ADT 2004 Annual Report Download - page 17

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TYCO IS DOING SOMETHING VITAL—STRENGTHENING OUR
COMPANY, HELPING OUR CUSTOMERS SUCCEED, AND
IMPROVING THE LIVES OF PEOPLE AROUND THE WORLD.
EVERY MOMENT
OF EVERY DAY...
Thanks to our customers and our dedicated employees,
we had a very good year in 2004. Our success was
based on a simple strategy: to make operational
excellence a core competency, to build a platform
for sustainable organic growth, to invest in
our people, and to hold ourselves to the highest
ethical standards.
Above all, 2004 was a year to demonstrate our
ability to meet our commitments to you. To that
end, I am extremely pleased to report that our sus-
tained progress throughout the year resulted
in Tyco meeting or exceeding all of our financial
goals. We also took important actions to strengthen
our balance sheet and to build a solid operational
core for the Company.
In 2004, we achieved many notable financial
highlights. Our revenue grew 12 percent to $40.2 bil-
lion, and income from continuing operations
reached $3.0 billion. Diluted earnings per share
from continuing operations reached $1.41, com-
pared with $0.52 in 2003. We also delivered
$5.4 billion in cash flow from operating activities
and $4.8 billion in free cash flow1.
In a year of many memorable moments, my
personal favorites were those that underscored our
new operating discipline. Whether it was the candor
of strategy sessions, the rigor of operating reviews,
or the intensity of fostering organic growth, our
employees embraced the tough, everyday actions
necessary to become a world-class operating com-
pany. From Budapest to Beijing to Boston, we
all felt the impact of what becoming an operating
company truly means—how it strengthens our
foundation, how it engages our employees, and how
it delivers value for our shareholders.
PRODUCTIVITY FOCUS
In 2004, we made considerable progress toward
improving productivity across the company and
institutionalizing a rigorous operating culture.
Our restructuring actions resulted in annualized
savings of $285 million, and we had exited 27 noncore
businesses as of November 2004 that were diluting
our resources and management focus.
Our operational excellence performance was a
true highlight of 2004—enabling us to generate
strong financial results and to continue transforming
the way we operate around the world.
SIX SIGMA
Increasingly, Six Sigma has become the foundation
of Tyco’s language and culture. While our initial
efforts began in the manufacturing environment, we
have expanded to more transactional areas of the
company, such as sales, service, and product devel-
opment. In 2004, we trained approximately 2,400
1 Free cash flow is a non-GAAP financial measure. See GAAP reconciliation on inside back cover.