NCR Corporation NCR
Q1 2010 Earnings Call Transcript

Operator: Welcome, and thank you for standing by. At this time, all participants are in a listen-only mode. After the presentation, we will conduct a question-and-answer session. (Operator Instructions).

Today’s conference is being recorded. If there are any objections, please disconnect at this time. I would now like to turn the conference over to your host Mr. Gavin Bell. Mr. Bell, please begin.

Gavin Bell - IR: Thank you, Dorr. Good afternoon, and thanks everyone for joining us for our First Quarter 2010 Earnings Call. Bill Nuti, NCR’s Chairman and Chief Executive Officer will lead our conference call this afternoon.

Please note that we have posted a presentation on the Investor page of our website www.ncr.com and Bill will be referring to that presentation as part of his prepared remarks this afternoon.

After Bill’s opening remarks, Bob Fishman, NCR’s Chief Financial Officer will provide comments on NCR’s total company financial results. Also, with us today is John Bruno, Executive Vice President of our Industry Solutions Group. John will participate in Q&A following the prepared remarks.

Discussion today includes forecast and other information that are considered forward-looking statements. While these statements reflect our current outlook, they are subject to a number of risks and uncertainties that could cause actually results to vary materially.

These risk factors are described in NCR’s periodic filings with the SEC and in our Annual Report to stockholders. On today's call, we will also be discussion certain non-GAAP financial information such as free cash flow and results excluding the impacts of pension and other items.

Reconciliations of non-GAAP financial results to our reported and forecasted GAAP results and other information concerning such measures are included in our earnings press release and also available on the Investor page of our website.

A replay of this conference call will be available later today on our website. And for those listening to the replay of this call, please keep in mind that the information discussed is as of April 22, 2010 and NCR assumes no obligation to update or revise the information included in this conference call whether as a result of new information or future results.

With that, I’ll now turn the call over to Will.

William Nuti - Chairman and CEO: Thank you Gavin. And good afternoon, and thank you all for joining us. NCR is off to a good start in 2010, as summarized by slide number three in the accompanying presentation on our website. Our first quarter financial results were ahead of expectations and we are beginning to see signs of a slow but steady recovery in our core end markets.

Our return to revenue growth, gross margin improvement, cost and expense reduction and significant NPOI and EPS ex-pension growth were all positive indicators in the first quarter. These results signaled that we expect to be a return-to-growth Company in 2010, and give us increased confidence in our outlook for full year revenue in operating earnings, which we are reaffirming today.

Returning NCR to growth is, of course, vital to building shareholder value. But so is addressing our pension liability and we are pleased to share with you today our strategy for addressing this issue. This roadmap is a result of a comprehensive analysis of our capital allocation strategy. We have chosen a three-year aggressive yet balanced approach that we believe should enhance shareholder value by significantly reducing the pension overhang on NCR’s equity valuation, while preserving our strategic and financial flexibility.