TYCO International Ltd. (TYC)
February 21, 2013 2:10 pm ET
George R. Oliver - Chief Executive Officer and Director
Previous Statements by TYC
» Tyco International Management Discusses Q1 2013 Results - Earnings Call Transcript
» Tyco International Management Discusses Q4 2012 Results - Earnings Call Transcript
» Tyco International Management Discusses Q3 2012 Results - Earnings Call Transcript
But we have with George Oliver, who's the CEO; and Antonella Franzen who is -- has been heading up the Investor Relations effort for Tyco and also worked very closely with Maroon [ph] on the ADT side. For a number of year, who knows the business -- both sides of the business very well after the breakup.
And Tyco is a stock that we've been bullish on. I mean, those of you who followed our work, post the spin, we -- our recommendation to investors was to buy a bigger focus in -- on the Tyco side, and less of a focus on the ADT side. Part of that is it reflects -a part of that reflects just valuation and where things were trading upon.
It's been up. A part of that reflects the fact that it is our view, at least, that Tyco is very well positioned to be an above-market grower and an above-market margin expander over the next several years as we do get a recovery in our market. It's also our view that there's a lot of pent-up demand out there in security markets, and that there are catalysts to get people to upgrade systems and such.
So those are some topics that I think are important to talk about with George today. This is a company that really has a fresh start, a clean sheet of paper to be able to build its reputation and, really, position itself with its customers and with its investors and everyone else as something different arguably than what we have seen historically at Tyco as a higher-growth entity with rising margins and rising returns.
And as a pure play security company, I think is very, very well positioned to fit into the some of the themes that we've been talking about in our written work, as far as companies getting back to their core competencies the way they have sustainable competitive advantages and scale in the market and such.
So I think what you get with Tyco is very interesting. George has a fair amount of pressure as far as execution is concerned I'm sure. But what you get is, in fact, very interesting. So George wanted to open up and have a few opening comments, and then we'll move right into Q&A and also queue up the audience responses in as well.
With that, George?
George R. Oliver
Thanks, Scott [ph], and thanks for having us at the conference. What I thought I'd do is really kick it off and talk a little bit about my own background where I am new to the role, the new CEO for Tyco. I'll talk a little bit about the strategy that we've outlined for the new company and then some of the initiatives that we have well under way that we updated all of you on at our earnings call recently.
So a little bit about my background. Prior to coming to Tyco, I was 23 years in GE, came up through the operating ranks, having led large operations, including some of the bigger positions we're leading all over the designs and supply chain within the aircraft engine group. I did extension in appliances, as well as water and process technologies. And when I came to Tyco about 7 years ago, it was really with the focus of coming in and really building the product businesses. So I had responsibility for, at that time, the reported segment was Tyco Safety Products, which was a combination of our Fire & Security products businesses.
And if you recall, that was at the time of the last separation when we split off Covidien, as well as TE Connectivity. And there was a real focus on where we looked at the remaining businesses within Tyco as having been underperforming from a revenue standpoint. But, really, good solid businesses with strong brands that with a little bit of reinvestment could be repositioned very well to be able to accelerate growth.
So at that stage, we embarked on a strategy within our products business, to accelerate R&D, to be able to expand our footprint with sales and marketing and just some of the high-growth markets. And I think you've seen the progress within those set of businesses being able to deliver double-digit growth over the last couple of years and within the strategy that we've outlined for new company will continue to deliver very strong growth over the next 3 years.
And then along the journey within the old Tyco, we looked at how do we get better performance within Security, within Fire and within Flow, and that's when I picked up the responsibility. I started with the international piece of the Fire services Installation & Services. And so at that time, if you recall, especially in the European businesses, we had margins that were barely profitable with that set of business within Europe. And across the company, we had a keen focus on how do we restructure the business, refocus the business, implement the discipline that were required to ultimately get to double-digit returns, which we achieved across the rest of the portfolio.