) was recently awarded a contract modification by The Los Angeles
World Airports (LAWA) to upgrade its access control and alarm
monitoring system which is used to identify the 45,000 airport
employees, contractors, police and others who work at the
organization's three airports.
LAWA oversees airport operations for the city of Los Angeles.
Earlier, LAWA awarded a contract to Unisys to operate and maintain
the access control and alarm monitoring system in 2009.
LAWA currently plans to move to a biometrics-based
identification system wherein workers at the airports will be
identified based on personal attributes such as fingerprints.
Meanwhile, the modification plan is estimated to be worth $10.3
million over one year. Under the plan, Unisys will provide services
such as site assessments, engineering, installation and training on
the system's new features. Unisys will also upgrade LAWA's network
infrastructure to provide greater levels of reliability and
The new modification will help Unisys replace the airports'
existing magnetic stripe card readers with a contactless system,
which should make it difficult for non-authorized individuals to
access secure areas. The new contactless system is also estimated
to save money by reducing the wear on cards and readers associated
with magnetic stripe systems.
Earlier, Unisys Corporation reported revenues of $1.02
billion in the third quarter of 2011, up 6% year over year. Foreign
currency fluctuations had a six percentage-point positive impact on
revenue in the quarter.
Total revenues grew 6% despite a decline in the company's U.S.
federal business. Excluding the U.S. Federal business, overall
revenue grew 14% year over year. Management stated that strong
ClearPath sales, continued growth in the non-U.S. Federal IT
outsourcing business, and higher sales of industry solutions within
the system integration business more than offset the decline in the
U.S. Federal business where market conditions remain
Technology revenues grew 36% from the year-ago quarter driven by
significantly higher sales of ClearPath software and servers.
Gross margin increased to 27.9% from 24.7% in the year-ago
quarter and 22.8% in the previous quarter primarily reflecting
higher sales of ClearPath software and servers and a more
profitable mix of services revenue. Services gross profit margin
improved to 21.6% from 20.6% a year ago.
Operating margin improved to 11.1% from 7.9% in the year-ago
quarter. Services operating margin improved to 8.7% from 7.1% a
Net income came in at $78.6 million or $1.63 per share in the
third quarter compared with a net loss of $11.6 million or $0.27 in
the previous quarter and a net income of $28.3 million or $0.65 in
the year-ago quarter. The results easily beat the Zacks Consensus
Estimate of $0.70.
We continue to maintain an Underperform recommendation on
Unisys. However, we have a Zacks #3 Rank on the stock which
translates into a short-term rating of Hold.
): Free Stock Analysis Report