Tyco Reports Increased Profit and Plans to Sell Assets

Tyco International Ltd. (West Windsor, NJ) reported that quarterly net income rose 23 percent, beating the company's own forecast. The conglomerate, which previously said it planned to exit more than 50 small businesses, is in talks on about 20 potential deals to unload assets.

Tyco, whose former chairman and former finance chief have been on trial since September on charges of having looted the company of $600 million, said it closed 47 facilities and cut about 1,200 employees in the fiscal first quarter as part of a restructuring program unveiled last year.

Tyco shares rose as much as 3 percent in early trade. Net income rose to $719 million, or $0.34 a diluted share, for the fiscal first quarter ended December 31, 2003, from $586 million, or $0.28 a share, the year before. Quarterly revenue rose 9 percent to $9.7 billion, with the weak dollar contributing seven percentage points of the increase.

Tyco said its earnings outlook for 2004 is unchanged. The company still expects to earn $1.42 to $1.52 a share before restructuring charges and divestitures, and $0.35 to $0.37 in the current quarter. Tyco lowered its debt load in the quarter by $2.1 billion to $18.9 billion, reporting a debt-to-capitalization ratio of 40.4 percent, down from 44.3 percent in the previous quarter.