ADT 2009 Annual Report Download - page 148

During 2009, 2008 and 2007 we paid out $154 million, $187 million and $70 million, respectively,
in cash related to restructuring activities. See Note 3 to the Consolidated Financial Statements for
further information regarding our restructuring activities.
Income taxes paid, net of refunds, related to continuing operations was $291 million, $501 million,
and $649 million in 2009, 2008, and 2007, respectively.
During 2009, 2008 and 2007, Tyco paid $543 million, $376 million and $409 million of cash,
respectively, to acquire approximately 512,000, 370,000 and 415,000 customer contracts for electronic
security services through the ADT dealer program.
As previously discussed, effective June 29, 2007, we completed the Separation. In connection with
the Separation, we paid $68 million and $349 million in Separation costs during 2008 and 2007
respectively. Of these amounts, $36 million and $256 million were included in cash flows from
discontinued operating activities, respectively.
During the second quarter of 2008, Tyco released $2,960 million of funds placed in escrow during
the third quarter of 2007 as well as $60 million of interest earned on those funds for the benefit of the
class as stipulated in the Court’s final order related to the class action settlement.
We will continue to divest businesses that do not align with our overall strategy. We expect to use
the proceeds from these sales, as well as the cash generated by our operations, to continue to make
investments in our businesses that are intended to grow revenue and improve productivity, including
our restructuring actions. We expect to also use cash to selectively pursue acquisitions.
Pursuant to our share repurchase program, we may repurchase Tyco shares from time to time in
open market purchases at prevailing market prices, in negotiated transactions off the market, or
pursuant to an approved 10b5-1 trading plan in accordance with applicable regulations.
Management believes that cash generated by or available to us should be sufficient to fund our
capital and liquidity needs for the foreseeable future, including quarterly dividend payments. We intend
to continue to repurchase shares under our existing $1.0 billion share repurchase program approved by
our Board of Directors on July 10, 2008 depending on credit market conditions, macroeconomic factors
and expectations regarding future cash flows.
Capitalization
Shareholders’ equity was $12.9 billion or $27.30 per share, as of September 25, 2009, compared to
$15.5 billion or $32.76 per share, as of September 26, 2008. Shareholders’ equity decreased primarily
due to a net loss of $1.8 billion, which was primarily driven by goodwill and intangible asset
impairments, dividends declared of $472 million, a $220 million current period change relating to the
Company’s retirement plans and unfavorable changes in foreign currency exchange rates of
$203 million.
Total debt was $4.3 billion as of September 25, 2009 and September 26, 2008, respectively. Total
debt as a percentage of capitalization (total debt and shareholders’ equity) was 25% as of
September 25, 2009 and 22% as of September 26, 2008, respectively.
Our cash balance increased to $2.4 billion as of September 25, 2009, as compared to $1.5 billion as
of September 26, 2008. This increase in cash was primarily due to cash generated by the operating
segments as well as proceeds from issuance of long-term debt.
56 2009 Financials