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Tyco Reports Fourth Quarter 2012 Earnings From Continuing Operations Before Special Items Of $0.33 Per Share And GAAP Loss Of



 Tyco Reports Fourth Quarter 2012 Earnings From Continuing Operations Before
      Special Items Of $0.33 Per Share And GAAP Loss Of $1.36 Per Share

PR Newswire

SCHAFFHAUSEN, Switzerland, Nov. 14, 2012

SCHAFFHAUSEN, Switzerland, Nov. 14, 2012 /PRNewswire/ --

(Income and EPS amounts are attributable to Tyco common shareholders)

($ millions, except per-share amounts)

 
                            Q4 2012 Q4 2011* % Change FY 12   FY 11*  % Change
Revenue                     $2,728  $2,799   (2.5)%   $10,403 $10,557 (1)%
Segment Operating Income    $320    $340     (6)%     $1,183  $1,125  5%
Operating Income            $153    $221              $685    $982
Income from Continuing      $(629)  $174              $(332)  $617
Operations
Diluted EPS from Continuing $(1.36) $0.37             $(0.72) $1.29
Operations
Special Items               $(1.69) $(0.06)           $(2.07) $0.12
Segment Operating Income    $358    $353     1%       $1,324  $1,223  8%
Before Special Items
Income from Continuing Ops  $156    $203     (23)%    $635    $562    13%
Before Special Items
Diluted EPS from Continuing $0.33   $0.43    (23)%    $1.35   $1.17   15%
Ops Before Special Items

*Due to the timing of our fiscal year-end, the fourth quarter and full year
fiscal 2011 includes the impact of an additional week of revenue and related
operating results.

Tyco (NYSE: TYC) today reported GAAP diluted loss per share from continuing
operations for the fiscal fourth quarter of 2012 of $1.36 and diluted earnings
per share (EPS) from continuing operations before special items of $0.33.
Revenue in the quarter decreased 2.5% versus the prior year to $2.7 billion.
This included a 3% decline due to foreign currency, a 4% decline related to
the impact of the benefit of the 53^rd week in 2011, and a 4% benefit from
acquisitions. Organic revenue grew 1% in the quarter with 9% growth in
products, 2% growth in service and a 4% decline in installation revenue.

For the full year, the company reported GAAP diluted loss per share from
continuing operations of $0.72 and diluted earnings per share from continuing
operations before special items of $1.35. Revenue of $10.4 billion increased
2%, excluding the Electrical and Metals Products business which has been
reported as an equity investment following the sale of a majority interest in
that business completed on December 22, 2010. Organic revenue growth for the
year was 2% with 10% growth in products, 3% growth in service and a 2% decline
in installation.

The company previously disclosed on September 17, 2012 that it expected to
record additional reserves in the range of $40 to $60 million in the fourth
quarter of fiscal 2012 due to the aging of receivables relating to certain
security contracts in China that it had determined may not be collectible.
Following an investigation to determine the cause of the aging receivables,
the company has determined that revenue relating to these contracts in China
was improperly recorded. As a result, rather than recording the full impact in
the fiscal fourth quarter of 2012, the company has adjusted prior years to
eliminate revenue and operating income related to these contracts in its Rest
of World Systems Installation and Services segment. The cumulative effect
of adjustments related to China is to decrease revenue by $164 million and
decrease operating income by $51 million. The company does not expect to
record any further adjustments related to this matter.

The table below provides the revenue and operating income decrease for all
years impacted.

                                                           All Periods Prior
($millions)      Fiscal 2012         Fiscal 2011           to

                                                           Fiscal 2008-2010
                 Q4     Full Year    Q4       Full Year
Revenue          $    - $      (31)  $  (16)  $      (49)  $        (84)
Operating Income $  (9) $      (19)  $    (3) $      (14)  $        (18)

Income from continuing operations in the fourth quarter was negatively
impacted by special items totaling $785 million after tax or $1.69 per share.
Income for the full year was negatively impacted by special items totaling
$967 million after tax or $2.07 per share.

Special Items                          Q4       FY
Loss on Extinguishment of Debt         $0.98    $0.98
Tax Related Items                      $0.54    $0.61
Separation Costs                       $0.12    $0.14
Revaluation of Asbestos Liabilities    $      - $0.15
Net Restructuring and Impairment Costs $0.05    $0.15
Other Items                            $      - $0.04
Total Special Items per Share          $1.69    $2.07

Tyco Chief Executive Officer George Oliver said, "I am very excited about the
new Tyco.  As the world's largest pure play Fire & Security company, we have
the opportunity to leverage our global scale and broad portfolio of products
and services to deliver substantial shareholder value.  Our market-leading
position and breadth and depth of industry experience differentiates us from
our competitors and it is these strengths that make us a leader in the $100
billion global fire and security industry."

"Our full year and fourth quarter results highlight our ability to continue to
deliver margin expansion. Our performance this year along with a strong
balance sheet and continued investments in the businesses position us well to
achieve a 15% to 16% segment operating margin before special items in 2015,"
Oliver added.

Organic revenue, free cash flow, operating income, operating margin, and
diluted EPS from continuing operations before special items are non-GAAP
financial measures and are described below. For a reconciliation of these
non-GAAP measures, see the attached tables. Additional schedules as well as
fourth quarter review slides can be found at www.tyco.com on the Investor
Relations portion of Tyco's website.

SEGMENT RESULTS
In connection with the spin-off of ADT and Flow Control, Tyco has realigned
its businesses into the following segments: North America Systems Installation
& Services, Rest of World Systems Installation & Services, and Global
Products.

The financial results presented in the tables below are in accordance with
GAAP unless otherwise indicated. All dollar amounts are pre-tax and stated in
millions. All comparisons are to the fiscal fourth quarter or full year of
2011 unless otherwise indicated.

North America Systems Installation & Services

                               Q4 2012 Q4 2011 % Change FY 12  FY 11  % Change
Revenue                        $1,042  $1,095  (5)%     $3,962 $4,022 (1)%
Operating Income               $109    $128    (15)%    $374   $425   (12)%
Operating Margin               10.5%   11.7%            9.4%   10.6%
Special Items                  $(19)   $1               $(77)  $(7)
Operating Income Before        $128    $127    1%       $451   $432   4%
Special Items
Operating Margin Before        12.3%   11.6%            11.4%  10.7%
Special Items

Revenue of $1.0 billion decreased 5% in the quarter primarily driven by the
benefit of an additional week of revenue in the prior year.  Service revenue
was in-line with the prior year, while installation revenue declined 2%
organically for a net organic revenue decline of 1%. Backlog of $2.5 billion
increased 5% year-over-year and, due to normal seasonality, declined 1% on a
quarter sequential basis, excluding the impact of foreign currency.

Operating income for the quarter was $109 million and the operating margin was
10.5%. Special items of $19 million consisted primarily of restructuring
charges. Operating income before special items was $128 million and the
operating margin was 12.3%. The 70 basis point improvement in operating margin
before special items was driven by a higher mix of service revenue and
continued productivity benefits, partially offset by increased investments in
sales and marketing, and the benefit of the 53^rd week in the prior year.

Revenue for the full year was $4.0 billion decreasing 1% year-over-year on a
reported basis due to the benefit of the 53^rd week in the prior year.
Operating income was $374 million and included $77 million of special items.
Operating income before special items was $451 million and the operating
margin increased 70 basis points to 11.4%.

Rest of World Systems Installation & Services

                               Q4 2012 Q4 2011 % Change FY 12  FY 11  % Change
Revenue                        $1,128  $1,219  (7)%     $4,341 $4,434 (2)%
Operating Income               $123    $141    (13)%    $456   $405   13%
Operating Margin               10.9%   11.6%            10.5%  9.1%
Special Items                  $(12)   $(13)            $(49)  $(97)
Operating Income Before        $135    $154    (12)%    $505   $502   1%
Special Items
Operating Margin Before        12.0%   12.6%            11.6%  11.3%
Special Items

Revenue of $1.1 billion decreased 7% in the quarter including a 6% decline due
to foreign currency. Organic revenue declined 1% with 4% growth in service and
a 7% decline in installation. Backlog of $2.4 billion increased 8%
year-over-year and, due to normal seasonality, declined 3% on a quarter
sequential basis, excluding the impact of foreign currency.

Operating income for the quarter was $123 million and the operating margin was
10.9%. Operating income before special items was $135 million and the
operating margin was 12.0%. The benefit of higher margin service revenue was
more than offset by a 70 basis point decline due to adjustments recorded for
China and a 40 basis point decline related to the benefit of the 53rd week in
the prior year, for a year-over-year operating margin before special items
decline of 60 basis points.  

Revenue for the full year was $4.3 billion decreasing 2% year-over-year with
organic revenue growth of 2%. Operating income was $456 million and included
$49 million of special items. Operating income before special items was $505
million and the operating margin increased 30 basis points to 11.6%.

Global Products

                               Q4 2012 Q4 2011 % Change FY 12  FY 11  % Change
Revenue                        $558    $485    15%      $2,100 $1,754 20%
Operating Income               $88     $71     24%      $353   $295   20%
Operating Margin               15.8%   14.6%            16.8%  16.8%
Special Items                  $(7)    $(1)             $(15)  $6
Operating Income Before        $95     $72     32%      $368   $289   27%
Special Items
Operating Margin Before        17.0%   14.8%            17.5%  16.5%
Special Items

Revenue of $558 million increased 15% in the quarter including a 3% decline
due to foreign currency. Organic revenue grew 9% with 3% growth in fire
products, 24% growth in security products and 10% growth in life safety
products.

Operating income for the quarter was $88 million and the operating margin was
15.8%. Special items of $7 million consisted primarily of restructuring
charges. Operating income before special items was $95 million and the
operating margin was 17.0%. The 220 basis point improvement in operating
margin before special items was driven by increased volume as well as the
benefit of productivity and restructuring actions.

Revenue for the full year was $2.1 billion, increasing 20% year-over-year with
organic revenue growth of 10%. Operating income was $353 million and included
$15 million of special items. Operating income before special items was $368
million and the operating margin increased 100 basis points to 17.5%.

OTHER ITEMS

  o The company's fiscal 2011 consisted of 53 weeks compared to 52 weeks in
    fiscal 2012. The additional week contributed an estimated $104 million in
    revenue in the fourth quarter and full year of fiscal 2011. Organic
    revenue growth and orders growth have been adjusted to exclude the impact
    of the additional week in the prior year.
  o Corporate expense before special items was $103 million for the quarter
    and $331 million for the year.
  o The tax rate before special items was 28.4% for the quarter and 17.7% for
    the year.
  o The company completed the year with $844 million in cash and cash
    equivalents, including cash reserved for separation related payments and
    cash reserved for certain tax liabilities.
  o Cash flow from operating activities for the quarter was $225 million and
    free cash flow was $109 million, which included a cash outflow of $56
    million primarily related to separation and restructuring activities for
    adjusted free cash flow of $165 million.
  o The Company successfully completed the spin-offs of ADT and Flow Control
    as well as the merger of Flow Control with Pentair, Inc on September 28,
    2012.

ABOUT TYCO
Tyco (NYSE: TYC) is the world's largest pure-play fire protection and security
company. Tyco provides more than three million customers around the globe with
the latest fire protection and security products and services. A company with
$10+ billion in revenue, Tyco has more than 70,000 employees in more than
1,000 locations across 50 countries serving various end markets, including
commercial, institutional, governmental, retail, industrial, energy,
residential and small business. For more information, visit the new
www.tyco.com.

CONFERENCE CALL AND WEBCAST
Management will discuss the company's fourth quarter results for 2012 and
outlook for the first quarter and full year of fiscal year 2013 during a
conference call and webcast today beginning at 8:00 a.m. ET. Today's
conference call for investors can be accessed in the following ways: 

  o At Tyco's website: http://investors.tyco.com.
  o By telephone: For both "listen-only" participants and those participants
    who wish to take part in the question-and-answer portion of the call, the
    telephone dial-in number in the United States is (800) 857-9797. The
    telephone dial-in number for participants outside the United States is
    (517) 308-9262, passcode "Tyco".
  o An audio replay of the conference call will be available at 10:00 a.m.
    (ET) on November 14, 2012 and ending at 11:59 p.m. (ET) on November 21,
    2012. The replay dial-in number for participants in the United States is
    (866) 465-0332. For participants outside the United States, the replay
    dial-in number is (203) 369-1414, passcode 6578.
  o A webcast replay of the conference call will be available on the
    "Presentations & Webcasts" section of Tyco's website:
    http://investors.tyco.com.

NON-GAAP MEASURES
Organic revenue, free cash flow (outflow) (FCF), and income from continuing
operations, earnings per share (EPS) from continuing operations, operating
income, operating margin and corporate expense, in each case "before special
items," are non-GAAP measures and should not be considered replacements for
GAAP results.

Organic revenue is a useful measure used by the company to measure the
underlying results and trends in the business. The difference between reported
net revenue (the most comparable GAAP measure) and organic revenue (the
non-GAAP measure) consists of the impact from foreign currency, acquisitions
and divestitures, and other changes that do not reflect the underlying results
and trends (for example, the 53^rd week of operations in fiscal 2011).

The Company's organic growth / decline calculations incorporate an estimate of
prior year reported revenue associated with any acquired entities that have
been fully integrated within the first year, and exclude prior year revenues
associated with entities that do not meet the criteria for discontinued
operations which have been divested within the past year. The rate of organic
growth or decline is calculated based on the adjusted number to better reflect
the rate of growth or decline of the combined business, in the case of
acquisitions, or the remaining business, in the case of dispositions. The rate
of organic growth or decline for acquired businesses that are not fully
integrated within the first year are based on unadjusted historical revenue.
Organic revenue and the rate of organic growth or decline as presented herein
may not be comparable to similarly titled measures reported by other
companies.

Organic revenue is a useful measure of the company's performance because it
excludes items that: i) are not completely under management's control, such as
the impact of foreign currency exchange; or ii) do not reflect the underlying
results of the company's businesses, such as acquisitions and divestitures. It
may be used as a component of the company's compensation programs. The
limitation of this measure is that it excludes items that have an impact on
the company's revenue. This limitation is best addressed by using organic
revenue in combination with the GAAP numbers. See the accompanying tables to
this press release for the reconciliation presenting the components of organic
revenue.

FCF is a useful measure of the company's cash that is free from any
significant existing obligation. The difference between Cash Flows from
Operating Activities (the most comparable GAAP measure) and FCF (the non-GAAP
measure) consists mainly of significant cash flows that the company believes
are useful to identify. FCF permits management and investors to gain insight
into the number that management employs to measure cash that is free from any
significant existing obligation. It, or a measure that is based on it, may be
used as a component in the company's incentive compensation plans. The
difference reflects the impact from:

  o net capital expenditures,
  o dealer generated accounts and bulk accounts purchased,
  o cash paid for purchase accounting and holdback liabilities, and
  o voluntary pension contributions.

Capital expenditures and dealer generated and bulk accounts purchased are
subtracted because they represent long-term commitments. Cash paid for
purchase accounting and holdback liabilities is subtracted because these cash
outflows are not available for general corporate uses. Voluntary pension
contributions are added or subtracted because this activity is driven by
economic financing decisions rather than operating activity. In addition, from
time to time the company may present adjusted free cash flow, which is free
cash flow, adjusted to exclude the cash impact of the special items
highlighted below. This number provides information to investors regarding the
cash impact of certain items management believes are useful to identify, as
described below.

The limitation associated with using FCF is that it adjusts for cash items
that are ultimately within management's and the Board of Directors' discretion
to direct and therefore may imply that there is less or more cash that is
available for the company's programs than the most comparable GAAP measure.
This limitation is best addressed by using FCF in combination with the GAAP
cash flow numbers.

FCF as presented herein may not be comparable to similarly titled measures
reported by other companies. The measure should be used in conjunction with
other GAAP financial measures. Investors are urged to read the company's
financial statements as filed with the Securities and Exchange Commission, as
well as the accompanying tables to this press release that show all the
elements of the GAAP measures of Cash Flows from Operating Activities, Cash
Flows from Investing Activities, Cash Flows from Financing Activities and a
reconciliation of the company's total cash and cash equivalents for the
period. See the accompanying tables to this press release for a cash flow
statement presented in accordance with GAAP and a reconciliation presenting
the components of FCF and adjusted FCF.

The company has presented its income and EPS from continuing operations,
operating income and margin, and its corporate expense before special items.
Special items include charges and gains related to divestitures, acquisitions,
restructurings, impairments, certain changes to accounting methodologies,
legacy legal and tax charges and other income or charges that may mask the
underlying operating results and/or business trends of the company or business
segment, as applicable. The company utilizes these measures to assess overall
operating performance and segment level core operating performance, as well as
to provide insight to management in evaluating overall and segment operating
plan execution and underlying market conditions. The Company also presents its
effective tax rate as adjusted for special items for consistency. One or more
of these measures may be used as components in the company's incentive
compensation plans. These measures are useful for investors because they may
permit more meaningful comparisons of the company's underlying operating
results and business trends between periods. The difference between income and
EPS from continuing operations before special items and income and EPS from
continuing operations (the most comparable GAAP measures) consists of the
impact of the special items noted above on the applicable GAAP measure.
Operating income and margin before special items do not reflect any additional
adjustments that are not reflected in income from continuing operations before
special items. The limitation of these measures is that they exclude the
impact (which may be material) of items that increase or decrease the
company's reported operating income and margin and operating income and EPS
from continuing operations. This limitation is best addressed by using the
non-GAAP measures in combination with the most comparable GAAP measures in
order to better understand the amounts, character and impact of any increase
or decrease on reported results.

Tyco provides general corporate services to its segments and those costs are
reported in the "Corporate and Other" segment. This segment's operating income
(loss) is presented as "Corporate Expense." Segment Operating Income
represents Tyco's operating income excluding the Corporate and Other segment,
and reflects the results of Tyco's three operating segments.  Segment
Operating Income before special items reflects GAAP operating income adjusted
for the special items noted in the paragraph above.

FORWARD-LOOKING STATEMENTS
This press release contains a number of forward-looking statements. Words, and
variations of words, such as "expect", "intend", "will", "anticipate",
"believe", "propose", "potential", "continue", "opportunity", "estimate",
"project" and similar expressions are intended to identify forward-looking
statements. Examples of forward-looking statements include, but are not
limited to, revenue, operating income and other financial projections,
statements regarding the health and growth prospects of the industries and end
markets in which Tyco operates, the leadership, resources, potential,
priorities, and opportunities for Tyco in the future, statements regarding
Tyco's credit profile and capital allocation priorities, and statements
regarding Tyco's acquisition, divestiture, restructuring and capital market
related activities. The forward-looking statements in this press release are
based on current expectations and assumptions that are subject to risks and
uncertainties, many of which are outside of our control, and could cause
results to materially differ from expectations. Such risks and uncertainties
include, but are not limited to: economic, business, competitive,
technological or regulatory factors that adversely impact Tyco or the markets
and industries in which it competes; unanticipated expenses such as litigation
or legal settlement expenses; tax law changes; and industry specific events or
conditions that may adversely impact revenue or other financial projections.
Actual results could differ materially from anticipated results. Tyco is under
no obligation (and expressly disclaims any obligation) to update its
forward-looking statements. More detailed information about these and other
factors is set forth in Tyco's Annual Report on Form 10-K for the fiscal year
ended Sept. 30, 2011 and in subsequent filings with the Securities and
Exchange Commission.

 

TYCO INTERNATIONAL LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)
(Unaudited)
                           Quarters Ended             Twelve Months Ended
                           September     September    September    September
                           28,           30,          28,          30,
                           2012          2011         2012         2011
Revenue from product       $             $            $            $          
sales                             1,557                                 
                                          1,579        5,845        5,990
Service revenue            1,171         1,220        4,558        4,567
                           $             $            $            $          
    Net revenue                   2,728                    10,403       10,557
                                          2,799
Cost of product sales      876           904          3,298        3,542
Cost of services           852           886          3,328        3,348
Selling, general and       749           773          2,903        2,834
administrative expenses
Separation                 61            -            71           -
Restructuring, asset
impairment and             37            15           118          (149)
divestiture charges
(gains), net
   Operating income        153           221          685          982
Interest income            5             7            19           27
Interest expense           (33)          (59)         (209)        (240)
Other (expense) income,    (453)         5            (454)        (5)
net
(Loss) income from
continuing operations      (328)         174          41           764
before income taxes
Income tax (expense)       (294)         13           (348)        (134)
benefit
Equity (loss) income in
earnings of                (7)           (12)         (26)         (12)
unconsolidated
subsidiaries
   (Loss) income from      (629)         175          (333)        618
continuing operations
Income from discontinued
operations, net of         210           223          804          1,102
income taxes
   Net (loss) income       (419)         398          471          1,720
Less: noncontrolling
interest in subsidiaries   -             1            (1)          1
net income
   Net (loss) income       $             $            $            $          
attributable to Tyco                                                    
common shareholders        (419)         397          472           1,719
Amounts attributable to
Tyco common
shareholders:
(Loss) income from         $             $            $            $          
continuing operations                                                       
                           (629)         174          (332)        617
Income from discontinued   210           223          804          1,102
operations
Net (loss) income          $             $            $            $          
attributable to Tyco                                                    
common shareholders        (419)         397          472           1,719
Basic earnings per share
attributable to Tyco
common shareholders:
(Loss) income from         $             $            $            $          
continuing operations                                                     
                            (1.36)        0.37         (0.72)       1.30
Income from discontinued   0.45          0.48         1.74         2.33
operations
Net (loss) income          $             $            $            $          
attributable to Tyco                                                      
common shareholders         (0.91)        0.85         1.02         3.63
Diluted earnings per
share attributable to
Tyco common
shareholders:
(Loss) income from         $             $            $            $          
continuing operations                                                     
                            (1.36)        0.37         (0.72)       1.29
Income from discontinued   0.45          0.47         1.74         2.30
operations
Net (loss) income          $             $            $            $          
attributable to Tyco                                                      
common shareholders         (0.91)        0.84         1.02         3.59
Weighted-average number
of shares outstanding:
  Basic                    462           466          463          474
  Diluted                  462           471          463          479
NOTE: These financial statements should be read in conjunction with the
Consolidated Financial Statements and accompanying notes contained in the
Company's Annual Report on Form 10-K for the fiscal year ended September 30,
2011 and Quarterly Report on Form 10-Q for the quarterly period ended June 29,
2012.

 

TYCO INTERNATIONAL LTD.
RESULTS OF SEGMENTS 
(in millions)
(Unaudited)
              Quarters Ended                   Twelve Months Ended
              September       September        September       September
              28,             30,              28,             30,
              2012            2011             2012            2011
NET REVENUE
NA            $               $                $               $        
Installation                                       3,962           4,022
& Services     1,042           1,095
ROW
Installation  1,128           1,219            4,341           4,434
& Services
Global        558             485              2,100           1,754
Products
Corporate and -               -                -               347
Other 
   Total Net  $               $                $               $        
Revenue                                          10,403          10,557
               2,728           2,799
OPERATING
INCOME AND
MARGIN
NA            $               $                $               $        
Installation            10.5%           11.7%            9.4%            10.6%
& Services    109             128               374             425
ROW
Installation  123       10.9% 141       11.6%  456       10.5% 405       9.1%
& Services
Global        88        15.8% 71        14.6%  353       16.8% 295       16.8%
Products
Corporate and (167)     N/M   (119)     N/M    (498)     N/M   (143)     N/M
Other 
    Operating $               $                $               $        
Income and              5.6%            7.9%             6.6%            9.3%
Margin        153             221               685             982

 

                       TYCO INTERNATIONAL LTD.
                       CONSOLIDATED BALANCE SHEETS
                       (in millions)
                       (Unaudited)
                                            September 28,      September 30,
                                            2012               2011
 Assets
     Cash and cash equivalents              $844               $1,229
     Accounts receivable, net               1,711              1,547
     Inventories                            634                539
     Prepaid expenses and other current     850                666
 assets
     Deferred income taxes                  295                301
     Assets of discontinued operations      -                  13,960
       Total current assets                 4,334              18,242
 Property, plant and equipment, net         1,670              1,609
 Goodwill                                   4,377              4,238
 Intangible assets, net                     780                745
 Other assets                               1,204              1,868
       Total Assets                         $12,365            $26,702
 Liabilities and Equity
     Loans payable and current              $10                $1
 maturities of long-term debt
     Accounts payable                       897                782
     Accrued and other current              1,788              1,794
 liabilities
     Deferred revenue                       402                377
     Liabilities of discontinued            -                  2,702
 operations
       Total current liabilities            3,097              5,656
 Long-term debt                             1,481              4,105
 Deferredrevenue                            424                443
 Other liabilities                          2,341              2,251
       Total Liabilities                    7,343              12,455
 Redeemable noncontrolling interest         12                 -
 Redeemable noncontrolling interest of      -                  93
 discontinued operations
 Total Tyco shareholders' equity            4,994              14,149
 Nonredeemable noncontrolling interest      16                 5
       Total Equity                         5,010              14,154
       Total Liabilities, Redeemable        $12,365            $26,702
 Noncontrolling Interest and Equity
 Note: These financial statements should be read in conjunction with the
 Consolidated Financial Statements and accompanying notes contained in the
 Company's Annual Report on Form 10-K for the fiscal year ended September 30,
 2011 and Form 10-Q for the quarterly period ended June 29, 2012.

 

TYCO INTERNATIONAL LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
(Unaudited)
                                  For the Quarters Ended  For the Years Ended
                                  September    September  September  September
                                  28,          30,        28,        30,
                                  2012         2011       2012       2011
Cash Flows From Operating
Activities:
Net (loss) income attributable to ($419)       $397       $472       $1,719
Tyco common shareholders
  Noncontrolling interest in      -            1          (1)        1
  subsidiaries net income
  Income from discontinued        (210)        (223)      (804)      (1,102)
  operations, net of income taxes
(Loss) income from continuing     (629)        175        (333)      618
operations
Adjustments to reconcile net cash
provided by operating activities:
  Depreciation and amortization   105          112        418        421
  Non-cash compensation expense   48           20         113        89
  Deferred income taxes           433          (55)       373        (10)
  Provision for losses on
  accounts receivable and         17           8          55         32
  inventory
  Loss (gain) on divestitures     2            3          14         (224)
  Loss on the retirement of debt  453          -          453        -
  Other non-cash items            12           27         97         83
  Changes in assets and
  liabilities, net of the effects
  of acquisitions and
  divestitures:
      Accounts receivable, net    (62)         64         (128)      (47)
      Contracts in Process        8            (13)       (46)       (39)
      Inventories                 2            41         (72)       (42)
      Prepaid expenses and other  51           18         (86)       16
      current assets
      Accounts payable            36           61         59         (33)
      Accrued and other           (31)         (92)       (80)       (216)
      liabilities
      Income taxes, net           (172)        25         (172)      23
      Deferred Revenue            (24)         (5)        (1)        (24)
      Other                       (24)         (42)       37         14
           Net cash provided by   225          347        701        661
           operating activities
           Net cash provided by
           discontinued operating 531          469        1,885      1,767
           activities
Cash Flows From Investing
Activities:
Capital expenditures              (110)        (112)      (406)      (371)
Proceeds from disposal of assets  4            2          8          6
Acquisition of businesses, net of -            (132)      (217)      (353)
cash acquired
Acquisition of dealer generated
customer accounts and bulk        (10)         (8)        (28)       (33)
account purchases
Divestiture of businesses, net of -            (2)        (5)        709
cash divested
Other                             -            (16)       66         (19)
           Net cash used in       (116)        (268)      (582)      (61)
           investing activities
           Net cash used in
           discontinued investing (311)        (542)      (1,204)    (1,005)
           activities
Cash Flows From Financing
Activities:
Proceeds from issuance of         785          644        2,008      805
short-term debt
Repayment of short-term debt      (785)        (684)      (2,009)    (1,337)
Proceeds from issuance of         19           -          19         497
long-term debt
Repayment of long-term debt       (3,040)      -          (3,040)    (1)
Proceeds from exercise of share   86           12         226        124
options
Dividends paid                    (115)        (116)      (461)      (458)
Repurchase of common shares by    -            -          (500)      (1,300)
treasury
Transfer from discontinued        2,852        (170)      3,274      726
operations
Other                             (3)          (3)        (25)       6
           Net cash used in       (201)        (317)      (508)      (938)
           financing activities
           Net cash provided by
           (used in) discontinued 174          105        (251)      (793)
           financing activities
Effect of currency translation on 14           (22)       4          (4)
cash
Effect of currency translation on
cash related to discontinued      5            (11)       4          (2)
operations.
Net increase (decrease) in cash   321          (239)      49         (375)
and cash equivalents
Net (increase) decrease in cash
and cash equivalents related to   (399)        (21)       (434)      33
discontinued operations
Decrease in cash and cash
equivalents from deconsolidation  -            -          -          (10)
of variable interest entity
Cash and cash equivalents at      922          1,489      1,229      1,581
beginning of period
Cash and cash equivalents at end  $844         $1,229     $844       $1,229
of period
Reconciliation to "Free Cash
Flow":
Net cash provided by operating    $225         $347       $701       $661
activities
Capital expenditures, net         (106)        (110)      (398)      (365)
Acquisition of dealer generated
customer accounts and bulk        (10)         (8)        (28)       (33)
account purchases
Purchase accounting and holdback  -            (11)       (2)        (10)
liabilities
Voluntary pension contributions   -            -          -          12
Free Cash Flow                    $109         $218       $273       $265
Reconciliation to "Adjusted Free
Cash Flow":
Free Cash Flow                    $109         $218       $273       $265
Cash restructuring costs          24           22         89         90
Cash acquisition/integration      1            -          3          -
costs
Cash (receipt) payment from       6            126        19         126
Covidien/TE Connectivity
Legal legacy settlements          -            -          -          (1)
Separation costs                  17           -          18         -
Separation costs-capital          8            -          12         -
expenditures
Adjusted Free Cash Flow           $165         $366       $414       $480
NOTE: Free cash flow is a non-GAAP measure.  See description of non-GAAP
measures contained in this release.

 

Tyco International Ltd.
Organic Growth Reconciliation - Revenue
(in millions)
(Unaudited)
                        Quarter Ended September 28, 2012
                        Base Year
                        Adjustments
             Net
             Revenue                    Adjusted                                                         Net Revenue for
             for the    (Divestitures)  2011      Foreign                                   Organic      the Quarter
             Quarter    /               Base      Currency      Acquisitions  Other (3)     Revenue (1)  Ended
             Ended      Other (4)       Revenue                                                          September 28,
             September                                                                                   2012
             30, 2011
NA           $          $                         $             $             $             $            $      
Installation                   0.0%     $                -0.2%         0.1%          -3.8%        -0.9%          -4.8%
& Services                -              1,095                     1           (42)                       1,042
               1,095                               (2)                                       (10)
ROW
Installation 1,219      (12)   -1.0%    1,207     (68)   -5.6%  33     2.7%   (34)   -2.8%  (10)  -0.8%  1,128   -7.5%
& Services
Global       485        4      0.8%     489       (13)   -2.7%  68     14.0%  (28)   -5.8%  42    8.6%   558     15.1%
Products
             $          $                         $             $             $             $            $      
Total Net                      -0.3%    $                -3.0%         3.6%          -3.7%        0.8%           -2.5%
Revenue                 (8)              2,791                   102           (104)                      2,728
               2,799                               (83)                                      22
                        Twelve Months Ended September 28, 2012
                        Base Year
                        Adjustments
             Net                                                                                         Net Revenue for
             Revenue                    Adjusted                                                         the
             for the
                        (Divestitures)  2011      Foreign                                   Organic      Twelve Months
             Twelve     /               Base      Currency      Acquisitions  Other (3)     Revenue      Ended
             Months     Other (4)                                                           (1) 
             Ended                      Revenue                                                          September 28,
             September                                                                                   2012
             30, 2011
NA           $          $                         $             $             $             $            $      
Installation                   0.0%     $                -0.2%         0.1%          -1.0%        -0.3%          -1.5%
& Services                -              4,022                     4           (42)                       3,962
               4,022                               (10)                                      (12)
ROW
Installation 4,434      (67)   -1.5%    4,367     (178)  -4.0%  105    2.4%   (34)   -0.8%  81    1.9%   4,341   -2.1%
& Services
Global       1,754      13     0.7%     1,767     (38)   -2.2%  221    12.6%  (28)   -1.6%  178   10.1%  2,100   19.7%
Products
Total before $          $                         $             $             $             $            $      
Corporate                      -0.5%    $                -2.2%         3.2%          -1.0%        2.4%           1.9%
and Other               (54)             10,156    (226)         330           (104)                      10,403
             10,210                                                                          247
Corporate
and Other    347        (347)  -100.0%  -         -      0.0%   -      0.0%   -      0.0%   -     0.0%   -       -100.0%
(2)
             $          $                         $             $             $             $            $      
Total Net                      -3.8%    $                -2.1%         3.1%          -1.0%        2.4%           -1.5%
Revenue                 (401)            10,156    (226)         330           (104)                      10,403
             10,557                                                                          247
(1)          Organic revenue growth percentage based on adjusted 2011 base
             revenue.
(2)          Corporate and Other includes the former Electrical and Metal Products business which
             was divested during Q1 2011.   
(3)          Amounts represent the impact of the 53rd week of revenue for each segment during fiscal 2011 at
             fiscal 2012 foreign exchange rates.
(4)          Amounts include the transfer of certain business from ROW Installation and
             Services to Global Products.  

 

 Earnings Per Share Summary
 (Unaudited)
                                    Quarter   Year Ended  Quarter   Year Ended
                                    Ended                 Ended
                                    Sept. 28, Sept. 28,   Sept. 30, Sept. 30,
                                    2012      2012        2011      2011
 Diluted EPS from Continuing
 Operations Attributable to Tyco    ($1.36)   ($0.72)     $0.37     $1.29
 Shareholders (GAAP)
 expense / (benefit)
 Restructuring, net                 0.05      0.11        0.01      0.11
 Restructuring charges in cost of   -         -           -         0.01
 sales and SG&A
 Separation costs included in SG&A  -         -           -         -
 (Gains) / losses on divestitures,  -         0.03        (0.03)    (0.33)
 net
 Acquisition / integration costs    -         0.01        -         0.01
 Asset impairment charges           -         0.04        -         -
 Change in valuation methodology    -         0.15        -         -
 for asbestos
 Note receivable write-off          -         -           -         0.01
 Legacy legal items                 -         0.07        0.06      0.04
 Former management ERISA reversal   -         (0.07)      -         -
 Separation costs                   0.12      0.14        -         -
 Tax items                          0.54      0.61        0.02      0.03
 Loss on extinguishment of debt     0.98      0.98        -         -
 Total Before Special Items         $0.33     $1.35       $0.43     $1.17

 

Tyco
International
Ltd.
For the Quarter Ended
September 28, 2012
(in millions,
except per
share data)
(Unaudited)
expense /
(benefit)
Segments
                NA                   ROW                  Global           Segment           Corporate          Total
                Installation         Installation
                & Service            & Service            Products         Revenue           and Other          Revenue
Revenue (GAAP)  $1,042               $1,128               $558             $2,728                               $2,728
                                                                                                                                                                                      (Loss)       Diluted
                                                                                                                                                                                      income
                                                                                                                                                                                      from         EPS from
                Operating Income                                                                                                                                                      Continuing   Continuing
                                                                                                                                                                                      Operations   Operations
                                                                           Segment                              Total                                                Equity (loss)    Attributable Attributable
                                                                                                                                                                     in earnings
                NA                   ROW                  Global           Operating         Corporate          Operating         Interest    Other       Income     of               to Tyco      to Tyco 
                Installation         Installation                                                                                                                    unconsolidated
                & Service    Margin  & Service    Margin  Products Margin  Income    Margin  and Other  Margin  Income    Margin  (Expense),  (Expense),  Tax        subsidiary       Shareholders Shareholders
                                                                                                                                  net         net         (Expense)
Operating       $109         10.5%   $123         10.9%   $88      15.8%   $320      11.7%   ($167)     N/M     $153      5.6%    ($28)       ($453)      ($294)     ($7)             ($629)       ($1.36)
Income (GAAP)
Restructuring,  17                   8                    4                29                6                  35                                        (13)                        22           0.05
net
Separation
costs included  2                                                          2                                    2                                                                     2            -
in SG&A
(Gains) /
losses on                            3                                     3                 (1)                2                                                                     2            -
divestitures,
net
Acquisition /
integration                                               2                2                                    2                                         (1)                         1            -
costs
Change in
valuation                                                                                    3                  3                                         (2)                         1            -
methodology
for asbestos
Legacy legal                                                                                 (3)                (3)                                       1                           (2)          -
items
Former
management                                                                                                                                                1                           1            -
ERISA reversal
Separation                           1                    1                2                 59                 61                                        (5)                         56           0.12
costs
Tax items                                                                                                                                                 249                         249          0.54
Loss on
extinguishment                                                                                                                                453                                     453          0.98
of debt
Total Before    $128         12.3%   $135         12.0%   $95      17.0%   $358      13.1%   ($103)     N/M     $255      9.3%    ($28)                   ($64)      ($7)             $156         $0.33
Special Items 
                                                                                                                                               Diluted Shares Outstanding                          462
                                                                                                                                               Diluted Shares Outstanding - Before Special Items   470

 

Tyco
International
Ltd.
For the Year
Ended September
28, 2012
(in millions,
except per
share data)
(Unaudited)
expense /
(benefit)
Segments
                NA                   ROW                  Global           Segment           Corporate          Total
                Installation         Installation
                & Service            & Service            Products         Revenue           and Other          Revenue
Revenue (GAAP)  $3,962               $4,341               $2,100           $10,403                              $10,403
                                                                                                                                                                                                     (Loss)       Diluted
                                                                                                                                                                                                     income
                                                                                                                                                                                                     from         EPS from
                Operating Income                                                                                                                                                                     Continuing   Continuing
                                                                                                                                                                                                     Operations   Operations
                                                                           Segment                              Total                                                Equity (loss)   Noncontrolling  Attributable Attributable
                                                                                                                                                                     in earnings
                NA                   ROW                  Global           Operating         Corporate          Operating         Interest    Other       Income     of              Interest        to Tyco      to Tyco 
                Installation         Installation                                                                                                                    unconsolidated
                & Service    Margin  & Service    Margin  Products Margin  Income    Margin  and Other  Margin  Income    Margin  (Expense),  (Expense),  Tax        subsidiary      (Expense)       Shareholders Shareholders
                                                                                                                                  net         net         (Expense)
Operating       $374         9.4%    $456         10.5%   $353     16.8%   $1,183    11.4%   ($498)     N/M     $685      6.6%    ($190)      ($454)      ($348)     ($26)           $1              ($332)       ($0.72)
Income (GAAP)
Restructuring,  25                   34                   7                66                13                 79                                        (26)                                       53           0.11
net
Separation
costs included  2                                                          2                 1                  3                                         (1)                                        2            -
in SG&A
(Gains) /
losses on                            7                                     7                 7                  14                                        (1)                                        13           0.03
divestitures,
net
Acquisition /
integration     1                    4                    4                9                                    9                                         (3)                                        6            0.01
costs
Asset
impairment      20                   2                    3                25                                   25                                        (8)                                        17           0.04
charges
Change in
valuation                                                                                    111                111                                       (43)                                       68           0.15
methodology
for asbestos
Legacy legal    29                                                         29                17                 46                                        (11)                                       35           0.07
items
Former
management                                                                                   (50)               (50)                                      19                                         (31)         (0.07)
ERISA reversal
Separation                           2                    1                3                 68                 71                                        (5)                                        66           0.14
costs
Tax items                                                                                                                                                 285                                        285          0.61
Loss on
extinguishment                                                                                                                                453                                                    453          0.98
of debt
Total Before    $451         11.4%   $505         11.6%   $368     17.5%   $1,324    12.7%   ($331)     N/M     $993      9.5%    ($190)      ($1)        ($142)     ($26)           $1              $635         $1.35
Special Items 
                                                                                                                                               Diluted Shares Outstanding                                         463
                                                                                                                                               Diluted Shares Outstanding - Before Special Items                  469

 

Tyco
International
Ltd.
For the Quarter Ended
September 30, 2011
(in millions,
except per
share data)
(Unaudited)
expense /
(benefit)
Segments
                NA                   ROW                  Global           Segment           Corporate          Total
                Installation         Installation
                & Service            & Service            Products         Revenue           and Other          Revenue
Revenue (GAAP)  $1,095               $1,219               $485             $2,799                               $2,799
                                                                                                                                                                                                Income       Diluted
                                                                                                                                                                                                from         EPS from
                Operating Income                                                                                                                                                                Continuing   Continuing
                                                                                                                                                                                                Operations   Operations
                                                                           Segment                              Total                                           Equity (loss)   Noncontrolling  Attributable Attributable
                                                                                                                                                                in earnings
                NA                   ROW                  Global           Operating         Corporate          Operating         Interest    Other    Income   of              Interest        to Tyco      to Tyco 
                Installation         Installation                                                                                                               unconsolidated
                & Service    Margin  & Service    Margin  Products Margin  Income    Margin  and Other  Margin  Income    Margin  (Expense),  Income,  Tax      subsidiaries    (Expense)       Shareholders Shareholders
                                                                                                                                  net         net      Benefit
Operating       $128         11.7%   $141         11.6%   $71      14.6%   $340      12.1%   ($119)     N/M     $221      7.9%    ($52)       $5       $13      ($12)           ($1)            $174         $0.37
Income (GAAP)
Restructuring,  (1)                  8                                     7                 3                  10                                     (2)                                      8            0.01
net
Restructuring
charges in                           1                                     1                                    1                                                                               1            -
cost of sales
and SG&A
(Gains) /
losses on                            3                                     3                 2                  5                                      (21)                                     (16)         (0.03)
divestitures,
net
Acquisition /
integration                          1                    1                2                                    2                                      (1)                                      1            -
costs
Legacy legal                                                                                 26                 26                                                                              26           0.06
items
Tax items                                                                                                       -                                      9                                        9            0.02
Total Before    $127         11.6%   $154         12.6%   $72      14.8%   $353      12.6%   ($88)      N/M     $265      9.5%    ($52)       $5       ($2)     ($12)           ($1)            $203         $0.43
Special Items 
                                                                                                                                               Diluted Shares Outstanding                                    471
                                                                                                                                               Diluted Shares Outstanding - Before Special                   471
                                                                                                                                              Items 

 

Tyco
International
Ltd.
For the Year
Ended September
30, 2011
(in millions,
except per
share data)
(Unaudited)
expense /
(benefit)
Segments
                NA                   ROW                  Global           Segment           Corporate          Total
                Installation         Installation
                & Service            & Service            Products         Revenue           and Other          Revenue
Revenue (GAAP)  $4,022               $4,434               $1,754           $10,210           $347               $10,557
                                                                                                                                                                                                     Income       Diluted
                                                                                                                                                                                                     from         EPS from
                Operating Income                                                                                                                                                                     Continuing   Continuing
                                                                                                                                                                                                     Operations   Operations
                                                                           Segment                              Total                                                Equity (loss)   Noncontrolling  Attributable Attributable
                                                                                                                                                                     in earnings
                NA                   ROW                  Global           Operating         Corporate          Operating         Interest    Other       Income     of              Interest        to Tyco      to Tyco 
                Installation         Installation                                                                                                                    unconsolidated
                & Service    Margin  & Service    Margin  Products Margin  Income    Margin  and Other  Margin  Income    Margin  (Expense),  (Expense),  Tax        subsidiaries    (Expense)       Shareholders Shareholders
                                                                                                                                  net         net         (Expense)
Operating       $425         10.6%   $405         9.1%    $295     16.8%   $1,125    11.0%   ($143)     N/M     $982      9.3%    ($213)      ($5)        ($134)     ($12)           ($1)            $617         $1.29
Income (GAAP)
Restructuring,  7                    61                   (7)              61                14                 75                                        (21)                                       54           0.11
net
Restructuring
charges in                           3                                     3                                    3                                                                                    3            0.01
cost of sales
and SG&A
(Gains) /
losses on                            29                                    29                (253)              (224)                                     66                                         (158)        (0.33)
divestitures,
net
Note
receivable                                                                                   5                  5                                                                                    5            0.01
write-off
Acquisition /
integration                          4                    1                5                                    5                                         (2)                                        3            0.01
costs
Legacy legal                                                                                 20                 20                                                                                   20           0.04
items
Tax items                                                                                                                                                 18                                         18           0.03
Total Before    $432         10.7%   $502         11.3%   $289     16.5%   $1,223    12.0%   ($357)     N/M     $866      8.2%    ($213)      ($5)        ($73)      ($12)           ($1)            $562         $1.17
Special Items 
                                                                                                                                               Diluted Shares Outstanding                                         479
                                                                                                                                               Diluted Shares Outstanding - Before Special Items                  479

 

 

SOURCE Tyco

Website: http://www.tyco.com
Contact: Investor Relations Contacts: Antonella Franzen, +1-609-720-4665,
Afranzen@tyco.com or Joe Longo, +1-609-720-4545, jlongo@tyco.com; Media
Contacts: Ira Gottlieb, +1-609-610-1999, igottlieb@tycoint.com or Brett
Ludwig, +1-609-216-3255, bludwig@tyco.com
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