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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) JANUARY 28, 1998
UNOVA, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 001-13279 95-4647021
(STATE OR OTHER (COMMISSION FILE (I.R.S. EMPLOYER
JURISDICTION NUMBER) IDENTIFICATION NO.)
OF INCORPORATION)
360 NO. CRESCENT DRIVE, BEVERLY HILLS, CALIFORNIA 90210
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (310) 888-2500
Item 5. OTHER EVENTS.
The Registrant announced on January 28, 1998 its preliminary results for the
three months and year ended December 31, 1997, as more fully set forth in
Exhibit 99.1 filed herewith.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) and (b) No financial statements are required to be filed with this
report.
(c) The following exhibits are filed with this report:
EXHIBIT NUMBER DESCRIPTION
99.1 Press Release of the Company
issued January 28, 1998
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
UNOVA, INC.
By: /s/ Charles A. Cusumano
----------------------
Charles A. Cusumano
Vice President, Finance
Dated: February 27, 1998
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EXHIBIT 99.1
FOR IMMEDIATE RELEASE
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Contact: Dirk Koerber (310) 888-2575
UNOVA ANNOUNCES RESULTS FOR
1997 FOURTH QUARTER AND FULL YEAR
BEVERLY HILLS, Calif. - January 28, 1998 -- UNOVA, Inc. (NYSE:UNA) today
announced results for the 1997 fourth quarter and the full year. The new
industrial technologies company began trading publicly in November 1997 when
its business activities were spun off from Western Atlas Inc. (NYSE:WAI).
Revenues for 1997 grew to $1.43 billion, a 23 percent increase over the
$1.16 billion reported for fiscal year 1996. Operating income, prior to a
one-time contract charge, grew by 18 percent from $99.6 million in 1996 to
$117.2 million in 1997. On an after-tax basis, the Company reported a net
loss of $171.4 million for 1997, or $3.17 per share, compared with net
earnings of $42.0 million, or $0.78 per share in 1996. The net loss in 1997
was the result of one-time acquisition related charges. These charges were
primarily associated with the expense of acquired in-process research and
development, comprising $203.3 million related to the acquisitions of Norand
Corporation and United Barcode Industries, and $8.2 million resulting from
the acquisition of radio frequency identification (RFID) technology.
Exclusive of one-time charges, earnings per share would have increased to
$0.83. Calculated under the requirements of newly effective Statement of
Financial Accounting Standards No. 128, "Earnings Per Share", basic and
diluted per share amounts are the same for all periods presented.
Revenues for the fourth quarter of 1997 decreased to $332.1 million from
the reported $350.2 million in the same quarter a year ago. Net earnings in
the fourth quarter were negatively impacted by one-time charges to expense
acquired in-process R&D and the costs of a long-term contract related to
wireless RFID technology the Company
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purchased from IBM Corporation. The $13.0 million after-tax charge resulted
in a fourth quarter net loss of $5.6 million, or $0.10 per share. This
compares to net earnings of $14.1 million, or $0.26 per share, in the 1996
fourth quarter.
"This past year has been a repositioning period for us," said Alton J.
Brann, Chairman and CEO of UNOVA. "We successfully completed our spin-off
from Western Atlas, establishing UNOVA as an independent public corporation.
We doubled the size of Intermec Technologies, our Automated Data Systems
business, with two major acquisitions, making us the second largest
competitor in this market. In addition, we completed 1997 with record
profits in our Industrial Automation Systems segment.
"While we are not yet at the end of the process of integrating the
acquired businesses into Intermec," continued Brann, "we believe we now have
the size, technology, products, internal structure and distribution network
that should enable us to accelerate our growth and improve our operational
performance as we move further into 1998.
"Our Industrial Automation Systems operations again demonstrated their
competitiveness by setting new performance records in 1997, although bookings
slowed as several customers moved the startup of new projects into 1998.
This is expected to result in an interim decline in quarterly revenues and
operating income which began in the second half of 1997 and is not
anticipated to improve until later in 1998," added Brann.
INDUSTRIAL AUTOMATION SYSTEMS
During the fourth quarter, UNOVA's Lamb Technicon division delivered its
first "modular" engine part manufacturing system to a new Chrysler
Corporation engine plant in Detroit. This modular concept enabled Lamb to
install and certify the system in record time. The equipment will be used to
produce a new 4.7-liter engine for Chrysler's 1999 Grand Cherokee.
Implementation efficiencies by UNOVA's divisions on this and other
contracts saved Chrysler almost $10 million of capital investments in 1997,
as documented through the car maker's prestigious S.C.O.R.E. (Supplier Cost
Reduction Effort) process. The achievement earned the UNOVA divisions a
citation of merit from Chrysler.
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Further refinements to the modular design process will allow Lamb to
significantly reduce design, engineering and installation times for new
systems, thus lowering working capital requirements while improving project
throughput and effective capacity at the Company's existing facilities.
The European Lamb divisions won a contract to build a diesel engine
production line at a major automaker's new facility in Poland. The line will
incorporate Lamb Honsberg's new dual-spindle Mach I-TM- CNC machining
technology for greater manufacturing flexibility and productivity.
The Company's precision grinding operations introduced new products that
open the semiconductor wafer manufacturing industry as a market for UNOVA.
Several Japanese silicon wafer producers purchased UNOVA equipment for
evaluation in processing next-generation 300-millimeter wafers. Based on
successful beta tests with these systems, the Company plans to accelerate the
commercialization of this new product line and introduce several additional
systems in 1998.
UNOVA completed the acquisition of Goldcrown Machinery, Inc., in the
fourth quarter and integrated it into its Industrial Automation Systems
segment. The acquired activities broaden the Company's grinding systems line
and provide access to non-automotive markets.
AUTOMATED DATA SYSTEMS
Intermec Technologies established its new divisional structure for the
combined activities of Intermec, Norand and UBI in the fourth quarter of
1997. Three product divisions and four sales organizations were created to
allow for more targeted product development and better market support, while
the integrated manufacturing organization will benefit from the cost savings
of volume procurement and production.
Just prior to year end, UNOVA acquired from IBM an innovative RFID
technology that will allow its Intermec division to develop an entirely new
product line which could significantly expand the use of automated data
collection equipment and systems. The product line would comprise tags or
labels that offer memory for data storage and wireless data transmission
capability, as well as the related equipment to
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read, write and transmit that data. This wireless technology has important
competitive advantages. Information stored on a tag or label can be updated
or changed at any time; and the data transmission does not require a direct
line of sight between the tag and the read/write equipment.
Earlier in the quarter, UNOVA announced that it had provided $10 million
in capital to Amtech Corporation to support a planned R&D alliance between
Intermec and Amtech for the development of RFID technology. In exchange,
UNOVA received 2.2 million shares, representing 13 percent of Amtech's common
stock.
UNOVA, a $1.43 billion industrial technologies company, is a leading
participant in the automated data collection and manufacturing technology
markets. The Company is headquartered in Beverly Hills, California, and
serves the global market from its engineering and manufacturing operations in
North America and Europe.
# # #
THE COMPANY CAUTIONS READERS THAT, IN ADDITION TO THE HISTORICAL INFORMATION
COVERED IN THIS RELEASE, INCLUDED ARE CERTAIN FORWARD-LOOKING STATEMENTS AND
INFORMATION THAT ARE BASED ON MANAGEMENT'S BELIEFS AS WELL AS ON ASSUMPTIONS
MADE BY AND INFORMATION CURRENTLY AVAILABLE TO MANAGEMENT. SUCH STATEMENTS
ARE NOT GUARANTEES OF FUTURE PERFORMANCE AND INVOLVE CERTAIN RISKS,
UNCERTAINTIES AND ASSUMPTIONS WHICH COULD CAUSE THE COMPANY'S FUTURE RESULTS
TO DIFFER MATERIALLY FROM THOSE EXPRESSED OR IMPLIED IN ANY FORWARD-LOOKING
STATEMENTS MADE BY, OR ON BEHALF OF, THE COMPANY. SUCH FACTORS INCLUDE, BUT
ARE NOT LIMITED TO, FLUCTUATIONS IN THE STRENGTH OF THE AUTOMOTIVE MARKET;
TECHNOLOGICAL DEVELOPMENTS, PARTICULARLY IN THE ADC/MOBILE COMPUTING SYSTEM
INDUSTRY; COMPETITIVE CONDITIONS; THE AVAILABILITY AND COST OF MATERIALS AND
SUPPLIES; RELATIONS WITH THE COMPANY'S EMPLOYEES; THE COMPANY'S ABILITY TO
MANAGE ITS OPERATING COSTS AND TO INTEGRATE ACQUIRED BUSINESSES IN AN
EFFECTIVE MANNER; GENERAL ECONOMIC CONDITIONS; GOVERNMENTAL REGULATIONS; AND
RISKS ASSOCIATED WITH INTERNATIONAL OPERATIONS. ANY FORWARD-LOOKING
STATEMENTS SHOULD BE CONSIDERED IN LIGHT OF THESE FACTORS, MANY OF WHICH ARE
BEYOND THE COMPANY'S ABILITY TO CONTROL OR PREDICT. READERS ARE CAUTIONED
NOT TO PUT UNDUE RELIANCE ON FORWARD-LOOKING STATEMENTS. THE COMPANY
DISCLAIMS ANY INTENT OR OBLIGATION TO UPDATE PUBLICLY ANY FORWARD-LOOKING
STATEMENTS, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR
OTHERWISE.
WWW.UNOVA.COM UNA-121
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UNOVA, INC.
SALES AND SERVICE REVENUES AND OPERATING PROFIT
BY BUSINESS SEGMENT (PRELIMINARY)
THREE MONTHS AND YEAR ENDED DECEMBER 31, 1997 AND 1996
(THOUSANDS OF DOLLARS)
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<CAPTION>
THREE MONTHS ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
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1997 1996 1997 1996
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<S> <C> <C> <C> <C>
SALES AND SERVICE REVENUES
Industrial Automation Systems $ 156,707 $ 249,821 $ 789,771 $ 797,426
Automated Data Systems 175,436 100,359 636,476 367,256
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Total Sales and Service Revenues $ 332,143 $ 350,180 $ 1,426,247 $ 1,164,682
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SEGMENT OPERATING PROFIT
Industrial Automation Systems $ 20,063 $ 22,587 $ 94,611 $ 69,496
Automated Data Systems * (7,245) 8,724 9,077 30,124
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Subtotal 12,818 31,311 103,688 99,620
Acquired In-Process Research and Development (8,200) (211,500)
Unallocated Expenses (8,344) (5,788) (23,898) (22,473)
Interest, Net (3,918) (1,980) (16,689) (7,111)
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Earnings (Loss) before Taxes on Income (7,644) 23,543 (148,399) 70,036
Taxes on Income 2,050 (9,417) (22,968) (28,014)
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Net Earnings (Loss) $ (5,594) $ 14,126 $ (171,367) $ 42,022
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Basic and Diluted Earnings (Loss) per Share $ (0.10) $ 0.26 $ (3.17) $ 0.78
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Shares Used in Computing Basic and
Diluted Earnings (Loss) per Share 54,395,396 53,891,534 54,056,243 53,891,534
* Amounts for 1997 include a contract loss associated with the purchase of
RFID technology.
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UNOVA, INC.
CONSOLIDATED AND COMBINED BALANCE SHEETS (PRELIMINARY)
(THOUSANDS OF DOLLARS)
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<CAPTION>
DECEMBER 31, DECEMBER 31,
1997 1996
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ASSETS
<S> <C> <C>
Current Assets
Cash and cash equivalents $ 13,685 $ 149,467
Accounts receivable, net 448,079 394,572
Inventories less progress billings 150,537 94,452
Deferred tax assets 106,694 53,636
Other current assets 30,072 3,664
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Total Current Assets 749,067 695,791
Property, Plant and Equipment, Net 157,680 132,508
Goodwill and Other Intangibles, Net 366,098 178,810
Other Assets 83,513 66,684
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Total Assets $ 1,356,358 $ 1,073,793
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LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities
Accounts payable $ 311,759 $ 242,168
Payrolls and related expenses 72,909 50,567
Notes payable and current portion of
long-term obligations 86,645 27,461
Due to Western Atlas Inc. 109,574
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Total Current Liabilities 471,313 429,770
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Long-term Obligations 216,938 14,507
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Deferred Taxes and Other Long-term Liabilities 78,618 55,008
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Shareholders' Investment
Common stock 545
Additional paid-in capital 603,743
Accumulated deficit (8,041)
Cumulative currency translation adjustment (6,758)
Investment by Western Atlas Inc. 574,508
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Total Shareholders' Investment 589,489 574,508
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Total Liabilities and Shareholders' Investment $ 1,356,358 $ 1,073,793
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<CAPTION>
UNOVA, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS (PRELIMINARY)
Year Ended December 31, 1997
(thousands of dollars)
<S> <C>
Cash and Cash Equivalents at Beginning of Year $ 149,467
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Cash Flows from Operating Activities:
Net loss (171,367)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Charges for acquired in-process research and development 211,500
Depreciation and amortization 40,672
Changes in working capital and other operating activities (39,849)
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Net Cash Provided by Operating Activities 40,956
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Cash Flows from Investing Activities:
Acquisition of businesses, net of cash acquired (400,754)
Capital expenditures (30,310)
Other investing activities (9,583)
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Net Cash Used in Investing Activities (440,647)
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Cash Flows from Financing Activities:
Proceeds from borrowings 243,938
Net transactions with Western Atlas Inc. 190,338
Due to Western Atlas Inc. (109,574)
Repayment of long-term obligations (62,847)
Other financing activities 2,054
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Net Cash Provided by Financing Activities 263,909
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Resulting in Decrease in Cash and Cash Equivalents (135,782)
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Cash and Cash Equivalents at End of Year $ 13,685
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