Board of directors authorizes $2.5 billion increase in share repurchase program
GALWAY, Ireland, Oct. 30, 2024 /PRNewswire/ — TE Connectivity plc (NYSE: TEL) today reported results for the fiscal fourth quarter and fiscal year ended Sept. 27, 2024.
Fourth Quarter Highlights
Full Year Highlights
Share Repurchase Authorization
“Our team finished the fiscal year strong, delivering quarterly sales that were above guidance and a record $1.95 adjusted EPS,” said TE Connectivity CEO Terrence Curtin. “For the full year, we set records in key areas including EPS, cash generation and operating margins, delivering on our commitment to expand margins in a dynamic market environment. Our Transportation segment expanded its adjusted operating margin to 20%, driven by strong operational performance and our leading global position in next generation automotive technologies. Our Industrial segment finished the year with growth in three out of four businesses. The Communications segment finished the year delivering growth and strong margin expansion, driven by accelerating momentum in artificial intelligence programs.
“Our teams will build on our momentum from 2024 and we expect first quarter sales and adjusted EPS to be up year over year. We will continue to capitalize on our operational strengths and innovations in long-term growth trends such as electrification and data connectivity in transportation, renewable energy and AI. In a reinforcement of our long-term value creation model, I’m pleased that our board authorized a $2.5 billion increase in our share repurchase program that will continue to benefit our owners.”
First Quarter FY25 Outlook
For the first quarter of fiscal 2025, the company expects net sales of approximately $3.9 billion. GAAP EPS from continuing operations is expected to be $1.64 and adjusted EPS is expected to be $1.88. First quarter guidance includes $0.04 of tax headwinds compared to the prior year.
Beginning in fiscal 2025, the company will have two reportable segments – Transportation Solutions and Industrial Solutions – resulting from a reorganization announced in the fourth quarter of fiscal 2024. The company will also provide recast financial information in an 8-K filing later this quarter.
Information about TE Connectivity’s use of non-GAAP financial measures is provided below. For reconciliations of these non-GAAP financial measures, see the attached tables.
Any share repurchase by the company will be made in accordance with applicable securities laws in the open market or in private transactions. The repurchase program is subject to business and market conditions, and may be commenced, suspended or discontinued at any time or from time to time without prior notice.
Conference Call and Webcast
The company will hold a conference call for investors today beginning at 8:30 a.m. ET. The conference call may be accessed in the following ways:
About TE Connectivity
TE Connectivity plc (NYSE: TEL) is a global industrial technology leader creating a safer, sustainable, productive, and connected future. Our broad range of connectivity and sensor solutions enable the distribution of power, signal and data to advance next-generation transportation, renewable energy, automated factories, data centers, medical technology and more. With more than 85,000 employees, including 8,000 engineers, working alongside customers in approximately 130 countries, TE ensures that EVERY CONNECTION COUNTS. Learn more at www.te.com and on LinkedIn, Facebook, WeChat, Instagram and X (formerly Twitter).
Non-GAAP Financial Measures
We present non-GAAP performance and liquidity measures as we believe it is appropriate for investors to consider adjusted financial measures in addition to results in accordance with accounting principles generally accepted in the U.S. (“GAAP”). These non-GAAP financial measures provide supplemental information and should not be considered replacements for results in accordance with GAAP. Management uses non-GAAP financial measures internally for planning and forecasting purposes and in its decision-making processes related to the operations of our company. We believe these measures provide meaningful information to us and investors because they enhance the understanding of our operating performance, ability to generate cash, and the trends of our business. Additionally, we believe that investors benefit from having access to the same financial measures that management uses in evaluating our operations. The primary limitation of these measures is that they exclude the financial impact of items that would otherwise either increase or decrease our reported results. This limitation is best addressed by using these non-GAAP financial measures in combination with the most directly comparable GAAP financial measures in order to better understand the amounts, character, and impact of any increase or decrease in reported amounts. These non-GAAP financial measures may not be comparable to similarly-titled measures reported by other companies.
The following provides additional information regarding our non-GAAP financial measures:
Forward-Looking Statements
This release contains certain “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and are subject to risks, uncertainty and changes in circumstances, which may cause actual results, performance, financial condition or achievements to differ materially from anticipated results, performance, financial condition or achievements. All statements contained herein that are not clearly historical in nature are forward-looking and the words “anticipate,” “believe,” “expect,” “estimate,” “plan,” and similar expressions are generally intended to identify forward-looking statements. We have no intention and are under no obligation to update or alter (and expressly disclaim any such intention or obligation to do so) our forward-looking statements whether as a result of new information, future events or otherwise, except to the extent required by law. The forward-looking statements in this release include statements addressing our future financial condition and operating results. Examples of factors that could cause actual results to differ materially from those described in the forward-looking statements include, among others, the extent, severity and duration of business interruptions negatively affecting our business operations; business, economic, competitive and regulatory risks, such as conditions affecting demand for products in the automotive and other industries we serve; competition and pricing pressure; fluctuations in foreign currency exchange rates and commodity prices; natural disasters and political, economic and military instability in countries in which we operate, including continuing military conflict in certain parts of the world; developments in the credit markets; future goodwill impairment; compliance with current and future environmental and other laws and regulations; and the possible effects on us of changes in tax laws, tax treaties and other legislation. In addition, our change of incorporation from Switzerland to Ireland is subject to risks, such as the risk that the anticipated advantages might not materialize, as well as the risks that the price of our stock could decline and our position on stock exchanges and indices could change, and Irish corporate governance and regulatory schemes could prove different or more challenging than currently expected. More detailed information about these and other factors is set forth in TE Connectivity Ltd.’s Annual Report on Form 10-K for the fiscal year ended Sept 29, 2023, as well as in our Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other reports filed by us with the U.S. Securities and Exchange Commission.
TE CONNECTIVITY LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
For the Quarters Ended
For the Years Ended
September 27,
September 29,
September 27,
September 29,
2024
2023
2024
2023
(in millions, except per share data)
Net sales
$
4,068
$
4,035
$
15,845
$
16,034
Cost of sales
2,685
2,750
10,389
10,979
Gross margin
1,383
1,285
5,456
5,055
Selling, general, and administrative expenses
433
412
1,732
1,670
Research, development, and engineering expenses
195
174
741
708
Acquisition and integration costs
5
7
21
33
Restructuring and other charges, net
99
57
166
340
Operating income
651
635
2,796
2,304
Interest income
26
21
87
60
Interest expense
(15)
(19)
(70)
(80)
Other expense, net
(5)
(3)
(16)
(16)
Income from continuing operations before income taxes
657
634
2,797
2,268
Income tax (expense) benefit
(381)
(81)
397
(364)
Income from continuing operations
276
553
3,194
1,904
Income (loss) from discontinued operations, net of income taxes
—
(1)
(1)
6
Net income
$
276
$
552
$
3,193
$
1,910
Basic earnings per share:
Income from continuing operations
$
0.91
$
1.77
$
10.40
$
6.04
Income (loss) from discontinued operations
—
—
—
0.02
Net income
0.91
1.76
10.40
6.06
Diluted earnings per share:
Income from continuing operations
$
0.90
$
1.75
$
10.34
$
6.01
Income (loss) from discontinued operations
—
—
—
0.02
Net income
0.90
1.75
10.33
6.03
Weighted-average number of shares outstanding:
Basic
303
313
307
315
Diluted
305
316
309
317
TE CONNECTIVITY LTD.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
September 27,
September 29,
2024
2023
(in millions, except share data)
Assets
Current assets:
Cash and cash equivalents
$
1,319
$
1,661
Accounts receivable, net of allowance for doubtful accounts of $32and $30, respectively
3,055
2,967
Inventories
2,517
2,552
Prepaid expenses and other current assets
740
712
Total current assets
7,631
7,892
Property, plant, and equipment, net
3,903
3,754
Goodwill
5,801
