Big revenue gains in its electronics and health care segments, aided by the weakening dollar, helped
to first-quarter earnings that were up solidly from a year ago and surpassed analyst estimates.
The company earned $719.2 million, or 34 cents a share, on revenue of $9.70 billion in the latest quarter compared with earnings of $585.9 million, or 29 cents a share, on revenue of $8.93 billion a year ago. Analysts surveyed by Thomson One Analytics were forecasting earnings of 32 cents a share in the latest quarter.
Of the overall 9% gain in first-quarter revenue from a year ago, 7 percentage points were the result of favorable currency translation, Tyco said.
The shares were recently up 10 cents, or 0.4%, to $27.20 on the Instinet premarket session. They're up about 67% in the last year.
Tyco reiterated second-quarter operating-earnings guidance of 35 cents to 37 cents a share and full-year operating-earnings guidance of $1.42 to $1.52 a share. Analysts surveyed by Thomson One Analytics were forecasting earnings of 36 cents a share in the quarter and $1.50 a share in the full year.
"The economy appears to be improving consistent with our expectations for the year," Tyco said. "However, stronger performance in the industrial and nonresidential construction markets remains an important factor in achieving the high end of the EPS range."
Tyco said it reduced its headcount by about 1,200 employees in the most recent first quarter, cut overall debt by $2.1 billion to $18.9 billion, produced cash flow from operating activities of $1.0 billion, and produced free cash flow of $736 million in the quarter, up $600 million from last year.
By segment, fire and security revenue rose 7.3% to $2.96 billion in the quarter, while income in the division rose 15.8% to $251.6 million. Electronics revenue rose 10.7% to $2.84 billion, while income rose 31.4% to $424 million. Health care revenue rose 10.7% to $2.18 billion while income rose 21.4% to $537.8 million. And engineered product and services revenue rose 6.1% to $1.26 billion while income fell 12.2% to $106.2 million.