Tyco Posts Better-Than-Expected Profit Despite Currency Impacts

By Chelsey Dulaney 

Tyco International Ltd.'s adjusted profit topped expectations in its June quarter, even as revenue continued to be hurt by foreign currency impacts.

The Cork, Ireland-based fire-protection and security systems company, which moved its headquarters late last year to Ireland from Switzerland, does more than half its business outside of the U.S. The stronger U.S. dollar makes its products more expensive abroad, and, like other companies that generate a significant amount of revenue overseas, its top line has been under pressure.

In a news release, Chief Executive George R. Oliver said the company was "disappointed" with its top-line growth, though its cost containment efforts helped drive profit.

Tyco reported a profit of $156 million, or 37 cents a share, down from $1.45 billion, or $3.11 a share, a year earlier.

The prior year period included a gain on the sale of its stake in the electrical and metal products business now known as Atkore.

On a continuing operations basis and excluding special items, earnings grew to 59 cents from 54 cents a year earlier.

Revenue fell 6.4% to $2.49 billion, with the stronger dollar representing a 7% headwind.

Analysts polled by Thomson Reuters had forecast per-share earnings of 56 cents on revenue of $2.52 billion.

For the current quarter, Tyco forecast per-share earnings of 60 cents to 62 cents, just missing analyst expectations for 63 cents a share in earnings.

For the year ending in September, the company lowered the top end of its earnings guidance by two cents to a range of $2.23 to $2.25 a share.

Write to Chelsey Dulaney at [e-mail]