The company currently expects sales of $2.45 billion to $2.55 billion, versus the previous guidance range of $2.35 billion to $2.45 billion. The increase in revenue is due to improved sales in the consumer-related end markets served by the Electronic Components segment, additional project revenue in the Undersea Telecommunications segment and foreign currency translation.
GAAP income from operations is now expected to be $25 million to $55 million, which includes restructuring charges of approximately $60 million. Adjusted operating income is expected to be $85 million to $115 million, versus prior guidance of $40 million to $70 million. The improvement in adjusted operating income versus prior guidance is due to increased revenue in the Electronic Components and Undersea Telecommunications segments, as well as accelerated execution on restructuring and other cost actions.
GAAP earnings per share (EPS) from continuing operations are now expected to be $0.00 to $0.07, including restructuring charges of approximately $0.10 per share. Adjusted EPS from continuing operations are expected to be $0.10 to $0.17, compared to prior guidance of $0.01 to $0.06.
ABOUT TYCO ELECTRONICS
Tyco Electronics Ltd. is a leading global provider of engineered electronic components, network solutions, undersea telecommunication systems and specialty products, with fiscal 2008 sales of US$14.8* billion to customers in more than 150 countries. We design, manufacture and market products for customers in a broad array of industries including automotive; data communication systems and consumer electronics; telecommunications; aerospace, defense and marine; medical; and alternative energy and lighting. With approximately 7,000 engineers and worldwide manufacturing, sales and customer service capabilities, Tyco Electronics' commitment is our customers' advantage. More information on Tyco Electronics can be found at http://www.tycoelectronics.com/. (* Includes revenue from the company's former Wireless Systems segment, which will be reported as a discontinued operation beginning in the fiscal third quarter of 2009.)
The company has discussed above its expected operating income before unusual items including costs related to legal settlements, restructuring costs, impairment charges and other income or charges ("Adjusted Operating Income"). The company utilizes Adjusted Operating Income to assess segment level core operating performance and to provide insight to management in evaluating segment operating plan execution and underlying market conditions. It is also a significant component in the company's incentive compensation plans. Adjusted Operating Income is a useful measure for investors because it better reflects the company's underlying operating results, trends and the comparability of these results between periods. The difference between Adjusted Operating Income and operating income (the most comparable GAAP measure) consists of the impact of charges related to litigation settlement costs, restructuring costs, impairment charges and other income or charges that may mask the underlying operating results and/or business trends. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease the company's reported operating income. This limitation is best addressed by using Adjusted Operating Income in combination with operating income (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease on reported results.
The company has discussed above income tax expense after adjusting for the tax effect of unusual items including charges related to restructuring, impairment and other income or charges ("Adjusted Tax Expense"). The company utilizes Adjusted Tax Expense to provide investors further information regarding the tax effects of adjustments used in determining the non-GAAP financial measure Adjusted Earnings Per Share (as defined below). The difference between Adjusted Tax Expense and income tax expense (the most comparable GAAP measure) is the tax effect of adjusting items. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease income tax expense. This limitation is best addressed by using Adjusted Tax Expense in combination with income tax expense in order to better understand the amounts, character and impact of any increase or decrease in reported amounts.
The company has discussed above its expected adjusted diluted earnings per share, which is earnings per share from continuing operations before unusual items, including charges related to legal settlements and reserves, restructuring charges, impairment charges, tax sharing income related to the adoption of FIN 48 and other income or charges ("Adjusted Earnings Per Share"). The company utilizes Adjusted Earnings Per Share because we believe that it is appropriate for investors to consider results excluding these items in addition to our results in accordance with GAAP. We believe such a measure provides a picture of our results that is more comparable among periods since it excludes the impact of unusual items, which may recur occasionally, but tend to be irregular as to timing, thereby making comparisons between periods more difficult. This limitation is best addressed by using Adjusted Earnings Per Share in combination with earnings per share (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease on reported results.