Johnson Controls International Plc · NYSE:JCI
Johnson Controls International — Tyco International — Investor Day (September 2012)
135 slides from Johnson Controls International's investor day presentation, Sep 18, 2012
Slide 1: Investor Day, New York, September 18, 2012
Exhibit 99.1 Investor Day New York, NY September 18, 2012
Slide 2: Forward-Looking Statements
Forward-Looking “believe”, Inc.), statements expectations of announcement business or the events uncertainties SEC Tyco Relations” our legal company’s filings, International the common orsettlement conditions expectation conditions “propose”, include, regarding and including, and include, reboard or
Slide 3: Tyco Investor Day Agenda
Tyco Investor Review minutes Q&A 15 minutes Closing Day Agenda 20Comments minutes Business 20Brian minutes Segment McDonald 30 Reviews—Installation minutes cDonald 5 minutes Colleen Repplier & Services—Fire Mark VanDover Protection Mike Products—Security Ryan Scott cott Clements Products—Life Arun N
Slide 4: Our Leadership Team
Our Leadership Officer ProductsBrian Installation Scott Team Colleen &George Officer Mike Oliver* andRyan Chief CEO Mark Kamath Business McDonald* Products Leaders Clements Information Functional Repplier Chief Leaders Life Services Judy Safety Arun Vertical VanDover Larry Market Reinsdorf* Chief Of
Slide 5: Overview, George Oliver, Chief Executive Officer
Officer Overview George Oliver Chief Executive Officer
Slide 6: A Combination of World Class Businesses
A Combination Products ƒSecurity Of World Products Class ƒLife FireSafety & Security “New”Businesses We AdvanceSecurity SafetyFire AndSolutions Security Protection By FindingƒNA Smarter Commercial Ways ToƒFire Save Protection Lives, Improve Security Businesses ServicesAnd ƒInternational Protect Wher
Slide 7: The New Tyco Positioned to Lead
The “New” leader worldwide Accelerate ended September in $100 Revenue sales Tyco billion and Uniquely 28,Growth service 2012 fragmented, and Positioned branches Toreflects Achieve consolidating ƒTo the Comprehensive 4-5% Lead ADTCAGR The North space Fire Over growing America capability & Security Th
Slide 8: Delivering Critical Solutions That Protect People and Assets
Delivering 1,000,000 the world We fire Mission help fighters protect Critical worldwide 80% Solutions of We the world’s help That protect Protect top 200 aPeople majority retailers Andof8Assets the Note: Fortune Across internal 500 The company companies Globe We estimates We help help protect protec
Slide 9: Respected and Known for Quality and Innovation
Respected is * Outside finding new of Industry North * andAmerica Brands better ways Knownto For serve Quality customers” And Innovation “What we’re Customer lookingQuotes: for is a company “Tyco is known that brings in thefire industry and security we participate together in…as and does theitleader
Slide 10: A Strong Presence Outside North America
A Strongof outside countries revenue isPresence ƒNorth a69,000 projection America In employees Developed forAsia the globally fiscal Latin Markets year ƒ Growth in ended more With markets An than September Accelerating 1,200 represent office 28, 2012 Presence locations Pacific and America reflects I
Slide 11: Organized in Three Reporting Segments
Organized Installation reflects theIn ADT &Three Services North Reporting Leadership America Segments Residential In Products Forecasted andAnd Small Installation 2012 Business Pro-forma Drives and Revenue* Flow Service Control Growth $10.4 businesses Billion 11 *Forecasted NA as discontinued 65% Of
Slide 12: We Provide an Extensive Range of Product and Service Offerings
We Provide Monitoring control, thermal imaging EAS, & Ansystems maintenance Extensive Producontrol, andRange vices gasvideo detection Of sprinklers, Product and electronic equipment extinguishers, & Service video)—Fire Uniquely Offerings services Positioned detection Products for: 15To Installation
Slide 13: We Provide Solutions Across the Building Life Cycle
We Provide Concept Design The Implement Most Critical Certify Building LifeSystems Cycle Service Life Safety Product Systems & Installation Major Building Conversion Fire to Data/ Service HVAC 13 Plumbing Security Electrical Protection Telecom Systems Building System Monitor & Improve
Slide 14: Delivering Comprehensive Integrated Life Safety Solution
Delivering contract staff applications to A in provide 2012 Comprehensive tothat upgrade andintegrate maintain the Integrated with fire cohesive, alarms our fire Life integrated, insolutions Safety multiple Solution 14 fire sitesand ƒ Riker’s 10 lifemajor safety Island jails solution run Fireby Dete
Slide 15: Multiple Channels to Market
MultipleofChannels ƒProximity ƒSpeed Engineers Contractors service to customers and Serve ƒRegional Owner ƒResponsiveness Local, EndRegional expertise User Strong &to ƒExtensive Global ƒGlobal Relationships Customers scope branch&With network scale Channels Customers ƒKnowledge delivery To Market &ƒ
Slide 16: We Are a Leader in a Fragmented Market
We AreOther Share players critical to regional A success Leader Other players In success Other A $100 Characteristics Market Unique Billion #1-2 Advantage Global #1ƒ #1 Innovation And Position ToFragmented Leverage and ƒ Top ƒScale Project 5Market global 16selectivity, Source: players ProductsIMS, ƒ
Slide 17: Long-Term Growth Trends Driving Demand
Favorable new recovery ƒIncreased applications ƒIncreasing Long-Term consolidation Technology building Growth ƒStrong ƒApplication & Trends fire interest codes Driving inand latest Demand systems standards technology ƒExpanding convergence Regulations Customers middle-class Global ƒGrowth ƒHigh ƒGro
Slide 18: Our Strengths Position Us To Win
Our Strengthsof ƒSignificant ƒIntegration Vertical-market-specific ƒFragmented growth market Position access, inCompetitive emerging video, Us Evolution To Win intrusion, markets advancements ƒIncreased ƒVertical-specific fire ƒ Technology and demand offerings Landscape technologies for leadership b
Slide 19: A Proven Track Record of Operational Improvement
A Proven margin invest appendix. inservice core Track businesses—Increased revenue Record ƒOfFocused Operational on R&D project Improvement… spend selectivity by ~13% ƒ290bps Improved (CAGR) Margin margins …With Expansion Additional in Europe Pro-Forma from Runway mid-single Revenue Ahead 19& digits
Slide 20: Strategic Areas of Focus
Strategic Areas Of Focus 1 2 3 Execute Accelerate Drive Disciplined Organic Productivity Bolt-On Growth Initiatives Acquisitions 20
Slide 21: Accelerate Organic Growth in Our Direct Channel
1a Accelerate via *Organic technology revenue Service andisprocess a Growth non-GAAP enhancements In Our measure. Direct ƒ For Utilize Channel a reconciliation, global ƒ Leverage best practices see existing appendix. Service customer Growth Organic Focus Service Areas: Growth* Customer baseCustomer
Slide 22: Innovation: Differentiated Product Introductions Driving Growth
1b InnovationRepresent Differentiated Introductions Driving technology Product Over $ Billions 30% Revenue Of~$2.1 Global Growth $1.5 Products $1.5 R&D $1.8 Spend Revenue 31%$ ƒMillions 22 Core *Organic product Focusrevenue service Areas ƒis innovation New a non-GAAP product ƒ Total and measure. lif
Slide 23: Drive Vertical Specific Solutions
Drive Vertical $10.4B specific Solutions businesses ƒsolutions—Retail Global 23 as*Forecasted discontinued Market and concentrated Solutions 2012 Resi/Small operations. pro-forma Tocustomer Create Business—Oil revenue Opportunities base Retail is a&projection Gas 10% For16% 1c ƒ Significant Differen
Slide 24: Accelerate Growth in China, India, Brazil and Middle East
1d Accelerate Focus China and on China, India Growth ƒIndia, Local Market Brazil market-driven and Capabilities Middle R&DEast & Revenue supported to drive China, higher by Tyco’s India, growth—Local global Brazil technology & Middle leadership and Eastto resources ƒdrive Currently growth ƒ Investin
Slide 25: Multifaceted Approach to Delivering Growth Markets
Multifaceted Education best firmspractices ƒ Distributors/ ƒ Productivity Approach ƒ Project contractors To management initiatives Delivering ƒ In-country ƒand Service Performance delivery business and training ƒIn Internal 1d partners Growth Business maintenance ƒ Integrators Markets Development kn
Slide 26: Disciplined Approach to Acquisitions
2 Accelerateapproach disciplined Growth Through to acquisitions Targeted ƒ Deep Acquisitions pipeline Broaden of highlyEnhance synergistic Expand opportunities Strengthenwith Service attractive Technology return metrics ProductFragmented Geographic Industry & Vertical Provides Portfolio Attractive P
Slide 27: Bolt-on Acquisitions Accelerated Growth
Bolt-on ƒEnhances frequency Hua Neng Acquisitions gas Fuzhou foam andand other Power Have other key Plant ƒLeading Broadened verticals ~$400M installation customer Our In Portfolio Revenue base andAnd hopping, Added ƒStrengthens 2 Accelerated Inwireless Lastwireless 18-24 remote Growth Months capabi
Slide 28: A Centralized Cost Structure Drives Efficiency
A Centralized Implement in Margins a Box”28Costs consolidated Model ƒ Reduce To Services Fund real Investments estate Netfootprint Cost In strategic Growth ƒ Consolidate sourcing And 3 Drive ERP process systems Shareholder Efficiency Growth Value Initiatives ƒ Reinvestment Cost Of Structure ƒ Lean/S
Slide 29: Operating as a Pure Play Company
3 Operating centralizing compliance, centralize and As back and identified Aƒoffice “Pure Approach operations—15+ Play” automate toCompany global backroll-out office Driving procurement processes increasing Savings groups Leveraging speed—Focus Simplify to single Operations Ourglobal the Scale distr
Slide 30: Positioned to Accelerate Growth and Expand Margins
Positioned equates revenue to and 2% Tooperating Accelerate EPS growth margin Growth ƒ Net before productivity Andspecial Expanditems enhancement Margins are non-GAAP Accelerating of $50 measures. million Growthannually For Overa the reconciliation, equates Next 3toYears ~5%seePro?forma EPS appendix
Slide 31: Installation & Services, Brian McDonald
Installation & Services Brian McDonald Chief Operating Officer Installation & Services
Slide 32: Installation & Services at a Glance
Installation Services 3 million$4.0B—ROW commercial & Servicesand At Installation residential A Glance & ƒcustomers Leading Services global $4.3B 32 *Forecasted provider ƒ Broad geographic of2012 system revenue design, reach—Over is ainstallation projection 1,000and for locations the services fiscal
Slide 33: Comprehensive Services and Solutions with Leading Brands
Comprehensive Leading Brands Portfolio 33 * Outside Of Services North America & Solutions… Lines of Business Key Brands ƒ Fire detection ƒ Fire suppression ƒ Security systems ƒ Monitoring and * maintenance services With Well Known
Slide 34: Serving a Variety of Customers Across Multiple Verticals
Serving Residential Industrial Institutional utilities A Oil Variety Healthcare & gas, Of&power Customers Single-family facilities, generation, Across academic homes mining, Multiple institutions, and petrochemical local Verticals providers museums Residential and of and aother wide foundations andi
Slide 35: Positioned to Grow in a Fragmented Market
We Are ƒPositioned integrated players Unmatched Fire & service ToOther Grow players Competitors In A $70B Fragmented Security footprint Market company and9% scope Industry account of services for Tycoless 35 ƒ Highly Global Source: which fragmented IMS,provides Management ƒ Tyco thanhas 25% estimate
Slide 36: What Differentiates Us
What Differentiates 30,000 customer technicians base withƒvertical Us Experienced ƒ Brand market recognition local solutions management inƒ the In-depth industry with knowledge deep withunderstanding a broad and influence offering of local of ofboth codes customer fire and and standards needs securi
Slide 37: Global Footprint with Local Management
Global Footprint Headquarters South With Africa LocalLocal Management BranchesNorth 3% ofAmerica RevenueEurope GlobalAsia Reach 48% And ofSignificant Revenue 22% Scale of Of Revenue Operations 13% of37 Revenue Pacific Latin America 9% of Revenue 5% of Revenue Regional
Slide 38: Installations Convert to Long-Term Service Relationships
InstallationConvert Upgrades And Services Installations Life Cycle To Long-Term New System Customer Installation Relationships Higher Margin 38 Service Monitoring System Sales Design Installation Service Preventive Maintenance Repairs 20+ 1 to 3 Years Years
Slide 39: Vertical Solutions for High Value Customers
Vertical Solutions Systems 6 7. Network For High 8. Control ValueSoftware Customers 3 5University 4 9. Campus?wide Example Monitoring 1. Control Panel & Diagnostics 2. Fire Pumps Provider 9 3.Intrusion Of Life Safety 4. Security Products 1 Detection And / OrCameras Service Solutions 7 5. Emergency T
Slide 40: Installation Financial Trends and Targets
Installation (8%) Integrated performance appendix. (5%) solutions 4% &and Services Positive improvement ƒ North Financial Growth*: America growth Trends Service security ƒ –North (Non-Recurring) North ƒAmerica dis-synergies Americasecurity Revenue Business Business project &Drivers Operating refresh
Slide 41: Installation Rest of World Financial Trends and Targets
Installation 1% revenue improvement Growth*: CAGR & ƒService Services Integrated ƒ Service (Non-Recurring) Financial expansion / back-office Trends / ƒ Business consolidation Integrated – Rest ofDrivers World solutions benefits Revenue Keysubscriber Elements 41 *Organic & Operating revenue of Plan r
Slide 42: Installation & Services Strategic Priorities
Installation Advance shared services field & Services technology and customer – Strategic 3 4 service Improve Priorities centers Installation 1422 Accelerate Rationalize Service CostsEnhance & Performance Service Growth Infrastructure Productivity ƒ Project ƒ Service selectivity and/product risk man
Slide 43: Accelerate Service Growth
1 Accelerate Control solutions Control 43 Services Rooms Growth Repair–Systems Install Toƒ Service Drive volume Value Differentiation and scale ƒ Service Integration, innovation Preventive / ƒ Deeper Remote customer Cloud-Based relationship Command efficiencies Mission digitization Critical ƒMainten
Slide 44: Enhance Service Platforms and Productivity
2 Enhance platforms ƒStandard Services Productivity C SchedulingRemote GlobaleMetrics Diagnostics ƒDataƒProduct analyticsinnovation ƒStandardCustomer global processes ƒIT investments First Time Service Fix Operating Experienc Margin Center44Technician Mobility ƒEfficiency applications ustomer Advanc
Slide 45: Improve Installation Excellence
3 Improve Installation Excellence Approvals ƒTyco Performance Management Bid / Installation ƒProject ƒSales Planning Products Estimating ƒMetrics Design Selection Sourcing Compensation NegotiationGaining ƒRelationship Efficiencies ƒTraining Throughout ƒCenters The of Construction ƒManagement Cycle ƒ
Slide 46: Rationalize Infrastructure Costs
4 RationalizeMonitoring Collections Customer Costs & Contact Infrastructure Dispatch Centralized TechHistorical Support Services Goal ƒ Monitoring Technician Traditional ƒ Tech Dispatch Branch Support “Branch Customer Simplify InShared A Box” & Standardize, Service Sales Sales Center Centralize Inst
Slide 47: Significant Service and Install Benefits
4 Significant Service/Install Benefits Contributed Realized 160bps Benefits Planning Over toRealized a3ƒtotal Year Scheduling operating Period In TheƒU.K. margin Reduced Logistics Simplify improvement headcount ƒ Small & Standardize Project by of300 ~700bps Quoting full-time Centralize 47ƒ Call equi
Slide 48: Generating Synergies from Fire and Security Combination
Generating businesses combination supply chain Highlighted Synergies of consolidation Tyco’sWithin N.A. CostƒFire Savings—Build-out Continuous Theand FireSecurity & Security improvement businesses of 4 Businesses IT infrastructure initiatives ƒ Additional In 48 North and Opportunities America increm
Slide 49: Installation & Services Summary
Installation Extensive ƒ Highly attractive global & Services direct and Summary growing installation service ƒ and Market service revenue leader footprint mix in aacross highly withanfragmented deep extensive local expertise installed market with ƒbase Continued significant ƒ Significant partnership
Slide 50: Global Products, Colleen Repplier
Global Products Colleen Repplier Fire Protection Products
Slide 51: Extensive Portfolio of Fire and Security Products
Extensive Security Deep technology &Portfolio Life Safety pipeline of Fire Products ƒ&Focus Security ƒ Well on growth Product knownmarkets and Solutions respected andwith keybrands Leading verticals ƒ Strong Technology 51 *Forecasted industry ƒ 2012 positions 2012 forecasted revenue with leading is
Slide 52: Global Products Three Platforms
Global 55% systems ƒMechanical Products ƒThermalConsists products imagingOftechnologies Revenue Three Platforms Security 20% Lines ƒGas ƒIntrusion detection of Business Products equipment Products ƒAccess Revenue Fire control ƒSuppression 52 ƒVideo surveillance systems ƒFire 25% sprinklers ƒReal tim
Slide 53: Global Products Market Leader
Global facilities Excellence Products Tyco for Is Is Well The ~25% Market Positioned shareLeader Products To Win In -11 Fire In in The &Americas Security Market Products Market 9% Industry -15 53 in Source: Tyco EMEA ƒ Highly IMS, ƒ Innovation Management ƒ ~8,400 and—9 fragmented estimates in Asiaem
Slide 54: Global Products Financial Overview
Global Products CAGR +300 to 350bps Financial operating Overview margin Revenue improvement & Operating 54 *Organic Margin* revenue $ Billions andOrganic operating Revenue margin(13)% before(1)% special 11%items 10%are Growth*: non-GAAP Revenue measures. By Geography For a reconciliation, Growth Tar
Slide 55: Integrated System Example
ProductArrive System Management Alarm activation Integration C-Cure at Scene Information Advantage 9000 Future—Under Access 4100ES Example—Real Control Control—Today Cloud Egress Based Time andServer Incident Occupancy 55 FireManagement Detection Management Fire Service and and Dangerous Center Repo
Slide 56: Fire Protection Products, Colleen Repplier
Fire Protection Products Colleen Repplier Fire Protection Products
Slide 57: Fire Protection Products at a Glance
FireƒProtection products sector 9% New $0.9 andproducts $0.8 innovative Products $0.9that (e.g. solutions reduce AtOil a Glance &risk Gas, ƒ Diverse orOverview Mining) lowercustomer Growth*: ƒRevenue Infrastructure base total Mix ininstalled By aspending variety Geography oroflifecycle ƒvertical Fir
Slide 58: We Serve Multiple Product Categories
We Serve Fire Detection Mechanical Protection Mechanical Needs Across Fire Metal Multiple Framing Product Panels Categories… DetectorsSpecial Notification Hazards Grooved Water Grooved Portables&Engineered Supports An Pre- Extensive Foam Sprinklers PortfolioValves Of Critical Watermist Fire Protecti
Slide 59: Applications Across Key Verticals
…With Various Applications Across Key Verticals… Commercial Residential Storage Institutional Power Oil & Gas Mining 59
Slide 60: Around the World
…Around Speak languages the World 23 languages Americas Speak EMEA22Asia-Pacific languages 27Trade Manufacturing in 35 countries Locations, Trade in50 122 Distribution countries Trade Branches in 33And countries ~4,600Located Employees in 6 In countries 35 Countries; LocatedTrading in 20 countries I
Slide 61: Fire Codes and Standards Drive Outperformance
Firecodes by Commercial Protection 0.80Construction and Products standards Outperforming Spend 0.70 FPP ƒ Differentiation Sales Construction 61 Source: of 0.60 Market IHSproducts Global ƒ Diverse Insight through products 0.50 innovation and customers also1.30 Percent havechange mitigated in constant
Slide 62: Highly Effective Go-To-Market Approach
Highly Effective Influence Distribution Specifications Installation Go-To Market & Sales Services &Approach Marketing 62 Driving 3rd Party Leadership 3rd PartyPosition Distributors Tyco Contractors Fire Protection Codes Products & EndIndustry/Technical Authorities Engineers Business Standards Develo
Slide 63: We Provide Solutions
We ProvideSolutions Mechanical Integrated Vertical Sprinklers Solutions 63Products1.9.Portable Foam 10.Metal & Wheeled Framing Units & OilChannel & Gas Facility & Pipe Supports 3. Foam 4. Dike Chemical Protection Agents 11. & Emergency Spill Control 12. Detection Hardware Foam 5. Clean Supply 6. Res
Slide 64: R&D Investment Driving New Product Innovation
R&D Investment Detector Triangulation Positioned Algorithm Driving Extinguishing Pinpoints New Product Monitor and Targets Innovation Suppression Flame THESource on NEED unmanned (Bangalore, THE ENABLING platforms India) The (Ráječko, TECHNOLOGIES Solution Czech – Automated Republic) Tyco High Far-I
Slide 65: Fire Protection Products Summary
Fire Protection position us for growth Products ƒ Solid Summary organic ƒ Broadest growth complemented portfolio of fireby products accretive in acquisitions the industry ƒ Recovering Industry experts construction driving innovation demand provides and shaping additional the future opportunity ƒ Glo
Slide 66: Security Products, Mark VanDover
Security Products Mark VanDover Security Products
Slide 67: Security Products at a Glance
Security range acceleration—Mobility—Edge non-GAAP of premium Products reconciliation At solutions A Glance forindetails. security Overview Intelligence industry Revenue Organic ƒ Strong Mix ƒ Visonic By market Geography acquisition position ƒ Industry with Revenue large leader (11%) installed in8%
Slide 68: Our Brands Help Make the World Safer
Our Brandscommercial 2,000,000 Help Makeenterprises The WorldƒSafer Thousands In Many of Industries students inAround 900+ schools The Globe ƒ 42% Worldwide of the Fortune We Help 500Protect… companies ƒ Transportation 68 systems on 5 continents ƒ 37% of the world’s top 100 retailers ƒ Over
Slide 69: We Serve Security Needs Across Product Categories
We Serve Video Management RealSecurity Time Systems Location Needs Exciters Across Systems Software Various Network 69 Product and Digital Categories… IP and Intrusion Analog Monitors Access Control and Active Cards RFID and Controllers, Controllers Security TrackingMgmt & Video Panels Management Ke
Slide 70: Around the World
…Around Trade languages The World in multiple Americas languages EMEATrade Asia-Pacific in multiple Tradelanguages in 34 countries 3 Manufacturing Trade in 120 Locations, countries9Trade Distribution in 22 countries BranchesLocated And ~2,700 in 6 countries EmployeesLocated Trading in In 8 countries
Slide 71: Markets and Customers
Markets User s End & Customers 71 * Outside Verticals of Northy Ke America Commercial Residential Retail Transportation Financial Government Healthcare Education & External Channel Internal Channel s rs ontractor Distributo * C
Slide 72: R&D Driving Innovation and Growth
R&D Is Recorder Event security Hardwired Wireless Management Key system 72 venue ƒ Interactive To keypad 12%venue Driving System with Remote Innovation Management for quick pend Residential emergency And multi Growth System location Home/SB response Re New enterprises 70% Product Monitoring New Re T
Slide 73: M&A and R&D Enabling Next Generation Platforms
M&Aperformance, Storage high 73 IsR&D Enabling SkillNext ƒSet Video Skills, Generation intelligence Distribution Platforms to quickly ƒ Enables Acquired ƒ Wireless seamless November remote ƒ Video 2007 upgrade for Acquired theft / scalable prevention July 2008 storage ƒAcquired Wireless portfolio en
Slide 74: Opportunity to Innovate and Lead in Intelligent Edge Devices
Addressing Customer Needs With Integrated Solutions Opportunity To Innovate & Lead In Intelligent Edge Devices & Converged Wireless Solutions 74
Slide 75: Security Products Summary
Security accelerating allow customers Products growth toSummary see ƒ R&D more,investments ƒdo Extensive more, and are range save driving ofmore premium operating 75 solutions margininexpansion the security andindustry innovation ƒ Strong ƒ Attractive marketvertical positionmarkets with large within
Slide 76: Life Safety Products, Mike Ryan
Life Safety Products Mike Ryan Life Safety Products
Slide 77: Life Safety Products at a Glance
Life Safety Attractive Regulatory (12%) Spending markets At Standards A (e.g., Glance with ƒOil Technology good Overview & Gas, growth Power) Revenue Advancements and EMEA 77Mix *Organic By 29% ƒGeography Government NA revenue profitisƒopportunities aMarket / non-GAAP Municipal leading 59% Spending
Slide 78: Why Scott Safety?
Why Scott Safety? ƒ Brand ƒ Relationships & Trust ƒ Reliable ƒ Technical Innovators ƒ Service Capability 78
Slide 79: Product Categories
Product ƒCost Image of Incident Categories Ownership Management ƒTechnology ƒAmbient 79AirExpertise FiltrationProducts Mask Filter Differentiation PAPR HeadSupplied Tops ƒComfort Air ƒProduct / Aesthetics “Ruggedization” Detection & ƒProduct Accountability Reliability ƒSensors SCBA&Compressor Connec
Slide 80: Global Product Development
Global Product Development:—SCBA’s Detection Bangalore, Platform India Strategy Monroe, ƒ Software Skelmersdale, U.S.—Portable Development:—Fire England Gas Detection ƒ Product Fighter ƒ Product Development:—SCBA’s—Escape Tracking Development:—NFPA = R&D Facility 80 SCBA’s—Escape Respirator’s—Powere
Slide 81: Key Verticals
Key Verticals Chemical Defense Spending FireƒService Newƒ Geo-Political Ship Oil Builds & Gas ƒMilitary Tensions Government &ƒCivil Terrorist Spending ƒ Supply Threat ƒ&Regulatory 81 Demand Defense Requirements ƒ Government ƒ Regulatory Spending Standards ƒ Infrastructure ƒ Fleet Management Spend ƒ
Slide 82: Key Product Launches
Key Product disrupter Filter Respirator ModularandAssembly ƒhead (FRR) Launched Launches topƒ recognition 82 Best April ininFY12 class 2012ƒHigh protection Highest Vibrating Pressure Quality alarm factor SCBA…5500psi, options SCBA ƒ Greater New High comfort Branding Flow Reduced with Blower 5500psi
Slide 83: Key Products in Development
Key Products features… Detector 2012 KernelErgonomic Universal &Thermal Docking In Development Design Transmitter Materials—Extended Station IR er ƒƒNew Fixed NFPA Global Scott Gas 2013 regulatory Detection…Universal Safety tracking Compliant offering approvals range SCBA w/altitude ƒ Compliments Ca
Slide 84: Life Safety Growth Acceleration Summary
Life Safety Growth 84 Acceleration SummaryDriven ƒ Industry By Continued leading provider Diversification: of life safety – Geography: products with China, strong Middle well East knownandbrands Latin ƒAmerica Preferred – Markets: choice byMarine, end users Mining ƒ Investments and POG in Upstream R
Slide 85: Technology & Innovation, Scott Clements
Technology & Innovation Scott Clements Chief Technology Officer Vertical Market Solutions
Slide 86: Technology Trends Impacting Tyco
Technology Advanced devices Material Competitive ƒgas Asset/personnel alarm Trends Advantage absorption management Impacting Sciences 86tracking ƒTyco Remote ƒ /Micro-cell Information security connected Mobility chemical ƒ World services ƒ sensors Presence class Ubiquitous software ƒ detection New f
Slide 87: Tyco's Areas of Focus for Strengthening Innovation
Tyco’sAreas ƒEnterprise ƒAdvanced Focus Strengthening NewR&D Capability Innovation ƒ Tyco’s Maintain ƒPrioritize Innovation Mgmt Framework—Technology and extend tech ƒBenchmark DNA investment product – People, R&D leadership ƒDepth Process, invest Leadership and ƒlevel Develop efficiency Metrics Off
Slide 88: Extend Product Leadership Through R&D Investment
Extend 2009 ƒ Expanded ƒ Reinvestment Product viewLeadership—Increased of services driving innovation 7.5% product R&D Strong revenue Investment Returns CAGRFrom Is ƒSpurring Implementing Technology Strong Investments enterprise-level Revenue Growth 88 approach Key Points to R&D R&Dinvestment Spend
Slide 89: Ubiquitous Sensors and Edge Devices
Ubiquitous sensors cameras Access with Networks—Intelligent on-board Control video NFC Mobile storage Edge Application—Near andDevices analytics Power for motion Advanced Field & Communications(NFC) facial Datadetection Driven Offerings capability enables PowerG Proliferation mobile Wireless phone O
Slide 90: Enterprise Technology Management and Cross Portfolio Collaboration
Enterprise Tyco advanced Leadership—R&D capabilities services Technology Advanced and Efficiency—Speed analytics Management—Linking Retail Healthcare Traffic To Management Market Asset Tyco Management 90Technologies Enterprise Advanced Creates Retail Video Fire Unique Detection Solution Solutions ƒC
Slide 91: Software Expertise Enabling Recurring Revenue
Software Alarm Powering Panel Expertise—Enabling Recurring infrastructure Revenuecosts Service Recurring ƒ Highly Opportunities Revenue scalable Customer Services – Expanding Access Access Addressable Control Alarm ƒasConverts aMarkets Serviceone-time 91 Key Points saleƒSite Cloud 1 Panel basedtoSof
Slide 92: Vertical Value Propositions: Retail
Vertical value Information Globalpropositions Theft Insight—Business rich Barometer 9 One-time 9 Expanded 2011 Model sale value 9Innovation High propositions recurring in Retail 9revenue Hardware TycoNew Retail centric Technologies Traditional 9 Software Build Security powered OnOpportunity Legacy 9
Slide 93: Tyco Retail Solutions
Tyco Retail 95%+ inventory Solutions accuracy – Store ƒ Faster Performance check-out Solutions ƒ Significant Platform employee Typicaltheft Inventory reduction Intelligence ƒ Optimized Project assortment Impact Financial execution Impact ƒ Substantially Shopper reduced Impact ƒlabor 5-10costs % sale
Slide 94: Vertical Value Propositions: Oil and Gas Coverage
Vertical Fire Engineering, Special Insight—Process Hazards Coverage 9 9And 9Verticals Life Services Safety Solution 9499 9 Command Coverage Oil and&Control Gas Marine Integration Mining99Capability 9 Remote Diagnostics / Product Category and Services $5.2B 99 Market 9 Security $4.6B99 Market Vehicle
Slide 95: Technology and Innovation Summary
Profitableareas —Increased targeted Dynamic Enterprise Growth innovation of technology—Open Through 95 and Innovation technology innovation ƒinvestment Three Tyco to access ƒ growth Tycobroader Innovation acceleration sources Framework—Increased vectors—Increase of innovation—Strengthening penetrati
Slide 96: Financial Review, Arun Nayar, Chief Financial Officer
Financial Review Arun Nayar Chief Financial Officer
Slide 97: A Foundation of Financial Strength
A Foundation return acquisitions 97 on invested Strong of Strength capital capitalA Compelling position great track supports financial recordfinancial ofprofile improved flexibility positions financial ƒusAmple well performance for liquidity the future ƒƒDemonstrated Balanced ƒ Large, debt diverse m
Slide 98: Diverse Revenue Mix Across Economic Cycles
Diverse Installation For a reconciliation, Revenue businesses Mixsee Across toappendix. benefit Economic from non-residential Cycles ƒ Service construction provides recovery predictable Balanced revenueEnd stream Market 65%Exposure Of Service Supports is Recurring Performance ƒ Products Through are
Slide 99: Large Revenue Base with Improving Profitability
Large reduction Expansion Metal see appendix. Revenue Product initiatives Over business Base LastƒWith Three Divestiture forImproving which Years of a*All majority unprofitable Profitability periods interest reflect businesses Segment was the sold ADT Operating ƒ on Increased North December America
Slide 100: Generating Solid Free Cash Flow
Generating100 appendix. Solid Note: FreeExcludes Cash Flow the Pro-forma Electrical and $466Metal $545Product $721 $750 business Net Income: for which 90-100% a majority Freeinterest Cash Flow was sold Conversion on December *Adjusted 22, 2010. free cash flow is a non-GAAP measure. For a reconciliat
Slide 101: Capital Investments
A Significant Electrical and Portion Metal Product Of Capital business Investments for which Area Growth majorityRelated interest$was Millions sold on Percentage Decemberof22, Revenue: 2010. Capex 0.8% 1.2% 1.4% 1.7% Subscriber 2.2% 2.4% 2.5% 3.1% /Dealer 101 Note: Excludes the
Slide 102: Improving Working Capital Efficiency
Improving Note: December Primary 22, Working 2010. Working Capital Capital Efficiency includesWorking Accounts Capital Receivable, Days Primary Inventory Working and Accounts Capital Payable. & % of Sales Excludes 4 DaytheReduction Electrical$and Billions MetalGrowing Product Revenue 102 business Wh
Slide 103: Attractive Return on Invested Capital
Attractive sold on December Return On 22,Invested 2010. Capital Track Record Of Balancing Growth And Return On Capital 103 * FY09 Excludes the Electrical and Metal Product business for which a majority interest was
Slide 104: Financial Outlook to FY15
FinancialGrowth ~12.3% Strength services productivity commercial inOutlook ƒbeginning Expansion to By FY15F security Segment ininFY15 Revenue ƒ Innovation footprint NA 104Install CAGR *Operating inand ƒ&Pricing +1 ƒROW Excludes tomargin 2% discipline Install +5before any toGlobal 6% future developed
Slide 105: Operating Margin Expansion Over Next 3 Years
Strong Operating margins 370bps Of $0.4 Margin ~$1.3 Income Expansion 15% ($0.2) & Margin Over ƒ Beneficial The Expansion Nextproduct 3 Years Into FY15 to105 12.3% *Operating ƒ Productivity and service margin initiatives—Offset mixbefore ($0.2)special 16% FY’12 items inflationary Savings is a non-GA
Slide 106: Strong Balance Sheet Summary
Strong Balance generation Weighted average comfortably Sheet interest Summary Netrate Debt ofCapitalization 6.5% $1.1 supports Provides($B) anticipated Liquidity& Pro forma cash Financial ƒ needs Significant Flexibility ƒ No near liquidity term 106 Cash debt $0.4 maturities ƒ Expect – next to mainta
Slide 107: Estimated Effective Tax Rate Post-Separation
Estimated relative to Effective peer groupTax ƒ Volatility Rate Post-Separation in the rate quarter Estimated over Post quarter Longer-Term may arise due Effective to discrete Separation or one-time Goal Tax tax planning Rate ~20%benefits ƒ Swiss-based 107 parent structure will continue to drive low
Slide 108: Disciplined Capital Allocation
Disciplined Growth Financial Improvements Criteria CapitalRepurchases Allocation Investments Is ƒ Sales The ƒ Growth Cornerstone Force ƒMarkets Vertical Of Our ƒMarkets Commercial Financial Balanced Policies ƒ Technology Capital Improving Allocation ƒ Dividends Operating Strategy ƒ Technology Perfor
Slide 109: Acquisitions Are an Integral Part of Our Growth Strategy
Acquisitions our vertical Pipeline global channels Offootprint Opportunities Are An solutions ƒIntegral Leadership 109 ƒ EPS Part in accretion Ofkey OurƒGrowth Expand by yearStrategy product 2 and ROIC markets Targetƒ Criteria Strengthen or regions Additional in ƒ Supply excess Value of Tyco geograp
Slide 110: Proven Integration Process
Proven One Workshops Plans Communication Steady First Finance, State Acquisition 100 Progress Planning Days IT, Plan Legal) Integration Days Practices ƒ(Integration Develop ƒWrap-Up Transition /Playbook Lessons Cultural Activities) Recommendations to Learned Steady Disciplined ƒ Validate (Operationa
Slide 111: Track Record of Increasing Dividends
Track Record Payment Payout Ratio DatesPlanned of-November Increasing At 30-35% 15, Dividends 2012 Of -February Net ƒ Increased Income20,111 dividends 2013 ƒ Expect at an to 11%propose CAGR ansince annual 2007 cash Separation dividend ƒtoPost-separation shareholders at quarterly the next Annual divi
Slide 112: One Time Separation Costs
One Time Separation separation costs do notCosts include To Be costs Completed to be incurred By 2014 by The Future ADTseparation Corporation costs for Tyco expected to approximate $165 million $Millions $Millions ~$65 ~$45 ~$35 ~$20 112 Note: FY13 & FY14
Slide 113: Closing Remarks: A Foundation of Strength
Closingimprovement margin Disciplined Remarks capitalAallocation Foundation ƒ Significant to of maximize Strength… operational return …On efficiencies on Which capitaltoWe ƒ expand Strong Will Continue Balance operatingsheet To margin Build thatƒƒprovides Solid Large,free stable liquidity cashrevenu
Slide 114: Closing Comments
SS —————— tyco ; Closing Comments
Slide 115: A Strong Foundation for Continued Growth
A Strong excess Fire & of Security Foundation GDP ƒsolutions Industry For Continued around leadingthe brands Growth world and ƒ ƒSolid technologies Diverse cashbusiness flow ƒ Significant generation mix across scale with industries, significant advantagegeographies, with financial overflexibility 60
Slide 116: Appendix
SS tyco ; Appendix
Slide 117: Other Financial Information
Other Financial Information
Slide 118: Pro Forma Fiscal Year 2012 Earnings Per Share
Pro forma expense fully?diluted /Non-controlling Fiscal shares Year outstanding 2012Interests Earnings($17) Per Pre-tax Share $operating Millions FY’12F income $938 Revenue Tax $10,420 (20%) ($188) Segment Netoperating income $750 income Earnings $1,280per Corporate share $1.60* expense * Earnings (
Slide 119: Separation Costs Incurred by Tyco
Separation incurred byCosts the ADT Summary Corporation P&L CapEx Total $ Millions FY12 ~$710 ~$50 ~$760 FY13 ~$65 ~$45 ~$110 FY14 ~$20 ~$35 ~$55 Note: FY13 and FY14 separation costs do not include costs to be
Slide 120: Non GAAP Reconciliations
SS —————— tyco ; Non GAAP Reconciliations
Slide 121: Q1 FY12 Revenue and Operating Margin
Q1 FY12—Revenue Revenue Margin Restructuring, 18.5% our ADT$Products 326 (GAAP) NA 13.1% Residential netMargin $962 1 6($91) and 1 $1,069 8Segments Operating and 5N/M 13Flow Acquisition $460 $235 Control Margin Income $2,491 9.4% /*and business, Future integration $0 WeOther $2,491 continue Segments
Slide 122: Q2 FY12 Revenue and Operating Margin
Q2 8FY12—Revenue Revenue Margin net management business operating 8—16 Products consistent (GAAP) and(2) ERISA management 14Margin $953 -(Gains) with reversal—(50) and$1,089 our Segments Operating structure /segmentation losses $509and on Income (50) of $2,551 divestitures, our Other Separation asbu
Slide 123: Q3 FY12 Revenue and Operating Margin
Q3 asbestos—108 Revenue Service Restructuring, for manage realign FY12—Revenue the Margin the (GAAP) operating business net—12 Products $1,005 108consistent and Legacy 1 13 Margin Operating management $1,107 4 17 legal with Segments $552 Separation Income items ourstructure $2,664 segmentation 29 an
Slide 124: Q1 FY11 Revenue and Operating Margin
Q1 FY11—Revenue Revenue Service Restructuring, 11.3% connection $119 Margin (GAAP) with 11.2% net Products the$979 3$67 spin-offs 30 and(11) 16.8% $1,062 Operating Margin $ of 22 $$400 our 297 6Segments 28 Income ADT $2,441 12.2% (Gains) NAMargin Future ($89) $347 Residential / losses N/M $2,788 Seg
Slide 125: Q2 FY11 Revenue and Operating Margin
Q2 FY11—Revenue Revenue Margin Restructuring Items connection $91 Products (GAAP) 9.5% with charges $111 the Margin $955 spin-offs and 10.6% in$1,052 cost and Operating $65 Other of$413 sales our 15.7% Margin Income ADT $2,420 and267 NA SG&A Income Future $0 11.0% Residential $2,420 1—1—1 Segments*
Slide 126: Q3 FY11 Revenue and Operating Margin
Q3 FY11—Revenue Revenue Margin Restructuring, Special 2012. InProducts Items connection (GAAP) $104 netMargin $993 410.5% 19 with and1$1,133 Segments Operating 24 the $128 3spin-offs 27 $456 11.3% Restructuring Margin Income $2,582 of $85 our and 18.6% Future $0 ADT charges Other $2,582 317 NA Segme
Slide 127: Q4 FY11 Revenue and Operating Margin
Q4 FY11—Revenue Revenue Margin —7 costs—24 our 8-K 3 10Products filed (GAAP) Restructuring 24 on Total January Margin $1,095 Before andcharges 31, and Operating $1,236 Special 2012. Other in$488 cost Items In Margin Income connection of $2,819 $126 sales Income Future $0 11.5% and with $2,819 Segmen
Slide 128: FY2011 Revenue and Operating Margin
FY2011—Revenue Revenue Service 90% $—5 ($368) Residential .5Restructuring, N/M Acquisition Margin (GAAP) and $869 Products Flow 8.2% $4,022 /and integration net Control *Operating 7Margin We $4,483 61 continue (7) business, costs—4 Segments $1,757 $Income 61 14 towe $10,262 manage 75 2Future will $M
Slide 129: FY2010 Revenue and Operating Margin
FY2010—Revenue Revenue Margin net Operating shown businesses. 13 71 inProducts Net our 3Income $ Revenue 87 8?K7Margin filed 94—Restructuring / Margin and$3,784 on Operating Segments January Before $4,339 Income 31, Special Margin charges $1,529 2012.Future Items and In $9,652 inOther connection cos
Slide 130: FY2009 Revenue and Operating Margin
FY2009—Revenue Revenue Margin Restructuring, divestitures, Income our businesses. 8?KProducts /filed Net Margin net Revenue on net 6January Margin Before 619and 3 100 9—Goodwill $3,931 Operating Special Segments 31, 24 143 2012. $4,280 Items 24Income In Margin impairment 167—Restructuring $1,537 con
Slide 131: Organic Revenue Growth: Installation & Services
Organic Installation 2.7% 439 Twelve 0.0% —0.0%—0.0% Base Foreign (803)—- revenue joint4.6% venture Year 4,483 $—0.0% Months Currency growth Revenue (154) $Adjustments & 3.3% 10,262 inServices -2.9% $the (9) Ended percentage (200) Global Growth Acquisitions ROW -0.6% 6.3% 4,280 2010 September -5.1%
Slide 132: Organic Revenue Growth: Global Products
Organic 2011 Global Months Revenue $ 12 fiscal 915 33 (161) $ (250) $—$—$ Fire 2011 $Products -14.3% (30) Ended Revenue Twelve for Protection -13.2% and the $ (9) 885 2009 the $Twelve $Months 915 -0.6% Growth 1,526 $deconsolidation 1,534 Base 7on Life $—$—$ Products Months $$Ended for Organic 1,526
Slide 133: Organic Revenue Growth: Services
Organic Revenue 74 $—$ Revenue (27) Twelve -0.5% Months Growth $ 4,470 Ended for(1) theOrganic September Year Ended revenue 25, 2009—Services 2008 grow(Divestitures) th percentage TwelveRevenue based Months onForeign adjusted Ended Currency Base 2008 Year base Acquisitions Adjustments revenue. Other
Slide 134: Non-GAAP Measures
Non-GAAP margin the measure) Company’s exclude calculated rate decline items acquisitions revenue. components most investors component paidcompany of for comparable that: organic and as prior purchase This to consists presented based i)in corporate organic gain Measures and of are to year limitation
Slide 135: Non-GAAP Measures (Cont.)
Non-GAAP and programs cash management Directors’ addressed should the Financing accordance Security methodologies, Tyco may operating measures) that measures reported accompanying holdback increase be flow, utilizes be used in business in plan results are used by Activities discretion which consists