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Non-Tech : Tyco International Limited (TYC)
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To: Terrapin who started this subject3/4/2004 1:50:24 PM
From: rich evans  Read Replies (1) of 3770
 
Tyco going up today again. Results should continue to improve as margins go up.

Tyco's Q1 report showed operating earnings of $1237 mill and 12.8% operating margin(EBIT).

The 10Q shows more the complete picture because tyco is running some onetime charges and credits thru the P&L and other charges thru the cash flow ( working capital and Other liabilities) section to the tune of 57 mill.

Near as I can figure out the true operating picture for tyco is:
$1237 mill operating income plus 16mill-F/S charges minus 20mill- Elect credits plus 3 mill Health charges, plus 1.2 mill engineer charges plus 30 mill Plastic charges plus 70.2 mill A/R and invent charges overall.

The operating income for tyco therefore without these one time charges was about 1338 mill or 13.8% operating margin.

Tyco also put 17 mill of TGN losses in the corporate results. So continued operations should be 17 mill higher or $1354 mill or 14% operating margin.

In addition outside the P&L tyco charged to "working capital and other" 57.2 mill in additional restructure charges on the cashflow statement.

This quarter we will get restructure charges again and reported results depends on where tyco puts these charges in accordance with GAAP.

But my conclusion is that based on an ongoing forward looking view, operations are improving quickly but masked both in cashflow and P&L with these restructure charges. When they are finished in 2004 and assets also sold, we will see a quantum leap in tyco's reported profits, operating margins and cashflow.
Rich
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