Record sales and double-digit EPS growth driven by continued strong operational performance
SCHAFFHAUSEN, Switzerland, April 27, 2022 /PRNewswire/ -- TE Connectivity Ltd. (NYSE: TEL) today reported results for the fiscal second quarter ended March 25, 2022.
Second Quarter Highlights
"I am very pleased with our strong second quarter performance and our global team's execution in delivering record sales and double-digit EPS growth that exceeded our expectations," said TE Connectivity CEO Terrence Curtin. "All three of our business segments – Transportation, Industrial and Communications – contributed and delivered sales growth year over year, demonstrating the strategic positioning of our portfolio, as we continue to benefit from our leadership position in long-term growth and sustainability trends. We continue to outperform the market in both automotive and commercial transportation due to our Transportation segment's ongoing content growth and global design win momentum in electric vehicles. Our Communications segment is also seeing continued content growth in high-speed cloud applications and market share gains as we work with leading cloud customers on AI deployment and data center energy efficiencies. Our Industrial segment continues to demonstrate growth in factory automation applications and renewable energy applications where our technology is advancing sustainability initiatives. Our order trends remained strong through the quarter, and we expect to deliver year-over-year sales growth in the third quarter despite broader volatility in the macro environment."
Third Quarter FY22 OutlookFor the third quarter of fiscal 2022, the company expects net sales of approximately $3.9 billion, reflecting an approximate 1% increase on a reported basis and an approximate 3% increase on an organic basis year over year. The company has included in its third quarter outlook an approximately 300 basis point year-over-year sales headwind from COVID-related shutdowns in China. GAAP EPS from continuing operations are expected to be approximately $1.71, with adjusted EPS of approximately $1.75, both down approximately 2% year over year.
Information about TE Connectivity's use of non-GAAP financial measures is provided below. For reconciliations of these non-GAAP financial measures, see the attached tables.
Conference Call and WebcastThe company will hold a conference call today beginning at 8:30 a.m. ET. The dial-in information is provided here:
About TE ConnectivityTE Connectivity Ltd. (NYSE: TEL) is a global industrial technology leader creating a safer, sustainable, productive, and connected future. Our broad range of connectivity and sensor solutions, proven in the harshest environments, enable advancements in transportation, industrial applications, medical technology, energy, data communications, and the home. With more than 85,000 employees, including over 8,000 engineers, working alongside customers in approximately 140 countries, TE ensures that EVERY CONNECTION COUNTS. Learn more at www.te.com and on LinkedIn, Facebook, WeChat and Twitter.
Non-GAAP Financial MeasuresWe present non-GAAP performance and liquidity measures as we believe it is appropriate for investors to consider adjusted financial measures in addition to results in accordance with accounting principles generally accepted in the U.S. ("GAAP"). These non-GAAP financial measures provide supplemental information and should not be considered replacements for results in accordance with GAAP. Management uses non-GAAP financial measures internally for planning and forecasting purposes and in its decision-making processes related to the operations of our company. We believe these measures provide meaningful information to us and investors because they enhance the understanding of our operating performance, ability to generate cash, and the trends of our business. Additionally, we believe that investors benefit from having access to the same financial measures that management uses in evaluating our operations. The primary limitation of these measures is that they exclude the financial impact of items that would otherwise either increase or decrease our reported results. This limitation is best addressed by using these non-GAAP financial measures in combination with the most directly comparable GAAP financial measures in order to better understand the amounts, character, and impact of any increase or decrease in reported amounts. These non-GAAP financial measures may not be comparable to similarly-titled measures reported by other companies.
The following provides additional information regarding our non-GAAP financial measures:
Forward-Looking StatementsThis release contains certain "forward-looking statements" within the meaning of the U.S. 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. We have no intention and are under no obligation to update or alter (and expressly disclaim any such intention or obligation to do so) our 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, and the impact on our operations resulting from the coronavirus disease 2019 ("COVID-19"). Examples of factors that could cause actual results to differ materially from those described in the forward-looking statements include, among others, the extent, severity and duration of COVID-19 negatively affecting our business operations; business, economic, competitive and regulatory risks, such as conditions affecting demand for products in the automotive and other industries we serve; competition and pricing pressure; fluctuations in foreign currency exchange rates and commodity prices; natural disasters and political, economic and military instability in countries in which we operate, including continuing military conflict between Russia and Ukraine resulting from Russia's invasion of Ukraine or escalating tensions in surrounding countries; developments in the credit markets; future goodwill impairment; 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, including the effects of Swiss tax reform. In addition, the extent to which COVID-19 will impact our business and our financial results will depend on future developments, which are highly uncertain and cannot be predicted. Such developments may include the geographic spread of the virus, the severity of the virus, the duration of the outbreak, the impact on our suppliers' and customers' supply chains, the actions that may be taken by various governmental authorities in response to the outbreak in jurisdictions in which we operate, and the possible impact on the global economy and local economies in which we operate. More detailed information about these and other factors is set forth in TE Connectivity Ltd.'s Annual Report on Form 10-K for the fiscal year ended Sept. 24, 2021 as well as in our Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other reports filed by us with the U.S. Securities and Exchange Commission.
TE CONNECTIVITY LTD. |
|||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) |
|||||||||||
For the Quarters Ended |
For the Six Months Ended |
||||||||||
March 25, |
March 26, |
March 25, |
March 26, |
||||||||
2022 |
2021 |
2022 |
2021 |
||||||||
(in millions, except per share data) |
|||||||||||
Net sales |
$ |
4,007 |
$ |
3,738 |
$ |
7,825 |
$ |
7,260 |
|||
Cost of sales |
2,670 |
2,528 |
5,258 |
4,904 |
|||||||
Gross margin |
1,337 |
1,210 |
2,567 |
2,356 |
|||||||
Selling, general, and administrative expenses |
416 |
401 |
779 |
762 |
|||||||
Research, development, and engineering expenses |
185 |
174 |
360 |
336 |
|||||||
Acquisition and integration costs |
10 |
6 |
18 |
14 |
|||||||
Restructuring and other charges, net |
21 |
17 |
33 |
184 |
|||||||
Operating income |
705 |
612 |
1,377 |
1,060 |
|||||||
Interest income |
4 |
8 |
6 |
11 |
|||||||
Interest expense |
(18) |
(13) |
(30) |
(28) |
|||||||
Other income, net |
5 |
4 |
20 |
3 |
|||||||
Income from continuing operations before income taxes |
696 |
611 |
1,373 |
1,046 |
|||||||
Income tax expense |
(136) |
(106) |
(246) |
(166) |
|||||||
Income from continuing operations |
560 |
505 |
1,127 |
880 |
|||||||
Income (loss) from discontinued operations, net of income taxes |
— |
1 |
(1) |
7 |
|||||||
Net income |
$ |
560 |
$ |
506 |
$ |
1,126 |
$ |
887 |
|||
Basic earnings per share: |
|||||||||||
Income from continuing operations |
$ |
1.72 |
$ |
1.53 |
$ |
3.46 |
$ |
2.66 |
|||
Income from discontinued operations |
— |
— |
— |
0.02 |
|||||||
Net income |
1.72 |
1.53 |
3.45 |
2.68 |
|||||||
Diluted earnings per share: |
|||||||||||
Income from continuing operations |
$ |
1.71 |
$ |
1.51 |
$ |
3.44 |
$ |
2.64 |
|||
Income from discontinued operations |
— |
— |
— |
0.02 |
|||||||
Net income |
1.71 |
1.51 |
3.43 |
2.66 |
|||||||
Weighted-average number of shares outstanding: |
|||||||||||
Basic |
325 |
331 |
326 |
331 |
|||||||
Diluted |
327 |
334 |
328 |
333 |
TE CONNECTIVITY LTD. |
|||||
CONSOLIDATED BALANCE SHEETS (UNAUDITED) |
|||||
March 25, |
September 24, |
||||
2022 |
2021 |
||||
(in millions, except share data) |
|||||
Assets |
|||||
Current assets: |
|||||
Cash and cash equivalents |
$ |
749 |
$ |
1,203 |
|
Accounts receivable, net of allowance for doubtful accounts of $50 and $41, respectively |
3,068 |
2,928 |
|||
Inventories |
2,999 |
2,511 |
|||
Prepaid expenses and other current assets |
601 |
621 |
|||
Total current assets |
7,417 |
7,263 |
|||
Property, plant, and equipment, net |
3,817 |
3,778 |
|||
Goodwill |
5,463 |
5,590 |
|||
Intangible assets, net |
1,441 |
1,549 |
|||
Deferred income taxes |
2,466 |
2,499 |
|||
Other assets |
847 |
783 |
|||
Total assets |
$ |
21,451 |
$ |
21,462 |
|
Liabilities, redeemable noncontrolling interests, and shareholders' equity |
|||||
Current liabilities: |
|||||
Short-term debt |
$ |
610 |
$ |
503 |
|
Accounts payable |
1,986 |
1,911 |
|||
Accrued and other current liabilities |
2,450 |
2,242 |
|||
Total current liabilities |
5,046 |
4,656 |
|||
Long-term debt |
3,441 |
3,589 |
|||
Long-term pension and postretirement liabilities |
1,103 |
1,139 |
|||
Deferred income taxes |
185 |
181 |
|||
Income taxes |
318 |
302 |
|||
Other liabilities |
809 |
847 |
|||
Total liabilities |
10,902 |
10,714 |
|||
Commitments and contingencies |
|||||
Redeemable noncontrolling interests |
107 |
114 |
|||
Shareholders' equity: |
|||||
Common shares, CHF 0.57 par value, 336,099,881 shares authorized and issued |
148 |
148 |
|||
Accumulated earnings |
12,160 |
11,709 |
|||
Treasury shares, at cost, 13,281,156 and 9,060,919 shares, respectively |
(1,769) |
(1,055) |
|||
Accumulated other comprehensive loss |
(97) |
(168) |
|||
Total shareholders' equity |
10,442 |
10,634 |
|||
Total liabilities, redeemable noncontrolling interests, and shareholders' equity |
$ |
21,451 |
$ |
21,462 |
TE CONNECTIVITY LTD. |
|||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) |
|||||||||||
For the Quarters Ended |
For the Six Months Ended |
||||||||||
March 25, |
March 26, |
March 25, |
March 26, |
||||||||
2022 |
2021 |
2022 |
2021 |
||||||||
(in millions) |
|||||||||||
Cash flows from operating activities: |
|||||||||||
Net income |
$ |
560 |
$ |
506 |
$ |
1,126 |
$ |
887 |
|||
(Income) loss from discontinued operations, net of income taxes |
— |
(1) |
1 |
(7) |
|||||||
Income from continuing operations |
560 |
505 |
1,127 |
880 |
|||||||
Adjustments to reconcile income from continuing operations to net cash |
|||||||||||
Depreciation and amortization |
194 |
193 |
392 |
380 |
|||||||
Deferred income taxes |
38 |
(6) |
42 |
(48) |
|||||||
Non-cash lease cost |
33 |
29 |
64 |
59 |
|||||||
Provision for losses on accounts receivable and inventories |
35 |
16 |
68 |
22 |
|||||||
Share-based compensation expense |
28 |
30 |
60 |
49 |
|||||||
Other |
13 |
(41) |
4 |
(20) |
|||||||
Changes in assets and liabilities, net of the effects of acquisitions and |
|||||||||||
Accounts receivable, net |
(205) |
(268) |
(57) |
(567) |
|||||||
Inventories |
(147) |
(67) |
(411) |
(212) |
|||||||
Prepaid expenses and other current assets |
(16) |
57 |
36 |
(30) |
|||||||
Accounts payable |
— |
161 |
15 |
510 |
|||||||
Accrued and other current liabilities |
(20) |
37 |
(305) |
125 |
|||||||
Income taxes |
(7) |
17 |
27 |
34 |
|||||||
Other |
(93) |
(83) |
(117) |
38 |
|||||||
Net cash provided by operating activities |
413 |
580 |
945 |
1,220 |
|||||||
Cash flows from investing activities: |
|||||||||||
Capital expenditures |
(179) |
(142) |
(351) |
(284) |
|||||||
Proceeds from sale of property, plant, and equipment |
9 |
57 |
63 |
58 |
|||||||
Acquisition of businesses, net of cash acquired |
(2) |
— |
(102) |
(107) |
|||||||
Other |
(12) |
8 |
7 |
10 |
|||||||
Net cash used in investing activities |
(184) |
(77) |
(383) |
(323) |
|||||||
Cash flows from financing activities: |
|||||||||||
Net decrease in commercial paper |
(479) |
— |
— |
— |
|||||||
Proceeds from issuance of debt |
588 |
661 |
588 |
661 |
|||||||
Repayment of debt |
(3) |
(250) |
(558) |
(280) |
|||||||
Proceeds from exercise of share options |
8 |
44 |
30 |
119 |
|||||||
Repurchase of common shares |
(404) |
(140) |
(708) |
(259) |
|||||||
Payment of common share dividends to shareholders |
(163) |
(159) |
(326) |
(318) |
|||||||
Other |
(7) |
(5) |
(38) |
(24) |
|||||||
Net cash provided by (used in) financing activities |
(460) |
151 |
(1,012) |
(101) |
|||||||
Effect of currency translation on cash |
(2) |
(4) |
(4) |
7 |
|||||||
Net increase (decrease) in cash, cash equivalents, and restricted cash |
(233) |
650 |
(454) |
803 |
|||||||
Cash, cash equivalents, and restricted cash at beginning of period |
982 |
1,098 |
1,203 |
945 |
|||||||
Cash, cash equivalents, and restricted cash at end of period |
$ |
749 |
$ |
1,748 |
$ |
749 |
$ |
1,748 |
|||
Supplemental cash flow information: |
|||||||||||
Interest paid on debt, net |
$ |
17 |
$ |
29 |
$ |
29 |
$ |
33 |
|||
Income taxes paid, net of refunds |
106 |
96 |
177 |
181 |
TE CONNECTIVITY LTD. |
|||||||||||
RECONCILIATION OF FREE CASH FLOW (UNAUDITED) |
|||||||||||
For the Quarters Ended |
For the Six Months Ended |
||||||||||
March 25, |
March 26, |
March 25, |
March 26, |
||||||||
2022 |
2021 |
2022 |
2021 |
||||||||
(in millions) |
|||||||||||
Net cash provided by operating activities |
$ |
413 |
$ |
580 |
$ |
945 |
$ |
1,220 |
|||
Excluding: |
|||||||||||
Cash (collected) paid pursuant to collateral requirements related to |
(1) |
(18) |
(42) |
12 |
|||||||
Capital expenditures, net |
(170) |
(85) |
(288) |
(226) |
|||||||
Free cash flow (1) |
$ |
242 |
$ |
477 |
$ |
615 |
$ |
1,006 |
|||
(1) Free cash flow is a non-GAAP financial measure. See description of non-GAAP financial measures. |
TE CONNECTIVITY LTD. |
|||||||||||||||||||||||
CONSOLIDATED SEGMENT DATA (UNAUDITED) |
|||||||||||||||||||||||
For the Quarters Ended |
For the Six Months Ended |
||||||||||||||||||||||
March 25, |
March 26, |
March 25, |
March 26, |
||||||||||||||||||||
2022 |
2021 |
2022 |
2021 |
||||||||||||||||||||
($ in millions) |
|||||||||||||||||||||||
Net Sales |
Net Sales |
Net Sales |
Net Sales |
||||||||||||||||||||
Transportation Solutions |
$ |
2,314 |
$ |
2,287 |
$ |
4,472 |
$ |
4,511 |
|||||||||||||||
Industrial Solutions |
1,075 |
952 |
2,134 |
1,825 |
|||||||||||||||||||
Communications Solutions |
618 |
499 |
1,219 |
924 |
|||||||||||||||||||
Total |
$ |
4,007 |
$ |
3,738 |
$ |
7,825 |
$ |
7,260 |
|||||||||||||||
Operating |
Operating |
Operating |
Operating |
Operating |
Operating |
Operating |
Operating |
||||||||||||||||
Income |
Margin |
Income |
Margin |
Income |
Margin |
Income |
Margin |
||||||||||||||||
Transportation Solutions |
$ |
409 |
17.7 |
% |
$ |
398 |
17.4 |
% |
$ |
804 |
18.0 |
% |
$ |
706 |
15.7 |
% |
|||||||
Industrial Solutions |
148 |
13.8 |
111 |
11.7 |
271 |
12.7 |
187 |
10.2 |
|||||||||||||||
Communications Solutions |
148 |
23.9 |
103 |
20.6 |
302 |
24.8 |
167 |
18.1 |
|||||||||||||||
Total |
$ |
705 |
17.6 |
% |
$ |
612 |
16.4 |
% |
$ |
1,377 |
17.6 |
% |
$ |
1,060 |
14.6 |
% |
|||||||
Adjusted |
Adjusted |
Adjusted |
Adjusted |
Adjusted |
Adjusted |
Adjusted |
Adjusted |
||||||||||||||||
Operating |
Operating |
Operating |
Operating |
Operating |
Operating |
Operating |
Operating |
||||||||||||||||
Income (1) |
Margin (1) |
Income (1) |
Margin (1) |
Income (1) |
Margin (1) |
Income (1) |
Margin (1) |
||||||||||||||||
Transportation Solutions |
$ |
422 |
18.2 |
% |
$ |
413 |
18.1 |
% |
$ |
814 |
18.2 |
% |
$ |
844 |
18.7 |
% |
|||||||
Industrial Solutions |
164 |
15.3 |
119 |
12.5 |
321 |
15.0 |
237 |
13.0 |
|||||||||||||||
Communications Solutions |
150 |
24.3 |
105 |
21.0 |
313 |
25.7 |
180 |
19.5 |
|||||||||||||||
Total |
$ |
736 |
18.4 |
% |
$ |
637 |
17.0 |
% |
$ |
1,448 |
18.5 |
% |
$ |
1,261 |
17.4 |
% |
|||||||
(1) Adjusted operating income and adjusted operating margin are non-GAAP financial measures. See description of non-GAAP financial measures. |
TE CONNECTIVITY LTD. |
|||||||||||||||||
RECONCILIATION OF NET SALES GROWTH (DECLINE) (UNAUDITED) |
|||||||||||||||||
Change in Net Sales for the Quarter Ended March 25, 2022 |
|||||||||||||||||
versus Net Sales for the Quarter Ended March 26, 2021 |
|||||||||||||||||
Net Sales |
Organic Net Sales |
Acquisitions/ |
|||||||||||||||
Growth (Decline) |
Growth (Decline) (1) |
Translation (2) |
(Divestitures) |
||||||||||||||
($ in millions) |
|||||||||||||||||
Transportation Solutions (3): |
|||||||||||||||||
Automotive |
$ |
23 |
1.4 |
% |
$ |
80 |
4.9 |
% |
$ |
(57) |
$ |
— |
|||||
Commercial transportation |
12 |
3.1 |
21 |
5.4 |
(9) |
— |
|||||||||||
Sensors |
(8) |
(2.9) |
— |
— |
(8) |
— |
|||||||||||
Total |
27 |
1.2 |
101 |
4.5 |
(74) |
— |
|||||||||||
Industrial Solutions (3): |
|||||||||||||||||
Industrial equipment |
133 |
39.2 |
93 |
27.2 |
(13) |
53 |
|||||||||||
Aerospace, defense, oil, and gas |
(6) |
(2.2) |
— |
— |
(5) |
(1) |
|||||||||||
Energy |
(1) |
(0.5) |
9 |
4.8 |
(8) |
(2) |
|||||||||||
Medical |
(3) |
(1.9) |
(1) |
(1.2) |
(2) |
— |
|||||||||||
Total |
123 |
12.9 |
101 |
10.5 |
(28) |
50 |
|||||||||||
Communications Solutions (3): |
|||||||||||||||||
Data and devices |
107 |
38.5 |
98 |
35.0 |
(4) |
13 |
|||||||||||
Appliances |
12 |
5.4 |
16 |
7.3 |
(4) |
— |
|||||||||||
Total |
119 |
23.8 |
114 |
22.8 |
(8) |
13 |
|||||||||||
Total |
$ |
269 |
7.2 |
% |
$ |
316 |
8.4 |
% |
$ |
(110) |
$ |
63 |
|||||
Change in Net Sales for the Six Months Ended March 25, 2022 |
|||||||||||||||||
versus Net Sales for the Six Months Ended March 26, 2021 |
|||||||||||||||||
Net Sales |
Organic Net Sales |
Acquisitions/ |
|||||||||||||||
Growth (Decline) |
Growth (Decline) (1) |
Translation (2) |
(Divestitures) |
||||||||||||||
($ in millions) |
|||||||||||||||||
Transportation Solutions (3): |
|||||||||||||||||
Automotive |
$ |
(86) |
(2.6) |
% |
$ |
(11) |
(0.4) |
% |
$ |
(75) |
$ |
— |
|||||
Commercial transportation |
46 |
6.5 |
57 |
7.9 |
(11) |
— |
|||||||||||
Sensors |
1 |
0.2 |
13 |
2.5 |
(12) |
— |
|||||||||||
Total |
(39) |
(0.9) |
59 |
1.3 |
(98) |
— |
|||||||||||
Industrial Solutions (3): |
|||||||||||||||||
Industrial equipment |
300 |
47.3 |
212 |
33.0 |
(25) |
113 |
|||||||||||
Aerospace, defense, oil, and gas |
(14) |
(2.7) |
(6) |
(1.4) |
(8) |
— |
|||||||||||
Energy |
15 |
4.2 |
38 |
10.5 |
(12) |
(11) |
|||||||||||
Medical |
8 |
2.5 |
11 |
3.1 |
(3) |
— |
|||||||||||
Total |
309 |
16.9 |
255 |
13.9 |
(48) |
102 |
|||||||||||
Communications Solutions (3): |
|||||||||||||||||
Data and devices |
222 |
43.4 |
209 |
40.7 |
(5) |
18 |
|||||||||||
Appliances |
73 |
17.7 |
77 |
18.4 |
(4) |
— |
|||||||||||
Total |
295 |
31.9 |
286 |
30.8 |
(9) |
18 |
|||||||||||
Total |
$ |
565 |
7.8 |
% |
$ |
600 |
8.2 |
% |
$ |
(155) |
$ |
120 |
|||||
(1) Organic net sales growth (decline) is a non-GAAP financial measure. See description of non-GAAP financial measures. |
|||||||||||||||||
(2) Represents the change in net sales resulting from changes in foreign currency exchange rates. |
|||||||||||||||||
(3) Industry end market information is presented consistently with our internal management reporting and may be periodically revised as management deems necessary. |
TE CONNECTIVITY LTD. |
||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES |
||||||||||||||||
For the Quarter Ended March 25, 2022 |
||||||||||||||||
(UNAUDITED) |
||||||||||||||||
Adjustments |
||||||||||||||||
Acquisition- |
Restructuring |
|||||||||||||||
Related |
and Other |
Adjusted |
||||||||||||||
U.S. GAAP |
Charges (1) |
Charges, Net (1) |
Tax Items (2) |
(Non-GAAP) (3) |
||||||||||||
($ in millions, except per share data) |
||||||||||||||||
Operating income: |
||||||||||||||||
Transportation Solutions |
$ |
409 |
$ |
4 |
$ |
9 |
$ |
— |
$ |
422 |
||||||
Industrial Solutions |
148 |
6 |
10 |
— |
164 |
|||||||||||
Communications Solutions |
148 |
— |
2 |
— |
150 |
|||||||||||
Total |
$ |
705 |
$ |
10 |
$ |
21 |
$ |
— |
$ |
736 |
||||||
Operating margin |
17.6 |
% |
18.4 |
% |
||||||||||||
Other income, net |
$ |
5 |
$ |
— |
$ |
— |
$ |
— |
$ |
5 |
||||||
Income tax expense |
$ |
(136) |
$ |
(2) |
$ |
(5) |
$ |
8 |
$ |
(135) |
||||||
Effective tax rate |
19.5 |
% |
18.6 |
% |
||||||||||||
Income from continuing operations |
$ |
560 |
$ |
8 |
$ |
16 |
$ |
8 |
$ |
592 |
||||||
Diluted earnings per share from |
$ |
1.71 |
$ |
0.02 |
$ |
0.05 |
$ |
0.02 |
$ |
1.81 |
||||||
(1) The tax effect of each non-GAAP adjustment is calculated based on the jurisdictions in which the expense (income) is incurred and the tax laws in effect for each such jurisdiction. |
||||||||||||||||
(2) Includes $27 million of income tax expense related to the write-down of certain deferred tax assets to the lower tax rate enacted in the canton of Schaffhausen on December 27, 2021. Also includes a $19 million income tax benefit related to the tax impacts of an intercompany transaction. Our estimated annual effective tax rate for fiscal 2022 includes a total income tax benefit of approximately $75 million related to this transaction, with portions recognized in the quarters ended December 24, 2021 and March 25, 2022 and the remainder to be recognized in the remaining quarters of fiscal 2022. |
||||||||||||||||
(3) See description of non-GAAP financial measures. |
TE CONNECTIVITY LTD. |
|||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES |
|||||||||||||
For the Quarter Ended March 26, 2021 |
|||||||||||||
(UNAUDITED) |
|||||||||||||
Adjustments |
|||||||||||||
Acquisition- |
Restructuring |
||||||||||||
Related |
and Other |
Adjusted |
|||||||||||
U.S. GAAP |
Charges (1) |
Charges, Net (1) |
(Non-GAAP) (2) |
||||||||||
($ in millions, except per share data) |
|||||||||||||
Operating income: |
|||||||||||||
Transportation Solutions |
$ |
398 |
$ |
5 |
$ |
10 |
$ |
413 |
|||||
Industrial Solutions |
111 |
3 |
5 |
119 |
|||||||||
Communications Solutions |
103 |
— |
2 |
105 |
|||||||||
Total |
$ |
612 |
$ |
8 |
$ |
17 |
$ |
637 |
|||||
Operating margin |
16.4 |
% |
17.0 |
% |
|||||||||
Other income, net |
$ |
4 |
$ |
— |
$ |
— |
$ |
4 |
|||||
Income tax expense |
$ |
(106) |
$ |
(2) |
$ |
(2) |
$ |
(110) |
|||||
Effective tax rate |
17.3 |
% |
17.3 |
% |
|||||||||
Income from continuing operations |
$ |
505 |
$ |
6 |
$ |
15 |
$ |
526 |
|||||
Diluted earnings per share from continuing operations |
$ |
1.51 |
$ |
0.02 |
$ |
0.04 |
$ |
1.57 |
|||||
(1) The tax effect of each non-GAAP adjustment is calculated based on the jurisdictions in which the expense (income) is incurred and the tax laws in effect for each such jurisdiction. |
|||||||||||||
(2) See description of non-GAAP financial measures. |
TE CONNECTIVITY LTD. |
||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES |
||||||||||||||||
For the Six Months Ended March 25, 2022 |
||||||||||||||||
(UNAUDITED) |
||||||||||||||||
Adjustments |
||||||||||||||||
Acquisition- |
Restructuring |
|||||||||||||||
Related |
and Other |
Adjusted |
||||||||||||||
U.S. GAAP |
Charges (1) |
Charges, Net (1)(2) |
Tax Items (3) |
(Non-GAAP) (4) |
||||||||||||
($ in millions, except per share data) |
||||||||||||||||
Operating income: |
||||||||||||||||
Transportation Solutions |
$ |
804 |
$ |
7 |
$ |
3 |
$ |
— |
$ |
814 |
||||||
Industrial Solutions |
271 |
18 |
32 |
— |
321 |
|||||||||||
Communications Solutions |
302 |
1 |
10 |
— |
313 |
|||||||||||
Total |
$ |
1,377 |
$ |
26 |
$ |
45 |
$ |
— |
$ |
1,448 |
||||||
Operating margin |
17.6 |
% |
18.5 |
% |
||||||||||||
Other income, net |
$ |
20 |
$ |
— |
$ |
— |
$ |
(11) |
$ |
9 |
||||||
Income tax expense |
$ |
(246) |
$ |
(5) |
$ |
(12) |
$ |
3 |
$ |
(260) |
||||||
Effective tax rate |
17.9 |
% |
18.1 |
% |
||||||||||||
Income from continuing operations |
$ |
1,127 |
$ |
21 |
$ |
33 |
$ |
(8) |
$ |
1,173 |
||||||
Diluted earnings per share from |
$ |
3.44 |
$ |
0.06 |
$ |
0.10 |
$ |
(0.02) |
$ |
3.58 |
||||||
(1) The tax effect of each non-GAAP adjustment is calculated based on the jurisdictions in which the expense (income) is incurred and the tax laws in effect for each such jurisdiction. |
||||||||||||||||
(2) Includes $33 million recorded in net restructuring and other charges and $12 million recorded in cost of sales. |
||||||||||||||||
(3) Includes a $36 million income tax benefit related to the tax impacts of an intercompany transaction. Our estimated annual effective tax rate for fiscal 2022 includes a total income tax benefit of approximately $75 million related to this transaction, with portions recognized in the quarters ended December 24, 2021 and March 25, 2022 and the remainder to be recognized in the remaining quarters of fiscal 2022. Also includes $27 million of income tax expense related to the write-down of certain deferred tax assets to the lower tax rate enacted in the canton of Schaffhausen, and $12 million of income tax expense related to an income tax audit of an acquired entity, as well as the related impact of $11 million to other income pursuant to the indemnification terms of the purchase agreement. |
||||||||||||||||
(4) See description of non-GAAP financial measures. |
TE CONNECTIVITY LTD. |
||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES |
||||||||||||||||
For the Six Months Ended March 26, 2021 |
||||||||||||||||
(UNAUDITED) |
||||||||||||||||
Adjustments |
||||||||||||||||
Acquisition- |
Restructuring |
|||||||||||||||
Related |
and Other |
Adjusted |
||||||||||||||
U.S. GAAP |
Charges (1) |
Charges, Net (1) |
Tax Items (2) |
(Non-GAAP) (3) |
||||||||||||
($ in millions, except per share data) |
||||||||||||||||
Operating income: |
||||||||||||||||
Transportation Solutions |
$ |
706 |
$ |
10 |
$ |
128 |
$ |
— |
$ |
844 |
||||||
Industrial Solutions |
187 |
7 |
43 |
— |
237 |
|||||||||||
Communications Solutions |
167 |
— |
13 |
— |
180 |
|||||||||||
Total |
$ |
1,060 |
$ |
17 |
$ |
184 |
$ |
— |
$ |
1,261 |
||||||
Operating margin |
14.6 |
% |
17.4 |
% |
||||||||||||
Other income, net |
$ |
3 |
$ |
— |
$ |
— |
$ |
— |
$ |
3 |
||||||
Income tax expense |
$ |
(166) |
$ |
(4) |
$ |
(34) |
$ |
(29) |
$ |
(233) |
||||||
Effective tax rate |
15.9 |
% |
18.7 |
% |
||||||||||||
Income from continuing operations |
$ |
880 |
$ |
13 |
$ |
150 |
$ |
(29) |
$ |
1,014 |
||||||
Diluted earnings per share from continuing operations |
$ |
2.64 |
$ |
0.04 |
$ |
0.45 |
$ |
(0.09) |
$ |
3.05 |
||||||
(1) The tax effect of each non-GAAP adjustment is calculated based on the jurisdictions in which the expense (income) is incurred and the tax laws in effect for each such jurisdiction. |
||||||||||||||||
(2) Income tax benefits related to an Internal Revenue Service approved change in the tax method of depreciating or amortizing certain assets. |
||||||||||||||||
(3) See description of non-GAAP financial measures. |
TE CONNECTIVITY LTD. |
|||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES |
|||||||||||||
For the Quarter Ended June 25, 2021 |
|||||||||||||
(UNAUDITED) |
|||||||||||||
Adjustments |
|||||||||||||
Acquisition- |
Restructuring |
||||||||||||
Related |
and Other |
Adjusted |
|||||||||||
U.S. GAAP |
Charges (1) |
Charges, Net (1) |
(Non-GAAP) (2) |
||||||||||
($ in millions, except per share data) |
|||||||||||||
Operating income: |
|||||||||||||
Transportation Solutions |
$ |
433 |
$ |
5 |
$ |
2 |
$ |
440 |
|||||
Industrial Solutions |
148 |
4 |
6 |
158 |
|||||||||
Communications Solutions |
133 |
— |
3 |
136 |
|||||||||
Total |
$ |
714 |
$ |
9 |
$ |
11 |
$ |
734 |
|||||
Operating margin |
18.6 |
% |
19.1 |
% |
|||||||||
Other income, net |
$ |
2 |
$ |
— |
$ |
— |
$ |
2 |
|||||
Income tax expense |
$ |
(124) |
$ |
(2) |
$ |
(4) |
$ |
(130) |
|||||
Effective tax rate |
17.6 |
% |
17.9 |
% |
|||||||||
Income from continuing operations |
$ |
581 |
$ |
7 |
$ |
7 |
$ |
595 |
|||||
Diluted earnings per share from continuing operations |
$ |
1.74 |
$ |
0.02 |
$ |
0.02 |
$ |
1.79 |
|||||
(1) The tax effect of each non-GAAP adjustment is calculated based on the jurisdictions in which the expense (income) is incurred and the tax laws in effect for each such jurisdiction. |
|||||||||||||
(2) See description of non-GAAP financial measures. |
TE CONNECTIVITY LTD. |
|||||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES |
|||||||||||||||||||
For the Year Ended September 24, 2021 |
|||||||||||||||||||
(UNAUDITED) |
|||||||||||||||||||
Adjustments |
|||||||||||||||||||
Acquisition- |
Restructuring |
||||||||||||||||||
Related |
and Other |
Adjusted |
|||||||||||||||||
U.S. GAAP |
Charges (1) |
Charges, Net (1) |
Other Items (1)(2) |
Tax Items (3) |
(Non-GAAP) (4) |
||||||||||||||
($ in millions, except per share data) |
|||||||||||||||||||
Operating income: |
|||||||||||||||||||
Transportation Solutions |
$ |
1,526 |
$ |
18 |
$ |
135 |
$ |
— |
$ |
— |
$ |
1,679 |
|||||||
Industrial Solutions |
469 |
15 |
73 |
— |
— |
557 |
|||||||||||||
Communications Solutions |
439 |
1 |
25 |
— |
— |
465 |
|||||||||||||
Total |
$ |
2,434 |
$ |
34 |
$ |
233 |
$ |
— |
$ |
— |
$ |
2,701 |
|||||||
Operating margin |
16.3 |
% |
18.1 |
% |
|||||||||||||||
Other income (expense), net |
$ |
(17) |
$ |
— |
$ |
— |
$ |
28 |
$ |
— |
$ |
11 |
|||||||
Income tax expense |
$ |
(123) |
$ |
(7) |
$ |
(35) |
$ |
(6) |
$ |
(333) |
$ |
(504) |
|||||||
Effective tax rate |
5.2 |
% |
5.2 |
% |
|||||||||||||||
Income from continuing operations |
$ |
2,255 |
$ |
27 |
$ |
198 |
$ |
22 |
$ |
(333) |
$ |
2,169 |
|||||||
Diluted earnings per share from continuing operations |
$ |
6.77 |
$ |
0.08 |
$ |
0.59 |
$ |
0.07 |
$ |
(1.00) |
$ |
6.51 |
|||||||
(1) The tax effect of each non-GAAP adjustment is calculated based on the jurisdictions in which the expense (income) is incurred and the tax laws in effect for each such jurisdiction. |
|||||||||||||||||||
(2) Charge related to the transfer of certain U.S. pension plan liabilities to an insurance company through the purchase of a group annuity contract. |
|||||||||||||||||||
(3) Represents a $327 million income tax benefit for the net reduction in valuation allowances associated primarily with certain tax planning actions as well as improved current and expected future operating profit and taxable income, $29 million of income tax benefits related to an Internal Revenue Service approved change in the tax method of depreciating or amortizing certain assets, and $23 million of income tax expense associated with the tax impacts of an intercompany transaction. |
|||||||||||||||||||
(4) See description of non-GAAP financial measures. |
TE CONNECTIVITY LTD. |
|||
RECONCILIATION OF FORWARD-LOOKING NON-GAAP FINANCIAL MEASURES |
|||
TO FORWARD-LOOKING GAAP FINANCIAL MEASURES |
|||
As of April 27, 2022 |
|||
(UNAUDITED) |
|||
Outlook for |
|||
Quarter Ending |
|||
June 24, |
|||
2022 |
|||
Diluted earnings per share from continuing operations |
$ |
1.71 |
|
Restructuring and other charges, net |
0.07 |
||
Acquisition-related charges |
0.03 |
||
Tax items |
(0.06) |
||
Adjusted diluted earnings per share from continuing operations (1) |
$ |
1.75 |
|
Net sales growth |
1.4 |
% |
|
Translation |
4.0 |
||
(Acquisitions) divestitures, net |
(2.1) |
||
Organic net sales growth (1) |
3.3 |
% |
|
(1) See description of non-GAAP financial measures. |
SOURCE TE Connectivity Ltd.
Рекордные продажи и двузначный рост прибыли на акцию обусловлены сохраняющимися высокими операционными показателями
ШАФФХАУЗЕН, Швейцария, 27 апреля 2022 г. /PRNewswire/ -- TE Connectivity Ltd. (NYSE: TEL) сегодня были опубликованы результаты за второй финансовый квартал, закончившийся 25 марта 2022 года.
Основные моменты Второго квартала
"Я очень доволен нашими высокими показателями во втором квартале и работой нашей глобальной команды по обеспечению рекордных продаж и двузначного роста прибыли на акцию, который превзошел наши ожидания", - сказал генеральный директор TE Connectivity Терренс Кертин. "Все три наших бизнес–сегмента – Транспортный, Промышленный и коммуникационный - способствовали и обеспечивали рост продаж из года в год, демонстрируя стратегическое позиционирование нашего портфеля, поскольку мы продолжаем извлекать выгоду из нашей лидирующей позиции в области долгосрочного роста и тенденций устойчивого развития. Мы продолжаем превосходить рынок как в автомобильном, так и в коммерческом транспорте благодаря постоянному росту контента в нашем транспортном сегменте, а глобальный дизайн набирает обороты в электромобилях. В нашем сегменте коммуникаций также наблюдается продолжающийся рост контента в высокоскоростных облачных приложениях и увеличение доли рынка, поскольку мы работаем с ведущими облачными заказчиками над внедрением искусственного интеллекта и повышением энергоэффективности центров обработки данных. Наш промышленный сегмент продолжает демонстрировать рост в области автоматизации производства и применения возобновляемых источников энергии, где наши технологии продвигают инициативы в области устойчивого развития. Динамика наших заказов оставалась сильной в течение квартала, и мы ожидаем, что в третьем квартале продажи вырастут по сравнению с аналогичным периодом прошлого года, несмотря на более широкую волатильность макроэкономической среды".
Прогноз на третий квартал 2022 финансового года В третьем квартале 2022 финансового года компания ожидает, что чистые продажи составят примерно 3,9 миллиарда долларов, что отражает рост примерно на 1% по сравнению с отчетным периодом и рост примерно на 3% на органической основе в годовом исчислении. Компания включила в свой прогноз на третий квартал рост продаж примерно на 300 базисных пунктов в годовом исчислении из-за остановок, связанных с COVID в Китае. Ожидается, что прибыль на акцию по ОПБУ от продолжающейся деятельности составит примерно 1,71 доллара США, при этом скорректированная прибыль на акцию составит примерно 1,75 доллара США, что примерно на 2% меньше по сравнению с аналогичным периодом прошлого года.
Информация об использовании TE Connectivity финансовых показателей, не относящихся к GAAP, представлена ниже. Для выверки этих финансовых показателей, не относящихся к GAAP, см. прилагаемые таблицы.
Конференц-связь и веб-трансляция Компания проведет сегодня телефонную конференцию, которая начнется в 8:30 утра по восточному времени. Информация о наборе номера приведена здесь:
О компании TE ConnectivityTE Connectivity Ltd. (NYSE: TEL) - мировой лидер в области промышленных технологий, создающий более безопасное, устойчивое, производительное и связанное будущее. Наш широкий спектр решений для подключения и датчиков, зарекомендовавших себя в самых суровых условиях, позволяет добиться прогресса в области транспорта, промышленного применения, медицинских технологий, энергетики, передачи данных и дома. Имея более 85 000 сотрудников, в том числе более 8000 инженеров, работающих вместе с клиентами примерно в 140 странах, TE гарантирует, что КАЖДОЕ ПОДКЛЮЧЕНИЕ ИМЕЕТ ЗНАЧЕНИЕ. Узнайте больше на сайте www.te.com а также в Facebook, LinkedIn, WeChat и Twitter.
Финансовые показатели, не относящиеся к GAAP, Мы представляем показатели эффективности и ликвидности, не относящиеся к GAAP, поскольку считаем, что инвесторам целесообразно учитывать скорректированные финансовые показатели в дополнение к результатам в соответствии с принципами бухгалтерского учета, общепринятыми в США ("GAAP"). Эти финансовые показатели, не относящиеся к GAAP, предоставляют дополнительную информацию и не должны рассматриваться как замена результатов в соответствии с GAAP. Руководство использует финансовые показатели, отличные от GAAP, внутри компании для целей планирования и прогнозирования, а также в процессах принятия решений, связанных с деятельностью нашей компании. Мы считаем, что эти показатели предоставляют значимую информацию нам и инвесторам, поскольку они улучшают понимание наших операционных показателей, способности генерировать денежные средства и тенденций нашего бизнеса. Кроме того, мы считаем, что инвесторы выигрывают от доступа к тем же финансовым показателям, которые руководство использует при оценке нашей деятельности. Основным ограничением этих мер является то, что они исключают финансовое воздействие статей, которые в противном случае либо увеличили бы, либо уменьшили бы наши отчетные результаты. Это ограничение лучше всего устранить, используя эти финансовые показатели, не относящиеся к GAAP, в сочетании с наиболее непосредственно сопоставимыми финансовыми показателями GAAP, чтобы лучше понять суммы, характер и влияние любого увеличения или уменьшения указанных сумм. Эти финансовые показатели, не относящиеся к GAAP, могут быть несопоставимы с аналогичными показателями, представленными другими компаниями.
Ниже представлена дополнительная информация о наших финансовых показателях, не относящихся к GAAP:
Прогнозные заявления В этом релизе содержатся определенные "прогнозные заявления" по смыслу Закона США о реформе судебных разбирательств по частным ценным бумагам 1995 года. Эти заявления основаны на текущих ожиданиях руководства и подвержены рискам, неопределенности и изменениям обстоятельств, которые могут привести к тому, что фактические результаты, результаты деятельности, финансовое состояние или достижения будут существенно отличаться от ожидаемых результатов, результатов деятельности, финансового состояния или достижений. Все содержащиеся в настоящем документе заявления, которые не носят явно исторического характера, носят прогнозный характер, а слова "ожидать", "полагать", "ожидать", "оценивать", "планировать" и подобные выражения, как правило, предназначены для обозначения прогнозных заявлений. Мы не намерены и не обязаны обновлять или изменять (и прямо отказываемся от любого такого намерения или обязательства делать это) наши прогнозные заявления, будь то в результате новой информации, будущих событий или иным образом, за исключением случаев, предусмотренных законом. Прогнозные заявления в этом выпуске включают заявления, касающиеся нашего будущего финансового состояния и операционных результатов, а также влияния на нашу деятельность коронавирусной инфекции 2019 года ("COVID-19"). Примеры факторов, которые могут привести к тому, что фактические результаты будут существенно отличаться от тех, которые описаны в прогнозных заявлениях, включают, среди прочего, степень, серьезность и продолжительность COVID-19, негативно влияющих на нашу деловую деятельность; деловые, экономические, конкурентные и регуляторные риски, такие как условия, влияющие на спрос на продукцию в автомобильной промышленности. и других отраслях, которые мы обслуживаем; конкуренция и ценовое давление; колебания курсов иностранных валют и цен на сырьевые товары; стихийные бедствия и политическая, экономическая и военная нестабильность в странах, в которых мы работаем, включая продолжающийся военный конфликт между Россией и Украиной в результате вторжения России в Украину или эскалации напряженности в соседних странах; события на кредитных рынках; будущее обесценение гудвила; соблюдение действующих и будущих экологических и других законов и нормативных актов; а также возможные последствия для нас изменений в налоговом законодательстве, налоговых соглашениях и других законодательных актах, включая последствия налоговой реформы в Швейцарии. Кроме того, степень, в которой COVID-19 повлияет на наш бизнес и наши финансовые результаты, будет зависеть от будущих событий, которые крайне неопределенны и не поддаются прогнозированию. Такие события могут включать географическое распространение вируса, тяжесть вируса, продолжительность вспышки, влияние на цепочки поставок наших поставщиков и клиентов, действия, которые могут быть предприняты различными государственными органами в ответ на вспышку в юрисдикциях, в которых мы работаем, и возможные влияние на мировую экономику и местную экономику, в которой мы работаем. Более подробная информация об этих и других факторах изложена в Годовом отчете TE Connectivity Ltd. по форме 10-K за финансовый год, закончившийся 24 сентября 2021 года, а также в наших Квартальных отчетах по форме 10-Q, Текущих отчетах по форме 8-K и других отчетах, поданных нами с Комиссией по ценным бумагам и биржам США.
TE Connectivity LTD. |
|||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) |
|||||||||||
For the Quarters Ended |
For the Six Months Ended |
||||||||||
March 25, |
March 26, |
March 25, |
March 26, |
||||||||
2022 |
2021 |
2022 |
2021 |
||||||||
(in millions, except per share data) |
|||||||||||
Net sales |
$ |
4,007 |
$ |
3,738 |
$ |
7,825 |
$ |
7,260 |
|||
Cost of sales |
2,670 |
2,528 |
5,258 |
4,904 |
|||||||
Gross margin |
1,337 |
1,210 |
2,567 |
2,356 |
|||||||
Selling, general, and administrative expenses |
416 |
401 |
779 |
762 |
|||||||
Research, development, and engineering expenses |
185 |
174 |
360 |
336 |
|||||||
Acquisition and integration costs |
10 |
6 |
18 |
14 |
|||||||
Restructuring and other charges, net |
21 |
17 |
33 |
184 |
|||||||
Operating income |
705 |
612 |
1,377 |
1,060 |
|||||||
Interest income |
4 |
8 |
6 |
11 |
|||||||
Interest expense |
(18) |
(13) |
(30) |
(28) |
|||||||
Other income, net |
5 |
4 |
20 |
3 |
|||||||
Income from continuing operations before income taxes |
696 |
611 |
1,373 |
1,046 |
|||||||
Income tax expense |
(136) |
(106) |
(246) |
(166) |
|||||||
Income from continuing operations |
560 |
505 |
1,127 |
880 |
|||||||
Income (loss) from discontinued operations, net of income taxes |
— |
1 |
(1) |
7 |
|||||||
Net income |
$ |
560 |
$ |
506 |
$ |
1,126 |
$ |
887 |
|||
Basic earnings per share: |
|||||||||||
Income from continuing operations |
$ |
1.72 |
$ |
1.53 |
$ |
3.46 |
$ |
2.66 |
|||
Income from discontinued operations |
— |
— |
— |
0.02 |
|||||||
Net income |
1.72 |
1.53 |
3.45 |
2.68 |
|||||||
Diluted earnings per share: |
|||||||||||
Income from continuing operations |
$ |
1.71 |
$ |
1.51 |
$ |
3.44 |
$ |
2.64 |
|||
Income from discontinued operations |
— |
— |
— |
0.02 |
|||||||
Net income |
1.71 |
1.51 |
3.43 |
2.66 |
|||||||
Weighted-average number of shares outstanding: |
|||||||||||
Basic |
325 |
331 |
326 |
331 |
|||||||
Diluted |
327 |
334 |
328 |
333 |
TE Connectivity LTD. |
|||||
CONSOLIDATED BALANCE SHEETS (UNAUDITED) |
|||||
March 25, |
September 24, |
||||
2022 |
2021 |
||||
(in millions, except share data) |
|||||
Assets |
|||||
Current assets: |
|||||
Cash and cash equivalents |
$ |
749 |
$ |
1,203 |
|
Accounts receivable, net of allowance for doubtful accounts of $50 and $41, respectively |
3,068 |
2,928 |
|||
Inventories |
2,999 |
2,511 |
|||
Prepaid expenses and other current assets |
601 |
621 |
|||
Total current assets |
7,417 |
7,263 |
|||
Property, plant, and equipment, net |
3,817 |
3,778 |
|||
Goodwill |
5,463 |
5,590 |
|||
Intangible assets, net |
1,441 |
1,549 |
|||
Deferred income taxes |
2,466 |
2,499 |
|||
Other assets |
847 |
783 |
|||
Total assets |
$ |
21,451 |
$ |
21,462 |
|
Liabilities, redeemable noncontrolling interests, and shareholders' equity |
|||||
Current liabilities: |
|||||
Short-term debt |
$ |
610 |
$ |
503 |
|
Accounts payable |
1,986 |
1,911 |
|||
Accrued and other current liabilities |
2,450 |
2,242 |
|||
Total current liabilities |
5,046 |
4,656 |
|||
Long-term debt |
3,441 |
3,589 |
|||
Long-term pension and postretirement liabilities |
1,103 |
1,139 |
|||
Deferred income taxes |
185 |
181 |
|||
Income taxes |
318 |
302 |
|||
Other liabilities |
809 |
847 |
|||
Total liabilities |
10,902 |
10,714 |
|||
Commitments and contingencies |
|||||
Redeemable noncontrolling interests |
107 |
114 |
|||
Shareholders' equity: |
|||||
Common shares, CHF 0.57 par value, 336,099,881 shares authorized and issued |
148 |
148 |
|||
Accumulated earnings |
12,160 |
11,709 |
|||
Treasury shares, at cost, 13,281,156 and 9,060,919 shares, respectively |
(1,769) |
(1,055) |
|||
Accumulated other comprehensive loss |
(97) |
(168) |
|||
Total shareholders' equity |
10,442 |
10,634 |
|||
Total liabilities, redeemable noncontrolling interests, and shareholders' equity |
$ |
21,451 |
$ |
21,462 |
TE Connectivity LTD. |
|||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) |
|||||||||||
For the Quarters Ended |
For the Six Months Ended |
||||||||||
March 25, |
March 26, |
March 25, |
March 26, |
||||||||
2022 |
2021 |
2022 |
2021 |
||||||||
(in millions) |
|||||||||||
Cash flows from operating activities: |
|||||||||||
Net income |
$ |
560 |
$ |
506 |
$ |
1,126 |
$ |
887 |
|||
(Income) loss from discontinued operations, net of income taxes |
— |
(1) |
1 |
(7) |
|||||||
Income from continuing operations |
560 |
505 |
1,127 |
880 |
|||||||
Adjustments to reconcile income from continuing operations to net cash |
|||||||||||
Depreciation and amortization |
194 |
193 |
392 |
380 |
|||||||
Deferred income taxes |
38 |
(6) |
42 |
(48) |
|||||||
Non-cash lease cost |
33 |
29 |
64 |
59 |
|||||||
Provision for losses on accounts receivable and inventories |
35 |
16 |
68 |
22 |
|||||||
Share-based compensation expense |
28 |
30 |
60 |
49 |
|||||||
Other |
13 |
(41) |
4 |
(20) |
|||||||
Changes in assets and liabilities, net of the effects of acquisitions and |
|||||||||||
Accounts receivable, net |
(205) |
(268) |
(57) |
(567) |
|||||||
Inventories |
(147) |
(67) |
(411) |
(212) |
|||||||
Prepaid expenses and other current assets |
(16) |
57 |
36 |
(30) |
|||||||
Accounts payable |
— |
161 |
15 |
510 |
|||||||
Accrued and other current liabilities |
(20) |
37 |
(305) |
125 |
|||||||
Income taxes |
(7) |
17 |
27 |
34 |
|||||||
Other |
(93) |
(83) |
(117) |
38 |
|||||||
Net cash provided by operating activities |
413 |
580 |
945 |
1,220 |
|||||||
Cash flows from investing activities: |
|||||||||||
Capital expenditures |
(179) |
(142) |
(351) |
(284) |
|||||||
Proceeds from sale of property, plant, and equipment |
9 |
57 |
63 |
58 |
|||||||
Acquisition of businesses, net of cash acquired |
(2) |
— |
(102) |
(107) |
|||||||
Other |
(12) |
8 |
7 |
10 |
|||||||
Net cash used in investing activities |
(184) |
(77) |
(383) |
(323) |
|||||||
Cash flows from financing activities: |
|||||||||||
Net decrease in commercial paper |
(479) |
— |
— |
— |
|||||||
Proceeds from issuance of debt |
588 |
661 |
588 |
661 |
|||||||
Repayment of debt |
(3) |
(250) |
(558) |
(280) |
|||||||
Proceeds from exercise of share options |
8 |
44 |
30 |
119 |
|||||||
Repurchase of common shares |
(404) |
(140) |
(708) |
(259) |
|||||||
Payment of common share dividends to shareholders |
(163) |
(159) |
(326) |
(318) |
|||||||
Other |
(7) |
(5) |
(38) |
(24) |
|||||||
Net cash provided by (used in) financing activities |
(460) |
151 |
(1,012) |
(101) |
|||||||
Effect of currency translation on cash |
(2) |
(4) |
(4) |
7 |
|||||||
Net increase (decrease) in cash, cash equivalents, and restricted cash |
(233) |
650 |
(454) |
803 |
|||||||
Cash, cash equivalents, and restricted cash at beginning of period |
982 |
1,098 |
1,203 |
945 |
|||||||
Cash, cash equivalents, and restricted cash at end of period |
$ |
749 |
$ |
1,748 |
$ |
749 |
$ |
1,748 |
|||
Supplemental cash flow information: |
|||||||||||
Interest paid on debt, net |
$ |
17 |
$ |
29 |
$ |
29 |
$ |
33 |
|||
Income taxes paid, net of refunds |
106 |
96 |
177 |
181 |
TE Connectivity LTD. |
|||||||||||
RECONCILIATION OF FREE CASH FLOW (UNAUDITED) |
|||||||||||
For the Quarters Ended |
For the Six Months Ended |
||||||||||
March 25, |
March 26, |
March 25, |
March 26, |
||||||||
2022 |
2021 |
2022 |
2021 |
||||||||
(in millions) |
|||||||||||
Net cash provided by operating activities |
$ |
413 |
$ |
580 |
$ |
945 |
$ |
1,220 |
|||
Excluding: |
|||||||||||
Cash (collected) paid pursuant to collateral requirements related to |
(1) |
(18) |
(42) |
12 |
|||||||
Capital expenditures, net |
(170) |
(85) |
(288) |
(226) |
|||||||
Free cash flow (1) |
$ |
242 |
$ |
477 |
$ |
615 |
$ |
1,006 |
|||
(1) Free cash flow is a non-GAAP financial measure. See description of non-GAAP financial measures. |
TE Connectivity LTD. |
|||||||||||||||||||||||
CONSOLIDATED SEGMENT DATA (UNAUDITED) |
|||||||||||||||||||||||
For the Quarters Ended |
For the Six Months Ended |
||||||||||||||||||||||
March 25, |
March 26, |
March 25, |
March 26, |
||||||||||||||||||||
2022 |
2021 |
2022 |
2021 |
||||||||||||||||||||
($ in millions) |
|||||||||||||||||||||||
Net Sales |
Net Sales |
Net Sales |
Net Sales |
||||||||||||||||||||
Transportation Solutions |
$ |
2,314 |
$ |
2,287 |
$ |
4,472 |
$ |
4,511 |
|||||||||||||||
Industrial Solutions |
1,075 |
952 |
2,134 |
1,825 |
|||||||||||||||||||
Communications Solutions |
618 |
499 |
1,219 |
924 |
|||||||||||||||||||
Total |
$ |
4,007 |
$ |
3,738 |
$ |
7,825 |
$ |
7,260 |
|||||||||||||||
Operating |
Operating |
Operating |
Operating |
Operating |
Operating |
Operating |
Operating |
||||||||||||||||
Income |
Margin |
Income |
Margin |
Income |
Margin |
Income |
Margin |
||||||||||||||||
Transportation Solutions |
$ |
409 |
17.7 |
% |
$ |
398 |
17.4 |
% |
$ |
804 |
18.0 |
% |
$ |
706 |
15.7 |
% |
|||||||
Industrial Solutions |
148 |
13.8 |
111 |
11.7 |
271 |
12.7 |
187 |
10.2 |
|||||||||||||||
Communications Solutions |
148 |
23.9 |
103 |
20.6 |
302 |
24.8 |
167 |
18.1 |
|||||||||||||||
Total |
$ |
705 |
17.6 |
% |
$ |
612 |
16.4 |
% |
$ |
1,377 |
17.6 |
% |
$ |
1,060 |
14.6 |
% |
|||||||
Adjusted |
Adjusted |
Adjusted |
Adjusted |
Adjusted |
Adjusted |
Adjusted |
Adjusted |
||||||||||||||||
Operating |
Operating |
Operating |
Operating |
Operating |
Operating |
Operating |
Operating |
||||||||||||||||
Income (1) |
Margin (1) |
Income (1) |
Margin (1) |
Income (1) |
Margin (1) |
Income (1) |
Margin (1) |
||||||||||||||||
Transportation Solutions |
$ |
422 |
18.2 |
% |
$ |
413 |
18.1 |
% |
$ |
814 |
18.2 |
% |
$ |
844 |
18.7 |
% |
|||||||
Industrial Solutions |
164 |
15.3 |
119 |
12.5 |
321 |
15.0 |
237 |
13.0 |
|||||||||||||||
Communications Solutions |
150 |
24.3 |
105 |
21.0 |
313 |
25.7 |
180 |
19.5 |
|||||||||||||||
Total |
$ |
736 |
18.4 |
% |
$ |
637 |
17.0 |
% |
$ |
1,448 |
18.5 |
% |
$ |
1,261 |
17.4 |
% |
|||||||
(1) Adjusted operating income and adjusted operating margin are non-GAAP financial measures. See description of non-GAAP financial measures. |
TE Connectivity LTD. |
|||||||||||||||||
RECONCILIATION OF NET SALES GROWTH (DECLINE) (UNAUDITED) |
|||||||||||||||||
Change in Net Sales for the Quarter Ended March 25, 2022 |
|||||||||||||||||
versus Net Sales for the Quarter Ended March 26, 2021 |
|||||||||||||||||
Net Sales |
Organic Net Sales |
Acquisitions/ |
|||||||||||||||
Growth (Decline) |
Growth (Decline) (1) |
Translation (2) |
(Divestitures) |
||||||||||||||
($ in millions) |
|||||||||||||||||
Transportation Solutions (3): |
|||||||||||||||||
Automotive |
$ |
23 |
1.4 |
% |
$ |
80 |
4.9 |
% |
$ |
(57) |
$ |
— |
|||||
Commercial transportation |
12 |
3.1 |
21 |
5.4 |
(9) |
— |
|||||||||||
Sensors |
(8) |
(2.9) |
— |
— |
(8) |
— |
|||||||||||
Total |
27 |
1.2 |
101 |
4.5 |
(74) |
— |
|||||||||||
Industrial Solutions (3): |
|||||||||||||||||
Industrial equipment |
133 |
39.2 |
93 |
27.2 |
(13) |
53 |
|||||||||||
Aerospace, defense, oil, and gas |
(6) |
(2.2) |
— |
— |
(5) |
(1) |
|||||||||||
Energy |
(1) |
(0.5) |
9 |
4.8 |
(8) |
(2) |
|||||||||||
Medical |
(3) |
(1.9) |
(1) |
(1.2) |
(2) |
— |
|||||||||||
Total |
123 |
12.9 |
101 |
10.5 |
(28) |
50 |
|||||||||||
Communications Solutions (3): |
|||||||||||||||||
Data and devices |
107 |
38.5 |
98 |
35.0 |
(4) |
13 |
|||||||||||
Appliances |
12 |
5.4 |
16 |
7.3 |
(4) |
— |
|||||||||||
Total |
119 |
23.8 |
114 |
22.8 |
(8) |
13 |
|||||||||||
Total |
$ |
269 |
7.2 |
% |
$ |
316 |
8.4 |
% |
$ |
(110) |
$ |
63 |
|||||
Change in Net Sales for the Six Months Ended March 25, 2022 |
|||||||||||||||||
versus Net Sales for the Six Months Ended March 26, 2021 |
|||||||||||||||||
Net Sales |
Organic Net Sales |
Acquisitions/ |
|||||||||||||||
Growth (Decline) |
Growth (Decline) (1) |
Translation (2) |
(Divestitures) |
||||||||||||||
($ in millions) |
|||||||||||||||||
Transportation Solutions (3): |
|||||||||||||||||
Automotive |
$ |
(86) |
(2.6) |
% |
$ |
(11) |
(0.4) |
% |
$ |
(75) |
$ |
— |
|||||
Commercial transportation |
46 |
6.5 |
57 |
7.9 |
(11) |
— |
|||||||||||
Sensors |
1 |
0.2 |
13 |
2.5 |
(12) |
— |
|||||||||||
Total |
(39) |
(0.9) |
59 |
1.3 |
(98) |
— |
|||||||||||
Industrial Solutions (3): |
|||||||||||||||||
Industrial equipment |
300 |
47.3 |
212 |
33.0 |
(25) |
113 |
|||||||||||
Aerospace, defense, oil, and gas |
(14) |
(2.7) |
(6) |
(1.4) |
(8) |
— |
|||||||||||
Energy |
15 |
4.2 |
38 |
10.5 |
(12) |
(11) |
|||||||||||
Medical |
8 |
2.5 |
11 |
3.1 |
(3) |
— |
|||||||||||
Total |
309 |
16.9 |
255 |
13.9 |
(48) |
102 |
|||||||||||
Communications Solutions (3): |
|||||||||||||||||
Data and devices |
222 |
43.4 |
209 |
40.7 |
(5) |
18 |
|||||||||||
Appliances |
73 |
17.7 |
77 |
18.4 |
(4) |
— |
|||||||||||
Total |
295 |
31.9 |
286 |
30.8 |
(9) |
18 |
|||||||||||
Total |
$ |
565 |
7.8 |
% |
$ |
600 |
8.2 |
% |
$ |
(155) |
$ |
120 |
|||||
(1) Organic net sales growth (decline) is a non-GAAP financial measure. See description of non-GAAP financial measures. |
|||||||||||||||||
(2) Represents the change in net sales resulting from changes in foreign currency exchange rates. |
|||||||||||||||||
(3) Industry end market information is presented consistently with our internal management reporting and may be periodically revised as management deems necessary. |
TE Connectivity LTD. |
||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES |
||||||||||||||||
For the Quarter Ended March 25, 2022 |
||||||||||||||||
(UNAUDITED) |
||||||||||||||||
Adjustments |
||||||||||||||||
Acquisition- |
Restructuring |
|||||||||||||||
Related |
and Other |
Adjusted |
||||||||||||||
U.S. GAAP |
Charges (1) |
Charges, Net (1) |
Tax Items (2) |
(Non-GAAP) (3) |
||||||||||||
($ in millions, except per share data) |
||||||||||||||||
Operating income: |
||||||||||||||||
Transportation Solutions |
$ |
409 |
$ |
4 |
$ |
9 |
$ |
— |
$ |
422 |
||||||
Industrial Solutions |
148 |
6 |
10 |
— |
164 |
|||||||||||
Communications Solutions |
148 |
— |
2 |
— |
150 |
|||||||||||
Total |
$ |
705 |
$ |
10 |
$ |
21 |
$ |
— |
$ |
736 |
||||||
Operating margin |
17.6 |
% |
18.4 |
% |
||||||||||||
Other income, net |
$ |
5 |
$ |
— |
$ |
— |
$ |
— |
$ |
5 |
||||||
Income tax expense |
$ |
(136) |
$ |
(2) |
$ |
(5) |
$ |
8 |
$ |
(135) |
||||||
Effective tax rate |
19.5 |
% |
18.6 |
% |
||||||||||||
Income from continuing operations |
$ |
560 |
$ |
8 |
$ |
16 |
$ |
8 |
$ |
592 |
||||||
Diluted earnings per share from |
$ |
1.71 |
$ |
0.02 |
$ |
0.05 |
$ |
0.02 |
$ |
1.81 |
||||||
(1) The tax effect of each non-GAAP adjustment is calculated based on the jurisdictions in which the expense (income) is incurred and the tax laws in effect for each such jurisdiction. |
||||||||||||||||
(2) Includes $27 million of income tax expense related to the write-down of certain deferred tax assets to the lower tax rate enacted in the canton of Schaffhausen on December 27, 2021. Also includes a $19 million income tax benefit related to the tax impacts of an intercompany transaction. Our estimated annual effective tax rate for fiscal 2022 includes a total income tax benefit of approximately $75 million related to this transaction, with portions recognized in the quarters ended December 24, 2021 and March 25, 2022 and the remainder to be recognized in the remaining quarters of fiscal 2022. |
||||||||||||||||
(3) See description of non-GAAP financial measures. |
TE Connectivity LTD. |
|||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES |
|||||||||||||
For the Quarter Ended March 26, 2021 |
|||||||||||||
(UNAUDITED) |
|||||||||||||
Adjustments |
|||||||||||||
Acquisition- |
Restructuring |
||||||||||||
Related |
and Other |
Adjusted |
|||||||||||
U.S. GAAP |
Charges (1) |
Charges, Net (1) |
(Non-GAAP) (2) |
||||||||||
($ in millions, except per share data) |
|||||||||||||
Operating income: |
|||||||||||||
Transportation Solutions |
$ |
398 |
$ |
5 |
$ |
10 |
$ |
413 |
|||||
Industrial Solutions |
111 |
3 |
5 |
119 |
|||||||||
Communications Solutions |
103 |
— |
2 |
105 |
|||||||||
Total |
$ |
612 |
$ |
8 |
$ |
17 |
$ |
637 |
|||||
Operating margin |
16.4 |
% |
17.0 |
% |
|||||||||
Other income, net |
$ |
4 |
$ |
— |
$ |
— |
$ |
4 |
|||||
Income tax expense |
$ |
(106) |
$ |
(2) |
$ |
(2) |
$ |
(110) |
|||||
Effective tax rate |
17.3 |
% |
17.3 |
% |
|||||||||
Income from continuing operations |
$ |
505 |
$ |
6 |
$ |
15 |
$ |
526 |
|||||
Diluted earnings per share from continuing operations |
$ |
1.51 |
$ |
0.02 |
$ |
0.04 |
$ |
1.57 |
|||||
(1) The tax effect of each non-GAAP adjustment is calculated based on the jurisdictions in which the expense (income) is incurred and the tax laws in effect for each such jurisdiction. |
|||||||||||||
(2) See description of non-GAAP financial measures. |
TE Connectivity LTD. |
||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES |
||||||||||||||||
For the Six Months Ended March 25, 2022 |
||||||||||||||||
(UNAUDITED) |
||||||||||||||||
Adjustments |
||||||||||||||||
Acquisition- |
Restructuring |
|||||||||||||||
Related |
and Other |
Adjusted |
||||||||||||||
U.S. GAAP |
Charges (1) |
Charges, Net (1)(2) |
Tax Items (3) |
(Non-GAAP) (4) |
||||||||||||
($ in millions, except per share data) |
||||||||||||||||
Operating income: |
||||||||||||||||
Transportation Solutions |
$ |
804 |
$ |
7 |
$ |
3 |
$ |
— |
$ |
814 |
||||||
Industrial Solutions |
271 |
18 |
32 |
— |
321 |
|||||||||||
Communications Solutions |
302 |
1 |
10 |
— |
313 |
|||||||||||
Total |
$ |
1,377 |
$ |
26 |
$ |
45 |
$ |
— |
$ |
1,448 |
||||||
Operating margin |
17.6 |
% |
18.5 |
% |
||||||||||||
Other income, net |
$ |
20 |
$ |
— |
$ |
— |
$ |
(11) |
$ |
9 |
||||||
Income tax expense |
$ |
(246) |
$ |
(5) |
$ |
(12) |
$ |
3 |
$ |
(260) |
||||||
Effective tax rate |
17.9 |
% |
18.1 |
% |
||||||||||||
Income from continuing operations |
$ |
1,127 |
$ |
21 |
$ |
33 |
$ |
(8) |
$ |
1,173 |
||||||
Diluted earnings per share from |
$ |
3.44 |
$ |
0.06 |
$ |
0.10 |
$ |
(0.02) |
$ |
3.58 |
||||||
(1) The tax effect of each non-GAAP adjustment is calculated based on the jurisdictions in which the expense (income) is incurred and the tax laws in effect for each such jurisdiction. |
||||||||||||||||
(2) Includes $33 million recorded in net restructuring and other charges and $12 million recorded in cost of sales. |
||||||||||||||||
(3) Includes a $36 million income tax benefit related to the tax impacts of an intercompany transaction. Our estimated annual effective tax rate for fiscal 2022 includes a total income tax benefit of approximately $75 million related to this transaction, with portions recognized in the quarters ended December 24, 2021 and March 25, 2022 and the remainder to be recognized in the remaining quarters of fiscal 2022. Also includes $27 million of income tax expense related to the write-down of certain deferred tax assets to the lower tax rate enacted in the canton of Schaffhausen, and $12 million of income tax expense related to an income tax audit of an acquired entity, as well as the related impact of $11 million to other income pursuant to the indemnification terms of the purchase agreement. |
||||||||||||||||
(4) See description of non-GAAP financial measures. |
TE Connectivity LTD. |
||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES |
||||||||||||||||
For the Six Months Ended March 26, 2021 |
||||||||||||||||
(UNAUDITED) |
||||||||||||||||
Adjustments |
||||||||||||||||
Acquisition- |
Restructuring |
|||||||||||||||
Related |
and Other |
Adjusted |
||||||||||||||
U.S. GAAP |
Charges (1) |
Charges, Net (1) |
Tax Items (2) |
(Non-GAAP) (3) |
||||||||||||
($ in millions, except per share data) |
||||||||||||||||
Operating income: |
||||||||||||||||
Transportation Solutions |
$ |
706 |
$ |
10 |
$ |
128 |
$ |
— |
$ |
844 |
||||||
Industrial Solutions |
187 |
7 |
43 |
— |
237 |
|||||||||||
Communications Solutions |
167 |
— |
13 |
— |
180 |
|||||||||||
Total |
$ |
1,060 |
$ |
17 |
$ |
184 |
$ |
— |
$ |
1,261 |
||||||
Operating margin |
14.6 |
% |
17.4 |
% |
||||||||||||
Other income, net |
$ |
3 |
$ |
— |
$ |
— |
$ |
— |
$ |
3 |
||||||
Income tax expense |
$ |
(166) |
$ |
(4) |
$ |
(34) |
$ |
(29) |
$ |
(233) |
||||||
Effective tax rate |
15.9 |
% |
18.7 |
% |
||||||||||||
Income from continuing operations |
$ |
880 |
$ |
13 |
$ |
150 |
$ |
(29) |
$ |
1,014 |
||||||
Diluted earnings per share from continuing operations |
$ |
2.64 |
$ |
0.04 |
$ |
0.45 |
$ |
(0.09) |
$ |
3.05 |
||||||
(1) The tax effect of each non-GAAP adjustment is calculated based on the jurisdictions in which the expense (income) is incurred and the tax laws in effect for each such jurisdiction. |
||||||||||||||||
(2) Income tax benefits related to an Internal Revenue Service approved change in the tax method of depreciating or amortizing certain assets. |
||||||||||||||||
(3) See description of non-GAAP financial measures. |
TE Connectivity LTD. |
|||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES |
|||||||||||||
For the Quarter Ended June 25, 2021 |
|||||||||||||
(UNAUDITED) |
|||||||||||||
Adjustments |
|||||||||||||
Acquisition- |
Restructuring |
||||||||||||
Related |
and Other |
Adjusted |
|||||||||||
U.S. GAAP |
Charges (1) |
Charges, Net (1) |
(Non-GAAP) (2) |
||||||||||
($ in millions, except per share data) |
|||||||||||||
Operating income: |
|||||||||||||
Transportation Solutions |
$ |
433 |
$ |
5 |
$ |
2 |
$ |
440 |
|||||
Industrial Solutions |
148 |
4 |
6 |
158 |
|||||||||
Communications Solutions |
133 |
— |
3 |
136 |
|||||||||
Total |
$ |
714 |
$ |
9 |
$ |
11 |
$ |
734 |
|||||
Operating margin |
18.6 |
% |
19.1 |
% |
|||||||||
Other income, net |
$ |
2 |
$ |
— |
$ |
— |
$ |
2 |
|||||
Income tax expense |
$ |
(124) |
$ |
(2) |
$ |
(4) |
$ |
(130) |
|||||
Effective tax rate |
17.6 |
% |
17.9 |
% |
|||||||||
Income from continuing operations |
$ |
581 |
$ |
7 |
$ |
7 |
$ |
595 |
|||||
Diluted earnings per share from continuing operations |
$ |
1.74 |
$ |
0.02 |
$ |
0.02 |
$ |
1.79 |
|||||
(1) The tax effect of each non-GAAP adjustment is calculated based on the jurisdictions in which the expense (income) is incurred and the tax laws in effect for each such jurisdiction. |
|||||||||||||
(2) See description of non-GAAP financial measures. |
TE Connectivity LTD. |
|||||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES |
|||||||||||||||||||
For the Year Ended September 24, 2021 |
|||||||||||||||||||
(UNAUDITED) |
|||||||||||||||||||
Adjustments |
|||||||||||||||||||
Acquisition- |
Restructuring |
||||||||||||||||||
Related |
and Other |
Adjusted |
|||||||||||||||||
U.S. GAAP |
Charges (1) |
Charges, Net (1) |
Other Items (1)(2) |
Tax Items (3) |
(Non-GAAP) (4) |
||||||||||||||
($ in millions, except per share data) |
|||||||||||||||||||
Operating income: |
|||||||||||||||||||
Transportation Solutions |
$ |
1,526 |
$ |
18 |
$ |
135 |
$ |
— |
$ |
— |
$ |
1,679 |
|||||||
Industrial Solutions |
469 |
15 |
73 |
— |
— |
557 |
|||||||||||||
Communications Solutions |
439 |
1 |
25 |
— |
— |
465 |
|||||||||||||
Total |
$ |
2,434 |
$ |
34 |
$ |
233 |
$ |
— |
$ |
— |
$ |
2,701 |
|||||||
Operating margin |
16.3 |
% |
18.1 |
% |
|||||||||||||||
Other income (expense), net |
$ |
(17) |
$ |
— |
$ |
— |
$ |
28 |
$ |
— |
$ |
11 |
|||||||
Income tax expense |
$ |
(123) |
$ |
(7) |
$ |
(35) |
$ |
(6) |
$ |
(333) |
$ |
(504) |
|||||||
Effective tax rate |
5.2 |
% |
5.2 |
% |
|||||||||||||||
Income from continuing operations |
$ |
2,255 |
$ |
27 |
$ |
198 |
$ |
22 |
$ |
(333) |
$ |
2,169 |
|||||||
Diluted earnings per share from continuing operations |
$ |
6.77 |
$ |
0.08 |
$ |
0.59 |
$ |
0.07 |
$ |
(1.00) |
$ |
6.51 |
|||||||
(1) The tax effect of each non-GAAP adjustment is calculated based on the jurisdictions in which the expense (income) is incurred and the tax laws in effect for each such jurisdiction. |
|||||||||||||||||||
(2) Charge related to the transfer of certain U.S. pension plan liabilities to an insurance company through the purchase of a group annuity contract. |
|||||||||||||||||||
(3) Represents a $327 million income tax benefit for the net reduction in valuation allowances associated primarily with certain tax planning actions as well as improved current and expected future operating profit and taxable income, $29 million of income tax benefits related to an Internal Revenue Service approved change in the tax method of depreciating or amortizing certain assets, and $23 million of income tax expense associated with the tax impacts of an intercompany transaction. |
|||||||||||||||||||
(4) See description of non-GAAP financial measures. |
TE Connectivity LTD. |
|||
RECONCILIATION OF FORWARD-LOOKING NON-GAAP FINANCIAL MEASURES |
|||
TO FORWARD-LOOKING GAAP FINANCIAL MEASURES |
|||
As of April 27, 2022 |
|||
(UNAUDITED) |
|||
Outlook for |
|||
Quarter Ending |
|||
June 24, |
|||
2022 |
|||
Diluted earnings per share from continuing operations |
$ |
1.71 |
|
Restructuring and other charges, net |
0.07 |
||
Acquisition-related charges |
0.03 |
||
Tax items |
(0.06) |
||
Adjusted diluted earnings per share from continuing operations (1) |
$ |
1.75 |
|
Net sales growth |
1.4 |
% |
|
Translation |
4.0 |
||
(Acquisitions) divestitures, net |
(2.1) |
||
Organic net sales growth (1) |
3.3 |
% |
|
(1) See description of non-GAAP financial measures. |
ИСТОЧНИК TE Connectivity Ltd.
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