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26
REVENUE AND OPERATING INCOME AND MARGINS
Electronics
Electronics’ products and services include:
• designing, engineering and manufacturing of electronic con-
nector systems, fiber optic components, wireless devices, heat
shrink products, power components, wire and cable, relays,
sensors, touch screens, smart card components, identification
and labeling products, energy solutions, power products,
switches and battery assemblies.
The AMP merger occurred in April 1999, but, as required
under the pooling of interests method of accounting, Fiscal 1999
results are presented as though the companies had been com-
bined since the beginning of Fiscal 1999. The following table sets
forth revenue and operating income (loss) and margins for the
Electronics segment:
($ IN MILLIONS) FISCAL 2001 FISCAL 2000 FISCAL 1999
Revenue, before
accounting change $13,052.1 $11,417.7 $7,043.5
Operating income, before
certain (charges) credits and
accounting change $ 3,310.9 $ 2,759.9 $1,052.5
Operating margins, before
certain (charges) credits and
accounting change 25.4% 24.2% 14.9%
Revenue, after
accounting change $13,107.5 $11,417.7 $7,043.5
Operating income (loss),
after certain (charges) credits
and accounting change $ 2,848.4 $ 2,850.8 $ (22.3)
Operating margins, after certain
(charges) credits and
accounting change 21.7% 25.0% (0.3%)
The 14.3% increase in revenue, before accounting change,
in Fiscal 2001 over Fiscal 2000 resulted primarily from acquisi-
tions. These acquisitions included: Siemens Electromechanical
Components GmbH & Co. KG (“Siemens”) and AFC Cable Sys-
tems, Inc. (“AFC Cable”) in November 1999; Praegitzer Indus-
tries, Inc. (“Praegitzer”) in December 1999; Critchley Group PLC
(“Critchley”) in March 2000; the electronic OEM business of
Thomas & Betts in July 2000; CIGI Investment Group, Inc.
(“CIGI”) in October 2000; and Lucent Technologies’ Power Sys-
tems business unit in December 2000. Excluding the impact of
these acquisitions, revenue increased an estimated 0.3%, which
reflects an economic slowdown in the computer and consumer
electronics and communications industries and, to a lesser
extent, the effect of foreign exchange rates.
The 62.1% increase in revenue in Fiscal 2000 over Fiscal
1999 was predominantly due to acquisitions and, to a lesser
extent, organic growth. These acquisitions included: Glynwed
International, plc in March 1999; Raychem Corporation
(“Raychem”) in August 1999; Siemens and AFC Cable in
November 1999; Praegitzer in December 1999; Critchley in
March 2000; and the electronic OEM business of Thomas & Betts
in July 2000. Excluding the impact of these acquisitions, rev-
enue increased an estimated 13.1%.
The 20.0% increase in operating income and the increase in
margins, before certain (charges) credits and accounting
change, in Fiscal 2001 compared with Fiscal 2000 was primarily
due to acquisitions and improved margins at both Tyco Printed
Circuit Group and AMP. These increases were somewhat offset
by decreased operating income and margins at Allied Tube and
Conduit resulting from higher raw material prices.
Operating income and margins, after certain (charges)
credits and accounting change, include restructuring and other
non-recurring and impairment charges of $485.0 million, par-
tially offset by an increase of $22.5 million relating to the adop-
tion of SAB 101 in Fiscal 2001, as compared to a net merger,
restructuring and other non-recurring credit of $90.9 million in
Fiscal 2000.
The substantial increase in operating income and margins,
before certain (charges) credits, in Fiscal 2000 compared with
Fiscal 1999 was primarily due to the acquisitions of Raychem
and Siemens and improved margins at both AMP and Tyco
Printed Circuit Group. The improved operating margins, before
certain (charges) credits, in Fiscal 2000 compared with Fiscal
1999 resulted from increased volume, improved pricing and con-
tinuing cost reduction programs following the AMP merger.
In addition to the items discussed above, the substantial
increase in operating income and margins, after certain
(charges) credits, was due to a merger, restructuring and other
non-recurring net credit of $90.9 million in Fiscal 2000 com-
pared with a restructuring and other non-recurring charge of
$1,074.8 million in Fiscal 1999.
Fire and Security Services
Fire and Security Services’ products and services include:
• designing, installing and servicing a broad line of fire detec-
tion, prevention and suppression systems, and manufacturing
and servicing of fire extinguishers and related products;
• designing, installing, monitoring and maintaining electronic
security systems;
• designing and manufacturing valves and related products;
and
• providing a broad range of consulting, engineering and con-
struction management and operating services for water,
wastewater, environmental, transportation and infrastruc-
ture markets.