Summary
TE Connectivity plc (TEL) reported a significant revenue decline for the third quarter and first nine months of fiscal year 2009, largely attributed to adverse global economic conditions. Net sales decreased by 33.7% and 30.0% for the respective periods compared to the prior year, with organic sales down 28.4% and 25.5%. This downturn impacted profitability, leading to a net loss of $74 million ($0.16 per share) for the quarter and a substantial net loss of $3,349 million ($7.31 per share) for the nine-month period. A major factor contributing to the year-to-date loss was a significant goodwill impairment charge of $3.5 billion, primarily within the Electronic Components segment. Despite the challenging economic environment, the company completed the sale of its Wireless Systems business for $665 million, contributing positively to cash flow. TE Connectivity also continued to manage its cost structure through restructuring initiatives and headcount reductions. The company also successfully transitioned its domicile from Bermuda to Switzerland on June 25, 2009. While facing significant headwinds, the company maintained a solid liquidity position with cash and cash equivalents of $1.26 billion at quarter-end.
Financial Highlights
53 data points| Revenue | $2.51B |
| Cost of Revenue | $1.92B |
| Gross Profit | $587.00M |
| SG&A Expenses | $330.00M |
| Operating Income | $64.00M |
| Interest Expense | $42.00M |
| Net Income | -$77.00M |
| EPS (Basic) | $-0.17 |
| EPS (Diluted) | $-0.17 |
| Shares Outstanding (Basic) | 458.00M |
| Shares Outstanding (Diluted) | 459.00M |
Key Highlights
- 1Significant net sales decline of 33.7% in Q3 FY09 and 30.0% in the nine-month period of FY09 compared to FY08, driven by weak global economic conditions.
- 2Reported a net loss of $74 million ($0.16/share) for Q3 FY09 and a substantial net loss of $3,349 million ($7.31/share) for the nine months ended June 26, 2009.
- 3Recorded a significant goodwill impairment charge of $3.547 billion during the nine months ended June 26, 2009, primarily impacting the Electronic Components segment.
- 4Successfully divested the Wireless Systems business for $665 million in net cash proceeds, recognized a pre-tax gain of $55 million.
- 5Implemented restructuring and cost-reduction measures, including headcount reductions, to mitigate the impact of the economic downturn.
- 6Completed a change of domicile from Bermuda to Switzerland on June 25, 2009.
- 7Maintained a strong liquidity position with $1.258 billion in cash and cash equivalents as of June 26, 2009.