Attached files
| file | filename |
|---|---|
| 8-K - Q3-2015 FORM 8-K - HP INC | q3form8-k_82015.htm |
| EX-99.1 - Q3-2015 EXHIBIT 99.1 - HP INC | q3exhibit99-1_82015.htm |
EXHIBIT 99.2
 |
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(Unaudited)
(In millions, except per share amounts)
|
|
Three months ended
|
||||||||||||
|
July 31,
2015
|
April 30,
2015
|
July 31,
2014
|
||||||||||
|
Net revenue
|
$
|
25,349
|
$
|
25,453
|
$
|
27,585
|
||||||
|
Costs and expenses:
|
||||||||||||
|
Cost of sales
|
19,317
|
19,345
|
20,974
|
|||||||||
|
Research and development
|
893
|
850
|
887
|
|||||||||
|
Selling, general and administrative
|
2,962
|
3,063
|
3,388
|
|||||||||
|
Amortization of intangible assets
|
242
|
221
|
227
|
|||||||||
|
Restructuring charges
|
25
|
255
|
649
|
|||||||||
|
Acquisition-related charges
|
47
|
19
|
2
|
|||||||||
|
Separation costs
|
401
|
269
|
-
|
|||||||||
|
Defined benefit plan settlement charges
|
114
|
-
|
-
|
|||||||||
|
Impairment of data center assets
|
136
|
-
|
-
|
|||||||||
|
Total costs and expenses
|
24,137
|
24,022
|
26,127
|
|||||||||
|
Earnings from operations
|
1,212
|
1,431
|
1,458
|
|||||||||
|
Interest and other, net
|
(108
|
)
|
(139
|
)
|
(145
|
)
|
||||||
|
Earnings before taxes
|
1,104
|
1,292
|
1,313
|
|||||||||
|
Provision for taxes
|
(250
|
)
|
(281
|
)
|
(328
|
)
|
||||||
|
Net earnings
|
$
|
854
|
$
|
1,011
|
$
|
985
|
||||||
|
Net earnings per share:
|
||||||||||||
|
Basic
|
$
|
0.47
|
$
|
0.56
|
$
|
0.53
|
||||||
|
Diluted
|
$
|
0.47
|
$
|
0.55
|
$
|
0.52
|
||||||
|
Cash dividends declared per share
|
$
|
0.35
|
$
|
-
|
$
|
0.32
|
||||||
|
Weighted-average shares used to compute net earnings per share:
|
||||||||||||
|
Basic
|
1,805
|
1,814
|
1,870
|
|||||||||
|
Diluted
|
1,828
|
1,836
|
1,899
|
|||||||||
Page 1 of 5
|
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(Unaudited)
(In millions, except per share amounts)
|
|
Nine months ended July 31
|
||||||||
|
2015
|
2014
|
|||||||
|
Net revenue
|
$
|
77,641
|
$
|
83,048
|
||||
|
Costs and expenses:
|
||||||||
|
Cost of sales
|
59,233
|
63,414
|
||||||
|
Research and development
|
2,568
|
2,571
|
||||||
|
Selling, general and administrative
|
9,096
|
9,989
|
||||||
|
Amortization of intangible assets
|
685
|
774
|
||||||
|
Restructuring charges
|
426
|
1,015
|
||||||
|
Acquisition-related charges
|
70
|
8
|
||||||
|
Separation costs
|
750
|
-
|
||||||
|
Defined benefit plan settlement charges
|
114
|
-
|
||||||
|
Impairment of data center assets
|
136
|
-
|
||||||
|
Total costs and expenses
|
73,078
|
77,771
|
||||||
|
Earnings from operations
|
4,563
|
5,277
|
||||||
|
Interest and other, net
|
(421
|
)
|
(482
|
)
|
||||
|
Earnings before taxes
|
4,142
|
4,795
|
||||||
|
Provision for taxes
|
(911
|
)
|
(1,112
|
)
|
||||
|
Net earnings
|
$
|
3,231
|
$
|
3,683
|
||||
|
Net earnings per share:
|
||||||||
|
Basic
|
$
|
1.78
|
$
|
1.95
|
||||
|
Diluted
|
$
|
1.75
|
$
|
1.93
|
||||
|
Cash dividends declared per share
|
$
|
0.67
|
$
|
0.61
|
||||
|
Weighted-average shares used to compute net earnings per share:
|
||||||||
|
Basic
|
1,817
|
1,889
|
||||||
|
Diluted
|
1,842
|
1,913
|
||||||
Page 2 of 5
|
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(In millions)
|
|
As of
|
||||||||
|
July 31, 2015
|
October 31, 2014
|
|||||||
|
(Unaudited)
|
||||||||
|
ASSETS
|
||||||||
|
Current assets:
|
||||||||
| Cash and cash equivalents |
$
|
17,171
|
$
|
15,133
|
||||
|
Accounts receivable
|
12,753
|
13,832
|
||||||
|
Financing receivables
|
2,804
|
2,946
|
||||||
|
Inventory
|
6,700
|
6,415
|
||||||
|
Other current assets
|
12,570
|
11,819
|
||||||
|
Total current assets
|
51,998
|
50,145
|
||||||
|
Property, plant and equipment
|
11,028
|
11,340
|
||||||
|
Long-term financing receivables and other assets
|
8,733
|
8,454
|
||||||
|
Goodwill and intangible assets
|
35,274
|
33,267
|
||||||
|
Total assets
|
$
|
107,033
|
$
|
103,206
|
||||
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
|
Current liabilities:
|
||||||||
|
Notes payable and short-term borrowings
|
$
|
11,034
|
$
|
3,486
|
||||
|
Accounts payable
|
15,549
|
15,903
|
||||||
|
Employee compensation and benefits
|
3,348
|
4,209
|
||||||
|
Taxes on earnings
|
629
|
1,017
|
||||||
|
Deferred revenue
|
6,277
|
6,143
|
||||||
|
Other accrued liabilities
|
12,196
|
12,977
|
||||||
|
Total current liabilities
|
49,033
|
43,735
|
||||||
|
Long-term debt
|
14,468
|
16,039
|
||||||
|
Other liabilities
|
16,089
|
16,305
|
||||||
|
Stockholders' equity:
|
||||||||
|
HP stockholders' equity
|
27,035
|
26,731
|
||||||
|
Non-controlling interests
|
408
|
396
|
||||||
|
Total stockholders' equity
|
27,443
|
27,127
|
||||||
|
Total liabilities and stockholders' equity
|
$
|
107,033
|
$
|
103,206
|
||||
Page 3 of 5
|
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
SEGMENT INFORMATION
(Unaudited)
(In millions)
|
|
Three months ended
|
||||||||||||
|
July 31,
2015
|
April 30,
2015
|
July 31,
2014
|
||||||||||
|
Net revenue:(a)
|
||||||||||||
|
Personal Systems
|
$
|
7,491
|
$
|
7,740
|
$
|
8,649
|
||||||
|
Printing
|
5,108
|
5,453
|
5,590
|
|||||||||
|
Total Printing and Personal Systems Group
|
12,599
|
13,193
|
14,239
|
|||||||||
|
Enterprise Group
|
7,007
|
6,561
|
6,872
|
|||||||||
|
Enterprise Services
|
4,976
|
4,817
|
5,590
|
|||||||||
|
Software
|
900
|
892
|
959
|
|||||||||
|
HP Financial Services
|
806
|
805
|
855
|
|||||||||
|
Corporate Investments
|
4
|
2
|
3
|
|||||||||
|
Total segments
|
26,292
|
26,270
|
28,518
|
|||||||||
|
Elimination of intersegment net revenue and other
|
(943
|
)
|
(817
|
)
|
(933
|
)
|
||||||
|
Total HP consolidated net revenue
|
$
|
25,349
|
$
|
25,453
|
$
|
27,585
|
||||||
|
Earnings before taxes:(a)
|
||||||||||||
|
Personal Systems
|
$
|
222
|
$
|
235
|
$
|
346
|
||||||
|
Printing
|
910
|
996
|
1,026
|
|||||||||
|
Total Printing and Personal Systems Group
|
1,132
|
1,231
|
1,372
|
|||||||||
|
Enterprise Group
|
912
|
950
|
963
|
|||||||||
|
Enterprise Services
|
297
|
194
|
231
|
|||||||||
|
Software
|
185
|
160
|
203
|
|||||||||
|
HP Financial Services
|
87
|
85
|
79
|
|||||||||
|
Corporate Investments
|
(148
|
)
|
(144
|
)
|
(115
|
)
|
||||||
|
Total segment earnings from operations
|
2,465
|
2,476
|
2,733
|
|||||||||
|
Corporate and unallocated costs and eliminations
|
(129
|
)
|
(152
|
)
|
(265
|
)
|
||||||
|
Stock-based compensation expense
|
(159
|
)
|
(129
|
)
|
(132
|
)
|
||||||
|
Amortization of intangible assets
|
(242
|
)
|
(221
|
)
|
(227
|
)
|
||||||
|
Restructuring charges
|
(25
|
)
|
(255
|
)
|
(649
|
)
|
||||||
|
Acquisition-related charges(b)
|
(47
|
)
|
(19
|
)
|
(2
|
)
|
||||||
|
Separation costs
|
(401
|
)
|
(269
|
)
|
-
|
|||||||
|
Defined benefit plan settlement charges
|
(114
|
)
|
-
|
-
|
||||||||
|
Impairment of data center assets
|
(136
|
)
|
-
|
-
|
||||||||
|
Interest and other, net
|
(108
|
)
|
(139
|
)
|
(145
|
)
|
||||||
|
Total HP consolidated earnings before taxes
|
$
|
1,104
|
$
|
1,292
|
$
|
1,313
|
||||||
|
(a)
|
Effective at the beginning of its first quarter of fiscal 2015, HP implemented an organizational change to align its segment financial reporting more closely with its current business structure. This organizational change resulted in the transfer of third party multi-vendor support arrangements from the Technology Services business unit within the Enterprise Group segment to the Infrastructure Technology Outsourcing business unit within the Enterprise Services segment. HP reflected this change to its segment information in prior reporting periods on an as-if basis, which resulted in the removal of intersegment revenue from the Technology Services business unit within the Enterprise Group segment and the related corporate intersegment revenue eliminations, and the transfer of operating profit from the Technology Services business unit within the Enterprise Group segment to the Infrastructure Technology Outsourcing business unit within the Enterprise Services segment. This change had no impact on HP’s previously reported consolidated net revenue, earnings from operations, net earnings or net earnings per share.
|
| (b) | Acquisition-related charges in the current period include non-cash inventory fair value adjustment charges, as well as professional service and legal fees associated with the acquisition of Aruba Networks, Inc. |
Page 4 of 5
|
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
SEGMENT INFORMATION
(Unaudited)
(In millions)
|
|
Nine months ended July 31
|
||||||||
|
2015
|
2014
|
|||||||
|
Net revenue:(a)
|
||||||||
|
Personal Systems
|
$
|
23,775
|
$
|
25,355
|
||||
|
Printing
|
16,104
|
17,239
|
||||||
|
Total Printing and Personal Systems Group
|
39,879
|
42,594
|
||||||
|
Enterprise Group
|
20,549
|
20,475
|
||||||
|
Enterprise Services
|
14,786
|
16,887
|
||||||
|
Software
|
2,663
|
2,846
|
||||||
|
HP Financial Services
|
2,414
|
2,592
|
||||||
|
Corporate Investments
|
22
|
297
|
||||||
|
Total segments
|
80,313
|
85,691
|
||||||
|
Elimination of intersegment net revenue and other
|
(2,672
|
)
|
(2,643
|
)
|
||||
|
Total HP consolidated net revenue
|
$
|
77,641
|
$
|
83,048
|
||||
|
Earnings before taxes:(a)
|
||||||||
|
Personal Systems
|
$
|
770
|
$
|
915
|
||||
|
Printing
|
2,973
|
3,145
|
||||||
|
Total Printing and Personal Systems Group
|
3,743
|
4,060
|
||||||
|
Enterprise Group
|
2,952
|
2,923
|
||||||
|
Enterprise Services
|
639
|
439
|
||||||
|
Software
|
502
|
534
|
||||||
|
HP Financial Services
|
262
|
279
|
||||||
|
Corporate Investments
|
(416
|
)
|
(92
|
)
|
||||
|
Total segment earnings from operations
|
7,682
|
8,143
|
||||||
|
Corporate and unallocated costs and eliminations
|
(463
|
)
|
(637
|
)
|
||||
|
Stock-based compensation expense
|
(475
|
)
|
(432
|
)
|
||||
|
Amortization of intangible assets
|
(685
|
)
|
(774
|
)
|
||||
| Restructuring charges |
(426
|
) |
(1,015
|
) | ||||
|
Acquisition-related charges(b)
|
(70
|
)
|
(8
|
)
|
||||
|
Separation costs
|
(750
|
)
|
-
|
|||||
|
Defined benefit plan settlement charges
|
(114
|
)
|
-
|
|||||
|
Impairment of data center assets
|
(136
|
)
|
-
|
|||||
|
Interest and other, net
|
(421
|
)
|
(482
|
)
|
||||
|
Total HP consolidated earnings before taxes
|
$
|
4,142
|
$
|
4,795
|
||||
|
(a)
|
Effective at the beginning of its first quarter of fiscal 2015, HP implemented an organizational change to align its segment financial reporting more closely with its current business structure. This organizational change resulted in the transfer of third party multi-vendor support arrangements from the Technology Services business unit within the Enterprise Group segment to the Infrastructure Technology Outsourcing business unit within the Enterprise Services segment. HP reflected this change to its segment information in prior reporting periods on an as-if basis, which resulted in the removal of intersegment revenue from the Technology Services business unit within the Enterprise Group segment and the related corporate intersegment revenue eliminations, and the transfer of operating profit from the Technology Services business unit within the Enterprise Group segment to the Infrastructure Technology Outsourcing business unit within the Enterprise Services segment. This change had no impact on HP’s previously reported consolidated net revenue, earnings from operations, net earnings or net earnings per share.
|
| (b) | Acquisition-related charges in the current period include non-cash inventory fair value adjustment charges, as well as professional service and legal fees associated with the acquisition of Aruba Networks, Inc. |
Page 5 of 5