Tyco Earnings Beat Expectations, Rise 30 Percent
NEW YORK (AP) — Swiss manufacturer Tyco International Ltd. said Tuesday its fourth-quarter earnings jumped 30 percent on improving revenue and higher margins.
The company also agreed to sell a 51 percent stake in its electrical and metal products business to private equity firm Clayton Dubilier & Rice for about $720 million.
For the fourth quarter ended Sept. 24, Tyco International earned $266 million, or 53 cents per share, compared with year-earlier earnings of $205 million, or 43 cents per share.
Revenue rose 4 percent to $4.49 billion.
Sales in the company's largest segment, its ADT Worldwide security unit, rose 8 percent to $1.95 billion. Revenue in its fire protection and flow control units declined.
Tyco's results easily beat expectations. Earnings excluding items were 74 cents a share. Analysts polled by Thomson Reuters were expecting earnings of 66 cents a share on revenue of $4.44 billion.
For all of fiscal 2010, the company earned $1.13 billion, or $2.32 per share, compared with a year-ago loss of $1.8 billion, or $3.80 per share.
Revenue rose to $17.02 billion from $16.88 billion a year earlier.
The deal for the company's electrical and metal products unit is expected to close in December or January. Tyco said it will use proceeds to speed the repurchase of its shares under a $1 billion buyback program announced in September.
The business produces a wide range of products for construction, electrical, fire, security, and mechanical applications. It had revenue of about $1.4 billion in fiscal 2010.
When the deal closes, the unit will operate as a stand-alone business under the name Atkore International.
The acquisition follows other substantial deals by private-equity firms this week. On Monday, chemical maker Ashland Inc. announced the sale of its distribution business to private investment firm TPG Capital for $930 million.