Tyco sees higher than expected Q1 revenues

Company continues to grow service and recurring revenue


Flow Control

Q1 2010 Q1 2009 % Change
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Revenue $923 $959 (4%)
Operating Income $112 $137 (18%)
Operating Margin 12.1% 14.3%
Special Items ($6) ($2)
Operating Income Before Special Items $118 $139 (15%)
Operating Margin Before Special Items 12.8% 14.5%

Revenue of $923 million declined 4% in the quarter with an organic revenue decline of 14%. Organic revenue declined 15% in the Valves business, 10% in Water and 14% in Thermal Controls. Backlog of $1.7 billion decreased 3% on a quarter sequential basis (a 2% decline excluding the impact of foreign currency).

Operating income was $112 million and the operating margin was 12.1%. Operating income before special items was $118 million and the operating margin before special items was 12.8% as the benefits from cost-containment actions and restructuring activities were more than offset by the impact of the organic revenue decline and product mix.

Fire Protection Services

Q1 2010 Q1 2009 % Change
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Revenue $833 $839 (1%)
Operating Income $64 $56 14%
Operating Margin 7.7% 6.7%
Special Items - -
Operating Income Before Special Items $64 $56 14%
Operating Margin Before Special Items 7.7% 6.7%

Revenue of $833 million declined 1% in the quarter with an organic revenue decline of 6%. Service revenue declined 2% organically and installation revenue declined 10% driven primarily by softness in the North American and EMEA regions. Backlog of $1.2 billion decreased 1% on a quarter sequential basis.

Operating income was $64 million and the operating margin was 7.7%. There were no special items in the quarter.

Electrical and Metal Products

Q1 2010 Q1 2009 % Change
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Revenue $297 $416 (29%)
Operating Income $23 $27 (15%)
Operating Margin 7.7% 6.5%
Special Items - ($2)
Operating Income Before Special Items $23 $29 (21%)
Operating Margin Before Special Items 7.7% 7.0%

Revenue of $297 million declined 29% in the quarter with an organic revenue decline of 30%. The decline was primarily due to lower selling prices for both steel and copper products.

Operating income was $23 million and the operating margin was 7.7%. Operating income before special items decreased $6 million, despite a $119 million revenue decline as lower volume was almost fully offset by better steel spreads. The operating margin before special items was 7.7%.

Safety Products

Q1 2010 Q1 2009 % Change
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Revenue $358 $401 (11%)
Operating Income $54 $80 (33%)
Operating Margin 15.1% 20.0%
Special Items $1 ($1)
Operating Income Before Special Items $53 $81 (35%)
Operating Margin Before Special Items 14.8% 20.2%

Revenue of $358 million declined 11% in the quarter. Organic revenue declined 14% due to lower volume in the Fire Suppression and Electronic Security businesses resulting from weaker demand in their end markets.