NCR increases expectations for the fourth quarter

Source: NCR Corporation

NCR Corporation (NYSE:NCR) today announced that it anticipates fourth-quarter results to be better than expected due to double-digit revenue growth in the company's Teradata Data Warehousing, Financial Self Service and Retail Store Automation businesses.

Although NCR has not finalized its financial results for the fourth quarter of 2004, revenue for the quarter is expected to be approximately $1.79 billion, representing an increase of 9 percent from the fourth quarter of 2003. NCR's fourth-quarter revenue growth is expected to include a 3 percentage point benefit from foreign currency fluctuations.

Earnings per share reported in accordance with generally accepted accounting principles, or GAAP, for the fourth quarter are expected to be $1.20 or more. These results include the favorable impact of real estate, tax and certain non-operational items.

Excluding these items,(1) earnings per share are expected to be approximately $0.98 to $1.00. According to First Call, the mean estimate among Wall Street analysts for the fourth quarter is $0.77 per share.

On Dec. 1, 2004, NCR's Board of Directors authorized a 2-for-1 stock split for stockholders of record on Dec. 31, 2004. The stock split, which will be distributed in the form of a common stock dividend, will become effective on Jan. 21, 2005. On a post-stock-split basis, GAAP earnings per share for the fourth quarter of 2004 are likely to be $0.60 or more, and approximately $0.49 to $0.50 excluding the favorable items mentioned above.

NCR is increasing its guidance for 2005 earnings per share to $2.30 to $2.40, on a pre-stock-split basis, from $2.15 to $2.25, including $135 million to $140 million of pension expense, which is $10 million to $15 million more than earlier expected and comparable with the pension expense included in NCR's 2004 results. Although the company saw higher-than-anticipated investment return on pension plan assets in 2004, a lower interest rate environment at the end of 2004 requires NCR to utilize lower discount rates to determine the present value of future pension liabilities, which results in higher pension expense.

On a post-stock-split basis, NCR's 2005 earnings per share are expected to be in the $1.15 to $1.20 range.

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