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Tyco profit beats, break-up on track for September
(Reuters) - Tyco International Ltd (TYC.N), 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 maker of fire and safety systems and parent of ADT home security systems reported that 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.
Sales rose 4 percent to $4.46 billion, below Wall Street estimates of $4.54 billion.
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. Tyco has already agreed to merge its flow control business with Pentair Inc (PNR.N), a deal that would double Pentair's size and make it the largest player in its sector.
Tyco will provide its fourth-quarter outlook on its conference call. Order growth slowed from the prior quarter but was above last year's pace.
(Reporting by Nick Zieminski in New York; Editing by Lisa Von Ahn and Gerald E. McCormick)
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