PEROT SYSTEMS CORPORATION 
By PLANO, Texas, Aug. 4 /PRNewswire-FirstCall/ -- Perot Systems Corporation (NYSE: PER) today announced second quarter 2009 financial results:
-- Earnings per share (diluted) was $.25, an increase of 4% over second
quarter 2008 earnings per share (diluted) of $.24.
-- Revenue was $628 million, a decrease of 11% year-to-year from second
quarter 2008 revenue of $705 million. The primary sources for this
decline were decreases to project-based services, a reduction to low
margin pass through revenue primarily from two previously disclosed
contract renewals, and the unfavorable effect of currency exchange
fluctuations, partially offset by the revenue contribution from new
major contract signings.
-- Operating profit margin expanded year-to-year by 0.9 percentage points
to 7.6% for the second quarter of 2009.
-- Total bookings, which include contract renewals, totaled $362 million
for the second quarter of 2009, bringing the total value of bookings
during the past twelve months to $2.3 billion. The total contract value
of new contracts signed in the second quarter of 2009 was $135 million,
bringing the total contract value of new contracts signed over the past
twelve months to $1.0 billion.
-- Operating Cash Flow and Capital Expenditures for the second quarter of
2009 totaled $55 million and $14 million, respectively. Trailing twelve
month Operating Cash Flow and Capital Expenditures were $213 million and
$57 million, respectively.
-- As of June 30, 2009, Cash, Short-term Investments, and Debt totaled $291
million, $38 million, and $185 million, respectively.
"New business wins and the value we are creating for our clients resulted in another solid quarter of performance," said Peter Altabef, president and CEO for Perot Systems. "In the quarter, we grew revenue, profit margins and earnings sequentially, while continuing to produce strong levels of cash flow. While current market conditions require us to manage our business and cost structure tightly, we continue to make important investments in our business that are helping us to better serve our clients. We are developing next generation solutions for the deployment of electronic health records, creating financing options that reduce the investment necessary for healthcare providers to demonstrate meaningful use, and are helping clients to strengthen cash flow, while simultaneously reducing administrative costs through our revenue cycle services. As a leader in providing technology services to healthcare providers, we are well prepared to help our clients navigate the changing healthcare environment."
1. Business Outlook
For the third quarter of 2009, Perot Systems expects that revenue additions from new sales could be offset by work ending, most of which was previously expected. As a result, Perot Systems expects revenue to range from $620 million to $640 million. On a sequential basis, Perot Systems expects that third quarter 2009 earnings per share (diluted) will be flat-to-slightly lower than the second quarter of 2009 as a result of more mature engagements ending and early stage new sales starting. Consistent with the typical model for outsourcing contracts, these new sales are expected to reach full levels of profitability over time. Earnings per share (diluted) is expected to range from $.23 to $.25 for the third quarter of 2009.
Conference Call
Perot Systems will hold a conference call to review second quarter 2009 results of operations on August 4, 2009, at 10:15 a.m. EDT. Parties interested in participating may join the conference call via the Internet at www.perotsystems.com. Additionally, Perot Systems has published a downloadable summary of its second quarter 2009 financial results at www.perotsystems.com.
Perot Systems Corporation
Condensed Consolidated Income Statements
For the Three Months Ended June 30, 2008 and 2009
(Millions of USD, except per share amounts)
Unaudited
Three Months Ended
June 30
2008 2009
---- ----
Revenue $705 $628
Direct cost of services 585 503
--- ---
Gross profit 120 125
Selling, general & admin 73 77
--- ---
Operating income 47 48
Other income, net 1 -
Interest expense, net (1) -
--- ---
Income before taxes 47 48
Provision for income taxes 17 17
--- ---
Net income $30 $31
=== ===
Earnings per share (diluted) data:
Earnings per share (diluted) $.24 $.25
Shares outstanding (diluted) 121 121
Perot Systems Corporation
Revenue Summary
For the Three Months Ended June 30, 2009
(Millions of USD)
Unaudited
Revenue
2Q 2008 $705
Growth/(Decrease) Related to:
New major contract signings 15
TTM acquisitions (1) 4
Accounts and projects (2) (90)
---
Industry Solutions (71)
Government Services (6)
Inter-segment eliminations (3) -
----
2Q 2009 $628
====
Year-to-Year % of
Revenue Change Total
Healthcare (1) $302 (8%) 48%
Commercial 173 (21%) 27%
--- ---- ---
Industry Solutions 475 (13%) 75%
Government Services 155 (4%) 25%
Inter-segment eliminations (3) (2) n/m n/m
-- --- ---
Total $628 (11%) 100%
==== ==== ====
Perot Systems Corporation
Condensed Consolidated Balance Sheets
As of December 31, 2008 and June 30, 2009
(Millions of USD)
Unaudited
As of As of
12/31/2008 6/30/2009
Cash and cash equivalents $234 $291
Short-term investments 36 38
Accounts receivable, net 443 400
Prepaid expenses and other 93 116
--- ---
Total current assets 806 845
Property, equip. & software, net 221 221
Goodwill 730 729
Other non-current assets 221 217
--- ---
Total assets $1,978 $2,012
====== ======
Current liabilities $361 $318
Long-term liabilities 312 299
Stockholders' equity 1,305 1,395
----- -----
Total liabilities & stockholders'
equity $1,978 $2,012
====== ======
Perot Systems Corporation
Condensed Consolidated Statements of Cash Flows
For the Three Months Ended June 30, 2008 and 2009
(Millions of USD)
Unaudited
Three Months Ended
------------------
6/30/2008 6/30/2009
Net income $30 $31
Depreciation and amortization 28 27
Changes in assets and liabilities (net of
effects from acquisitions of businesses) and
other non-cash items 2 (3)
--- ---
Net cash provided by operating activities 60 55
Purchases of property, equipment & software (13) (14)
Purchases of short-term investments - (48)
Proceeds from sale of short-term investments - 17
Acquisitions of businesses, net (21) -
Other (1) -
--- ---
Net cash used by investing activities (35) (45)
Repayment of long-term debt (32) -
Proceeds from issuance of common stock 4 4
Proceeds from issuance of treasury stock 3 3
Other - (1)
--- ---
Net cash provided by (used in) financing
activities (25) 6
Effect of exchange rate changes on cash (5) 9
--- --
Net cash flow ($5) $25
=== ===
Footnotes
(1) During the past twelve months, Perot Systems acquired Tellurian
Networks, Inc. This acquisition contributed $4 million of revenue
for the second quarter, which is reported in the Healthcare area of
our Industry Solutions line of business.
(2) The $90 million reduction to revenue is primarily related to a $43
million decrease in our project-based services, a $23 million
reduction of low margin pass through revenue primarily resulting from
a previously disclosed contract renewal, and a $10 million impact
from foreign currency movements.
(3) Inter-segment eliminations relate to the revenue associated with
services provided by delivery organizations within our Industry
Solutions line of business to clients in our Government Services line
of business.
About Perot Systems
Perot Systems is a worldwide provider of information technology services and business solutions. Through its flexible and collaborative approach, Perot Systems integrates expertise from across the company to deliver custom solutions that enable clients to accelerate growth, streamline operations and create new levels of customer value. Headquartered in Plano, Texas, Perot Systems reported 2008 revenue of $2.8 billion. The company has more than 23,000 associates located in the Americas, Europe, Middle East and Asia Pacific. Additional information on Perot Systems is available at http://www.perotsystems.com/.
This press release contains forward-looking statements that are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. For factors that could affect our business and cause actual results to differ materially, please refer to our Annual Report on Form 10-K for the fiscal year ended December 31, 2008, as filed with the U.S. Securities and Exchange Commission and available at http://www.sec.gov/, as updated in our Quarterly Reports on Form 10-Q filed after such Form 10-K, for additional information regarding risk factors. We disclaim any intention or obligation to revise any forward-looking statements whether as a result of new information, future developments, or otherwise.
MEDIA CONTACTS:
Perot Systems Corporation
Joe McNamara
+1 972 577-6165
joe.mcnamara@ps.net
INVESTOR CONTACT:
John Lyon
+1 972 577-6132
+1 972-577-6791 fax
john.lyon@ps.net
SOURCE Perot Systems Corporation
