CSC’s divestments of businesses that do not meet the new operating model or do not perform well have been listed from CSC’s press releases. You can see details below.
These show that five business units have been sold or divested since new management took over. One unit, CSC Italy has no financial information in the press release.
The other four were sold for a total of $1,338.5mln cash.
The reported revenue associated with these businesses is $1,510mln.
Questions for the next earnings call on 6th August:-
Are there any other divestments planed?
How will the impact of the reduced revenues be reported?
Were these sort of figures reported at previous earnings calls?
What is the additional impact on cost, revenue and profit before tax of the large-scale head count reductions in other business areas?
News Release -- May 29, 2013
FALLS CHURCH, Va., May 29 – CSC has reached a definitive agreement with PAE for the sale of its base operations, aviation and range services business unit, Applied Technology Division (ATD), for $175 million in cash. CSC acquired ATD with the 2003 purchase of DynCorp.
This agreement, CSC’s sixth divestiture in seven months, furthers CSC’s transformation strategy to rebalance its portfolio of services by focusing on its core strength in next-generation technology solutions and services.
News Release -- February 20, 2013
FALLS CHURCH, Va., Feb. 20 – CSC has reached a definitive agreement with a consortium comprising ITOCHU Techno-Solutions Corporation (“CTC”) and ITOCHU Corporation for the sale of CSC’s Enterprise Systems Integration (ESI) unit, a reseller of enterprise hardware and software and a provider of maintenance services with operations in Malaysia and Singapore, for $90 million in cash.
…….In fiscal 2012, ESI’s revenue was approximately $180 million with mid-single digit operating margins. ESI’s results will be recast as discontinued operations. ESI’s results had been previously reported within CSC’s Business Solutions & Services sector.
The transaction is expected to close in March 2013.
News Release -- December 12, 2012
FALLS CHURCH, Va., Dec. 12 – CSC (NYSE: CSC) has reached a definitive agreement with Adcorp, South Africa’s largest employment services company, for the sale of Paxus, its Australian IT staffing unit. This agreement, CSC’s third divestiture in seven weeks, advances CSC’s transformation strategy to rebalance its portfolio of services. The total value of this all-cash transaction is expected to be $73.5 million.
In fiscal 2012, revenue from Paxus was approximately $340 million with low single-digit operating margins. Paxus’s results will be recast as discontinued operations in future periods. Paxus’s results had been previously reported within CSC’s Business Solutions and Services segment.
The companies expect to close the transaction by the end of January 2013.
News Release -- December 03, 2012
Transaction Expected to Close by End of December 2012
Management to Host Conference Call to Discuss Transaction
FALLS CHURCH, Va., Dec. 3 – As part of its transformation initiative to rebalance its portfolio of services and focus on next-generation technology solutions and services, CSC (NYSE: CSC) has reached a definitive agreement with Equifax for the sale of its credit services unit for $1 billion in cash. The after-tax proceeds from the sale of the business will be approximately $750 - $800 million based on preliminary plans. CSC intends to use $300 - $400 million to repurchase shares, contribute $300 - $400 million to its pension plans and apply the remainder to general corporate purposes.
…. “This transaction advances CSC’s turnaround by reshaping our portfolio and enabling the company to focus on next-generation technology solutions and services,” said Mike Lawrie, president and CEO, CSC. “Upon closing, we will receive $1 billion in cash and we intend to redeploy these funds for share repurchases and to fund our pension plan, which will be value accretive.”
For this current fiscal year CSC’s Credit Services business is tracking to approximately $230 million in revenue, $100 million in operating income and $0.40 of earnings per share. The credit services business results have been previously reported in CSC’s Business Solutions and Services segment.
News Release -- October 25, 2012
FALLS CHURCH, Va., Oct. 25 – As part of its ongoing service portfolio optimization, CSC (NYSE: CSC) has entered into an agreement with Dedagroup, an Italian IT services company, for the sale of the consulting and systems integration services part of its business in Italy. Financial terms were not disclosed.
After the transaction reaches final agreement, CSC will retain a presence in Italy and continue to provide a select portfolio of services, including cloud, financial services, infrastructure, business process outsourcing and healthcare offerings, to multinational companies. CSC will also retain corporate financial services products, solutions and services for CSC's international accounts.