Tyco Electronics Reports Fiscal First Quarter Results

Fiscal First Quarter Results

- Net Sales of $2.9 Billion Increased 7 Percent Sequentially and 7 Percent Year-Over-Year

- GAAP Operating Income of $269 Million; Adjusted Operating Income of $332 Million, a 50 Percent Sequential Increase

- Diluted Earnings Per Share From Continuing Operations (GAAP EPS) of $0.37; Adjusted EPS of $0.47, a 57 Percent Sequential Increase

- Cash From Continuing Operations of $330 Million; Free Cash Flow of $256 Million

Fiscal Second Quarter Outlook

- Company Expects Sales of $2.85 to $2.95 Billion, Up 22 to 26 Percent Year-Over-Year and Flat Sequentially

- GAAP Operating Income Expected to be $315 to $350 Million; Adjusted Operating Income Expected to be $335 to $370 Million

- GAAP EPS Expected to be $0.46 to $0.51; Adjusted EPS Expected to be $0.49 to $0.54

PRNewswire
SCHAFFHAUSEN, Switzerland
(NYSE:TEL)
Jan 27, 2010

SCHAFFHAUSEN, Switzerland, Jan. 27 /PRNewswire-FirstCall/ -- Tyco Electronics Ltd. (NYSE: TEL) today reported results for the fiscal first quarter ended Dec. 25, 2009. The company reported net sales of $2.9 billion, a 7 percent increase sequentially and a 7 percent increase compared to the prior-year period. GAAP EPS were $0.37 for the quarter, compared to $0.07 in the prior-year period. Included in the GAAP EPS were $0.10 per share of restructuring and other charges. This compares to $0.14 per share of net charges in the prior-year quarter. Adjusted EPS were $0.47 in the quarter, compared to last year's adjusted EPS of $0.21.

"The first quarter was a very good start to the year for us," said Tyco Electronics Chief Executive Officer Tom Lynch. "We had another quarter of sequentially improving sales in our Electronic Components markets due to stronger end demand and inventory replenishment in the supply chain. This, coupled with the footprint restructuring we began over two years ago and the aggressive cost actions we took last year, enabled us to improve our adjusted operating margin to 11.5 percent, up from 8.2 percent last quarter.

"In the second quarter, we expect the trends we experienced in the first quarter to continue, and overall sales to be similar to first quarter levels. We anticipate that our adjusted operating margin will approach 12 percent in the second quarter."

The following discussion includes non-GAAP financial measures which are described at the end of this press release. For a reconciliation of these non-GAAP financial measures, see the attached tables. All dollar amounts are pre-tax and stated in millions.


                            Dec. 25,      Sept. 25,      Dec. 26,
                              2009          2009           2008
                           ---------     ----------     ---------
        ($ in millions)
    Net Sales                  $2,892         $2,698        $2,713
    Operating Income             $269           $176           $83
    Restructuring and
     Other Changes               $(63)          $(45)         $(78)
    Other Items                    $0             $0          $(17)
                                  ---            ---          ----
    Adjusted Operating
     Income                      $332           $221          $178
    Operating Margin              9.3%           6.5%          3.1%
    Adjusted Operating
     Margin                      11.5%           8.2%          6.6%


                          % Change     % Change
                         Sequential       YoY
                         ----------       ---
        ($ in millions)
    Net Sales                     7%            7%
    Operating Income             53%          224%
    Restructuring and
     Other Changes
    Other Items
    Adjusted Operating
     Income                      50%           87%
    Operating Margin
    Adjusted Operating
     Margin


Sales grew 7 percent, both sequentially and compared to the prior-year quarter. Organically, sales increased 5 percent sequentially and 2 percent compared to the prior year. The sequential organic sales increase was driven by a 14 percent increase in the Electronic Components segment, where sales were up across all end markets. The company's growth was particularly strong in the Automotive business, where sales grew 17 percent due to increased global production levels and inventory replenishment. Organic sales declined 6 percent sequentially in the Network Solutions segment, and 3 percent in the Specialty Products segment, as these businesses continued to be affected by low levels of capital spending. In Undersea Telecommunications, sales declined 25 percent sequentially, in line with our expectations as a result of lower project activity.

The adjusted operating margin improved to 11.5 percent, compared to 8.2 percent in the prior quarter and 6.6 percent a year ago, reflecting the benefits of higher sales, footprint restructuring and cost reduction actions. In addition, last year's first quarter included approximately $50 million of foreign currency losses on hedging activity.

CASH FLOW

Cash from continuing operations was $330 million during the quarter, compared to $32 million in the year-ago period. Free cash flow was $256 million, compared to a use of $79 million in the prior-year period. The increase in free cash flow was primarily driven by higher income levels, as well as lower capital expenditures versus the prior year.

ORDERS

Total company orders increased 2 percent sequentially in the first quarter. On a year-over-year basis, orders increased 15 percent. The book-to-bill ratio was 1.02 in the quarter. Excluding the company's Undersea Telecommunications segment, which is a project-oriented business with uneven order patterns, orders increased 15 percent sequentially and increased 34 percent year-over-year, and the book-to-bill ratio was 1.09. The 15 percent sequential order increase was broad-based across most of the company's end markets.

ADDITIONAL ITEM

On Jan. 20, the company completed the acquisition of Sensitive Object, an early-stage software company engaged in developing touch-enabling technology focused on computers, mobile devices and consumer electronics, for a purchase price of approximately $62 million in cash, subject to certain adjustments. This acquisition will complement the company's existing touch systems business, which is part of the Specialty Products segment.

SECOND QUARTER FISCAL 2010 OUTLOOK

For the second fiscal quarter, the company expects sales of $2.85 to $2.95 billion and GAAP operating income of $315 to $350 million, which includes restructuring and other charges of approximately $20 million. Adjusted operating income is expected to be $335 to $370 million. GAAP EPS are expected to be $0.46 to $0.51, including restructuring and other charges of approximately $0.03 per share. Adjusted EPS are expected to be $0.49 to $0.54, compared to adjusted EPS of $0.14 in the prior-year period. This outlook assumes current foreign exchange rates.



    ($ in millions, except per share amounts)
                                                         Q2 Outlook
                                                         ----------
    Sales                                                  $2,850 to $2,950
    GAAP Operating Income                                      $315 to $350
    Restructuring and Other Charges                                    $(20)
    Adjusted Operating Income                                  $335 to $370
    GAAP EPS                                                 $0.46 to $0.51
    Adjusted EPS                                             $0.49 to $0.54


ABOUT TYCO ELECTRONICS

Tyco Electronics Ltd. is a leading global provider of engineered electronic components, network solutions, specialty products and undersea telecommunication systems, with fiscal 2009 sales of $10.3 billion to customers in more than 150 countries. We design, manufacture and market products for customers in a broad array of industries including automotive; data communication systems and consumer electronics; telecommunications; aerospace, defense and marine; medical; energy; and lighting. With approximately 7,000 engineers and worldwide manufacturing, sales and customer service capabilities, Tyco Electronics' commitment is our customers' advantage. More information on Tyco Electronics can be found at http://www.tycoelectronics.com/.

CONFERENCE CALL AND WEBCAST

  • The company will hold a conference call for investors today beginning at 8:30 a.m. EST.
  • Internet users will be able to access the company's earnings webcast, including slide materials, at the "Investors" section of Tyco Electronics' website: http://investors.tycoelectronics.com.
  • For both "listen-only" telephone participants and those participants who wish to take part in the question-and-answer portion of the call, the dial-in number in the United States is (800) 288-8960. The telephone dial-in number for participants outside the United States is (612) 332-0530.
  • An audio replay of the conference call will be available beginning at 10:30 a.m. on Jan. 27, 2010 and ending at 11:59 p.m. on Feb. 3, 2010. The dial-in number for participants in the United States is (800) 475-6701. For participants outside the United States, the replay dial-in number is (320) 365-3844. The replay access code for all callers is 140511.

NON-GAAP MEASURES

"Organic Sales Growth," "Adjusted Operating Income," "Adjusted Operating Margin," "Adjusted Income Tax Expense," "Adjusted Income from Continuing Operations," "Adjusted Earnings Per Share," and "Free Cash Flow" (FCF) are non-GAAP measures and should not be considered replacements for GAAP results.

"Organic Sales Growth" is a useful measure used by the company to measure the underlying results and trends in the business. The difference between reported net sales growth (the most comparable GAAP measure) and Organic Sales Growth (the non-GAAP measure) consists of the impact from foreign currency, acquisitions and divestitures. Organic Sales Growth is a useful measure of the company's performance because it excludes items that: i) are not completely under management's control, such as the impact of foreign currency exchange; or ii) do not reflect the underlying growth of the company, such as acquisition and divestiture activity. The limitation of this measure is that it excludes items that have an impact on the company's sales. This limitation is best addressed by using organic sales growth in combination with the GAAP numbers. See the accompanying tables to this press release for the reconciliation presenting the components of Organic Sales Growth.

The company has presented its operating income before special items including charges related to legal settlements and reserves, restructuring charges, impairment charges, and other income or charges ("Adjusted Operating Income"). The company utilizes Adjusted Operating Income to assess segment level core operating performance and to provide insight to management in evaluating segment operating plan execution and underlying market conditions. It is also a significant component in the company's incentive compensation plans. Adjusted Operating Income is a useful measure for investors because it better reflects the company's underlying operating results, trends and the comparability of these results between periods. The difference between Adjusted Operating Income and operating income (the most comparable GAAP measure) consists of the impact of charges related to legal settlements and reserves, restructuring charges, impairment charges, and other income or charges that may mask the underlying operating results and/or business trends. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease the company's reported operating income. This limitation is best addressed by using Adjusted Operating Income in combination with operating income (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease on reported results.

The company has presented its operating margin before special items including charges related to legal settlements and reserves, restructuring charges, impairment charges, and other income or charges ("Adjusted Operating Margin"). The company presents and forecasts its Adjusted Operating Margin before special items to give investors a perspective on the underlying business results. Because the company cannot predict the amount and timing of such items and the associated charges or gains that will be recorded in the company's financial statements, it is difficult to include the impact of those items in the forecast.

The company has presented income tax expense after adjusting for the tax effect of special items including charges related to restructuring, impairment charges, and other income or charges ("Adjusted Income Tax Expense"). The company presents Adjusted Income Tax Expense to provide investors further information regarding the tax effects of adjustments used in determining the non-GAAP financial measure Adjusted Income from Continuing Operations (as defined below). The difference between Adjusted Income Tax Expense and income tax expense (the most comparable GAAP measure) is the tax effect of adjusting items. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease income tax expense. This limitation is best addressed by using Adjusted Income Tax Expense in combination with income tax expense (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease in reported amounts.

The company has presented income from continuing operations attributable to Tyco Electronics Ltd. before special items including charges related to legal settlements and reserves, restructuring charges, impairment charges, other income or charges and, if applicable, related tax effects ("Adjusted Income from Continuing Operations"). The company presents Adjusted Income from Continuing Operations as it believes that it is appropriate for investors to consider results excluding these items in addition to its results in accordance with GAAP. Adjusted Income from Continuing Operations provides additional information regarding the company's underlying operating results, trends and the comparability of these results between periods. The difference between Adjusted Income from Continuing Operations and income from continuing operations attributable to Tyco Electronics Ltd. (the most comparable GAAP measure) consists of the impact of charges related to legal settlements and reserves, restructuring charges, impairment charges, other income or charges and, if applicable, related tax effects. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease the company's reported results. This limitation is best addressed by using Adjusted Income from Continuing Operations in combination with income from continuing operations attributable to Tyco Electronics Ltd. (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease in reported amounts.

The company has presented diluted earnings per share from continuing operations attributable to Tyco Electronics Ltd. before special items, including charges related to legal settlements and reserves, restructuring charges, impairment charges, and other income or charges ("Adjusted Earnings Per Share"). The company presents Adjusted Earnings Per Share because it believes that it is appropriate for investors to consider results excluding these items in addition to its results in accordance with GAAP. The company believes such a measure provides a picture of its results that is more comparable among periods since it excludes the impact of special items, which may recur, but tend to be irregular as to timing, thereby making comparisons between periods more difficult. This limitation is best addressed by using Adjusted Earnings Per Share in combination with diluted earnings per share from continuing operations attributable to Tyco Electronics Ltd. (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease on reported results.

"Free Cash Flow" (FCF) is a useful measure of the company's cash generation which is free from any significant existing obligation. The difference between cash flows from operating activities (the most comparable GAAP measure) and FCF (the non-GAAP measure) consists mainly of significant cash outflows that the company believes are useful to identify. FCF permits management and investors to gain insight into the number that management employs to measure cash that is free from any significant existing obligation. The difference reflects the impact from:

  • net capital expenditures,
  • voluntary pension contributions, and
  • cash impact of special items.

Net capital expenditures are subtracted because they represent long-term commitments. Voluntary pension contributions are subtracted from the GAAP measure because this activity is driven by economic financing decisions rather than operating activity. The company forecasts its cash flow results excluding any voluntary pension contributions because it has not yet made a determination about the amount and timing of any future such contributions. In addition, the company's forecast excludes the cash impact of special items because the company cannot predict the amount and timing of such items.

The limitation associated with using FCF is that it subtracts cash items that are ultimately within management's and the Board of Directors' discretion to direct and that therefore may imply that there is less or more cash that is available for the company's programs than the most comparable GAAP measure. This limitation is best addressed by using FCF in combination with the GAAP cash flow numbers.

FCF as presented herein may not be comparable to similarly-titled measures reported by other companies. The measure should be used in conjunction with other GAAP financial measures. Investors are urged to read the company's financial statements as filed with the Securities and Exchange Commission, as well as the accompanying tables to this press release that show all the elements of the GAAP measures of Cash Flows from Operating Activities, Cash Flows from Investing Activities, Cash Flows from Financing Activities and a reconciliation of the company's total cash and cash equivalents for the period. See the accompanying tables to this press release for a cash flow statement presented in accordance with GAAP and a reconciliation presenting the components of FCF.

Because the company does not predict the amount and timing of special items that might occur in the future, and its forecasts are developed at a level of detail different than that used to prepare GAAP-based financial measures, the company does not provide reconciliations to GAAP of its forward-looking financial measures.

FORWARD-LOOKING STATEMENTS

This release may contain certain "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to risks, uncertainty and changes in circumstances, which may cause actual results, performance, financial condition or achievements to differ materially from anticipated results, performance, financial condition or achievements. All statements contained herein that are not clearly historical in nature are forward-looking and the words "anticipate," "believe," "expect," "estimate," "plan," and similar expressions are generally intended to identify forward-looking statements. Tyco Electronics has no intention and is under no obligation to update or alter (and expressly disclaims any such intention or obligation to do so) its forward-looking statements whether as a result of new information, future events or otherwise, except to the extent required by law. The forward-looking statements in this release include statements addressing our future financial condition and operating results. Examples of factors that could cause actual results to differ materially from those described in the forward-looking statements include, among others, business, economic, competitive and regulatory risks, such as developments in the credit markets; conditions affecting demand for products, particularly the automotive industry and the telecommunications, computer and consumer electronics industries; future goodwill impairment; competition and pricing pressure; fluctuations in foreign currency exchange rates and commodity prices; political, economic and military instability in countries in which we operate; compliance with current and future environmental and other laws and regulations; and the possible effects on us of changes in tax laws, tax treaties and other legislation. More detailed information about these and other factors is set forth in Tyco Electronics' Annual Report on Form 10-K for the fiscal year ended Sept. 25, 2009, as well as in Tyco Electronics' Current Reports on Form 8-K and other reports filed by Tyco Electronics with the Securities and Exchange Commission.

                               TYCO ELECTRONICS LTD.
            CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)


                                              For the Quarters Ended
                                              ----------------------
                                         December 25,      December 26,
                                                  2009              2008
                                                  ----              ----


                                              (in millions, except per
                                                    share data)

    Net sales                                   $2,892            $2,713
    Cost of sales                                2,051             1,989
                                                 -----             -----
      Gross margin                                 841               724
    Selling, general, and administrative
     expenses                                      368               411
    Research, development, and
     engineering expenses                          138               144
    Pre-separation litigation charges,
     net                                             -                 9
    Restructuring and other charges, net            66                77
                                                   ---               ---
       Operating income                            269                83
    Interest income                                  4                 6
    Interest expense                               (39)              (42)
    Other income (expense), net                      8                (1)
                                                   ---               ---
       Income from continuing operations
        before income taxes                        242                46
    Income tax expense                             (69)              (14)
                                                   ---               ---
       Income from continuing operations           173                32
    Income (loss) from discontinued
     operations, net of income taxes                 -               (67)
                                                   ---               ---
       Net income (loss)                           173               (35)
    Less: net income attributable to
     noncontrolling interests                       (1)               (2)
                                                   ---               ---
      Net income (loss) attributable to
       Tyco Electronics Ltd.                      $172              $(37)
                                                  ====              ====

    Amounts attributable to Tyco
     Electronics Ltd.:
      Income from continuing operations           $172               $30
      Income (loss) from discontinued
       operations                                    -               (67)
                                                   ---               ---
      Net income (loss)                           $172              $(37)
                                                  ====              ====

    Basic earnings (loss) per share
     attributable to Tyco Electronics
     Ltd.:
       Income from continuing operations         $0.37             $0.07
       Income (loss) from discontinued
        operations                                   -             (0.15)
                                                   ---             -----
       Net income (loss)                         $0.37            $(0.08)
                                                 =====            ======

    Diluted earnings (loss) per share
     attributable to Tyco Electronics
     Ltd.:
       Income from continuing operations         $0.37             $0.07
       Income (loss) from discontinued
        operations                                   -             (0.15)
                                                   ---             -----
       Net income (loss)                         $0.37            $(0.08)
                                                 =====            ======

    Weighted-average number of shares
     outstanding:
       Basic                                       459               459
       Diluted                                     462               461

                           TYCO ELECTRONICS LTD.
             CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)


                                                  December        September
                                                     25,             25,
                                                       2009             2009
                                                       ----             ----


                                                   (in millions, except share
                                                             data)
    Assets
    Current Assets:
      Cash and cash equivalents                      $1,695           $1,521
    Accounts receivable, net of allowance for
     doubtful accounts of                             2,033            1,975
                        $41 and $48, respectively
      Inventories                                     1,458            1,435
      Prepaid expenses and other current assets         481              487
      Deferred income taxes                             153              161
                                                        ---              ---
        Total current assets                          5,820            5,579
    Property, plant, and equipment, net               3,008            3,111
    Goodwill                                          3,153            3,160
    Intangible assets, net                              388              407
    Deferred income taxes                             2,486            2,518
    Receivable from Tyco International Ltd.
     and Covidien plc                                 1,198            1,211
    Other assets                                        230              234
                                                        ---              ---
        Total Assets                                $16,283          $16,220
                                                    =======          =======

    Liabilities and Shareholders' Equity
    Current Liabilities:
      Current maturities of long-term debt             $101             $101
      Accounts payable                                1,221            1,068
      Accrued and other current liabilities           1,265            1,243
      Deferred revenue                                  174              203
                                                        ---              ---
        Total current liabilities                     2,761            2,615
    Long-term debt                                    2,314            2,316
    Long-term pension and postretirement
     liabilities                                      1,106            1,129
    Deferred income taxes                               174              188
    Income taxes                                      2,312            2,312
    Other liabilities                                   609              634
                                                        ---              ---
      Total Liabilities                               9,276            9,194
                                                      -----            -----
    Commitments and contingencies
    Shareholders' Equity:
       Common shares, 468,215,574 shares
        authorized and issued, CHF 2.26 par
        value, at December 25, 2009; 468,215,574
        shares authorized and issued, CHF 2.43
        par value, at September 25, 2009

                                                        899            1,049
      Contributed surplus                             8,116            8,135
      Accumulated deficit                            (2,102)          (2,274)
      Treasury shares, at cost, 9,168,652 and
       9,425,172 shares, respectively                  (328)            (349)
      Accumulated other comprehensive income            413              455
                                                        ---              ---
        Total Tyco Electronics Ltd. shareholders'
         equity                                       6,998            7,016
      Noncontrolling interests                            9               10
                                                        ---              ---
        Total Shareholders' Equity                    7,007            7,026
                                                      -----            -----
        Total Liabilities and Shareholders'
         Equity                                     $16,283          $16,220
                                                    =======          =======

                                   TYCO ELECTRONICS LTD.
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

                                               For the Quarters Ended
                                               ----------------------
                                         December 25,      December 26,
                                                  2009              2008
                                                  ----              ----


                                                   (in millions)
    Cash Flows From Operating
     Activities:
    Net income (loss)                             $173              $(35)
        (Income) loss from discontinued
         operations, net of income
         taxes                                       -                67
                                                   ---               ---
    Income from continuing
     operations                                    173                32
    Adjustments to reconcile net
     cash provided by operating
     activities:
      Non-cash restructuring and
       other charges, net                           19                10
      Depreciation and amortization                138               127
      Deferred income taxes                         53               (70)
      Provision for losses on
       accounts receivable and
       inventories                                  (5)               27
      Other                                         12                16
      Changes in assets and
       liabilities, net of the
       effects of acquisitions and
       divestitures:
        Accounts receivable, net                   (76)              495
        Inventories                                (20)             (116)
        Inventoried costs on long-term
         contracts                                 (20)              (28)
        Prepaid expenses and other
         current assets                             27               154
        Accounts payable                           162              (199)
        Accrued and other current
         liabilities                               (97)             (357)
        Income taxes                                 -                22
        Deferred revenue                           (28)              (52)
        Other                                       (8)              (29)
                                                   ---               ---
         Net cash provided by continuing
          operating activities                     330                32
         Net cash provided by
          discontinued operating
          activities                                 -                 1
                                                   ---               ---
         Net cash provided by operating
          activities                               330                33
                                                   ---               ---
    Cash Flows From Investing
     Activities:
    Capital expenditures                           (76)             (115)
    Proceeds from sale of property,
     plant, and equipment                            2                 4
    Proceeds from divestiture of
     discontinued operations, net
     of cash retained by operations
     sold                                            -                23
    Proceeds from divestiture of
     business, net of cash retained
     by business sold                               12                 -
    Other                                           (2)               (4)
                                                   ---               ---
         Net cash used in continuing
          investing activities                     (64)              (92)
         Net cash used in discontinued
          investing activities                       -                (1)
                                                   ---               ---
         Net cash used in investing
          activities                               (64)              (93)
                                                   ---               ---
    Cash Flows From Financing
     Activities:
    Net decrease in commercial
     paper                                           -              (400)
    Proceeds from long-term debt                     -               191
    Repayment of long-term debt                      -               (19)
    Repurchase of common shares                    (18)             (152)
    Payment of common share
     dividends and cash
     distributions to shareholders                 (74)              (74)
    Other                                           (1)               (3)
                                                   ---               ---
         Net cash used in financing
          activities                               (93)             (457)
                                                   ---              ----
    Effect of currency translation
     on cash                                         1               (24)
    Net increase (decrease) in cash
     and cash equivalents                          174              (541)
    Cash and cash equivalents at
     beginning of period                         1,521             1,090
                                                 -----             -----
    Cash and cash equivalents at
     end of period                              $1,695              $549
                                                ======              ====

    Supplemental Cash Flow
     Information:
    Income taxes paid, net of
     refunds                                       $16               $62

    Reconciliation to Free Cash
     Flow:
    Net cash provided by continuing
     operating activities                         $330               $32
    Capital expenditures, net                      (74)             (111)
                                                   ---              ----
    Free cash flow (1)                            $256              $(79)
                                                  ====              ====


    (1) Free cash flow is a non-GAAP measure.  See description of non-
    GAAP measures contained in this release.

                            TYCO ELECTRONICS LTD.
                    CONSOLIDATED SEGMENT DATA (UNAUDITED)


                                        For the Quarters Ended
                                        ----------------------
                                December 25,           December 26,
                                         2009                  2008
                                         ----                  ----


                                           ($ in millions)
    Net Sales:
    Electronic Components              $1,911                $1,625
    Network Solutions                     422                   456
    Specialty Products                    358                   367
    Undersea Telecommunications           201                   265
                                          ---                   ---
      Total                            $2,892                $2,713
                                       ======                ======

    Operating Income (Loss):
    Electronic Components                $163     8.5%         $(18) NM (1)
    Network Solutions                      20     4.7%           44     9.6%
    Specialty Products                     51    14.2%           28     7.6%
    Undersea Telecommunications            35    17.4%           38    14.3%
    Pre-separation litigation
     charges, net                           -                    (9)
                                          ---                   ---
      Total                              $269     9.3%          $83     3.1%
                                         ====                   ===


    (1) Not meaningful.


                            TYCO ELECTRONICS LTD.
                  NET SALES GROWTH RECONCILIATION (UNAUDITED) 


        Change in Net Sales for the Quarter Ended December 25, 2009
           versus Net Sales for the Quarter Ended December 26, 2008
           --------------------------------------------------------
                                  
                          Organic (1)      Translation(2)    Divestiture
                          -----------      --------------    -----------
                                       ($ in millions)

    Electronic
     Components (3):
      Automotive          $217     30.2%      $85               $-
      DataComm             (35)   (14.2)        9              (12)
      Industrial           (15)    (8.4)       10                -
      Appliance             18     15.4         5                -
      Computer              (5)    (5.3)        1               (1)
      Consumer                
       Devices              10      8.0         1              (14)
      Other                  8      4.9         5               (1)
                           ---      ---       ---              ---
        Total              198     12.2       116              (28)
                           ---     ----       ---              ---
    Network                
     Solutions (3):
      Energy               (28)   (13.1)       17                1
      Enterprise                
       Networks             (6)    (5.6)        7                -
      Service                
       Providers           (33)   (25.4)        8                -
      Other                  -     (1.8)        -                -
                           ---     ----       ---              ---
        Total              (67)   (14.8)       32                1
                           ---    -----       ---              ---
    Specialty
     Products (3):
      Aerospace,
       Defense, and
       Marine              (26)   (15.7)        6                -
      Touch Systems          -      0.4         5                -
      Circuit
       Protection            8     13.9         3                -
      Medical               (6)   (10.4)        1                -
                           ---    -----       ---              ---
        Total              (24)    (6.6)       15                -
                           ---     ----       ---              ---
    Undersea                    
     Telecommunications    (64)   (24.2)        -                -
                           ---    -----       ---              ---
      Total                $43   1.6   %     $163             $(27)
                           ===      ===      ====             ====


                         Change in Net Sales for the
                       Quarter Ended December 25, 2009     Percentage of
                      versus Net Sales for the Quarter    Segment's Total
                           Ended December 26, 2008       Net Sales for the
                           -----------------------         Quarter Ended
                                      Total              December 25, 2009
                                      -----              -----------------
                                ($ in millions)                            

    Electronic Components (3):
      Automotive                 $302      42.3%                      53%
      DataComm                    (38)    (14.8)                      11
      Industrial                   (5)     (2.6)                      10
      Appliance                    23      20.9                        7
      Computer                     (5)     (4.2)                       6
      Consumer Devices             (3)     (2.7)                       6
      Other                        12       9.8                        7
                                  ---       ---                      ---
        Total                     286      17.6                      100%
                                  ---      ----                      ---
    Network Solutions (3):                       
      Energy                      (10)     (4.7)                      48
      Enterprise Networks           1       0.9                       26
      Service Providers           (25)    (19.2)                      25
      Other                         -         -                        1
                                  ---       ---                      ---
        Total                     (34)     (7.5)                     100%
                                  ---      ----                      ---
    Specialty Products (3):                
      Aerospace, Defense, and
       Marine                     (20)    (12.3)                      40
      Touch Systems                 5       6.1                       24
      Circuit Protection           11      18.6                       20
      Medical                      (5)     (7.9)                      16
                                  ---      ----                      ---
        Total                      (9)     (2.5)                     100%
                                  ---      ----                      ---
    Undersea   
     Telecommunications           (64)    (24.2)
                                  ---     -----
        Total                    $179       6.6%
                                 ====       ===
       
       
    (1) Represents the change in net sales resulting from volume and
    price changes, before consideration of acquisitions, divestitures,
    and the impact of changes in foreign currency exchange rates.
    Organic net sales growth is a non-GAAP measure.   See description
    of non-GAAP measures contained in this release.
    (2) Represents the change in net sales resulting from changes in
    foreign currency exchange rates.
    (3) Industry end market information about net sales is presented
    consistently with our internal management reporting and may be
    periodically revised as management deems necessary.


                            TYCO ELECTRONICS LTD.
                  NET SALES GROWTH RECONCILIATION (UNAUDITED) 


               Change in Net Sales for the Quarter Ended December 25, 2009
                versus Net Sales for the Quarter Ended September 25, 2009
                ---------------------------------------------------------
                                  
                              Organic (1)      Translation(2)    Divestiture
                              -----------      --------------    -----------
                                              ($ in millions)



    Electronic 
     Components (3):
      Automotive              $143     17.1%       $35                $-
      DataComm                  24     12.5          3                 -
      Industrial                21     12.6          2                 -
      Appliance                 13     10.9          2                 -
      Computer                   6      5.1          1                 -
      Consumer Devices           2      1.6          1                 -
      Other                     21     19.3          5                 -
                               ---     ----        ---               ---
        Total                  230     14.1         49                 -
                               ---     ----        ---               ---
    Network Solutions (3):                  
      Energy                    (9)    (4.4)         7                (2)
      Enterprise Networks       (4)    (3.6)         3                 -
      Service Providers         (9)    (8.2)         1                 -
      Other                     (2)   (24.9)         1                 -
                               ---    -----        ---               ---
        Total                  (24)    (5.6)        12                (2)
                               ---     ----        ---               ---
    Specialty Products (3):                  
      Aerospace, Defense, and
       Marine                   (7)    (4.9)         2                 -
      Touch Systems             (3)    (2.9)         2                 -
      Circuit Protection         2      2.6          1                 -
      Medical                   (2)    (2.9)         1                 -
                               ---     ----        ---               ---
        Total                  (10)    (2.7)         6                 -
                               ---     ----        ---               ---
    Undersea                  
     Telecommunications        (67)   (25.4)         -                 -
                               ---    -----        ---               ---
      Total                   $129      4.8%       $67               $(2)
                              ====      ===        ===               ===


                         Change in Net Sales for the
                       Quarter Ended December 25, 2009     Percentage of
                      versus Net Sales for the Quarter    Segment's Total
                           Ended September 25, 2009       Net Sales for the
                           ------------------------        Quarter Ended
                                      Total              December 25, 2009
                                      -----              -----------------
                                ($ in millions)                            



    Electronic Components (3):
      Automotive                $178     21.2%                 53%
      DataComm                    27     14.1                  11
      Industrial                  23     14.1                  10
      Appliance                   15     12.7                   7
      Computer                     7      6.5                   6
      Consumer Devices             3      2.9                   6
      Other                       26     23.9                   7
                                 ---     ----                 ---
        Total                    279     17.1                 100%
                                 ---     ----                 ---
    Network Solutions (3):
      Energy                      (4)    (1.9)                 48
      Enterprise Networks         (1)    (0.9)                 26
      Service Providers           (8)    (7.1)                 25
      Other                       (1)   (14.3)                  1
                                 ---    -----                 ---
        Total                    (14)    (3.2)                100%
                                 ---     ----                 ---
    Specialty Products (3):              
      Aerospace, Defense, and              
       Marine                     (5)    (3.4)                 40
      Touch Systems               (1)    (1.1)                 24
      Circuit Protection           3      4.5                  20
      Medical                     (1)    (1.7)                 16
                                 ---     ----                 ---
        Total                     (4)    (1.1)                100%
                                 ---     ----                 ---
    Undersea              
     Telecommunications          (67)   (25.0)            
                                 ---    -----            
      Total                     $194      7.2%            
                                ====      ===


    (1) Represents the change in net sales resulting from volume and
    price changes, before consideration of acquisitions, divestitures,
    and the impact of changes in foreign currency exchange rates.
    Organic net sales growth is a non-GAAP measure.   See description
    of non-GAAP measures contained in this release.
    (2) Represents the change in net sales resulting from changes in
    foreign currency exchange rates.
    (3) Industry end market information about net sales is presented
    consistently with our internal management reporting and may be
    periodically revised as management deems necessary.


                              TYCO ELECTRONICS LTD.
     RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES
                     For the Quarter Ended December 25, 2009
                                   (UNAUDITED)

                                           Adjustment
                                           ----------
                                          Restructuring
                                            and Other             Adjusted
                        U.S. GAAP       Charges, Net (1)      (Non-GAAP) (2)
                        ---------       ----------------      --------------
                                ($ in millions, except per share data)
    Operating
     Income:
    Electronic
     Components               $163                    $44                $207
    Network
     Solutions                  20                     17                  37
    Specialty
     Products                   51                      -                  51
    Undersea
     Telecommunications         35                      2                  37
                               ---                    ---                 ---
        Total                 $269                    $63                $332
                              ====                    ===                ====

    Operating
     Margin                    9.3%                                      11.5%
                               ===                                       ====

    Income Tax
     Expense                  $(69)                  $(16)               $(85)
                              ====                   ====                ====

    Income from
     Continuing
     Operations
       Attributable
        to Tyco
        Electronics
        Ltd.                  $172                    $47                $219
                              ====                    ===                ====

    Diluted
     Earnings per
     Share from
     Continuing
     Operations
       Attributable
        to Tyco
        Electronics
        Ltd.                 $0.37                  $0.10               $0.47
                             =====                  =====               =====


    (1) Includes $66 million recorded in net restructuring and other
    charges and a $3 million credit recorded in cost of sales.
    (2) See description of non-GAAP measures contained in this release.



                               TYCO ELECTRONICS LTD.
     RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES
                      For the Quarter Ended December 26, 2008
                                    (UNAUDITED)

                                              Adjustments
                                              -----------
                                      Restructuring
                                        and Other
                            U.S.         Charges,    Other          Adjusted
                            GAAP           Net(1)  Items, Net(2) (Non-GAAP)(3)
                            ----           ------  ------------  -------------
                                  ($ in millions, except per share data)
    Operating Income:
    Electronic
     Components              $(18)           $42            $-           $24
    Network Solutions          44             19             -            63
    Specialty
     Products                  28             14             8            50
    Undersea
     Telecommunications        38              3             -            41
    Pre-separation
     litigation
     charges, net              (9)             -             9             -
                              ---            ---           ---           ---
        Total                 $83            $78           $17          $178
                              ===            ===           ===          ====

    Operating Margin          3.1%                                       6.6%
                              ===                                        ===

    Income Tax
     Expense                 $(14)          $(23)          $(3)         $(40)
                             ====           ====           ===          ====

    Income from
     Continuing
     Operations
       Attributable to
        Tyco Electronics
        Ltd.                  $30            $55           $14           $99
                              ===            ===           ===           ===

    Diluted Earnings
     per Share from
       Continuing
        Operations
        Attributable
       to Tyco
        Electronics Ltd.    $0.07          $0.12         $0.03         $0.21
                            =====          =====         =====         =====

    (1) Includes $77 million recorded in net restructuring and other
    charges and $1 million recorded in cost of sales.
    (2) Consists of $9 million of costs related to the settlement of pre-
    separation securities litigation and $8 million of costs related to
    a product liability matter from several years ago recorded in
    selling, general, and administrative expenses.
    (3) See description of non-GAAP measures contained in this release.



                               TYCO ELECTRONICS LTD.
     RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES 
                     For the Quarter Ended September 25, 2009
                                    (UNAUDITED)


                                                Adjustments
                                                -----------
                                     Restructuring                          
                                       and Other          Retirement  Adjusted
                            U.S.        Charges,     Tax        of    (Non-
                            GAAP        Net (1)    Items (2)   Debt  GAAP) (3)
                            ----        -------    ---------   ----  ---------
                                   ($ in millions, except per share data)
    Operating
     Income:
    Electronic
     Components              $38          $24         $-         $-      $62
    Network
     Solutions                37           14          -          -       51
    Specialty
     Products                 47            4          -          -       51
    Undersea
     Telecommunications       54            3          -          -       57
                             ---          ---        ---        ---      ---
        Total               $176          $45         $-         $-     $221
                            ====          ===        ===        ===     ====

    Operating
     Margin                  6.5%                                        8.2%
                             ===                                         ===

    Income Tax
     Expense                 $(1)         $(9)      $(46)        $-     $(56)
                             ===          ===       ====        ===     ====

    Income from
     Continuing
     Operations
     Attributable
     to Tyco
     Electronics
     Ltd.                    $83          $36        $40       $(19)    $140
                             ===          ===        ===       ====     ====

    Diluted
     Earnings per
     Share from
     Continuing
     Operations
     Attributable
     to Tyco
     Electronics
     Ltd.                  $0.18        $0.08      $0.09     $(0.04)   $0.30
                           =====        =====      =====     ======    =====

    (1) Includes $46 million recorded in net restructuring and other
    charges and a $1 million credit recorded in cost of sales.
    (2) Includes an income tax benefit primarily related to proposed
    adjustments to prior year tax returns, and charges to other expense
    pursuant to the Tax Sharing Agreement with Tyco International and
    Covidien.
    (3) See description of non-GAAP measures contained in this release.


SOURCE: Tyco Electronics Ltd.

Web site: http://www.tycoelectronics.com/


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