Delaware | 75-3236470 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
• | Unaudited pro forma condensed consolidated statements of (loss) income for the three months ended March 31, 2016 and the year ended December 31, 2015. |
• | Unaudited pro forma condensed consolidated balance sheet as of March 31, 2016. |
• | Notes to the unaudited pro forma condensed consolidated financial statements. |
Exhibit No. | Description | |
99.1 | Unaudited pro forma condensed consolidated financial information. |
TERADATA CORPORATION | |||||
Date: July 1, 2016 | By: | /s/ Stephen M. Scheppmann | |||
Stephen M. Scheppmann | |||||
Executive Vice President and Chief Financial Officer |
Exhibit No. | Description | |
99.1 | Unaudited pro forma condensed consolidated financial information. |
Teradata Corporation Unaudited Pro Forma Condensed Consolidated Statement of (Loss) Income For the Three Months Ended March 31, 2016 | ||||||||||||||
GAAP | Pro Forma | |||||||||||||
As reported | Adjustments (a) | Notes | Pro forma | |||||||||||
(in millions, except per share amounts) | ||||||||||||||
Revenue | ||||||||||||||
Product revenue | $ | 194 | $ | (6 | ) | (b) | $ | 188 | ||||||
Service revenue | 351 | (28 | ) | (b) | 323 | |||||||||
Total revenue | 545 | (34 | ) | 511 | ||||||||||
Costs and operating expenses | ||||||||||||||
Cost of products | 78 | — | 78 | |||||||||||
Cost of services | 198 | (19 | ) | (b) | 179 | |||||||||
Selling, general and administrative expenses | 174 | (23 | ) | (b) | 151 | |||||||||
Research and development expenses | 57 | (12 | ) | (b) | 45 | |||||||||
Impairment of goodwill and acquired intangibles | 80 | (76 | ) | (b) | 4 | |||||||||
Total costs and operating expenses | 587 | (130 | ) | 457 | ||||||||||
(Loss) income from operations | (42 | ) | 96 | 54 | ||||||||||
Other expense, net | ||||||||||||||
Interest expense | (3 | ) | — | (3 | ) | |||||||||
Other income, net | — | — | — | |||||||||||
Total other expense, net | (3 | ) | — | (3 | ) | |||||||||
(Loss) income before income taxes | (45 | ) | 96 | 51 | ||||||||||
Income tax expense | 1 | 13 | (c) | 14 | ||||||||||
Net (loss) income | $ | (46 | ) | $ | 83 | $ | 37 | |||||||
Net (loss) income per common share | ||||||||||||||
Basic | $ | (0.36 | ) | $ | 0.29 | |||||||||
Diluted | $ | (0.36 | ) | $ | 0.28 | |||||||||
Weighted average common shares outstanding | ||||||||||||||
Basic | 129.4 | 129.4 | ||||||||||||
Diluted | 129.4 | 130.9 | ||||||||||||
Teradata Corporation Unaudited Pro Forma Condensed Consolidated Statement of (Loss) Income For the Year Ended December 31, 2015 | ||||||||||||||
GAAP | Pro Forma | |||||||||||||
As reported | Adjustments (a) | Notes | Pro forma | |||||||||||
(in millions, except per share amounts) | ||||||||||||||
Revenue | ||||||||||||||
Product revenue | $ | 1,057 | $ | (28 | ) | (b) | $ | 1,029 | ||||||
Service revenue | 1,473 | (124 | ) | (b) | 1,349 | |||||||||
Total revenue | 2,530 | (152 | ) | 2,378 | ||||||||||
Costs and operating expenses | ||||||||||||||
Cost of products | 440 | (11 | ) | (b) | 429 | |||||||||
Cost of services | 814 | (90 | ) | (b) | 724 | |||||||||
Selling, general and administrative expenses | 765 | (92 | ) | (b) | 673 | |||||||||
Research and development expenses | 228 | (40 | ) | (b) | 188 | |||||||||
Impairment of goodwill and acquired intangibles | 478 | (478 | ) | (b) | — | |||||||||
Total costs and operating expenses | 2,725 | (711 | ) | 2,014 | ||||||||||
(Loss) income from operations | (195 | ) | 559 | 364 | ||||||||||
Other income, net | ||||||||||||||
Interest expense | (9 | ) | — | (9 | ) | |||||||||
Other income, net | 60 | — | 60 | |||||||||||
Total other income, net | 51 | — | 51 | |||||||||||
(Loss) income before income taxes | (144 | ) | 559 | 415 | ||||||||||
Income tax expense | 70 | 44 | (c) | 114 | ||||||||||
Net (loss) income | $ | (214 | ) | $ | 515 | $ | 301 | |||||||
Net (loss) income per common share | ||||||||||||||
Basic | $ | (1.53 | ) | $ | 2.16 | |||||||||
Diluted | $ | (1.53 | ) | $ | 2.12 | |||||||||
Weighted average common shares outstanding | ||||||||||||||
Basic | 139.6 | 139.6 | ||||||||||||
Diluted | 139.6 | 141.9 |
Teradata Corporation Unaudited Pro Forma Condensed Consolidated Balance Sheets As of March 31, 2016 | ||||||||||||||
GAAP | Pro Forma | |||||||||||||
(in millions, except per share amounts) | As reported | Adjustments (a) | Notes | Pro Forma | ||||||||||
Assets | ||||||||||||||
Current assets | ||||||||||||||
Cash and cash equivalents | $ | 917 | 88 | (d) | $ | 1,005 | ||||||||
Accounts receivable, net | 519 | — | 519 | |||||||||||
Inventories | 54 | — | 54 | |||||||||||
Assets held for sale | 139 | (134 | ) | (e) | 5 | |||||||||
Other current assets | 48 | (7 | ) | (f) | 41 | |||||||||
Total current assets | 1,677 | (53 | ) | 1,624 | ||||||||||
Property and equipment, net | 131 | — | 131 | |||||||||||
Capitalized software, net | 190 | — | 190 | |||||||||||
Goodwill | 384 | — | 384 | |||||||||||
Acquired intangible assets | 17 | — | 17 | |||||||||||
Deferred income taxes | 48 | — | 48 | |||||||||||
Other assets | 17 | — | 17 | |||||||||||
Total assets | $ | 2,464 | $ | (53 | ) | $ | 2,411 | |||||||
Liabilities and stockholders' equity | ||||||||||||||
Current liabilities | ||||||||||||||
Current portion of long-term debt | $ | 30 | — | $ | 30 | |||||||||
Short-term borrowings | 80 | — | 80 | |||||||||||
Accounts payable | 83 | — | 83 | |||||||||||
Payroll and benefits liabilities | 118 | — | 118 | |||||||||||
Deferred revenue | 506 | — | 506 | |||||||||||
Liabilities held for sale | 55 | (55 | ) | (e) | — | |||||||||
Other current liabilities | 96 | 13 | (f) | 109 | ||||||||||
Total current liabilities | 968 | (42 | ) | 926 | ||||||||||
Long-term debt | 560 | — | 560 | |||||||||||
Pension and other postemployment plan liabilities | 81 | — | 81 | |||||||||||
Long-term deferred revenue | 15 | — | 15 | |||||||||||
Deferred tax liabilities | 20 | (2 | ) | (f) | 18 | |||||||||
Other liabilities | 26 | — | 26 | |||||||||||
Total liabilities | 1,670 | (44 | ) | 1,626 | ||||||||||
Stockholders' equity | ||||||||||||||
Preferred stock | — | — | — | |||||||||||
Common stock | 1 | — | 1 | |||||||||||
Paid-in capital | 1,158 | — | 1,158 | |||||||||||
Accumulated deficit | (297 | ) | (9 | ) | (g) | (306 | ) | |||||||
Accumulated other comprehensive loss | (68 | ) | — | (68 | ) | |||||||||
Total stockholders' equity | 794 | (9 | ) | 785 | ||||||||||
Total liabilities and stockholders' equity | $ | 2,464 | $ | (53 | ) | $ | 2,411 |
(a) | The pro forma adjustments do not include special items that the Company sometimes excludes to present financial results. |
(b) | Elimination of revenue, cost and operating expenses attributable to the TMA Business. The pro forma adjustments exclude the portion of the Marketing Applications business that will be retained by Teradata. |
(c) | Adjustment reflects the tax effect of the pro forma adjustments at the applicable statutory income tax rates, including the discrete tax impact of the goodwill impairment that is not deductible for tax purposes. |
(d) | Adjustment reflects the approximately $92 million in cash received for the sale of the TMA Business, net of $4 million of transaction-related costs. The actual cash to be received in the third quarter of 2016 is subject to change pending the finalization of working capital and transaction costs. |
(e) | Elimination of assets and liabilities related to the TMA Business as if the divestment occurred on March 31, 2016. The remaining $5 million of assets held for sale relates to the sale of the Company's corporate plane. |
(f) | Adjustment reflects the $18 million estimated tax expense, of which $13 million is cash taxes associated with the tax gain on the sale of the TMA Business assets, due to having zero tax basis in goodwill. The tax expense associated with the gain was calculated based on the amount of proceeds allocated to the various jurisdictions in accordance with the Purchase Agreement at the local statutory rates. |
(g) | Adjustment reflects the estimated after-tax effect on retained earnings as if the divestment occurred on March 31, 2016, including the tax gain on the sale of the TMA Business and the reduction in net assets and liabilities. The actual loss to be reported in the third quarter of 2016 is subject to change pending final determination of the net asset value of the TMA Business, finalization of working capital, transaction costs and other adjustments. |