UPDATE 3-Tyco profit beats, break-up on track for September

* Q3 shr ex items $1.01 vs. $0.93 expected
* Q3 sales up 4 pct to $4.46 bln
* Separation on track for September
* Shares up 2 pct in early trading

By Nick Zieminski
July 31 (Reuters) - Tyco International Ltd, which is
in the process of splitting into three companies, reported a
forecast-beating quarterly profit on Tuesday and said it is on
track to complete its breakup in September.
The provider of fire and safety systems, maker of industrial
valves and parent of ADT home security systems is writing the
final chapter of a decade-long story under Chief Executive Ed
Breen, who has been widely credited for stabilizing a
conglomerate once mired in an accounting scandal.
Tyco shares gained 2 percent to $54.92.
Net earnings fell to $242 million, or 51 cents per share, in
the third quarter ended June 29 from $359 million, or 76 cents
per share, a year earlier.
Earnings from continuing operations, excluding items, were
$1.01 a share, the highest in five years, as all three segments
showed higher profit margins. The results topped average analyst
forecasts by 8 cents, according to Thomson Reuters I/B/E/S.
Revenue rose 4 percent to $4.46 billion, below Wall Street
estimates of $4.54 billion, as the strong U.S. dollar reduced
sales more than expected.
Tyco's biggest segment, which makes fire safety and
commercial security systems, posted a 3 percent sales gain, but
operating income jumped by a double-digit percentage rate,
helped by cost-cuts, a shift to high-margin service revenue, and
increased volumes.
ADT, which serves the North American residential market,
reported that more accounts were adopting its high-tech Pulse
home automation systems, helping boost average revenue per
subscriber.
The proposed break-up of the company into three businesses
is on track for the end of September, Tyco said.
ADT and Tyco Fire and Security will be stand-alone companies
and will hold an investor day on September 18. Tyco has already
agreed to merge its flow control business with Pentair Inc
, a deal that would double Pentair's size and make it the
largest player in its sector.
Order growth slowed from the prior quarter but was above
last year's pace. Tyco did not provide a quarterly earnings
forecast for its fiscal fourth quarter, citing the break-up, but
said its full-year results look on track to exceed its most
recent forecast of $3.65 a share, which is 2 cents below current
Wall Street estimates.
Separately, engineering company Harsco said Tuesday
its new Chief Executive will come over from Tyco. Patrick
Decker, who has led Tyco's $3.6 billion valves and controls
business for five years, will join Harsco on September 10.