Tyco Electronics Ltd. today reported results for the fiscal fourth quarter ended September 25, 2009. The company reported net sales of $2.7 billion for the fiscal fourth quarter, an 8% increase sequentially and a 25% decrease compared to the prior-year period. GAAP diluted earnings per share from continuing operations were $0.18 for the quarter, compared to $0.19 in the prior-year period.

Included in the earnings per share from continuing operations were $0.08 per share of restructuring and other charges, $0.09 per share of income tax related charges, and $0.04 per share of income related to a gain from the early retirement of debt. This compares to $0.46 per share of net charges in the prior-year quarter. Adjusted EPS from continuing operations were $0.30 in the quarter, compared to last year's adjusted EPS of $0.65.

"Our fourth quarter was a strong finish to a challenging year," said Tyco Electronics Chief Executive Officer, Tom Lynch. "Sales increased 8% sequentially due to continued improvement in our automotive and consumer-related businesses which grew 17%. This more than offset the expected slowdown in our Undersea Telecommunications segment. The aggressive cost actions we initiated in response to the downturn, coupled with the sales increase, improved our adjusted operating margins from 5 to 8%, sequentially. Further improvements in working capital enabled us to generate more than $600 million in free cash flow in the quarter, bringing our full-year free cash flow to more than $1.2 billion.

"In the first quarter, we expect our sales to be flat to up slightly due to continued strengthening in our Electronic Components segment, partially offset by the continued slowdown in our Undersea Telecommunications business. We expect another quarter of solid operating margin improvement," Lynch continued.

GAAP operating income was $176 million, compared to $205 million of operating income in the prior-year period. Included in the current quarter were restructuring and other charges of $45 million. Included in prior-year operating income were $165 million of restructuring and other charges and $103 million related to an impairment of goodwill. Excluding these items in both periods, adjusted operating income was $221 million compared to $473 million a year ago, a decrease of 53%. The adjusted operating margin was 8.2%, compared to 13.2% a year ago--reflecting a 25% decline in sales.

Cash Flow

Cash from continuing operations was $549 million during the quarter, compared to $597 million in the year-ago period. Free cash flow was $608 million, compared to $437 million in the prior-year period. The increase in free cash flow was primarily driven by inventory reductions, as well as reduced capital expenditures versus the prior year.