8-KEarnings & ResultsRegulation FDExhibits & Filings

TE Connectivity plc 8-K Report, Financial Results (Apr 12, 2012)

Filed April 12, 2012For Securities:TEL

Summary

TE Connectivity plc (TEL) has filed an 8-K report on April 12, 2012, announcing two significant divestitures. The company has entered into definitive agreements to sell its Touch Solutions business for $380 million in cash and its TE Professional Services (TPS) business for $23.5 million. Both transactions are anticipated to close in the third quarter of fiscal year 2012 and are subject to customary regulatory approvals. These businesses are being classified as held for sale and discontinued operations, with prior periods being reclassified to reflect this change. The Touch Solutions business was previously part of the Communications and Industrial Solutions segment, and TPS was part of the Network Solutions segment. This divestiture strategy signals TE Connectivity's focus on streamlining its portfolio and concentrating on core growth areas. The filing also includes unaudited financial information for several fiscal quarters and years, along with detailed explanations and reconciliations of non-GAAP financial measures used by the company.

Key Highlights

  • 1TE Connectivity is divesting its Touch Solutions business for $380 million in cash.
  • 2The TE Professional Services (TPS) business is being sold for $23.5 million.
  • 3Both divestitures are expected to close in the third quarter of fiscal year 2012.
  • 4The Touch Solutions and TPS businesses are being classified as held for sale and discontinued operations.
  • 5Prior period financial statements will be reclassified to reflect these businesses as discontinued operations.
  • 6The company has provided unaudited financial information for multiple historical periods.
  • 7Detailed reconciliations of non-GAAP financial measures to GAAP are included, explaining their use in assessing operational performance and comparability.

Frequently Asked Questions

While not explicitly stated as a primary reason in this 8-K, divestitures like these typically indicate a strategic shift by the company to streamline its portfolio, exit non-core or underperforming businesses, and focus resources on more profitable or higher-growth segments of its operations.

The Touch Solutions and TPS businesses will be reported as discontinued operations in the company's financial statements for all periods presented, starting from the second quarter of fiscal year 2012. This means their revenues, expenses, and profits/losses will be segregated from the company's continuing operations.

Non-GAAP financial measures are metrics that exclude certain items from the standard GAAP (Generally Accepted Accounting Principles) calculations. TE Connectivity uses measures like 'Adjusted Operating Income' and 'Adjusted Earnings Per Share' to provide investors with a view of the company's underlying operational performance, excluding the impact of specific items like restructuring charges, acquisition-related costs, or other irregular items that might obscure trends or comparability between periods. The filing provides detailed explanations and reconciliations for these measures.

The total expected cash proceeds from the sale of the Touch Solutions business ($380 million) and the TE Professional Services business ($23.5 million) amounts to $403.5 million.