Exhibit 99.1
FOR IMMEDIATE RELEASE
Contacts: | | News Media | | Investor Relations |
| | Paul Fitzhenry | | Ed Arditte |
| | 609-720-4261 | | 609-720-4621 |
| | | | Karen Chin |
| | | | 609-720-4398 |
TYCO INTERNATIONAL REPORTS FIRST QUARTER EARNINGS
FROM CONTINUING OPERATIONS OF $0.73 PER SHARE BEFORE SPECIAL
ITEMS AND GAAP EARNINGS OF $0.74 PER SHARE
($ millions, except per-share amounts)
| | Q1 2008 | | Q1 2007 | | % Change | |
Revenue | | $ | 4,870 | | $ | 4,365 | | 12 | % |
Income from Continuing Operations | | $ | 369 | | $ | 163 | | 126 | % |
Diluted EPS from Continuing Operations | | $ | 0.74 | | $ | 0.32 | | 131 | % |
Special Items Per Share After Tax | | $ | 0.01 | | $ | (0.17 | ) | — | |
Income from Continuing Operations Before Special Items | | $ | 361 | | $ | 249 | | 45 | % |
Diluted EPS from Continuing Operations Before Special Items | | $ | 0.73 | | $ | 0.49 | | 49 | % |
| · | Revenue increases 12% with organic revenue growth of 6% |
| · | Company achieves operating margin of 10.2% and operating margin before special items of 10.7% |
| · | Guidance for Diluted EPS from continuing operations before special items for full year 2008 increased to a range of $2.60 to $2.70 |
| · | Company has repurchased 13.3 million shares for $531 million under existing $1 billion share repurchase program |
PEMBROKE, Bermuda — February 5, 2008 — Tyco International Ltd. (NYSE: TYC; BSX: TYC) today reported $0.74 in diluted GAAP earnings per share (EPS) from continuing operations and diluted EPS from continuing operations of $0.73 before special items for the fiscal first quarter of 2008. Diluted GAAP EPS from continuing operations was positively impacted by special items which totaled $0.01 per share. Diluted EPS from continuing operations before special items
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increased 49% in the quarter. Revenue in the quarter increased 12% versus the prior year to $4.9 billion, with organic revenue growth of 6%.
The company’s operating margin in the quarter was 10.2% and the operating margin before special items was 10.7% driven by higher revenue and better productivity. The GAAP tax rate for the quarter was 24.8% and was adversely impacted by 1.3 percentage points due to special items.
Special items increased EPS by $0.01 per share in the quarter and consisted of the following: $0.08 per share of income for separation-related items, partially offset by charges of $0.03 per share for restructuring activities and $0.04 per share for certain tax items.
On January 23, the company raised its full year guidance for fiscal 2008 diluted EPS from continuing operations before special items from $2.50 - $2.65 to $2.60 - $2.70. Management will discuss the company’s outlook for the fiscal second quarter during a conference call and webcast today beginning at 8:30 a.m. EST.
“Our first quarter results exceeded our previous guidance with improved operating performance in each of our businesses,” said Tyco Chairman and Chief Executive Officer Ed Breen. “This performance, combined with the progress we are making on our key initiatives, puts us on track for a solid year in 2008.”
Organic revenue growth, free cash flow, operating income before special items, operating margin before special items, income from continuing operations before special items and EPS from continuing operations before special items are all non-GAAP financial measures and are described below. For a reconciliation of these non-GAAP measures, see the attached tables. Additional schedules can be found at www.tyco.com on the Investor Relations portion of Tyco’s Website.
SEGMENT RESULTS
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 first quarter of 2007 unless otherwise indicated.
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ADT Worldwide
| | Q1 2008 | | Q1 2007 | | % Change | |
Revenue | | $ | 1,999 | | $ | 1,863 | | 7 | % |
Operating Income | | $ | 249 | | $ | 201 | | 24 | % |
Operating Margin | | 12.5 | % | 10.8 | % | — | |
Special Items | | $ | (7 | ) | $ | (31 | ) | — | |
Operating Income Before Special Items | | $ | 256 | | $ | 232 | | 10 | % |
Operating Margin Before Special Items | | 12.8 | % | 12.5 | % | — | |
Revenue increased 7% in the quarter with organic revenue growth of 3.4% led by double digit growth in Asia and Latin America. North America grew 2% organically and the Europe, Middle East and Africa region grew 1% organically.
Operating income was $249 million in the quarter and the operating margin was 12.5%. Special items in the quarter consisted of $7 million of restructuring charges incurred primarily in Europe. Operating income before special items increased 10% to $256 million and included expenses of $24 million to convert certain North American customers to digital services in advance of the analog-to-digital transition for wireless phone services. The operating margin before special items improved to 12.8%.
Flow Control
| | Q1 2008 | | Q1 2007 | | % Change | |
Revenue | | $ | 1,074 | | $ | 835 | | 29 | % |
Operating Income | | $ | 171 | | $ | 108 | | 58 | % |
Operating Margin | | 15.9 | % | 12.9 | % | — | |
Special Items | | $ | (2 | ) | $ | (5 | ) | — | |
Operating Income Before Special Items | | $ | 173 | | $ | 113 | | 53 | % |
Operating Margin Before Special Items | | 16.1 | % | 13.5 | % | — | |
Revenue in Flow Control increased 29% in the quarter with organic revenue growth of 17.7% driven by strong double digit growth across industrial valves, water and thermal controls. Revenue growth continues to benefit from strong demand in key end markets – particularly energy and water.
Operating income was $171 million and the operating margin was 15.9%. Special items in the quarter consisted of $2 million of restructuring charges. Operating income before special items
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increased 53% to $173 million. The increase in operating income and the operating margin was due to higher revenue and improved productivity.
Fire Protection Services
| | Q1 2008 | | Q1 2007 | | % Change | |
Revenue | | $ | 832 | | $ | 791 | | 5 | % |
Operating Income | | $ | 72 | | $ | 59 | | 22 | % |
Operating Margin | | 8.7 | % | 7.5 | % | — | |
Special Items | | — | | — | | — | |
Operating Income Before Special Items | | $ | 72 | | $ | 59 | | 22 | % |
Operating Margin Before Special Items | | 8.7 | % | 7.5 | % | — | |
Revenue in the Fire Protection Services segment increased 5% driven by foreign exchange. Organic revenue growth in the North American SimplexGrinnell business was 3.6% while the international fire businesses declined 5% organically primarily due to the planned exit of certain non-core international businesses.
Operating income increased 22% to $72 million and the operating margin increased 120 basis points to 8.7% led primarily by North America with a modest improvement in the international fire businesses.
Electrical and Metal Products
| | Q1 2008 | | Q1 2007 | | % Change | |
Revenue | | $ | 487 | | $ | 443 | | 10 | % |
Operating Income | | $ | 41 | | $ | 41 | | 0 | % |
Operating Margin | | 8.4 | % | 9.3 | % | — | |
Special Items | | $ | (4 | ) | — | | — | |
Operating Income Before Special Items | | $ | 45 | | $ | 41 | | 10 | % |
Operating Margin Before Special Items | | 9.2 | % | 9.3 | % | — | |
Revenue in Electrical and Metal Products increased 10% in the quarter with better volume and pricing for steel tubular products partially offset by lower copper spreads. Organic revenue growth was 7.4%.
Operating income was $41 million and included $4 million of restructuring charges. Operating income before special items of $45 million improved primarily due to higher volume.
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Safety Products
| | Q1 2008 | | Q1 2007 | | % Change | |
Revenue | | $ | 447 | | $ | 406 | | 10 | % |
Operating Income | | $ | 86 | | $ | 71 | | 21 | % |
Operating Margin | | 19.2 | % | 17.5 | % | — | |
Special Items | | $ | (1 | ) | $ | (7 | ) | — | |
Operating Income Before Special Items | | $ | 87 | | $ | 78 | | 12 | % |
Operating Margin Before Special Items | | 19.5 | % | 19.2 | % | — | |
Revenue in the Safety Products segment increased 10% in the quarter with organic revenue growth of 4.7% driven by the fire suppression and electronic security businesses.
Operating income was $86 million and the operating margin was 19.2%. Operating income before special items was $87 million and the operating margin before special items was 19.5%. All three lines of business – fire suppression, electronic security and life safety – contributed to the increase in operating income before special items, primarily led by higher volume in fire suppression.
OTHER ITEMS
· Net cash used in operating activities was $152 million in the quarter. The company had a free cash outflow of $407 million, which included $53 million of payments for separation and restructuring activities.
· Corporate expenses were $126 million and included $10 million of separation expense. Revenue in Corporate and Other was $31 million and operating income from business operations was $6 million.
· Other income includes $50 million of income related to the Tax Sharing Agreement entered into as part of the separation and recorded in connection with the adoption of FASB Interpretation No. 48.
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ABOUT TYCO INTERNATIONAL
Tyco International (NYSE: TYC) is a diversified, global company that provides vital products and services to customers in more than 60 countries. Tyco is a leading provider of security products and services, fire protection and detection products and services, valves and controls, and other industrial products. Tyco had 2007 revenue of more than $18 billion and has 118,000 employees worldwide. More information on Tyco can be found at www.tyco.com.
CONFERENCE CALL AND WEBCAST
Today’s conference call for investors can be accessed in the following ways:
| · | At Tyco’s website: http://investors.tyco.com. |
| · | 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) 230-1085. The telephone dial-in number for participants outside the United States is (612) 332-0107. |
| · | An audio replay of the conference call will be available beginning at 10:30 a.m. on February 5, 2008 and ending on February 12, 2008. The dial-in number for participants in the United States is (800) 475-6701. For participants outside the United States, the replay dial-in number is (320) 365-3844. The replay access code for all callers is 904017. |
NON-GAAP MEASURES
“Organic revenue growth,” “free cash flow (outflow)” (FCF), “income from continuing operations before special items”, “operating income before special items”, “operating margin before special items” , and “earnings per share (EPS) from continuing operations before special items” are non-GAAP measures and should not be considered replacements for GAAP results.
Organic revenue growth is a useful measure used by the company to measure the underlying results and trends in the business. The difference between reported net revenue growth (the most comparable GAAP measure) and organic revenue growth (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, revenue reclassifications and changes to the fiscal year). Organic revenue growth 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 growth of the company, such as acquisition and divestiture activity. It may be used as a component of the
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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 growth in combination with the GAAP numbers. See the accompanying tables to this press release for the reconciliation presenting the components of organic revenue growth.
FCF is a useful measure of the company’s cash which 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 outflows 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 may also be a significant component in the company’s incentive compensation plans. The difference reflects the impact from:
| · | the sale of accounts receivable programs, |
| · | net capital expenditures, |
| · | acquisition of customer accounts (ADT dealer program), |
| · | cash paid for purchase accounting and holdback liabilities, and |
| · | voluntary pension contributions. |
The impact from the sale of accounts receivable programs and voluntary pension contributions is added or subtracted from the GAAP measure because this activity is driven by economic financing decisions rather than operating activity. Capital expenditures and the ADT dealer program are subtracted because they represent long-term commitments. Cash paid for purchase accounting and holdback liabilities is subtracted from Cash Flow from Operating Activities because these cash outflows are not available for general corporate uses.
The limitation associated with using FCF is that it subtracts cash items that are ultimately within management’s and the Board of Directors’ discretion to direct and that 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.
The company has presented income from continuing operations before special items, operating income and margin before special items and EPS from continuing operations before special items, and forecast its EPS from continuing operations before special items. Special Items include charges and gains related to divestitures, acquisitions, restructurings (including transaction costs related to the separations of Tyco Electronics and Covidien into separate public companies), 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 income from continuing operations, EPS and operating income and margin before special items to assess overall operating performance, segment level core operating performance and to provide insight to management in evaluating overall and segment operating
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plan execution and underlying market conditions. There may also be significant components in the company’s incentive compensation plans. Operating income, operating margin, income from continuing operations before special items and EPS before special items are useful measures for investors because they permit more meaningful comparisons of the company’s underlying operating results and business trends between periods. EPS before special items does not reflect any additional adjustments that are not reflected in income from continuing operations before special items. The difference between income from continuing operations before special items and operating income and margin before special items versus income from continuing operations, operating income and operating margin (the most comparable GAAP measures) consists of the impact of charges and gains related to divestitures, acquisitions, restructurings (including transaction costs related to the separations of Tyco Electronics and Covidien into separate public companies), and other income or charges that may mask the underlying operating results and/or business trends. 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 income from continuing operations, EPS and operating income and margin. This limitation is best addressed by using income from continuing operations before special items and operating income and margin before special items 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.
The company presents its EPS forecast before special items to give investors a perspective on the underlying business results. Because the company often cannot predict the amount and timing of unusual or special items and associated charges or gains that may be recorded in the company’s financial statements, it does not present forecasts that include the impact of those items. See the accompanying tables to this press release for the reconciliation presenting the components of operating income before special items.
FORWARD-LOOKING STATEMENTS
This release may contain certain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and are subject to risks, uncertainty and changes in circumstances, which may cause actual results, performance or achievements to differ materially from anticipated results, performance or achievements. All statements contained herein that are not clearly historical in nature are forward-looking and the words “anticipate,” “believe,” “expect,” “estimate,” “plan,” and similar expressions are generally intended to identify forward-looking statements. The forward-looking statements in this release include statements addressing future financial condition and operating results. Economic, business, competitive and/or regulatory factors affecting Tyco’s businesses are examples of factors, among others, that could cause actual results to differ materially from those described in the forward-looking statements. Tyco is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise. 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 September 28, 2007.
# # #
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TYCO INTERNATIONAL LTD.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in millions, except per share data)
(Unaudited)
| | Quarter Ended | |
| | December 28, | | December 29, | |
| | 2007 | | 2006 | |
Net revenue | | $ | 4,870 | | $ | 4,365 | |
Cost of sales | | 3,177 | | 2,871 | |
Selling, general and administrative expenses | | 1,174 | | 1,157 | |
Separation costs | | 9 | | 25 | |
Restructuring and asset impairment charges, net | | 11 | | 56 | |
Operating income | | 499 | | 256 | |
Interest income | | 58 | | 14 | |
Interest expense | | (117 | ) | (66 | ) |
Other income, net | | 52 | | 1 | |
Income from continuing operations before income taxes and minority interest | | 492 | | 205 | |
Income taxes | | (122 | ) | (41 | ) |
Minority interest | | (1 | ) | (1 | ) |
Income from continuing operations | | 369 | | 163 | |
(Loss) income from discontinued operations, net of income taxes | | (6 | ) | 630 | |
Net income | | $ | 363 | | $ | 793 | |
| | | | | |
Basic earnings per common share: | | | | | |
Income from continuing operations | | $ | 0.75 | | $ | 0.33 | |
(Loss) income from discontinued operations | | (0.01 | ) | 1.27 | |
Net income | | $ | 0.74 | | $ | 1.60 | |
Diluted earnings per common share: | | | | | |
Income from continuing operations | | $ | 0.74 | | $ | 0.32 | |
(Loss) income from discontinued operations | | (0.01 | ) | 1.25 | |
Net income | | $ | 0.73 | | $ | 1.57 | |
| | | | | |
Weighted-average number of shares outstanding: | | | | | |
Basic | | 493 | | 496 | |
Diluted | | 497 | | 509 | |
| | | | | |
Income Reconciliation for Diluted EPS: | | | | | |
Income from continuing operations | | $ | 369 | | $ | 163 | |
Add back of interest expense for convertible debt | | — | | 2 | |
Income from continuing operations, giving effect to dilutive adjustments | | 369 | | 165 | |
(Loss) income from discontinued operations | | (6 | ) | 630 | |
Add back of interest expense for convertible debt | | — | | 3 | |
Net income, giving effect to dilutive adjustments | | $ | 363 | | $ | 798 | |
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��28, 2007. |
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TYCO INTERNATIONAL LTD.
RESULTS OF SEGMENTS
(in millions)
(Unaudited)
| | Quarter Ended | | | |
| | December 28, | | | | December 29, | | | |
| | 2007 | | | | 2006 | | | |
NET REVENUE | | | | | | | | | |
ADT Worldwide | | $ | 1,999 | | | | $ | 1,863 | | | |
Flow Control | | 1,074 | | | | 835 | | | |
Fire Protection Services | | 832 | | | | 791 | | | |
Electrical and Metal Products | | 487 | | | | 443 | | | |
Safety Products | | 447 | | | | 406 | | | |
Corporate and Other (1) | | 31 | | | | 27 | | | |
Total Net Revenue | | $ | 4,870 | | | | $ | 4,365 | | | |
| | | | | | | | | |
OPERATING INCOME AND MARGIN | | | | | | | | | |
ADT Worldwide | | $ | 249 | | 12.5 | % | $ | 201 | | 10.8 | % |
Flow Control | | 171 | | 15.9 | % | 108 | | 12.9 | % |
Fire Protection Services | | 72 | | 8.7 | % | 59 | | 7.5 | % |
Electrical and Metal Products | | 41 | | 8.4 | % | 41 | | 9.3 | % |
Safety Products | | 86 | | 19.2 | % | 71 | | 17.5 | % |
Corporate and Other (2) | | (120 | ) | N/M | | (224 | ) | N/M | |
Operating Income and Margin | | $ | 499 | | 10.2 | % | $ | 256 | | 5.9 | % |
(1) Revenue related to certain international building products businesses. |
|
(2) Includes operating income of $6 million and $7 million for the three months ended December 28, 2007 and December 29, 2006, respectively, primarily related to certain international building products businesses. |
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TYCO INTERNATIONAL LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions)
(Unaudited)
| | December 28, | | September 28, | |
| | 2007 | | 2007 | |
Current Assets: | | | | | |
Cash and cash equivalents | | $ | 1,069 | | $ | 1,894 | |
Accounts receivable, net | | 3,040 | | 2,961 | |
Inventories | | 1,953 | | 1,826 | |
Class action settlement escrow | | 3,011 | | 2,992 | |
Other current assets | | 1,711 | | 1,634 | |
Assets of discontinued operations | | 1,007 | | 1,044 | |
Total current assets | | 11,791 | | 12,351 | |
| | | | | |
Property, plant and equipment, net | | 3,573 | | 3,551 | |
Goodwill | | 11,736 | | 11,691 | |
Intangible assets, net | | 2,695 | | 2,697 | |
Other assets | | 2,675 | | 2,525 | |
Total Assets | | $ | 32,470 | | $ | 32,815 | |
| | | | | |
Current Liabilities: | | | | | |
Short-term debt and current maturities of long-term debt | | $ | 693 | | $ | 380 | |
Accounts payable | | 1,553 | | 1,682 | |
Class action settlement liability | | 3,011 | | 2,992 | |
Accrued and other current liabilities | | 3,071 | | 3,493 | |
Liabilities of discontinued operations | | 554 | | 560 | |
Total current liabilities | | 8,882 | | 9,107 | |
| | | | | |
Long-term debt | | 3,777 | | 4,076 | |
Other liabilities | | 4,013 | | 3,941 | |
Total Liabilities | | 16,672 | | 17,124 | |
| | | | | |
Minority interest | | 70 | | 67 | |
| | | | | |
Shareholders’ equity | | 15,728 | | 15,624 | |
| | | | | |
Total Liabilities and Shareholders’ Equity | | $ | 32,470 | | $ | 32,815 | |
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 28, 2007. |
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TYCO INTERNATIONAL LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
(Unaudited)
| | Quarter Ended | |
| | December 28, | | December 29, | |
| | 2007 | | 2006 | |
Cash Flows from Operating Activities: | | | | | |
Net income | | $ | 363 | | $ | 793 | |
Loss (income) from discontinued operations | | 6 | | (630 | ) |
| | | | | |
Income from continuing operations | | 369 | | 163 | |
Adjustments to reconcile net cash provided by operating activities: | | | | | |
Depreciation and amortization | | 276 | | 296 | |
Non-cash compensation expense | | 35 | | 45 | |
Deferred income taxes | | (61 | ) | (7 | ) |
Provision for losses on accounts receivable and inventory | | 30 | | 24 | |
Other non-cash items | | 13 | | 4 | |
Changes in assets and liabilities, net of the effects of acquisitions and divestitures: | | | | | |
Accounts receivable, net | | (73 | ) | 22 | |
Inventories | | (117 | ) | (207 | ) |
Other current assets | | (53 | ) | 115 | |
Accounts payable | | (143 | ) | (56 | ) |
Accrued and other liabilities | | (382 | ) | (210 | ) |
Other | | (46 | ) | (59 | ) |
Net cash (used in) provided by operating activities | | (152 | ) | 130 | |
Net cash (used in) provided by discontinued operating activities | | (25 | ) | 697 | |
| | | | | |
Cash Flows from Investing Activities: | | | | | |
Capital expenditures | | (176 | ) | (143 | ) |
Proceeds from disposal of assets | | 7 | | 6 | |
Acquisition of businesses, net of cash acquired | | (22 | ) | (16 | ) |
Acquisition of customer accounts (ADT dealer program) | | (90 | ) | (97 | ) |
Other | | (4 | ) | 82 | |
Net cash used in investing activities | | (285 | ) | (168 | ) |
Net cash used in discontinued investing activities | | (19 | ) | (267 | ) |
| | | | | |
Cash Flows from Financing Activities: | | | | | |
Net repayments of debt | | 8 | | (2 | ) |
Proceeds from exercise of share options | | 13 | | 120 | |
Dividends paid | | (74 | ) | (199 | ) |
Repurchase of common shares by subsidiary | | (229 | ) | (660 | ) |
Transfers (to) from discontinued operations | | (43 | ) | 390 | |
Other | | (70 | ) | 7 | |
Net cash used in financing activities | | (395 | ) | (344 | ) |
Net cash provided by (used in) discontinued financing activities | | 44 | | (396 | ) |
| | | | | |
Effect of currency translation on cash | | 7 | | 16 | |
Effect of currency translation on cash of discontinued operations | | — | | 10 | |
Net decrease in cash and cash equivalents | | (825 | ) | (322 | ) |
Less: net increase in cash related to discontinued operations | | — | | (44 | ) |
Cash and cash equivalents at beginning of period | | 1,894 | | 2,187 | |
| | | | | |
Cash and cash equivalents at end of period | | $ | 1,069 | | $ | 1,821 | |
| | | | | |
Reconciliation to “Free Cash Flow”: | | | | | |
Net cash (used in) provided by operating activities | | $ | (152 | ) | $ | 130 | |
Decrease in sale of accounts receivable | | 5 | | 2 | |
Capital expenditures, net | | (169 | ) | (137 | ) |
Acquisition of customer accounts (ADT dealer program) | | (90 | ) | (97 | ) |
Purchase accounting and holdback liabilities | | (1 | ) | (2 | ) |
Voluntary pension contributions | | — | | 18 | |
Free Cash Flow | | $ | (407 | ) | $ | (86 | ) |
NOTE: Free cash flow is a non-GAAP measure. See description of non-GAAP measures contained in this release. |
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TYCO INTERNATIONAL LTD.
ORGANIC REVENUE GROWTH RECONCILIATION
(in millions)
(Unaudited)
| | Quarter Ended December 28, 2007 | | Net Revenue for the | |
| | Net Revenue | | Foreign Currency | | Other | | Organic Revenue
Growth | | Quarter Ended
December 29, 2006 | |
ADT Worldwide | | $ | 1,999 | | 7.3 | % | $ | 84 | | 4.5 | % | $ | (11 | ) | -0.6 | % | $ | 63 | | 3.4 | % | $ | 1,863 | |
Flow Control | | 1,074 | | 28.6 | % | 92 | | 11.0 | % | (1 | ) | 0.0 | % | 148 | | 17.7 | % | 835 | |
Fire Protection Services | | 832 | | 5.2 | % | 41 | | 5.2 | % | — | | 0.0 | % | — | | 0.0 | % | 791 | |
Electrical and Metal Products | | 487 | | 9.9 | % | 11 | | 2.5 | % | — | | 0.0 | % | 33 | | 7.4 | % | 443 | |
Safety Products | | 447 | | 10.1 | % | 22 | | 5.4 | % | — | | 0.0 | % | 19 | | 4.7 | % | 406 | |
Corporate and Other | | 31 | | 14.8 | % | 3 | | 11.1 | % | — | | 0.0 | % | 1 | | 3.7 | % | 27 | |
Total Net Revenue | | $ | 4,870 | | 11.6 | % | $ | 253 | | 5.8 | % | $ | (12 | ) | -0.2 | % | $ | 264 | | 6.0 | % | $ | 4,365 | |
NOTE: Organic revenue growth is a non-GAAP measure. See description of non-GAAP measures contained in this release.
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Tyco International Ltd.
Earnings Per Share Summary
(Unaudited)
| | Quarter Ended | | Year Ended | | Quarter Ended | |
| | Dec. 29, 2006 | | March 30, 2007 | | June 29, 2007 | | Sept. 28, 2007 | | Sept. 28, 2007 | | Dec. 28, 2007 | |
| | | | | | | | | | | | | |
Diluted EPS from Continuing Operations | | $ | 0.32 | | $ | 0.31 | | $ | (6.16 | ) | $ | 0.42 | | $ | (5.10 | ) | $ | 0.74 | |
| | | | | | | | | | | | | |
Restructuring charges in cost of sales | | — | | 0.00 | | 0.00 | | 0.01 | | 0.01 | | 0.01 | |
| | | | | | | | | | | | | |
Class action settlement, net | | — | | — | | 5.83 | | (0.02 | ) | 5.81 | | — | |
| | | | | | | | | | | | | |
Separation costs | | 0.07 | | 0.10 | | 0.69 | | 0.08 | | 0.93 | | (0.08 | ) |
| | | | | | | | | | | | | |
Losses on divestitures | | — | | 0.00 | | 0.00 | | — | | 0.01 | | — | |
| | | | | | | | | | | | | |
Restructuring and asset impairment charges, net | | 0.10 | | 0.05 | | 0.07 | | 0.07 | | 0.28 | | 0.02 | |
| | | | | | | | | | | | | |
Goodwill impairment | | — | | — | | 0.09 | | — | | 0.09 | | — | |
| | | | | | | | | | | | | |
Tax items | | — | | (0.12 | ) | — | | — | | (0.12 | ) | 0.04 | |
| | | | | | | | | | | | | |
Voluntary Replacement Program | | — | | — | | — | | 0.01 | | 0.01 | | — | |
| | | | | | | | | | | | | |
Diluted EPS from Continuing Operations Before Special Items | | $ | 0.49 | | $ | 0.34 | | $ | 0.52 | | $ | 0.57 | | $ | 1.92 | | $ | 0.73 | |
14
Tyco International Ltd.
For the Quarter Ended December 28, 2007
(in millions, except per share data)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | Income | | Diluted | |
| | | | | | Fire | | Electrical | | | | | | | | Interest | | Other | | | | | | from | | EPS from | |
| | ADT | | Flow | | Protection | | & Metal | | Safety | | Corporate | | Operating | | Expense, | | Expense, | | Income | | Minority | | Continuing | | Continuing | |
| | Worldwide | | Control | | Services | | Products | | Products | | and Other | | Income | | net | | net | | Taxes | | Interest | | Operations | | Operations | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Operating Income | | $249 | | $171 | | $72 | | $41 | | $86 | | $(120 | ) | $499 | | $(59 | ) | $52 | | $(122 | ) | $(1 | ) | $369 | | $0.74 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Restructuring charges in cost of sales | | | | 1 | | | | 2 | | | | | | 3 | | | | | | (1 | ) | | | 2 | | 0.01 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Class action settlement, net | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Separation costs | | | | | | | | | | | | 10 | | 10 | | 7 | | (50 | ) | (5 | ) | | | (38 | ) | (0.08 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Losses on divestitures | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Restructuring and asset impairment charges, net | | 7 | | 1 | | | | 2 | | 1 | | | | 11 | | | | | | (3 | ) | | | 8 | | 0.02 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Goodwill impairment | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Tax items | | | | | | | | | | | | | | | | | | | | 20 | | | | 20 | | 0.04 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Voluntary Replacement Program | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Operating Income Before Special Items | | $256 | | $173 | | $72 | | $45 | | $87 | | $(110 | ) | $523 | | $(52 | ) | $2 | | $(111 | ) | $(1 | ) | $361 | | $0.73 | |
| | | | | | | | | | | | | | | | | | Diluted Shares Outstanding | | 497 | |
| | | | | | | | | | | | | | | | | | Diluted Shares Outstanding - Before Special items | | 497 | |
15
