Form 8-K DXC Technology Co For: Aug 07
UNITED STATES
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): August 7, 2018
______________________________________________________________________________
DXC TECHNOLOGY COMPANY
(Exact name of Registrant as specified in its charter)
______________________________________________________________________________
Nevada | 001-38033 | 61-1800317 | ||
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||
1775 Tysons Boulevard | ||
Tysons, Virginia | 22102 | |
(Address of Principal Executive Offices) | (Zip Code) | |
Registrant’s telephone number, including area code: (703) 245-9675
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
_____________________________________________________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On August 7, 2018, DXC Technology Company (the “Company”) issued a press release reporting its preliminary financial results for the first quarter of fiscal 2019. The Company will hold a conference call at 5:00 PM EDT, on August 7, 2018, in which the Chief Executive Officer and the Chief Financial Officer will discuss this matter. The press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference and made a part hereof.
This information is “furnished” and not “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of that section. It may only be incorporated by reference in another filing under the Securities Exchange Act of 1934 or the Securities Act of 1933 only if and to the extent such subsequent filing specifically references the information incorporated by reference herein.
All statements in this report that do not directly and exclusively relate to historical facts constitute “forward-looking statements.” These statements represent the Company’s intentions, plans, expectations and beliefs, and are subject to risks, uncertainties and other factors many of which are outside the Company’s control. These factors could cause actual results to differ materially from such forward-looking statements. For a written description of these factors, see the section titled “Risk Factors” in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2018, and any updating information in subsequent SEC filings including the Company's upcoming Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2018. The Company disclaims any intention or obligation to update these forward-looking statements whether as a result of subsequent event or otherwise, except as required by law.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
Exhibit No. | Description |
99.1 | |
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.
DXC TECHNOLOGY COMPANY | |||
Dated: | August 7, 2018 | By: | /s/ Paul N. Saleh |
Name: | Paul N. Saleh | ||
Title: | Executive Vice President and Chief Financial Officer | ||
Exhibit 99.1
Moved on Business Wire | |
August 7, 2018 | |
DXC Technology Delivers Solid First Quarter with Growth in
Revenue, Earnings per Share and Margins
• | Q1 earnings per share from continuing operations was $0.78, including the cumulative impact of certain items of $(1.15) per share, reflecting restructuring costs, transaction, separation and integration-related costs, amortization of acquired intangible assets, and a tax adjustment related to U.S. tax reform |
• | Q1 non-GAAP earnings per share was $1.93 |
• | Q1 income from continuing operations was $231 million, including the cumulative impact of certain items of $(333) million, reflecting restructuring costs, transaction, separation and integration-related costs, and amortization of acquired intangible assets |
• | Q1 non-GAAP income from continuing operations was $564 million |
• | Q1 EBIT of $413 million, adjusted for certain items is $803 million and adjusted EBIT margin was 15.2%, compared with 10.9% in the prior year |
• | Q1 net cash from operating activities was $473 million |
• | Q1 adjusted free cash flow was $321 million |
TYSONS, Va., August 7, 2018 - DXC Technology (NYSE: DXC) today reported results for the first quarter of fiscal year 2019, representing the period from April 1 through June 30, 2018. All results from continuing operations and comparisons exclude the U.S. Public Sector business, which was combined with Vencore Holding Corp. and KeyPoint Government Solutions to form a new publicly-traded company, Perspecta.
“In the first quarter of fiscal 2019, DXC Technology delivered year-over-year growth in revenue, earnings per share, and margins,” said Mike Lawrie, DXC’s chairman, president and CEO. “We continue to build momentum in digital, with double-digit growth in each of our digital areas, and we also drove growth in our industry offerings, where we are seeing strong demand in financial services and healthcare. During the quarter, we completed the separation of our U.S. Public Sector business, and we also recently announced our intent to acquire Molina Medicaid Solutions from Molina Healthcare. This transaction will expand our state Medicaid business while enhancing the capabilities we provide these agencies. DXC is on track to deliver against its fiscal 2019 financial targets.”
Financial Highlights - First Quarter Fiscal 2019
• | Diluted earnings per share from continuing operations was $0.78 in the first quarter, including $(0.50) per share of restructuring costs, $(0.19) per share of transaction, separation and integration-related costs, $(0.35) per share of amortization of acquired intangible assets, and $(0.11) per share or tax adjustment related to U.S. tax reform. This compares with $0.33 in the year ago period. |
• | Non-GAAP diluted earnings per share from continuing operations was $1.93. This compares with $1.23 in the year ago period. |
• | Revenue in the first quarter was $5,282 million. Revenue grew 0.9% compared with $5,236 million in the prior year. |
• | Income from continuing operations before income taxes was $360 million in the first quarter, including $(185) million of restructuring costs, $(70) million of transaction, separation and integration-related costs, and $(135) million of amortization of acquired intangibles. This compares with $91 million in the year ago period. |
• | Non-GAAP income from continuing operations before income taxes was $750 million compared with $512 million in the year ago period on a GAAP basis. |
• | Net income was $266 million for the first quarter, including $(144) million of restructuring costs, $(54) million of transaction, separation and integration-related costs, $(102) million of amortization of acquired intangibles and $(33) million of tax adjustment related to U.S. tax reform. This compares with $173 million in the prior year period. |
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• | Non-GAAP net income was $599 million. |
• | Adjusted EBIT was $803 million in the first quarter compared with $570 million in the prior year. Adjusted EBIT margin was 15.2% compared with 10.9% in the year ago quarter. |
• | Net cash provided by operating activities was $473 million in the first quarter, compared with $519 million in the year ago period. |
• | Adjusted free cash flow was $321 million in the first quarter. |
Global Business Services (GBS)
GBS revenue was $2,213 million in the quarter compared to $2,267 million for the prior year. GBS revenue decreased 2.4% year-over-year, reflecting the completion of several traditional application contracts. This was partially offset by strong growth in our Enterprise and Cloud Applications business. GBS profit margin in the quarter was 18.2%, up from 12.1% in the prior year, reflecting ongoing cost actions in the business. New business awards for GBS were $2.0 billion in the first quarter.
Global Infrastructure Services (GIS)
GIS revenue was $3,069 million in the quarter compared to $2,969 million for the prior year. GIS revenues grew 3.4% year-over-year, reflecting a continued moderation of the decline in our IT outsourcing services business as well as strong growth in Cloud and Platform Services, Security, and Workplace and Mobility. GIS profit margin in the quarter was 15.4%, up from 9.1% in the prior year, reflecting ongoing cost actions and process automation. New business awards for GIS were $2.6 billion in the first quarter.
Returning Capital to Shareholders
During the first quarter, DXC Technology returned $375 million to shareholders, consisting of $51 million in common stock dividends and $324 million in share repurchases.
Earnings Conference Call and Webcast
DXC Technology senior management will host a conference call and webcast to discuss these results today at 5 p.m. EDT. The dial-in number for domestic callers is 888-682-0995. Callers who reside outside of the United States should dial +1-334-323-0509. The passcode for all participants is 6328180. The webcast audio and any presentation slides will be available on DXC Technology’s Investor Relations website.
A replay of the conference call will be available from approximately two hours after the conclusion of the call until August 14, 2018. The replay dial-in number is 888-203-1112 for domestic callers and +1-719-457-0820 for callers who reside outside of the United States. The replay passcode is also 6328180. A replay of this webcast will also be available on DXC Technology’s Investor Relations website.
Non-GAAP Measures
In an effort to provide investors with supplemental financial information, in addition to the preliminary and unaudited financial information presented on a GAAP basis, we have also disclosed in this press release preliminary non-GAAP information including: constant currency, earnings before interest and taxes ("EBIT"), adjusted EBIT, adjusted EBIT margin, adjusted free cash flow, and non-GAAP results including non-GAAP income from continuing operations before taxes, non-GAAP income from continuing operations and non-GAAP EPS from continuing operations.
About DXC Technology
DXC Technology is the world's leading independent, end-to-end IT services company, serving nearly 6,000 private and public-sector clients from a diverse array of industries across 70 countries. The company's technology independence, global talent and extensive partner network deliver transformative digital offerings and solutions that help clients harness the power of innovation to thrive on change. DXC Technology is recognized among the best corporate citizens globally. For more information, visit www.dxc.technology.
All statements in this press release that do not directly and exclusively relate to historical facts constitute “forward-looking statements.” These statements represent current expectations and beliefs, and no assurance can be given that the results described in such statements will be achieved. Such statements are subject to numerous assumptions, risks, uncertainties and other factors that could cause actual results to differ materially from those described in such statements, many of which are outside of our control. For a written description of these factors, see the section titled “Risk Factors” in DXC's Annual Report on Form 10-K for the fiscal year ended March 31, 2018, and any updating information in subsequent SEC filings including DXC's upcoming Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2018. No assurance can be given that any goal or plan set forth in any
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forward-looking statement can or will be achieved, and readers are cautioned not to place undue reliance on such statements which speak only as of the date they are made. We do not undertake any obligation to update or release any revisions to any forward-looking statement or to report any events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events except as required by law.
# # #
Contact:
Richard Adamonis, Corporate Media Relations, +1-862-228-3481, [email protected]
Jonathan Ford, Investor Relations, +1-703-245-9700, [email protected]
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Condensed Consolidated Statements of Operations
(preliminary and unaudited)
Three Months Ended | ||||||||
(in millions, except per-share amounts) | June 30, 2018 | June 30, 2017 | ||||||
Revenues | $ | 5,282 | $ | 5,236 | ||||
Costs of services | 3,867 | 4,309 | ||||||
Selling, general and administrative | 440 | 393 | ||||||
Depreciation and amortization | 471 | 342 | ||||||
Restructuring costs | 185 | 187 | ||||||
Interest expense | 85 | 74 | ||||||
Interest income | (32 | ) | (16 | ) | ||||
Other income, net | (94 | ) | (144 | ) | ||||
Total costs and expenses | 4,922 | 5,145 | ||||||
Income from continuing operations before income taxes | 360 | 91 | ||||||
Income tax expense (benefit) | 129 | (17 | ) | |||||
Income from continuing operations | 231 | 108 | ||||||
Income from discontinued operations, net of tax | 35 | 65 | ||||||
Net income | 266 | 173 | ||||||
Less: net income attributable to non-controlling interest, net of tax | 7 | 14 | ||||||
Net income attributable to DXC common stockholders | $ | 259 | $ | 159 | ||||
Income per common share: | ||||||||
Basic: | ||||||||
Continuing operations | $ | 0.79 | $ | 0.33 | ||||
Discontinued operations | 0.12 | 0.23 | ||||||
$ | 0.91 | $ | 0.56 | |||||
Diluted: | ||||||||
Continuing operations | $ | 0.78 | $ | 0.33 | ||||
Discontinued operations | 0.12 | 0.22 | ||||||
$ | 0.90 | $ | 0.55 | |||||
Cash dividend per common share | $ | 0.19 | $ | 0.18 | ||||
Weighted average common shares outstanding for: | ||||||||
Basic EPS | 284.44 | 283.83 | ||||||
Diluted EPS | 289.30 | 289.47 | ||||||
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Selected Consolidated Balance Sheet Data
(preliminary and unaudited)
As of | ||||||||
(in millions) | June 30, 2018 | March 31, 2018 | ||||||
Assets | ||||||||
Cash and cash equivalents | $ | 2,579 | $ | 2,593 | ||||
Receivables, net | 5,271 | 5,481 | ||||||
Prepaid expenses | 577 | 496 | ||||||
Other current assets | 389 | 469 | ||||||
Assets of discontinued operations | — | 581 | ||||||
Total current assets | 8,816 | 9,620 | ||||||
Intangible assets, net | 6,899 | 7,179 | ||||||
Goodwill | 7,451 | 7,619 | ||||||
Deferred income taxes, net | 332 | 373 | ||||||
Property and equipment, net | 3,349 | 3,363 | ||||||
Other assets | 2,279 | 2,404 | ||||||
Assets of discontinued operations - non-current | — | 3,363 | ||||||
Total Assets | $ | 29,126 | $ | 33,921 | ||||
Liabilities | ||||||||
Short-term debt and current maturities of long-term debt | $ | 2,307 | $ | 1,918 | ||||
Accounts payable | 1,326 | 1,513 | ||||||
Accrued payroll and related costs | 755 | 744 | ||||||
Accrued expenses and other current liabilities | 3,288 | 3,120 | ||||||
Deferred revenue and advance contract payments | 1,530 | 1,641 | ||||||
Income taxes payable | 108 | 127 | ||||||
Liabilities of discontinued operations | — | 789 | ||||||
Total current liabilities | 9,314 | 9,852 | ||||||
Long-term debt, net of current maturities | 4,747 | 6,092 | ||||||
Non-current deferred revenue | 351 | 795 | ||||||
Non-current income tax liabilities and deferred tax liabilities | 1,182 | 1,166 | ||||||
Other long-term liabilities | 1,718 | 1,723 | ||||||
Liabilities of discontinued operations - long-term | — | 456 | ||||||
Total Liabilities | 17,312 | 20,084 | ||||||
Total Equity | 11,814 | 13,837 | ||||||
Total Liabilities and Equity | $ | 29,126 | $ | 33,921 | ||||
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Condensed Consolidated Statements of Cash Flows
(preliminary and unaudited)
Three Months Ended | ||||||||
(in millions) | June 30, 2018 | June 30, 2017 | ||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 266 | $ | 173 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 509 | 363 | ||||||
Share-based compensation | 22 | 40 | ||||||
Gain on dispositions | (46 | ) | (4 | ) | ||||
Unrealized foreign currency exchange losses | (16 | ) | (132 | ) | ||||
Other non-cash charges, net | 12 | 17 | ||||||
Changes in assets and liabilities, net of effects of acquisitions and dispositions: | ||||||||
Increase in assets | (196 | ) | (42 | ) | ||||
(Decrease) increase in liabilities | (78 | ) | 104 | |||||
Net cash provided by operating activities | 473 | 519 | ||||||
Cash flows from investing activities: | ||||||||
Purchases of property and equipment | (79 | ) | (69 | ) | ||||
Payments for transition and transformation contract costs | (92 | ) | (23 | ) | ||||
Software purchased and developed | (49 | ) | (47 | ) | ||||
Cash acquired through Merger | — | 974 | ||||||
Payments for acquisitions, net of cash acquired | (43 | ) | — | |||||
Business dispositions | (65 | ) | — | |||||
Deferred purchase price receivable | 33 | 15 | ||||||
Proceeds from sale of assets | 19 | 9 | ||||||
Other investing activities, net | (8 | ) | 15 | |||||
Net cash (used in) provided by investing activities | (284 | ) | 874 | |||||
Cash flows from financing activities: | ||||||||
Borrowings of commercial paper | 633 | 611 | ||||||
Repayments of commercial paper | (633 | ) | (553 | ) | ||||
Borrowings on long-term debt, net of discount | 483 | — | ||||||
Principal payments on long-term debt | (1,278 | ) | (27 | ) | ||||
Payments on capital leases and borrowings for asset financing | (259 | ) | (124 | ) | ||||
Borrowings for USPS spin transaction | 1,114 | — | ||||||
Proceeds from stock options and other common stock transactions | 9 | 25 | ||||||
Taxes paid related to net share settlements of share-based compensation awards | (1 | ) | (62 | ) | ||||
Repurchase of common stock | (314 | ) | (14 | ) | ||||
Dividend payments | (51 | ) | (20 | ) | ||||
Other financing activities, net | (3 | ) | (4 | ) | ||||
Net cash used in financing activities | (300 | ) | (168 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | (39 | ) | 29 | |||||
Net (decrease) increase in cash and cash equivalents | (150 | ) | 1,254 | |||||
Cash and cash equivalents at beginning of year | 2,729 | 1,268 | ||||||
Cash and cash equivalents at end of period | $ | 2,579 | $ | 2,522 | ||||
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Segment Results
The following table summarizes segment revenue for the three months ended June 30, 2018 as compared to the three months ended June 30, 2017:
Segment Revenue | |||||||||||||
(in millions) | June 30, 2018 | June 30, 2017 | % Change | % Change in Constant Currency | |||||||||
Global Business Services | $ | 2,213 | $ | 2,267 | (2.4 | )% | (4.6)% | ||||||
Global Infrastructure Services | 3,069 | 2,969 | 3.4 | % | 0.3% | ||||||||
Total Revenues | $ | 5,282 | $ | 5,236 | 0.9 | % | (1.8)% | ||||||
We define segment profit as segment revenues less costs of services, segment selling, general and administrative, depreciation and amortization, and other income excluding the movement in foreign currency exchange rates on our foreign currency denominated assets and liabilities and the related economic hedges. The Company does not allocate to its segments certain operating expenses managed at the corporate level. These unallocated costs include certain corporate function costs, stock-based compensation expense, pension and OPEB actuarial and settlement gains and losses, restructuring costs, transaction, separation and integration-related costs and amortization of acquired intangible assets.
Segment Profit | ||||||||
Three Months Ended | ||||||||
(in millions) | June 30, 2018 | June 30, 2017 | ||||||
Profit | ||||||||
GBS profit | $ | 403 | $ | 274 | ||||
GIS profit | 474 | 271 | ||||||
All other (loss) profit | (74 | ) | 25 | |||||
Interest income | 32 | 16 | ||||||
Interest expense | (85 | ) | (74 | ) | ||||
Restructuring costs | (185 | ) | (187 | ) | ||||
Transaction, separation and integration-related costs | (70 | ) | (124 | ) | ||||
Amortization of acquired intangible assets | (135 | ) | (110 | ) | ||||
Income from continuing operations before income taxes | $ | 360 | $ | 91 | ||||
Segment profit margins | ||||||||
GBS | 18.2 | % | 12.1 | % | ||||
GIS | 15.4 | % | 9.1 | % | ||||
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Non-GAAP Financial Measures
We present non-GAAP financial measures of performance which are derived from the unaudited condensed consolidated statements of operations of DXC. These non-GAAP financial measures include earnings before interest and taxes (“EBIT”), EBIT margin, adjusted EBIT, adjusted EBIT margin, adjusted free cash flow, and non-GAAP results including non-GAAP income from continuing operations before taxes, non-GAAP income from continuing operations and non-GAAP EPS from continuing operations.
We present these non-GAAP financial measures to provide investors with meaningful supplemental financial information, in addition to the financial information presented on a GAAP basis. Non-GAAP financial measures exclude certain items from GAAP results which DXC management believes are not indicative of core operating performance. DXC management believes these non-GAAP measures allow investors to better understand the financial performance of DXC exclusive of the impacts of corporate wide strategic decisions. DXC management believes that adjusting for these items provides investors with additional measures to evaluate the financial performance of our core business operations on a comparable basis from period to period. DXC management believes the non-GAAP measures provided are also considered important measures by financial analysts covering DXC as equity research analysts continue to publish estimates and research notes based on our non-GAAP commentary, including our guidance around non-GAAP EPS.
There are limitations to the use of the non-GAAP financial measures presented in this report. One of the limitations is that they do not reflect complete financial results. We compensate for this limitation by providing a reconciliation between our non-GAAP financial measures and the respective most directly comparable financial measure calculated and presented in accordance with GAAP. Additionally, other companies, including companies in our industry, may calculate non-GAAP financial measures differently than we do, limiting the usefulness of those measures for comparative purposes between companies.
Reconciliation of Non-GAAP Financial Measures
DXC's non-GAAP adjustments include:
• | Restructuring costs - reflects restructuring costs, net of reversals, related to workforce optimization and real estate charges. |
• | Transaction, separation and integration-related costs - reflects costs related to integration planning, financing, and advisory fees associated with the HPES Merger and other acquisitions and costs related to the separation of USPS. |
• | Amortization of acquired intangible assets - reflects amortization of intangible assets acquired through business combinations. |
• | Tax adjustment - reflects the estimated non-recurring benefit of the Tax Cuts and Jobs Act of 2017 for fiscal 2019, and the application of an approximate 28% tax rate for fiscal 2018, which is within the targeted effective tax rate range for the prior year. |
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EBIT and Adjusted EBIT
A reconciliation of net income to adjusted EBIT is as follows:
Three Months Ended | ||||||||
(in millions) | June 30, 2018 | June 30, 2017 | ||||||
Net income | $ | 266 | $ | 173 | ||||
Income from discontinued operations, net of taxes | (35 | ) | (65 | ) | ||||
Income tax expense (benefit) | 129 | (17 | ) | |||||
Interest income | (32 | ) | (16 | ) | ||||
Interest expense | 85 | 74 | ||||||
EBIT | 413 | 149 | ||||||
Restructuring costs | 185 | 187 | ||||||
Transaction, separation, and integration-related costs | 70 | 124 | ||||||
Amortization of acquired intangible assets | 135 | 110 | ||||||
Adjusted EBIT | $ | 803 | $ | 570 | ||||
Adjusted EBIT margin | 15.2 | % | 10.9 | % | ||||
EBIT margin | 7.8 | % | 2.8 | % | ||||
Adjusted Free Cash Flow
A reconciliation of net cash provided by operating activities to adjusted free cash flow is as follows:
(in millions) | Three Months Ended June 30, 2018 | |||
Net cash provided by operating activities | $ | 473 | ||
Net cash used in investing activities | (284 | ) | ||
Acquisitions, net of cash acquired | 43 | |||
Business dispositions | 65 | |||
Payments on capital leases and other long-term asset financings | (259 | ) | ||
Payments on transaction, separation and integration-related costs | 105 | |||
Payments on restructuring costs | 148 | |||
Sale of accounts receivables, net DPP | (26 | ) | ||
Sale of USPS accounts receivables | 56 | |||
Adjusted free cash flow | $ | 321 | ||
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Non-GAAP Results
A reconciliation of reported results to non-GAAP results is as follows:
Three Months Ended June 30, 2018 | ||||||||||||||||||||||||
(in millions, except per-share amounts) | As Reported | Restructuring Costs | Transaction, Separation and Integration-Related Costs | Amortization of Acquired Intangible Assets | Tax Adjustment | Non-GAAP Results | ||||||||||||||||||
Costs of services (excludes depreciation and amortization and restructuring costs) | $ | 3,867 | $ | — | $ | — | $ | — | $ | — | $ | 3,867 | ||||||||||||
Selling, general and administrative (excludes depreciation and amortization and restructuring costs) | 440 | — | (70 | ) | — | — | 370 | |||||||||||||||||
Income from continuing operations before income taxes | 360 | 185 | 70 | 135 | — | 750 | ||||||||||||||||||
Income tax expense | 129 | 41 | 16 | 33 | (33 | ) | 186 | |||||||||||||||||
Income from continuing operations | 231 | 144 | 54 | 102 | 33 | 564 | ||||||||||||||||||
Income from discontinued operations, net of tax | 35 | — | — | — | — | 35 | ||||||||||||||||||
Net income | 266 | 144 | 54 | 102 | 33 | 599 | ||||||||||||||||||
Less: net income attributable to non-controlling interest, net of tax | 7 | — | — | — | — | 7 | ||||||||||||||||||
Net income attributable to DXC common stockholders | $ | 259 | $ | 144 | $ | 54 | $ | 102 | $ | 33 | $ | 592 | ||||||||||||
Effective tax rate | 35.8 | % | 24.8 | % | ||||||||||||||||||||
Basic EPS from continuing operations | $ | 0.79 | $ | 0.51 | $ | 0.19 | $ | 0.36 | $ | 0.12 | $ | 1.96 | ||||||||||||
Diluted EPS from continuing operations | $ | 0.78 | $ | 0.50 | $ | 0.19 | $ | 0.35 | $ | 0.11 | $ | 1.93 | ||||||||||||
Weighted average common shares outstanding for: | ||||||||||||||||||||||||
Basic EPS | 284.44 | 284.44 | 284.44 | 284.44 | 284.44 | 284.44 | ||||||||||||||||||
Diluted EPS | 289.30 | 289.30 | 289.30 | 289.30 | 289.30 | 289.30 | ||||||||||||||||||
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Three Months Ended June 30, 2017 | ||||||||||||||||||||||||
(in millions, except per-share amounts) | As Reported | Restructuring Costs | Transaction, Separation and Integration-Related Costs | Amortization of Acquired Intangible Assets | Tax Adjustment | Non-GAAP Results | ||||||||||||||||||
Costs of services (excludes depreciation and amortization and restructuring costs) | $ | 4,309 | $ | — | $ | — | $ | — | $ | — | $ | 4,309 | ||||||||||||
Selling, general and administrative (excludes depreciation and amortization and restructuring costs) | 393 | — | (124 | ) | — | — | 269 | |||||||||||||||||
Income from continuing operations before income taxes | 91 | 187 | 124 | 110 | — | 512 | ||||||||||||||||||
Income tax (benefit) expense | (17 | ) | — | — | — | 160 | 143 | |||||||||||||||||
Income from continuing operations | 108 | 187 | 124 | 110 | (160 | ) | 369 | |||||||||||||||||
Income from discontinued operations, net of tax | 65 | — | — | — | — | 65 | ||||||||||||||||||
Net income | 173 | 187 | 124 | 110 | (160 | ) | 434 | |||||||||||||||||
Less: net income attributable to non-controlling interest, net of tax | 14 | — | — | — | — | 14 | ||||||||||||||||||
Net income attributable to DXC common stockholders | $ | 159 | $ | 187 | $ | 124 | $ | 110 | $ | (160 | ) | $ | 420 | |||||||||||
Effective Tax Rate | (18.7 | )% | 28.0 | % | ||||||||||||||||||||
Basic EPS from continuing operations | $ | 0.33 | $ | 0.66 | $ | 0.44 | $ | 0.39 | $ | (0.56 | ) | $ | 1.25 | |||||||||||
Diluted EPS from continuing operations | $ | 0.33 | $ | 0.65 | $ | 0.43 | $ | 0.38 | $ | (0.55 | ) | $ | 1.23 | |||||||||||
Weighted average common shares outstanding for: | ||||||||||||||||||||||||
Basic EPS | 283.83 | 283.83 | 283.83 | 283.83 | 283.83 | 283.83 | ||||||||||||||||||
Diluted EPS | 289.47 | 289.47 | 289.47 | 289.47 | 289.47 | 289.47 | ||||||||||||||||||
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