Slide 1: Forward-Looking Statements and Non-GAAP Measures
Forward-Looking Statements and Non-GAAP Measures 2 Forward-Looking Statements This presentation 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 subje
Slide 2: TE Value Drivers
TE Value Drivers 3 SERVING LARGE, ATTRACTIVE MARKETS PROVIDING VALUE TO CUSTOMERS Benefiting from the secular trend of content growth across segments Strong differentiation: Global presence, broad portfolio, engineered solutions Levers to expand margins, increased focus on ROIC, consistent capital r
Slide 3: Q1 Highlights
Q1 performance above guidance with double digit sales and adjusted EPS growth Sales of $3.5B, up 14% Y/Y and up 8% organically Transportation grew 13% organically, with double-digit organic growth in all businesses Organic growth of 6% in Industrial driven primarily by strength in industrial equipme
Slide 4: Segment Orders Summary
Reported FY17 FY17 FY18 Q1 Y/Y Growth Q1 Q4 Q1 Reported Organic Transportation 1,775 1,918 2,129 20% 13% Industrial 832 951 942 13% 8% Communications Ex SubCom* 417 437 454 9% 7% Total TE Ex SubCom* 3,024 3,306 3,525 17% 11% Book to Bill Ex SubCom* 1.06 1.02 1.06 Segment Orders Summary ($ in million
Slide 5: Transportation Solutions
Y/Y Growth Rates Reported Organic Automotive $1,517 19% 10% Commercial Transportation 300 41% 34% Sensors 215 15% 11% Transportation Solutions $2,032 21% 13% $ in Millions Sales Business Performance Reported Up 21% Organic Up 13% Y/Y Growth Rates Reported Organic Orders $2,129 20% 13% Adjusted Opera
Slide 6: Industrial Solutions
Y/Y Growth Rates Reported Organic Industrial Equipment $471 23% 17% Aerospace, Defense and Marine 254 1% (2)% Energy 157 (2)% (6)% Industrial Solutions $882 11% 6% $ in Millions Sales Industrial Equipment organic growth across all regions driven by factory automation and medical applications AD&M de
Slide 7: Communications Solutions
Y/Y Growth Rates Reported Organic Data & Devices $239 3% 2% Appliances 184 24% 22% SubCom 143 (33)% (33)% Communications Solutions $566 (5)% (6)% $ in Millions Sales Data & Devices growth driven by strength in Asia and continued strength in high speed connectivity in the data center Appliances drive
Slide 8: Q1 Financial Summary
Adjusted Operating Income, Adjusted Operating Margin and Adjusted EPS are non-GAAP financial measures; see Appendix for description and reconciliation. *Represents Diluted Earnings Per Share from Continuing Operations ($ in Millions, except per share amounts) Q1 FY17 Q1 FY18 Net Sales $ 3,063 $ 3,48
Slide 9: Operating Metrics
$ in Millions Adjusted Gross Margin Percentage Adjusted Operating Margin Free Cash Flow Adjusted Gross Margin Percentage, Free Cash Flow, Adjusted Operating Margin and Adjusted EBITDA Margin are non-GAAP financial measures; see Appendix for description and reconciliation. Operating Metrics 10 Adjust
Slide 10: Q2 Outlook
Guidance* Organic growth across all segments with 13% adjusted EPS growth Transportation Solutions Industrial Solutions Communications Solutions TE Connectivity Highlights Sales $3.55B to $3.65B Adjusted EPS $1.33 to $1.37 Sales up 12% Y/Y; Expect organic growth of 6% Y/Y Adjusted EPS up 13% Y/Y at
Slide 11: FY18 Outlook
Raising sales and adjusted EPS guidance by $300M and $0.22, respectively Sales of $14.1B to $14.3B Adjusted EPS of $5.40 to $5.50 Raising sales guidance to 8% Y/Y; Organic growth of 5% Y/Y Raising Adjusted EPS guidance to 13% Y/Y at midpoint FX tailwind benefiting sales by ~$228M Y/Y and Adjusted EP
Slide 12: Q1 2018 Sales and Adjusted EPS Bridge
Y/Y Q1 2018 14 Sales (in millions) Adjusted EPS Q1 2017 Results $3,063 $1.15 Operational Performance 302 0.17 FX Impact 115 0.05 Tax Rate Impact - 0.03 Q1 2018 Results $3,480 $1.40 Adjusted EPS is a non-GAAP financial measure; See Appendix for description and reconciliation.
Slide 13: Q2 2018 Guidance Bridge
Y/Y Q2 2018 15 Sales (in millions) Adjusted EPS Q2 2017 Results $3,227 $1.19 Operational Performance 250 0.16 FX Impact 123 0.06 Tax Rate Impact - (0.06) Q2 2018 Guidance $3,600 $1.35 Guidance Range: Sales of $3.55B - $3.65B Adjusted EPS of $1.33 – $1.37 New acquisitions minimally accretive in first
Slide 14: FY 2018 Guidance Bridge
Y/Y FY 2018 16 Sales (in millions) Adjusted EPS 2017 Results $13,113 $4.83 Operational Performance 859 0.53 FX Impact 228 0.11 Share Repurchase / Interest - 0.10 Tax Rate Impact - (0.12) 2018 Guidance $14,200 $5.45 Guidance Range Sales of $14.1B - $14.3B Adjusted EPS of $5.40 - $5.50 Adjusted EPS is
Slide 15: Q1 Balance Sheet & Cash Flow Summary
($ in Millions) Q1 2017 Q1 2018 Beginning Cash Balance $647 $1,218 Free Cash Flow 218 127 Dividends (132) (141) Share repurchases (93) (167) Net increase (decrease) in debt 10 (348) Other 15 15 Ending Cash Balance $665 $704 Total Debt $4,028 $4,005 ($ in Millions) Q1 2017 Q1 2018 Cash from Continuin
Slide 16: Q1 Balance Sheet & Cash Flow Summary
Q1 Balance Sheet & Cash Flow Summary (Sin atons) 12017 a1 2018 $0 Mos) Cash from Continuing Operations $404 = $350 Beginning Cash Balance Free Cash Flow Capital expenditure, net (126) (281) Dividends Cash paid/(colected) pursuant to collateral (60) 18 requirements related to cross currency swaps Sha
Slide 17: Non-GAAP Financial Measures
19 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 financia
Slide 18: Non-GAAP Measure Definitions
20 Adjusted EBITDA and Adjusted EBITDA Margin - represent net income and net income as a percentage of net sales, respectively, (the most comparable GAAP financial measures) before interest expense, interest income, income taxes, depreciation, and amortization, as adjusted for net other income, inco
Slide 19: Segment Summary
21 Segment Summary Net Sales Net Sales Transportation Solutions 2,032 $ 1,675 $ Industrial Solutions 882 795 Communications Solutions 566 593 Total 3,480 $ 3,063 $ Operating Operating Operating Operating Income Margin Income Margin Transportation Solutions 420 $ 20.7% 348 $ 20.8% Industrial Solution
Slide 20: Reconciliation of Net Sales Growth – Q1 vs. Q1
Reconciliation of Net Sales Growth – Q1 18 vs. Q1 17 22 Translation (2) Acquisitions Transportation Solutions (3) : Automotive 242 $ 19.0% 131 $ 10.2% 57 $ 54 $ Commercial transportation 87 40.8 73 34.2 14 - Sensors 28 15.0 20 10.6 8 - Total 357 21.3 224 13.4 79 54 Industrial Solutions (3) : Industr
Slide 21: Reconciliation of Non-GAAP Measures, Quarter Ended December 29, 2017
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended December 29, 2017 23 Acquisition Restructuring Related and Other Tax Adjusted U.S. GAAP Charges (1) Charges, Net (1) Items (2) (Non-GAAP) (3) Operating Income: Transportation Solutions 420 $ 5 $ 4 $ - $ 42
Slide 22: Reconciliation of Non-GAAP Measures, Quarter Ended December 30, 2016
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended December 30, 2016 24 Acquisition Restructuring Related and Other Tax Adjusted U.S. GAAP Charges (1) Charges, Net (1) Items (2) (Non-GAAP) (3) Operating Income: Transportation Solutions 348 $ 1 $ 24 $ - $ 3
Slide 23: Reconciliation of Non-GAAP Measures, Quarter Ended March 31, 2017
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended March 31, 2017 25 Acquisition Restructuring Related and Other Tax Adjusted U.S. GAAP Charges (1) Charges, Net (1) Items (2) (Non-GAAP) (3) Operating Income: Transportation Solutions 305 $ - $ 33 $ - $ 338
Slide 24: Reconciliation of Gross Margin & Gross Margin Percentage
Reconciliation of Gross Margin & Gross Margin Percentage 27 For the Quarters Ended December 29, December 30, September 29, 2017 2016 2017 ($ in millions) Net Sales $ 3,480 $ 3,063 $ 3,456 Cost of Sales 2,303 1,996 2,315 Gross Margin 1,177 1,067 1,141 Gross Margin Percentage 33.8% 34.8% 33.0% Acquisi
Slide 25: Reconciliation of Free Cash Flow
Reconciliation of Free Cash Flow 28 December 29, December 30, 2017 2016 Net cash provided by operating activities: 350 $ 404 $ Net cash used in investing activities (241) (154) Net cash used in financing activities (634) (209) Effect of currency translation on cash 11 (23) Net increase (decrease) in
Slide 26: Reconciliation of Adjusted EBITDA Margin
Reconciliation of Adjusted EBITDA Margin 29 For the Quarters Ended December 29, December 30, September 29, 2017 2016 2017 ($ in millions) Net Income (Loss) $ (40) $ 409 $ 434 (Income) loss from discontinued operations 1 (3) (5) Income tax expense 600 54 91 Other (income) expense, net (2) 9 (8) Inter
Slide 27: Adjusted Return on Invested Capital (ROIC)
Adjusted Return on Invested Capital (ROIC) 30 December 29, September 29, June 30, March 31, December 30, September 30, June 24, March 25, 2017 2017 2017 2017 2016 2016 2016 2016 Operating income 581 $ 541 $ 544 $ 481 $ 495 $ 529 $ 463 $ 547 $ Acquisition related charges 7 1 4 3 3 4 18 4 Restructurin
Slide 28: Reconciliation of Forward-Looking Non-GAAP Financial Measures
Reconciliation of Forward-Looking Non-GAAP Financial Measures to Forward-Looking GAAP Financial Measures 31 Outlook for Quarter Ending March 30, Outlook for 2018 (1) Fiscal 2018 (1) Diluted earnings per share from continuing operations (GAAP) $1.18 - $1.22 $3.61 - $3.71 Restructuring and other charg
Slide 29: Reconciliation of Non-GAAP Measures, Quarter Ended September 29, 2017
32 Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended September 29, 2017 Restructuring Acquisition and Other Related Charges Adjusted U.S. GAAP Charges (1) (Credits), Net (1) (Non-GAAP) (2) Operating Income: Transportation Solutions 321 $ 1 $ 7 $ 329 $ Ind
Slide 30: Reconciliation of Non-GAAP Measures, Quarter Ended September 29, 2017
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended September 29, 2017 Operating Income: ‘Transportation Solutions Industrial Solutions ‘Communications Solutions Total Operating Margin Other Income, Net Income Tax Expense Effective Tax Rate Income from Cont