Tyco Tops First-Quarter Estimates, Warns on Second Quarter

Tyco International(TYC) said first-quarter earnings before items rose 17% to $1.47 billion, or 74 cents a diluted share, a penny better than analysts' forecasts, but warned second-quarter earnings would fall below expectations.

The electronics and health care conglomerate said revenues were $10.1 billion in the latest quarter, up 25% from $8 billion a year ago.

"Strong demand worldwide for our fire and security products and services offerings, coupled with the stability of our healthcare and Tyco Capital businesses, contributed greatly to the results for the quarter," the company said in a statement.

For the second fiscal quarter ending March 31, Tyco forecast earnings of 80 cents to 82 cents a share. Analysts polled by First Call were predicting 86 cents a share. For the full year, Tyco forecast earnings of $3.70 a share; analysts were predicting $3.67. The company said the reduced second-quarter guidance reflected continued uncertainty about its electronics end-markets.

Among its segments, Tyco said electronics revenues fell to $3.13 billion from $3.87 billion; health care revenues rose to $2.21 billion from $2.00 billion; and fire and security revenue jumped to $3.29 billion from $2.17 billion. The company said it produced negative free cash flow of $215 million in the latest quarter after spending $591 million on TyCom Global Network.

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