Unisys' Revenue Rises, But Earnings DropUnisys' Revenue Rises, But Earnings Drop

PHILADELPHIA (AP) -- Unisys Corp. said its third-quarter earnings fell 4.7 percent as pension income dropped, but still met analysts' expectations.

The computer services and equipment company said Wednesday it earned $56.2 million, or 17 cents per share, for the three months ended Sept. 30, down from $59 million, or 18 cents a share, in the third quarter of 2002.

The earnings of 17 cents a share matched the consensus expectation of analysts surveyed by Thomson First Call.

Growth in business services such as payment processing helped increase revenue to $1.45 billion from $1.33 billion in the third quarter of last year, Unisys said.

"Our services business showed continued double-digit growth, driven by growth in all of our service lines. Our technology business delivered 3 percent revenue growth in a tough industry environment," said Larry Weinbach, Unisys' chairman and chief executive officer.

Pension income dropped to $9 million from $37 million in the third quarter of last year, the company said.

Like many companies, Unisys had made overaggressive assumptions in the past about the amounts that money invested by its pension funds would be earning, so the decline had been expected. "We were warned about it," said Wendy I. Abramowitz, an analyst for Argus Research Corp.

She said the growth of Unisys' computer services business was encouraging, and that "the prospects going forward look pretty good."

Weinbach said the company generated $114 million in cash from operations during the quarter, compared with $57 million a year earlier, and continues to expect earnings per share of 77 cents for 2003, which would meet analysts' expectations.

For the first nine months of the year, Unisys said its net income increased to $147.2 million, or 44 cents a share, on revenue of $4.27 billion, from $133.9 million, or 41 cents a share, on revenue of $4.05 billion for the first nine months of 2002.