Diebold Announces First Quarter Results

Apr 24, 2001, 01:00 ET from Diebold, Incorporated

    NORTH CANTON, Ohio, April 24 /PRNewswire/ -- Diebold, Incorporated
 (NYSE:   DBD) today announced its first quarter results. Excluding the impact of
 previously announced realignment and special charges, Diebold reported net
 income of $25,730,000, or diluted earnings per share of $.36. This compares to
 previous guidance of $.34 to $.39.  Including the realignment and special
 charges, Diebold had net income of $7,557,000, or diluted $.11 per share, on
 revenue of $383,854,000.  This compares to first quarter 2000 net income of
 $31,260,000, or diluted $.44 per share on revenue of $344,592,000.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20000608/DIEBLOGO )
 
     Pro Forma Earnings
     On a pro forma basis, including the impact of the seasonally weak European
 acquisitions, which Diebold acquired in April 2000, first quarter 2000 diluted
 earnings per share were $.36, the same as first quarter 2001.
 
     Highlights
     First quarter highlights included:
 
     * Total revenue grew 11.4 percent.  On a pro forma, fixed exchange rate
       basis, financial self-service revenue grew 9.3 percent.
     * Financial self-service maintenance service revenue grew 24.6 percent.
     * On a pro forma, fixed exchange rate basis, total product orders
       increased in the double-digit range.
     * U.S. orders grew in the high single-digit range.
     * On a pro forma, fixed exchange rate basis, total product and service
       orders each grew in the double-digit range.
 
     First Quarter Results
     "We're very encouraged by the continuing growth in our services business
 during the quarter, as we continue to gain share and expand our offerings in
 that area," said Walden W. O'Dell, Diebold chairman, president and chief
 executive officer.  "We're pleased that we were able to achieve our earnings
 target in a difficult economic environment by focusing on areas within our
 control, such as internal process improvement, e-initiatives and cost
 containment.  We're especially pleased with our performance considering that
 last year's first quarter results were very strong."
     O'Dell continued, "Our corporate realignment will allow us to aggressively
 move forward in terms of integrating our global operations and creating a more
 efficient cost structure. We will be able to provide more comprehensive,
 competitively priced solutions worldwide and focus more resources on the areas
 of business that provide the highest growth potential. We remain optimistic
 about our business opportunities for the remainder of 2001."
 
     Pro Forma, Fixed Exchange Rate First Quarter Orders
     Total worldwide orders for product and service increased in the double-
 digit range. Total North America orders were up in the high single-digit
 range.  International orders increased in the double-digit range in Asia-
 Pacific; Europe, the Middle East and Africa; and Latin America.
     Significant orders for the quarter included:
 
     * Orders totaling more than $50 million for various financial institutions
       in Brazil.
     * More than $25 million in technology solutions for InnoVentry's financial
       service kiosks.
     * An agreement with Wal-Mart for 129 drive-up ATMs to be placed at Wal-
       Mart and Sam's Club gas station locations.
     * Web-enabled upgrades totaling $4 million to a U.S.-based financial
       institution.
     * OEM for self-service checkouts totaling $3.5 million.
     * Self-service orders totaling more than $3 million for two major U.S.-
       based financial institutions.
 
     Revenue
     Total revenue for the quarter grew $39.3 million, or 11.4 percent.  On a
 pro forma, fixed exchange rate basis, total revenue grew 6.4 percent.
 
     Revenue Summary by Product and Service Solutions
     (In Thousands -- Quarter Ended March 31, 2001)
 
                                              2001        2000        % change
 
     Self-service solutions hardware(a)      138,182     126,786        9.0%
     Professional and special services(b)     18,001      17,291        4.1%
     Total product financial self services   156,183     144,077        8.4%
 
     Maintenance services                    155,850     125,123       24.6%
     Total Financial self-service solutions  312,033     269,200       15.9%
     Pro forma fixed exchange rate change*                              9.3%
 
     Security solutions hardware              30,834      32,751       -5.9%
     Maintenance services                     39,546      39,086        1.2%
     Total Security solutions(c)              70,380      71,837       -2.0%
 
     Total Diebold excluding Voting
       & MedSelect                           382,413     341,037       12.1%
     Pro forma fixed exchange rate change*                              7.1%
 
     Voting Machines                               -         614        N/A
     MedSelect                                 1,441       2,941      -51.0%
 
     Total revenue                           383,854     344,592       11.4%
     Pro forma fixed exchange rate change*                              6.4%
 
     * Pro forma fixed exchange rate results include the first quarter 2000
       European acquisitions and translation of 2000 international results at
       2001 currency rates.
 
     (a) Self-service solutions include hardware and terminal software,
         terminal software and hardware upgrades.
     (b) Professional and special services include custom software products,
         project management, network management and other related services
     (c) Security solutions include physical security, facility products,
         electronic security and campus systems.
 
     Revenue by Geography
 
     Revenue Summary by Geographic Segment
     (In Thousands -- Quarter Ended March 31, 2001)
 
                                          2001        2000        % change
     The Americas
     Financial self-service solutions    230,222     232,183        -0.8%
     Security solutions                   69,996      71,342        -1.9%
     Other (Voting Machines/MedSelect)     1,441       3,555       -59.5%
     Total Americas                      301,659     307,080        -1.8%
 
     Asia-Pacific
     Financial self-service solutions     20,947      14,023        49.4%
     Security solutions                      255         427       -40.3%
     Total Asia-Pacific                   21,202      14,450        46.7%
 
     Europe, Middle East, Africa
     Financial self-service solutions     60,864      22,994       164.7%
     Security solutions                      129          68        89.7%
     Total Europe, Middle East, Africa    60,993      23,062       164.5%
 
 
     Total Revenue                      $383,854    $344,592        11.4%
 
     Gross Margin
     Excluding realignment and special charges, total gross margin was
 31.6 percent, down from 33.2 percent on a pro forma basis in the 2000 first
 quarter.  Product gross margin decreased to 39.9 percent from 41.0 percent in
 the 2000 first quarter on a pro forma basis due to a strong U.S. dollar.
 Service gross margin was 23.6 percent, down from 24.9 percent on a pro forma
 basis in the first quarter 2000 due to a very competitive service environment.
 
     Operating Expenses
     Total operating expenses, excluding realignment charges between years
 remained flat as a percentage of revenue on a pro forma basis, due to a strong
 focus on cost control.
 
     Operating Profit
     Excluding realignment and special charges operating profit was 10.6
 percent of revenue, down from 12.0 percent on a pro forma basis from 2000.
 
     Balance Sheet Items ($000's)
 
                                            March 31, 2001    Dec. 31, 2000
 
     Cash and Cash Equivalents                  $50,865          $65,184
     Trade Receivables                          373,446          363,571
          DSO                                        67               69
     Inventory                                  221,752          205,567
          Inv. T/O                                 5.50             6.30
     Bonds/Current Notes Payable                163,385          284,409
     Net (Debt)/Investment                       13,445          (68,741)
 
     Outlook
     The following statements are based on current expectations. These
 statements are forward-looking and actual results may differ materially. These
 statements do not include the potential impact of any mergers, acquisitions,
 disposals or other business combinations that may be completed after March 31,
 2001.
     Given current backlog and cost actions, the company expects the second
 half of the year to be stronger than the first half. Diebold does expect to
 benefit from its North American realignment as well as its expanded global
 infrastructure, particularly in Europe, during the balance of the year.
     Taking those factors into consideration, management expectations include:
 
     * Second quarter EPS to be in the range of $.43 to $.49, excluding
       realignment and special charges.
     * Full year EPS to be in the range of $1.95 to $2.00, excluding
       realignment and special charges.
     * Additional realignment and special charges are estimated to be in the
       range of $30 million to $40 million during the remainder of 2001, of
       which approximately $5 million to $10 million will be in the second
       quarter.
     * Depreciation, amortization and goodwill in the range of $70 million to
       $75 million for the year.
     * Effective tax rate of approximately 33 percent.
     * Capital expenditures of approximately $50 million for 2001.
 
     Financial Information
     Walden W. O'Dell and Senior Vice President and Chief Financial Officer
 Gregory T. Geswein will discuss the company's financial performance during a
 conference call today at 10:00 a.m. (EDT). Access is available from Diebold's
 Web site at www.diebold.com . The replay can also be accessed on the site for
 up to one year after the call.
 
     Forward-Looking Statement
     In the Company's written or oral statements, the use of the words
 "believes," "anticipates," "expects" and similar expressions is intended to
 identify forward-looking statements that have been made and may in the future
 be made by or on behalf of the company, including statements concerning future
 operating performance, the company's share of new and existing markets, and
 the Company's short- and long-term revenue and earnings growth rates.
 Although the Company believes that is outlook is based upon reasonable
 assumptions regarding the economy, its knowledge of its business, and on key
 performance indicators which impact the Company, there can be no assurance
 that the Company's goals will be realized.  The Company is not obligated to
 report changes to its outlook.  Readers are cautioned not to place undue
 reliance on these forward-looking statements, which speak only as of the date
 hereof.  The Company's uncertainties could cause actual results to differ
 materially from those anticipated in forward-looking statements.  These
 include, but are not limited to:
 
     * competitiveness pressures, including pricing pressures and technological
       developments;
     * changes in the Company's relationships with customers, suppliers,
     * distributors and/or partners in its business ventures;
     * changes in political, economic or other factors such as currency
       exchange rates, inflation rates, recessionary or expansive trends, taxes
       and regulations and laws affecting the worldwide business in each of the
       company's  operations, including Brazil, where a significant portion of
       the Company's revenue is derived;
     * acceptance of the company's product and technology introductions in the
       marketplace;
     * unanticipated litigation, claims or assessments;
     * ability to reduce costs and expenses and improve internal operating
       efficiencies; and
     * variation in consumer demand for biometrics and self-service
       technologies, products and services.
 
     Diebold, Incorporated is a global leader in providing integrated self-
 service delivery systems and services. Diebold employs more than 10,000
 associates with representation in more than 80 countries worldwide and
 headquarters in Canton, Ohio, USA.  Diebold reported revenue of $1.7 billion
 in 2000 and is publicly traded on the New York Stock Exchange under the symbol
 'DBD.'  For more information, visit the company's Web site at www.diebold.com.
 
     DIEBOLD, INCORPORATED
     (IN THOUSANDS EXCEPT EARNINGS PER SHARE)
 
                                          Three Months Ended March 31, 2001
 
                                        Including     Excluding
                                       Realignment    Realignment
                                        And Other      And Other
                                         Charges       Charges
                                          2001           2001        2000
 
     Net sales
       Product                          $188,458      $188,458     $180,384
       Service                           195,396       195,396      164,208
       Total                             383,854       383,854      344,592
 
     Cost of goods
       Product                           113,337       113,337      104,293
       Special Charges                     4,000             -            -
       Service                           149,360       149,360      123,476
       Total                             266,697       262,697      227,769
 
     Gross profit                        117,157       121,157      116,823
 
       Percent of net sales                 30.5%         31.6%        33.9%
 
     Operating expenses
       Selling, general
         and administrative               67,750        65,750       56,756
       Research, development
         and engineering                  14,754        14,754       10,870
       Realignment charges                21,124             -            -
       Total                             103,628        80,504       67,626
       Percent of net sales                 27.0%         21.0%        19.6%
 
     Operating profit                     13,529        40,653       49,197
       Percent of net sales                  3.5%         10.6%        14.3%
 
     Other income/(expense) and
       minority interest, net             (2,250)       (2,250)      (2,540)
     Income before taxes                  11,279        38,403       46,657
     Percent of net sales                    2.9%         10.0%        13.5%
 
     Taxes on income                      (3,722)      (12,673)     (15,397)
       Effective tax rate                   33.0%         33.0%        33.0%
 
     Net income                           $7,557       $25,730      $31,260
       Percent of net sales                  2.0%          6.7%         9.1%
 
     Basic weighted average
       shares outstanding                 71,554        71,554       71,130
 
     Diluted weighted average
       shares outstanding                 71,741        71,741       71,444
 
     Basic earnings per share              $0.11         $0.36        $0.44
 
     Diluted earnings per share            $0.11         $0.36        $0.44
 
                       MAKE YOUR OPINION COUNT -  Click Here
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SOURCE Diebold, Incorporated
    NORTH CANTON, Ohio, April 24 /PRNewswire/ -- Diebold, Incorporated
 (NYSE:   DBD) today announced its first quarter results. Excluding the impact of
 previously announced realignment and special charges, Diebold reported net
 income of $25,730,000, or diluted earnings per share of $.36. This compares to
 previous guidance of $.34 to $.39.  Including the realignment and special
 charges, Diebold had net income of $7,557,000, or diluted $.11 per share, on
 revenue of $383,854,000.  This compares to first quarter 2000 net income of
 $31,260,000, or diluted $.44 per share on revenue of $344,592,000.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20000608/DIEBLOGO )
 
     Pro Forma Earnings
     On a pro forma basis, including the impact of the seasonally weak European
 acquisitions, which Diebold acquired in April 2000, first quarter 2000 diluted
 earnings per share were $.36, the same as first quarter 2001.
 
     Highlights
     First quarter highlights included:
 
     * Total revenue grew 11.4 percent.  On a pro forma, fixed exchange rate
       basis, financial self-service revenue grew 9.3 percent.
     * Financial self-service maintenance service revenue grew 24.6 percent.
     * On a pro forma, fixed exchange rate basis, total product orders
       increased in the double-digit range.
     * U.S. orders grew in the high single-digit range.
     * On a pro forma, fixed exchange rate basis, total product and service
       orders each grew in the double-digit range.
 
     First Quarter Results
     "We're very encouraged by the continuing growth in our services business
 during the quarter, as we continue to gain share and expand our offerings in
 that area," said Walden W. O'Dell, Diebold chairman, president and chief
 executive officer.  "We're pleased that we were able to achieve our earnings
 target in a difficult economic environment by focusing on areas within our
 control, such as internal process improvement, e-initiatives and cost
 containment.  We're especially pleased with our performance considering that
 last year's first quarter results were very strong."
     O'Dell continued, "Our corporate realignment will allow us to aggressively
 move forward in terms of integrating our global operations and creating a more
 efficient cost structure. We will be able to provide more comprehensive,
 competitively priced solutions worldwide and focus more resources on the areas
 of business that provide the highest growth potential. We remain optimistic
 about our business opportunities for the remainder of 2001."
 
     Pro Forma, Fixed Exchange Rate First Quarter Orders
     Total worldwide orders for product and service increased in the double-
 digit range. Total North America orders were up in the high single-digit
 range.  International orders increased in the double-digit range in Asia-
 Pacific; Europe, the Middle East and Africa; and Latin America.
     Significant orders for the quarter included:
 
     * Orders totaling more than $50 million for various financial institutions
       in Brazil.
     * More than $25 million in technology solutions for InnoVentry's financial
       service kiosks.
     * An agreement with Wal-Mart for 129 drive-up ATMs to be placed at Wal-
       Mart and Sam's Club gas station locations.
     * Web-enabled upgrades totaling $4 million to a U.S.-based financial
       institution.
     * OEM for self-service checkouts totaling $3.5 million.
     * Self-service orders totaling more than $3 million for two major U.S.-
       based financial institutions.
 
     Revenue
     Total revenue for the quarter grew $39.3 million, or 11.4 percent.  On a
 pro forma, fixed exchange rate basis, total revenue grew 6.4 percent.
 
     Revenue Summary by Product and Service Solutions
     (In Thousands -- Quarter Ended March 31, 2001)
 
                                              2001        2000        % change
 
     Self-service solutions hardware(a)      138,182     126,786        9.0%
     Professional and special services(b)     18,001      17,291        4.1%
     Total product financial self services   156,183     144,077        8.4%
 
     Maintenance services                    155,850     125,123       24.6%
     Total Financial self-service solutions  312,033     269,200       15.9%
     Pro forma fixed exchange rate change*                              9.3%
 
     Security solutions hardware              30,834      32,751       -5.9%
     Maintenance services                     39,546      39,086        1.2%
     Total Security solutions(c)              70,380      71,837       -2.0%
 
     Total Diebold excluding Voting
       & MedSelect                           382,413     341,037       12.1%
     Pro forma fixed exchange rate change*                              7.1%
 
     Voting Machines                               -         614        N/A
     MedSelect                                 1,441       2,941      -51.0%
 
     Total revenue                           383,854     344,592       11.4%
     Pro forma fixed exchange rate change*                              6.4%
 
     * Pro forma fixed exchange rate results include the first quarter 2000
       European acquisitions and translation of 2000 international results at
       2001 currency rates.
 
     (a) Self-service solutions include hardware and terminal software,
         terminal software and hardware upgrades.
     (b) Professional and special services include custom software products,
         project management, network management and other related services
     (c) Security solutions include physical security, facility products,
         electronic security and campus systems.
 
     Revenue by Geography
 
     Revenue Summary by Geographic Segment
     (In Thousands -- Quarter Ended March 31, 2001)
 
                                          2001        2000        % change
     The Americas
     Financial self-service solutions    230,222     232,183        -0.8%
     Security solutions                   69,996      71,342        -1.9%
     Other (Voting Machines/MedSelect)     1,441       3,555       -59.5%
     Total Americas                      301,659     307,080        -1.8%
 
     Asia-Pacific
     Financial self-service solutions     20,947      14,023        49.4%
     Security solutions                      255         427       -40.3%
     Total Asia-Pacific                   21,202      14,450        46.7%
 
     Europe, Middle East, Africa
     Financial self-service solutions     60,864      22,994       164.7%
     Security solutions                      129          68        89.7%
     Total Europe, Middle East, Africa    60,993      23,062       164.5%
 
 
     Total Revenue                      $383,854    $344,592        11.4%
 
     Gross Margin
     Excluding realignment and special charges, total gross margin was
 31.6 percent, down from 33.2 percent on a pro forma basis in the 2000 first
 quarter.  Product gross margin decreased to 39.9 percent from 41.0 percent in
 the 2000 first quarter on a pro forma basis due to a strong U.S. dollar.
 Service gross margin was 23.6 percent, down from 24.9 percent on a pro forma
 basis in the first quarter 2000 due to a very competitive service environment.
 
     Operating Expenses
     Total operating expenses, excluding realignment charges between years
 remained flat as a percentage of revenue on a pro forma basis, due to a strong
 focus on cost control.
 
     Operating Profit
     Excluding realignment and special charges operating profit was 10.6
 percent of revenue, down from 12.0 percent on a pro forma basis from 2000.
 
     Balance Sheet Items ($000's)
 
                                            March 31, 2001    Dec. 31, 2000
 
     Cash and Cash Equivalents                  $50,865          $65,184
     Trade Receivables                          373,446          363,571
          DSO                                        67               69
     Inventory                                  221,752          205,567
          Inv. T/O                                 5.50             6.30
     Bonds/Current Notes Payable                163,385          284,409
     Net (Debt)/Investment                       13,445          (68,741)
 
     Outlook
     The following statements are based on current expectations. These
 statements are forward-looking and actual results may differ materially. These
 statements do not include the potential impact of any mergers, acquisitions,
 disposals or other business combinations that may be completed after March 31,
 2001.
     Given current backlog and cost actions, the company expects the second
 half of the year to be stronger than the first half. Diebold does expect to
 benefit from its North American realignment as well as its expanded global
 infrastructure, particularly in Europe, during the balance of the year.
     Taking those factors into consideration, management expectations include:
 
     * Second quarter EPS to be in the range of $.43 to $.49, excluding
       realignment and special charges.
     * Full year EPS to be in the range of $1.95 to $2.00, excluding
       realignment and special charges.
     * Additional realignment and special charges are estimated to be in the
       range of $30 million to $40 million during the remainder of 2001, of
       which approximately $5 million to $10 million will be in the second
       quarter.
     * Depreciation, amortization and goodwill in the range of $70 million to
       $75 million for the year.
     * Effective tax rate of approximately 33 percent.
     * Capital expenditures of approximately $50 million for 2001.
 
     Financial Information
     Walden W. O'Dell and Senior Vice President and Chief Financial Officer
 Gregory T. Geswein will discuss the company's financial performance during a
 conference call today at 10:00 a.m. (EDT). Access is available from Diebold's
 Web site at www.diebold.com . The replay can also be accessed on the site for
 up to one year after the call.
 
     Forward-Looking Statement
     In the Company's written or oral statements, the use of the words
 "believes," "anticipates," "expects" and similar expressions is intended to
 identify forward-looking statements that have been made and may in the future
 be made by or on behalf of the company, including statements concerning future
 operating performance, the company's share of new and existing markets, and
 the Company's short- and long-term revenue and earnings growth rates.
 Although the Company believes that is outlook is based upon reasonable
 assumptions regarding the economy, its knowledge of its business, and on key
 performance indicators which impact the Company, there can be no assurance
 that the Company's goals will be realized.  The Company is not obligated to
 report changes to its outlook.  Readers are cautioned not to place undue
 reliance on these forward-looking statements, which speak only as of the date
 hereof.  The Company's uncertainties could cause actual results to differ
 materially from those anticipated in forward-looking statements.  These
 include, but are not limited to:
 
     * competitiveness pressures, including pricing pressures and technological
       developments;
     * changes in the Company's relationships with customers, suppliers,
     * distributors and/or partners in its business ventures;
     * changes in political, economic or other factors such as currency
       exchange rates, inflation rates, recessionary or expansive trends, taxes
       and regulations and laws affecting the worldwide business in each of the
       company's  operations, including Brazil, where a significant portion of
       the Company's revenue is derived;
     * acceptance of the company's product and technology introductions in the
       marketplace;
     * unanticipated litigation, claims or assessments;
     * ability to reduce costs and expenses and improve internal operating
       efficiencies; and
     * variation in consumer demand for biometrics and self-service
       technologies, products and services.
 
     Diebold, Incorporated is a global leader in providing integrated self-
 service delivery systems and services. Diebold employs more than 10,000
 associates with representation in more than 80 countries worldwide and
 headquarters in Canton, Ohio, USA.  Diebold reported revenue of $1.7 billion
 in 2000 and is publicly traded on the New York Stock Exchange under the symbol
 'DBD.'  For more information, visit the company's Web site at www.diebold.com.
 
     DIEBOLD, INCORPORATED
     (IN THOUSANDS EXCEPT EARNINGS PER SHARE)
 
                                          Three Months Ended March 31, 2001
 
                                        Including     Excluding
                                       Realignment    Realignment
                                        And Other      And Other
                                         Charges       Charges
                                          2001           2001        2000
 
     Net sales
       Product                          $188,458      $188,458     $180,384
       Service                           195,396       195,396      164,208
       Total                             383,854       383,854      344,592
 
     Cost of goods
       Product                           113,337       113,337      104,293
       Special Charges                     4,000             -            -
       Service                           149,360       149,360      123,476
       Total                             266,697       262,697      227,769
 
     Gross profit                        117,157       121,157      116,823
 
       Percent of net sales                 30.5%         31.6%        33.9%
 
     Operating expenses
       Selling, general
         and administrative               67,750        65,750       56,756
       Research, development
         and engineering                  14,754        14,754       10,870
       Realignment charges                21,124             -            -
       Total                             103,628        80,504       67,626
       Percent of net sales                 27.0%         21.0%        19.6%
 
     Operating profit                     13,529        40,653       49,197
       Percent of net sales                  3.5%         10.6%        14.3%
 
     Other income/(expense) and
       minority interest, net             (2,250)       (2,250)      (2,540)
     Income before taxes                  11,279        38,403       46,657
     Percent of net sales                    2.9%         10.0%        13.5%
 
     Taxes on income                      (3,722)      (12,673)     (15,397)
       Effective tax rate                   33.0%         33.0%        33.0%
 
     Net income                           $7,557       $25,730      $31,260
       Percent of net sales                  2.0%          6.7%         9.1%
 
     Basic weighted average
       shares outstanding                 71,554        71,554       71,130
 
     Diluted weighted average
       shares outstanding                 71,741        71,741       71,444
 
     Basic earnings per share              $0.11         $0.36        $0.44
 
     Diluted earnings per share            $0.11         $0.36        $0.44
 
                       MAKE YOUR OPINION COUNT -  Click Here
     http://tbutton.prnewswire.com/prn/11690X71626751
 
 SOURCE  Diebold, Incorporated