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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MARCH 31, 1997
Commission File Number 001-00395
NCR CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
MARYLAND 31-0387920
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1700 SOUTH PATTERSON BLVD.
DAYTON, OHIO 45479
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (937) 445-5000
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [X]
Number of shares of common stock, $.01 par value, outstanding as of
April 30, 1997 was 101,904,025.
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TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION
DESCRIPTION PAGE
Item 1. Financial Statements
Consolidated Statements of Operations (Unaudited)
Quarter ended March 31, 1997 and 1996 3
Consolidated Balance Sheets (Unaudited)
March 31, 1997 and December 31, 1996 4
Consolidated Statements of Cash Flows (Unaudited)
Quarter ended March 31, 1997 and 1996 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition 8
PART II. OTHER INFORMATION
DESCRIPTION PAGE
Item 4. Submission of Matters to a Vote of Security Holders 11
Item 6. Exhibits and Reports on Form 8-K 11
Signature 12
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
NCR CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS
QUARTER ENDED MARCH 31
-----------------------
1997 1996
------- -------
REVENUE
Sales $ 714 $ 875
Services 675 711
------- -------
TOTAL REVENUE 1,389 1,586
------- -------
OPERATING EXPENSES
Cost of sales 489 637
Cost of services 517 544
Selling, general, and administrative expenses 314 355
Research and development expenses 87 87
------- -------
TOTAL OPERATING EXPENSES 1,407 1,623
------- -------
LOSS FROM OPERATIONS (18) (37)
Interest expense 2 13
Other (income) expense, net (5) 3
------- -------
LOSS BEFORE INCOME TAXES (15) (53)
Income tax expense 1 12
------- -------
NET LOSS $ (16) $ (65)
======= =======
NET LOSS PER COMMON SHARE $ (.16) $ (.64)
======= =======
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING (in millions) 101.5 101.4
======= =======
See accompanying notes.
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NCR CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS
MARCH 31 DECEMBER 31
1997 1996
------- -------
ASSETS
Current assets
Cash and short-term investments $ 1,133 $1,203
Accounts receivable, net 1,336 1,457
Inventories 535 439
Deferred income taxes 121 122
Other current assets 136 97
------- ------
TOTAL CURRENT ASSETS 3,261 3,318
Rental equipment and service parts, net 259 277
Property, plant, and equipment, net 884 930
Other assets 763 755
------- ------
TOTAL ASSETS $ 5,167 $5,280
======= ======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Short-term borrowings $ 44 $ 28
Accounts payable 314 352
Payroll and benefits liabilities 346 383
Customers' deposits and deferred service revenue 434 348
Other current liabilities 804 856
------- ------
TOTAL CURRENT LIABILITIES 1,942 1,967
Long-term debt 44 48
Pension and indemnity liabilities 307 300
Postretirement and postemployment benefits liabilities 800 777
Other liabilities 471 503
Minority interests 282 289
------- ------
TOTAL LIABILITIES 3,846 3,884
------- ------
Commitments and Contingencies
SHAREHOLDERS' EQUITY
Common stock par value $.01 per share (authorized: 500
million shares; issued and outstanding: 101.5 million
shares at March 31, 1997 and 101.4 million shares at
December 31, 1996) 1 1
Paid-in capital 1,394 1,394
Retained earnings (16) --
Other (58) 1
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TOTAL SHAREHOLDERS' EQUITY 1,321 1,396
------- ------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 5,167 $5,280
======= ======
See accompanying notes.
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NCR CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
DOLLARS IN MILLIONS
QUARTER ENDED MARCH 31
----------------------
1997 1996
------- -----
OPERATING ACTIVITIES
Net loss $ (16) $ (65)
Adjustments to reconcile net loss to net cash provided by
(used in) operating activities:
Depreciation and amortization 92 72
Changes in operating assets and liabilities:
Receivables 121 525
Inventories (96) 66
Payables and other current liabilities (60) (422)
Other operating assets and liabilities (43) 122
------- -----
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (2) 298
------- -----
INVESTING ACTIVITIES
Purchases of short-term investments (248) (56)
Sales of short-term investments 11 48
Expenditures for service parts (22) (16)
Expenditures for property, plant, and equipment (26) (21)
Proceeds from sales of assets 30 12
Other investing activities (24) (19)
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NET CASH USED IN INVESTING ACTIVITIES (279) (52)
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FINANCING ACTIVITIES
Short-term borrowings, net 16 (18)
Proceeds from issuance of long-term debt -- 7
Repayments of long-term debt (4) (237)
Transfers from AT&T, net -- 309
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NET CASH PROVIDED BY FINANCING ACTIVITIES 12 61
------- -----
Effect of exchange rate changes on cash and cash equivalents (38) (16)
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INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (307) 291
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 1,163 314
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CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 856 $ 605
======= =====
See accompanying notes.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying consolidated financial statements have been prepared by NCR
Corporation ("NCR") without audit pursuant to the rules and regulations of the
Securities and Exchange Commission and, in the opinion of management, include
all adjustments (consisting of normal recurring adjustments) necessary for a
fair presentation of the consolidated results of operations, financial position,
and cash flows for each period presented. The consolidated results for interim
periods are not necessarily indicative of results to be expected for the full
year. These financial statements should be read in conjunction with NCR's 1996
Annual Report to Shareholders and Form 10-K for the year ended December 31,
1996.
2. SUPPLEMENTAL BALANCE SHEET INFORMATION
March 31 December 31
1997 1996
------ ------
(In millions)
CASH AND SHORT-TERM INVESTMENTS
Cash and cash equivalents $ 856 $1,163
Short-term investments 277 40
------ ------
Total cash and short-term investments $1,133 $1,203
====== ======
INVENTORIES
Finished goods $ 372 $ 297
Work in process and raw materials 163 142
------ ------
Total inventories $ 535 $ 439
====== ======
3. CONTINGENCIES
In the normal course of business, NCR is subject to various regulations,
proceedings, lawsuits, claims, and other matters, including actions under laws
and regulations related to the environment and health and safety, among others.
Such matters are subject to the resolution of many uncertainties, and
accordingly, outcomes are not predictable with assurance. Although NCR believes
that amounts provided in its financial statements are adequate in light of the
probable and estimable liabilities, there can be no assurances that the amounts
required to discharge alleged liabilities from various lawsuits, claims, legal
proceedings, and other matters, and to comply with applicable laws and
regulations, will not exceed the amounts reflected in NCR's consolidated
financial statements or will not have a material adverse effect on its
consolidated financial condition, results of operations, or cash flows. Any
amounts of costs that may be incurred in excess of those amounts provided as of
March 31, 1997, cannot be determined.
LEGAL PROCEEDINGS
As of March 31, 1997, there were a number of individual product liability claims
pending against NCR alleging that its products, including personal computers,
supermarket bar code scanners, cash registers, and check encoders, caused
so-called "repetitive strain injuries" or "cumulative trauma disorders," such as
carpal tunnel syndrome. As of March 31, 1997, approximately 80 such claims were
pending against NCR. In such lawsuits, the plaintiff typically alleges that the
injury was caused by the design of the product at issue or a failure to warn of
alleged hazards. These plaintiffs generally seek compensatory damages and, in
many cases, punitive damages. Most other manufacturers of these products have
also been sued by plaintiffs on similar theories. Ultimate resolution of the
litigation against NCR may substantially depend on the outcome of similar
matters of this type pending in various courts. NCR has denied the merits and
basis for the pending claims against it and intends to continue to contest these
cases vigorously.
NCR was named as one of the defendants in a purported class-action suit filed in
November 1996 in Florida. The complaint seeks, among other things, damages from
the defendants in the aggregate amount of $200 million, trebled, plus attorneys'
fees, based on State antitrust and common-law claims of unlawful restraints of
trade, monopolization, and unfair business practices. The portions of the
complaint pertinent to NCR, among other things, assert a purported agreement
between Siemens-Nixdorf entities (Siemens) and NCR regarding the servicing of
certain "ultra-high speed printers" manufactured by Siemens and the agreement's
impact upon independent service organizations, brokers, and end-users of such
printers. The amount of any liabilities or other costs that may be incurred in
connection with this matter cannot currently be determined.
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ENVIRONMENTAL MATTERS
NCR's facilities and operations are subject to a wide range of environmental
protection laws in the U.S. and other countries related to solid and hazardous
waste disposal, the control of air emissions and water discharges, and the
mitigation of impacts to the environment from past operations and practices. NCR
has investigatory and remedial activities underway at a number of currently and
formerly owned or operated facilities to comply, or to determine compliance,
with applicable environmental protection laws. NCR has been identified, either
by a government agency or by a private party seeking contribution to site
cleanup costs, as a potentially responsible party (PRP) at a number of sites
pursuant to a variety of statutory schemes, both State and Federal, including
the Federal Water Pollution Control Act (FWPCA) and comparable State statutes,
and the Comprehensive Environmental Response, Compensation, and Liability Act of
1980, as amended (CERCLA), and comparable State statutes.
In February 1996, NCR received notice from the U.S. Department of the Interior,
Fish & Wildlife Service (USF&WS) that USF&WS considers NCR a PRP under the FWPCA
and CERCLA with respect to alleged natural resource restoration and damages to
the Fox River and related Green Bay environment (Fox River System) due to, among
other things, sediment contamination in the Fox River System allegedly resulting
from liability arising out of NCR's former carbonless paper manufacturing
operations at Appleton and Combined Locks, Wisconsin. USF&WS has also notified a
number of other manufacturing companies of their status as PRPs under the FWPCA
and CERCLA for natural resource restoration and damages in the Fox River System
resulting from their ongoing or former paper manufacturing operations in the Fox
River Valley. In addition, NCR has been identified, along with a number of other
companies, by the Wisconsin Department of Natural Resources (State Trustee) with
respect to alleged liability arising out of alleged past discharges that have
contaminated sediments in the Fox River System. In December 1996, USF&WS, two
Native American tribes, and other federal agencies (Federal Trustees) invited
NCR, the other PRP companies, and the State Trustee to enter into settlement
negotiations over these environmental claims. In January 1997, NCR and the other
PRP companies reached agreement on an interim settlement with the State Trustee.
The Federal Trustees are not party to that agreement, and they have collateral
disputes with the State Trustee. In January 1997, the Federal Trustees notified
NCR and the other PRPs of the Federal Trustees' intent to commence a natural
resource damages lawsuit under CERCLA and the FWCPA within 60 days of the
notice, unless a negotiated resolution of their claims is reached. In March
1997, NCR and the other identified PRPs entered into a tolling agreement with
the Federal Trustees, effectively staying the 60-day notice for an additional 60
days. Negotiations with the State and Federal Trustees continue. An estimate of
NCR's ultimate share, if any, of such cleanup costs or natural resource
restoration and damages liability cannot be made with certainty at this time due
to (i) the unknown magnitude, scope, and source of any alleged contamination,
(ii) the absence of identified remedial objectives and methods, and (iii) the
uncertainty of the amount and scope of any alleged natural resource restoration
and damages. NCR believes that there are additional PRPs who may be liable for
such natural resource damages and remediation costs. Further, in 1978, NCR sold
the business to which the claims apply and believes the claims described above
are the responsibility of the buyer and its former parent company pursuant to
the terms of the sales agreement. In this connection, NCR has commenced
litigation against the buyer to enforce its position.
It is difficult to estimate the future financial impact of environmental laws,
including potential liabilities. NCR accrues environmental provisions when it is
probable that a liability has been incurred and the amount of the liability is
reasonably estimable. Management expects that the amounts provided as of March
31, 1997 will be paid out over the period of investigation, negotiation,
remediation, and restoration for the applicable sites, which may be 30 years or
more. Provisions for estimated losses from environmental remediation are,
depending on the site, based primarily on internal and third-party environmental
studies, estimates as to the number and participation level of any other PRPs,
the extent of the contamination, and the nature of required remedial and
restoration actions. Accruals are adjusted as further information develops or
circumstances change. The amounts provided for environmental matters in NCR's
consolidated financial statements are the estimated gross undiscounted amount of
such liabilities, without deductions for insurance or third-party indemnity
claims. In those cases where insurance carriers or third-party indemnitors have
agreed to pay any amounts and management believes that collectibility of such
amounts is probable, the amounts are reflected as receivables in the
consolidated financial statements.
4. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENT
In February 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 128 (SFAS 128), "Earnings per Share" (EPS).
SFAS 128 replaces the requirement for a presentation of primary EPS with a
presentation of basic EPS and requires presentation of both basic and diluted
EPS on the face of the statement of operations for all entities with complex
capital structures. SFAS 128 is effective for financial statements issued for
periods ending after December 15, 1997 and requires restatement of all prior
period EPS data presented. The adoption of this statement is not expected to
materially affect either future or prior period EPS.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
RESULTS OF OPERATIONS
The following table displays selected components of NCR's consolidated
statements of operations, expressed as a percentage of revenue.
QUARTERS ENDED MARCH 31
-----------------------
1997 1996
---- ----
Sales revenue 51.4% 55.2%
Services revenue 48.6 44.8
----- -----
Total revenue 100.0% 100.0%
===== =====
Sales gross margin 31.5% 27.2%
Services gross margin 23.4 23.5
----- -----
Total gross margin 27.6% 25.5%
Selling, general, and administrative expenses 22.6% 22.4%
Research and development expenses 6.3 5.5
----- -----
Operating loss (1.3)% (2.4)%
===== =====
REVENUE
Revenue for the quarter ended March 31, 1997 was $1,389 million, a decrease of
12% from the first quarter of 1996. The decrease in revenue was in part due to
NCR's decision to no longer sell PC/entry level server products through
high-volume indirect channels. When PC/entry level server products are excluded
from both periods, revenues in NCR's core set of businesses decreased by 9% in
the first quarter of 1997. When adjusted for the unfavorable impact of
quarter-to-quarter changes in foreign currency exchange rates (particularly the
strengthening of the U.S. dollar against most European currencies and the
Japanese yen) revenues in core businesses decreased by 5%.
Sales revenue decreased 18% to $714 million in the first quarter of 1997
compared to the first quarter of 1996. The decrease in sales revenue was
principally due to NCR's decision to no longer sell PC/entry level server
products through high-volume indirect channels and the unfavorable impact of
foreign currency exchange rates. Revenue increased for NCR's enterprise servers
used in scalable data warehousing applications but was not sufficient to offset
declines in other parts of the computer business. Revenue for retail, financial,
and systemedia products also declined in the first quarter of 1997 compared to
the first quarter of 1996, largely due to the unfavorable impact of foreign
currency rates. Services revenue decreased 5% to $675 million in the first
quarter of 1997 compared to the first quarter of 1996. Revenue for professional
services increased by 5% in the quarter despite the adverse currency rate
impact. This increase was not sufficient to offset declines in customer services
and data services revenue, both of which were unfavorably influenced by foreign
currency rate impacts.
Revenue in the first quarter of 1997 compared with the first quarter of 1996 was
flat in the Asia Pacific region, declined by 12% in the Americas, and declined
by 18% in Europe/Middle East/Africa (EMEA). When adjusted for the unfavorable
impact of quarter to quarter changes in foreign currency exchange rates, revenue
on a local currency basis increased 8% in Asia Pacific and decreased 12% in
EMEA. The Americas region made up 49% of NCR's total first quarter 1997
revenues, EMEA region comprised 30%, and Asia Pacific region comprised 21%.
OPERATING EXPENSES
Gross margin as a percentage of revenue increased 2.1 percentage points from
25.5% in the first quarter of 1996 to 27.6% in the first quarter of 1997. Sales
gross margin increased 4.3 percentage points to 31.5% for the first quarter of
1997. Gross margin on services revenue was 23.4% for the first quarter of 1997
compared to 23.5% for the first quarter of 1996.
Selling, general, and administrative expenses decreased $41 million or 12% in
the first quarter of 1997. As a percentage of revenue, selling, general, and
administrative expenses were 22.6% in the first quarter of 1997 and 22.4% in the
same period in 1996. The decrease in 1997 was primarily the result of NCR's
continued focus on expense discipline and the favorable impact of foreign
exchange rates.
Research and development expenses were $87 million in both the first quarter of
1997 and 1996. As a percentage of revenue, research and development expenses
were 6.3% in the first quarter of 1997 and 5.5% of a larger revenue base in the
first quarter of 1996.
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LOSS BEFORE INCOME TAXES
NCR reported an operating loss of $18 million in the first quarter of 1997
compared to an operating loss of $37 million in the first quarter of 1996.
Interest expense was $2 million in the first quarter of 1997 compared to $13
million in the first quarter of 1996. Other income, net of expenses, was $5
million in the first quarter of 1997 compared to a net expense of $3 million in
the first quarter of 1996.
NCR reported a loss before taxes of $15 million in the first quarter of 1997
compared to a loss before taxes of $53 million in the first quarter of 1996.
NET LOSS
The provision for income taxes was $1 million in the first quarter of 1997
compared to $12 million in the first quarter of 1996. NCR's tax provision
results from a normal provision for income taxes in those foreign tax
jurisdictions where its subsidiaries are profitable, and an inability on a
stand-alone basis to reflect tax benefits from net operating losses and tax
credits, primarily in the United States.
Net loss was $16 million in the first quarter of 1997 and $65 million in the
same period in 1996.
FINANCIAL CONDITION, LIQUIDITY, AND CAPITAL RESOURCES
NCR's cash, cash equivalents, and short-term investments totaled $1,133 million
at March 31, 1997 compared to $1,203 million at December 31, 1996.
NCR used cash flows in operations of $2 million in the first quarter of 1997
while generating cash flows in operations of $298 million in the first quarter
of 1996. The cash generated in operations in the first quarter of 1996 was due
principally to the large reduction in inventory and receivable balances.
Receivable balances decreased $525 million in the first quarter of 1996 compared
with $121 million in the same period in 1997. The decrease in 1996 was due
largely to NCR's decision to no longer sell PC/entry level servers through
high-volume indirect channels and a reduction in receivable balances due to the
sale of NCR's Switzerland data services business. Inventory balances decreased
$66 million in the first quarter of 1996 compared to an increase of $96 million
in the first quarter of 1997. The decrease in 1996 resulted from exiting the PC
manufacturing business, overall improved supply line management, and an
increased focus on inventory management practices. The increase in inventory in
the first quarter of 1997 is consistent with the historical inventory balances
increases during the first three quarters of the year. Cash required for
payables decreased from $422 million in the first quarter of 1996 to $60 million
in the first quarter of 1997 primarily due to payments made in the first quarter
of 1996 relating to NCR's 1995 restructuring.
Net cash flows used in investing activities were $279 million in the first
quarter of 1997 and $52 million in the first quarter of 1996. In 1997, NCR
purchased $248 million of short-term investments as a part of its overall cash
management strategy. Capital expenditures were $48 million for the first quarter
of 1997 and $37 million for the comparable period in 1996. Capital expenditures
generally relate to expenditures for reworkable parts used to service customer
equipment, expenditures for equipment and facilities used in manufacturing and
research and development, and expenditures for facilities to support sales and
marketing activities.
Net cash provided by financing activities was $12 million in the first quarter
of 1997 and $61 million in the first quarter of 1996. In 1996, NCR relied on
AT&T to provide financing for its operations. The cash flows reflected as
transfers from AT&T in the consolidated statements of cash flows for 1996
represent capital infusions that were used to fund NCR's ongoing operations. In
addition, $237 million of debt was repaid in the first quarter of 1996.
NCR believes that cash flows from operations, the credit facility, and other
short- and long-term financings, if any, will be sufficient to satisfy its
future working capital, research and development, capital expenditure, and other
financing requirements for the foreseeable future.
FACTORS THAT MAY AFFECT FUTURE RESULTS
Management's Discussion and Analysis contains information based on management's
beliefs and forward-looking statements that involve a number of risks,
uncertainties, and assumptions. There can be no assurances that actual results
will not differ materially from the forward-looking statements as a result of
various factors, including but not limited to the following:
The markets for many of NCR's offerings are characterized by rapidly changing
technology, evolving industry standards, and frequent new product introductions.
NCR's operating results will depend to a significant extent on its ability to
design, develop, or otherwise obtain and introduce new products, services,
systems, and solutions and to reduce the costs of these offerings. The success
of these and other new offerings is dependent on many factors, including proper
identification of customer needs, cost, timely completion and introduction,
differentiation from offerings of NCR's competitors, and market acceptance. The
ability to successfully introduce new products and services could have an impact
on future results of operations.
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Due to NCR's focus on providing complex integrated solutions to customers, NCR
frequently relies on third parties to provide significant elements of NCR's
offerings, which must be integrated with the elements provided by NCR. NCR has
from time to time formed alliances with third parties that have complementary
products, services, and skills. These business practices often require NCR to
rely on the performance and capabilities of third parties which are beyond NCR's
control.
A number of NCR's products and systems rely primarily on specific suppliers for
microprocessors, operating systems, and other central components. The failure of
any of these technologies to remain competitive, either individually or as part
of a system or solution, or the failure of these providers to continue such
technologies, could impact future operating results.
NCR also uses many standard parts and components in its products and believes
there are a number of competent vendors for most parts and components. However,
a number of important components are developed by and purchased from single
sources due to price, quality, technology, or other considerations. In some
cases, those components are available only from single sources. The process of
substituting a new producer of such parts could impact NCR's results of
operations.
NCR faces significant competition in all geographic areas where it operates. Its
markets are characterized by continuous, rapid technological change, the need to
introduce products in a timely manner in order to take advantage of market
opportunities, short product life cycles, frequent product performance
improvements, and price reductions. The significant competition in the
information technology industry has decreased gross margins for many companies
in recent years and could continue to do so in the future. Future operating
results will depend in part on NCR's ability to mitigate such margin pressure by
maintaining a favorable mix of systems, solutions, services, and other revenues
and by achieving component cost reductions and operating efficiencies.
NCR's sales are historically seasonal, with revenue higher in the fourth quarter
of each year. Consequently, during the three quarters ending in March, June, and
September, NCR has historically experienced less favorable results than in the
quarter ending in December. Such seasonality also causes NCR's working capital
cash flow requirements to vary from quarter to quarter depending on the
variability in the volume, timing, and mix of product sales. In addition, in
many quarters, a large portion of NCR's revenue is realized in the third month
of the quarter. Operating expenses are relatively fixed in the short term and
often cannot be materially reduced in a particular quarter if revenue falls
below anticipated levels for such quarter.
NCR's foreign operations are subject to a number of risks inherent in operating
abroad. Such operations may be adversely affected by a variety of factors, many
of which cannot be readily foreseen and over which NCR has no control. A
significant change in the value of the dollar or another functional currency
against the currency of one or more countries where NCR recognizes revenues or
earnings or maintains net asset investments may impact future operating results.
NCR attempts to mitigate a portion of such changes through the use of foreign
currency contracts.
In the normal course of business, NCR is subject to regulations, proceedings,
lawsuits, claims, and other matters, including actions under laws and
regulations related to the environment and health and safety, among others. Such
matters are subject to the resolution of many uncertainties, and accordingly,
outcomes are not predictable with assurance. Although NCR believes that amounts
provided in its financial statements are currently adequate in light of the
probable and estimable liabilities, there can be no assurances that the amounts
required to discharge alleged liabilities from lawsuits, claims, and other legal
proceedings and environmental matters, and to comply with applicable
environmental laws, will not impact future operating results.
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PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted to a vote of security holders during the first
quarter of 1997. NCR's Annual Stockholders' Meeting was held on April 16, 1997.
At the Annual Meeting, stockholders voted on two matters: the proposal to elect
Lars Nyberg, David R. Holmes, and James O. Robbins as directors, and the
approval of material terms of performance goals for compensation provided under
the NCR Management Stock Plan to qualify such compensation under Section 162 (m)
of the Internal Revenue Code. The affirmative, negative, and abstaining votes
cast with respect to each matter required to be reported herein are as follows:
Annual Meeting of Stockholders
Affirmative Negative Abstaining
Votes Votes Votes
---------- ---------- ----------
1. Election of Directors
Lars Nyberg 74,509,232 489,202
David R. Holmes 74,498,074 500,360
James O. Robbins 74,511,184 487,250
2. Proposal to approve
Material Terms of Performance
Goals under the NCR Management
Stock Plan 66,316,551 8,123,383 558,500
A copy of the transcript of NCR's 1997 Annual Meeting may be obtained upon
written request to NCR's Corporate Secretary at NCR Corporation, 1700 S.
Patterson Blvd., Dayton, OH 45479.
ITEM 5. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
27 Financial Data Schedule
(b) REPORTS ON FORM 8-K
On February 7, 1997, NCR filed a Current Report on Form 8-K,
including a consolidated balance sheet as of December 31, 1996,
a consolidated statement of cash flows for the year ended
December 31, 1996, and consolidated statements of operations,
consolidated revenue summary, and supplemental consolidated
statements of operating income (excluding restructuring and
other charges) for the quarter and year ended December 31, 1996,
with respect to its Press Release on the fourth quarter and
year-end financial results.
On February 26, 1997, NCR filed a Current Report on Form 8-K
with respect to a change in its independent accountants.
On March 26, 1997, NCR filed a Current Report on Form 8-K/A as
an amendment to the Form 8-K filed on February 26, 1997 with
respect to a change in its independent accountants.
On April 18, 1997, NCR filed a Current Report on Form 8-K,
including an unaudited consolidated balance sheet as of March
31, 1997, and unaudited consolidated statements of operations
and consolidated revenue summary for the quarter ended March 31,
1997, with respect to its Press Release on the first quarter
financial results.
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SIGNATURE
Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
NCR CORPORATION
Date: May 9, 1997 By: /s/ John L. Giering
------------------------------
John L. Giering, Senior Vice-President
and Chief Financial Officer
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1,000,000
U.S. DOLLARS
3-MOS
DEC-31-1997
MAR-31-1997
1
856
277
1336
0
535
3261
2296
1412
5167
1942
44
0
0
1
1320
5167
714
1389
489
1006
401
0
2
(15)
1
(16)
0
0
0
(16)
(.16)
0
