Q4 sales up 4 percent; Adjusted EPS up 10 percent; GAAP EPS up 74 percent
TE Connectivity Ltd. (NYSE: TEL) today reported results for the fiscal fourth quarter and year ended September 26, 2014.
Fourth Quarter Highlights
- Net sales increased to $3.58 billion, up 4 percent versus the prior year and up 3 percent organically
- Adjusted Earnings Per Share (EPS) were $1.02, up 10 percent versus the prior year and at the high end of guidance range
- Diluted Earnings Per Share from Continuing Operations (GAAP EPS) were$1.60
- Free cash flow was $661 million
- Returned $283 million to shareholders through share repurchases and dividends
- Named to Dow Jones Sustainability North American Index for the third consecutive year
Full Year Highlights
- Net sales were $13.9 billion, up 5 percent on an actual and organic basis versus the prior year
- Adjusted EPS were $3.79, up 17 percent versus the prior year
- Diluted Earnings Per Share from Continuing Operations (GAAP EPS) were $4.29
- Free cash flow was $1.7 billion
- Returned $1.0 billion to shareholders through share repurchases and dividends
- Expanded position in the oil and gas market with acquisitions of LL Rowe, Seacon and Seacon Phoenix
- Established TE’s leadership in the large and attractive sensor market with the acquisitions of Measurement Specialties, Inc. (closed October 9, 2014) and American Sensor Technologies, Inc.
“The fourth quarter was a strong finish to a record year for the company,” said Tom Lynch, TE Connectivity Chairman and CEO. “Our performance was led by continued momentum in our Transportation and Industrial segments and our Appliances business. Our adjusted operating margins improved to 16 percent on higher volume and benefits driven by our TE Operating Advantage (TEOA) program.
“I am really pleased with our team’s achievements for the full year just ended. Sales grew 5 percent to $13.9 billion and adjusted EPS increased 17 percent to $3.79, new records for the company. Our strong performance generated $1.7 billion in free cash flow enabling us to make key strategic investments and return $1 billion to shareholders.
“TE is a world leader providing the connectivity and sensor solutions that are essential in our increasingly connected world. For fiscal 2015, we expect to deliver another year of solid sales and earnings growth driven by growth in most of our businesses. We expect continued solid performance in our Transportation and Industrial segments and Appliances business, TE’s businesses focused on harsh environment applications; and double-digit revenue growth in our Networks segment due to significant project wins in our Subcom business.”
FISCAL FOURTH QUARTER RESULTS
The company reported net sales of $3.58 billion, compared to prior year sales of $3.43 billion. Adjusted EPS were $1.02, compared to $0.93 in the prior year. GAAP EPS were $1.60, compared to $0.92 in the prior year. Free cash flow was $661 million for the quarter.
GAAP EPS includes $50 million of acquisition related charges and restructuring and other charges.
Excluding Subsea Communications, total company orders were $3.4 billion, up 4.9 percent, and the book-to-bill ratio was 0.98.
OUTLOOK
For the fiscal first quarter 2015, the company expects net sales of $3.46 billion to $3.56 billion and adjusted EPS of $0.88 to $0.92. GAAP EPS are expected to be $0.95 to $0.99, including acquisition related charges of $0.14, and restructuring and other charges of $0.05, and income from tax related items of $0.26.
For the full year, the company expects net sales of $14.7 to $15.3 billion and adjusted EPS of $4.05 to $4.35. GAAP EPS are expected to be $3.99 to $4.29, including acquisition related charges of $0.23, restructuring and other charges of $0.09, and income from tax related items of $0.26.
The outlook assumes foreign exchange and commodity rates that are consistent with current levels and includes the recently completed acquisition of Measurement Specialties, Inc.
Information about TE Connectivity’s use of non-GAAP financial measures is described at the end of this press release. For a reconciliation of these non-GAAP financial measures, see the attached tables.
