4.5% YoY to $2.857bn; operating loss was $118.3m and net loss attributable to shareholders was $181.6m, versus income of $73.6m in FY2012.

• Diebold 2.0 launched as a multi-year turnaround focused on cost, cash, talent and profitable growth, with a services-led, software-enabled business model.

Financial highlights

• Services revenue rose 0.6% to $1.637bn; product revenue declined 10.6% to $1.220bn; total gross profit fell 12.2% to $640.4m.

• FY2013 included a $70m non-cash goodwill impairment, $67.6m non-cash pension charge, $57.0m restructuring charges, $28m additional FCPA settlement losses and $17.2m net securities settlement charge.

• Cash from operating activities was $124.2m, down from $135.5m in FY2012; financing activities used $204.4m, including $126.7m in net debt repayments.

Outlook and guidance

• The multi-year realignment plan targets $150m in savings by end-2015; approximately 50% of savings are expected to benefit operating profit, with the rest partly reinvested in growth initiatives.

• Services and software are expected to exceed 60% of sales during the transformation; management expects capital resources to cover planned needs, investment, pension contributions and dividends for at least 12 months.

• Restructuring costs of $13m-$16m were anticipated through end-2014, primarily in North America and EMEA.