Tyco International Ltd.
) reported earnings per share (EPS before one-time items) of 40
cents in first quarter 2013 versus 26 cents in the year-ago
quarter. Quarterly earnings beat the Zacks Consensus Estimate by
a penny. Income from continuing operations stood at $159 million
or 34 cents versus $98 million or 21 cents in the year-ago
Revenues for the quarter increased 5.0% year over year to
$2600 million, surpassing the Zacks Consensus Estimate of $2559
million. The increase in revenues was driven by a 3% benefit from
acquisitions. Organic revenue grew 1% in the quarter with 6%
growth in products, 2% growth in service but a 3% decline in
Earlier, in the fourth quarter 2012, the company had
reorganized its business segments as North America Systems
Installation & Services, Rest of World Systems Installation
and Global Products following the spin-off of ADT and Flow
North America Systems Installation &
Revenues for first quarter 2013 increased 1.5% to $976
million. Organic revenues for the quarter increased 1.0%. Backlog
in the quarter stood at $2.4 billion, down 3% sequentially
excluding the impact of foreign currency.
Operating income in the reported quarter was $108 million with
an operating margin of 11.1%. Operating margin grew 110 basis
points year over year on higher mix of service revenue and
continued productivity benefits, partially offset by increased
synergy costs associated with the separation of the ADT
residential security business from the commercial security
business, Tyco Integrated Security.
Rest of World Systems Installation
Revenues for first quarter 2013 increased 3% to $1.1 billion
driven by accretive acquisitions. Organic revenues were flat with
service up 3% but installation down 5%. Backlog of $2.6 billion
increased 3% sequentially, excluding the impact of foreign
Operating income for the quarter was $114 million while the
operating margin was 10.5% versus 10.4% in the year ago quarter.
Revenues of $534 million increased 16% in the first quarter 2013,
driven by acquisitions. Organic revenues were up 6% across all
the three product platforms.
Operating income for the quarter was $74 million and the
operating margin was 13.9% versus 17.6% in the year-ago quarter.
The year-over-year margin decrease was due to higher
research and development and sales investments.
Balance Sheet and Share Repurchase
Cash and cash equivalents for first quarter 2013 were $501
million. During the reported quarter, TYCO international
purchased 1.8 million shares for $50 million and the company
increased its authorization for repurchase to $750 million.
During the quarter the company proposed a shareholder approval
for a 7% annual dividend increase from 60 cents to 64 cents per
FED SIGNAL CP (FSS): Free Stock Analysis
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The company expects an increase in investments in research and
development going forward, and some traction in its productivity
and sourcing initiatives, which would benefit the company in the
near tem. However, the company needs to be wary of its
competitors, which include formidable names such as
Jardine Strategic Holdings Ltd.
Federal Signal Corp
Tyco International Ltd currently has a Zacks Rank #1 (Strong
Buy). One of its competitors,
) carries a Zacks Rank #2 (Buy).