SCIENCE

DAYTON, OH -- NCR Corporation (NYSE: NCR) today announced its results for the second quarter ended June 30, 2001. Revenue increased 4 percent from the year-ago quarter to $1.50 billion; on a constant currency basis, revenue increased 8 percent. The company reported net income of $35 million, or $0.35 per diluted share for the second quarter, including integration expenses related to the October 2000 acquisition of 4Front Technologies, Inc. Excluding these expenses, net income and earnings per diluted share were $37 million and $0.37 respectively. Significant Items: Data Warehousing revenue growth of 2 percent was less than anticipated primarily due to a 50 percent decrease in purchases by U.S. telecommunications and retail companies. However, outside of these two market segments, Data Warehousing revenue grew 40 percent, and overall the business saw a 60 percent increase in the number of new customers over the prior-year quarter. Retail Store Automation operational improvement was driven by 8 percent revenue growth, revenues from new products and a heightened focus on operational efficiency. Financial Self Service achieved revenue growth of 8 percent -- 13 percent on a constant currency basis -- with broad-based geographic growth, particularly in the Americas. Operating margin improved 1.2 points to 15.7 percent. Within Worldwide Customer Services, maintenance revenues increased 6 percent. Overall revenue growth was generated across all regions on a constant currency basis, with the Americas up 2 percent, Europe/Middle East/Africa up 20 percent, and Asia/Pacific (including Japan) up 9 percent. Excluding expenses added as a result of acquisitions, NCR's core expense ratio improved 1.4 points, representing $21 million of year-over-year expense productivity. Other segments were impacted by: 1) revenue from exited businesses declining at a higher rate than anticipated and, 2) revenue and cost challenges in High Availability services, primarily caused by weakness in the telecommunications industry. Operating cash flow improved sequentially, as well as versus last year. Commenting on the company's second-quarter performance, NCR Chairman and CEO Lars Nyberg said, "The key drivers of growth in our Retail Store Automation and Financial Self Service businesses -- new products and broad-based global opportunities, respectively -- were clearly evidenced in the second quarter. Our Teradata Data Warehousing business, despite the deferrals of telecommunications and retail customer upgrades, still posted the second-highest revenue quarter in its history due to solid growth from other industries. Further, the strong growth in new customers illustrates the 'must-have' nature of this technology as well as the overall attractiveness of the Teradata business model." "Although the economic environment has deteriorated, each of our core solutions remains well positioned, and we believe NCR can achieve revenue growth and operating income improvement for the year," concluded Nyberg. For further information visit www.ncr.com