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Tyco Electronics Posts Q4, Full Year

SCHAFFHAUSEN, Switzerland — {complink 5844|Tyco Electronics} today reported results for the fiscal fourth quarter ended Sept. 24, 2010. The company reported a net sales increase of 16 percent year-over-year, and 2 percent sequentially, to $3.1 billion. GAAP EPS were $0.56 for the quarter, compared to $0.18 in the prior-year period. Included in the GAAP EPS were $0.10 per share related to restructuring charges and a loss on the sale of a mechatronics business, $0.02 per share of acquisition-related costs and $0.05 per share of items primarily due to shared tax matters. This compares to $0.12 per share of net charges in the prior-year quarter. Adjusted EPS were $0.72 in the quarter, compared to $0.30 in the prior-year quarter.

Full-year net sales were $12.1 billion, an increase of 18 percent over the prior year. Organic sales growth was 17 percent. GAAP EPS were $2.32 for the year, compared to a loss of $6.77 in the prior year. Included in GAAP EPS were $0.22 per share of net charges, compared to $7.58 per share of charges in the prior year. Adjusted EPS were $2.54 for the year, compared to $0.81 in the prior year.

“Our fourth quarter was a strong finish to a very good year,” said Tyco Electronics Chief Executive Officer Tom Lynch. “Our 2010 sales of $12.1 billion were up 18 percent over the prior year. This growth was broad-based across our markets and geographies, driven by a recovering global economy and our ability to respond quickly during the rebound. We also strengthened our market position during the year.

“Full-year adjusted EPS of $2.54 were up from $0.81 in the prior year. This improvement was primarily due to the sales growth and strong execution of our productivity improvement programs. We also generated $1.4 billion of free cash flow.”

FIRST QUARTER AND FULL YEAR FISCAL 2011 OUTLOOK (EXCLUDES ADC ACQUISITION)
“For fiscal 2011, we are expecting organic sales growth of 4 to 7 percent and 12 to 20 percent adjusted EPS growth. This excludes the ADC acquisition that we expect to close this quarter,” Lynch said. “The sales growth assumes 2 to 3 percent global GDP growth, driven primarily by continued strength in developing markets, where we have a leading position. We expect another year of strong cash flow and plan to increase our dividend by 12.5 percent in our third quarter of fiscal 2011. Earlier this month, we announced that our Board of Directors approved a $750 million expansion of our share repurchase program.”

For the first quarter, the company expects net sales of $3.05 to $3.15 billion, an increase of 5 to 9 percent over the prior-year period. GAAP EPS are expected to be $0.63 to $0.67, including restructuring charges and acquisition-related costs of approximately $0.03 per share. Adjusted EPS are expected to be $0.66 to $0.70, up 40 percent to 49 percent compared to adjusted EPS of $0.47 in the prior-year period.

For the full fiscal year, which includes 53 weeks in 2011, the company expects sales of $12.8 to $13.2 billion, an increase of 6 to 9 percent over the prior year. GAAP EPS are expected to be $2.80 to $3.00, including restructuring charges and acquisition-related costs of approximately $0.05 per share. Adjusted EPS are expected to be $2.85 to $3.05, compared to adjusted EPS of $2.54 in the prior-year period. Approximately $240 million of the expected growth and $0.05 per share of EPS is due to the impact of the additional week in 2011. Excluding the 53rd week, sales are expected to be up 4 to 7 percent organically and adjusted EPS will be up 10 to 18 percent.

This outlook assumes current foreign exchange and commodity rates, and does not include results related to the pending acquisition of ADC.

ADC ACQUISITION UPDATE
As announced in July 2010, the company reached an agreement to acquire ADC (Nasdaq: ADCT) for $12.75 per share in cash, or an enterprise value of approximately $1.25 billion. This acquisition is expected to position the company as a leading global provider of broadband connectivity products to carrier and enterprise networks.

Integration plans are progressing as expected. We continue to anticipate that the transaction will close in the current quarter and be accretive by $0.14 per share in the first 12 months after closing — excluding acquisition-related costs.

For more information: Tyco Electronics

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