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Sanford C. Bernstein Strategic
Decisions Conference
May, 2015
Tom Lynch
Chief Executive Officer
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 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 presentation include statements addressing our future financial condition and operating results and
our planned sale of the Broadband Network Solutions business. Examples of factors that could cause actual results to differ materially from
those described in the forward-looking statements include, among others, business, economic, competitive and regulatory risks, such as
conditions affecting demand for products, particularly in the automotive industry and the telecommunications networks and consumer devices
industries; 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; developments in the credit markets; future goodwill impairment;
compliance with current and future environmental and other laws and regulations; the possible effects on us of changes in tax laws, tax
treaties and other legislation; the risk that the operations of Measurement Specialties will not be successfully integrated into ours; the risk
that revenue opportunities, cost savings and other anticipated synergies from the Measurement Specialties acquisition may not be fully
realized or may take longer to realize than expected; and the risk that the sale of the Broadband Network Solutions business may not be
consummated, or if consummated, we do not realize the anticipated benefits from such transaction. 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. 26, 2014 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.
Non-GAAP Measures
Where we have used non-GAAP financial measures, reconciliations to the most comparable GAAP measure are provided, along with a
disclosure on the usefulness of the non-GAAP measure, in this presentation.
2
Forward-Looking Statements
and Non-GAAP Measures
Our highly engineered solutions are key enablers of the connected world
TE is the World Leader in Connectivity &
Sensor Solutions
3
Connectivity and
Sensor Market
$165BILLION TE Annual
Revenue
$12+BILLION
Commercial Transportation
Appliances
Automotive
Medical
Data & Devices
Energy
Industrial Equipment
Subsea Communications
Aerospace & Defense
Oil & Gas
Automotive – Electronification driving 4-6% TE content growth/year
Sensors – Automotive content opportunity doubles from an average of
$200 to $400 per vehicle with sensors; Adds $80B to total market
Aerospace – New aircraft platforms increasing TE content per design by
more than 2X in new models vs. prior generations
Industrial Equipment – Smart factories, 2.5X increase in robotics, and
manufacturing automation, driving more TE connectors & sensors
Appliances – Adoption of more smart appliances results in content
growth of 3X
Safe, Green, & Connected Mega Trends
Driving Strong Secular Growth
4
24BILLION
by 2020
total connected devices
Source: GSMA & Machine Research
12BILLION
Today
total connected devices
Strategic Acquisitions
• Deutsch – leader in industrial transportation, aerospace, defense
• Seacon – leader in oil & gas
• MEAS & AST – leading sensor portfolio
Track Record of Divesting Non-Core Assets
• Over $4B in divestitures since 2007, including pending
Broadband Networks divestiture
Strategy Focused on Expanding Leadership
in Harsh Connectivity & Sensing
$6.1B
TRANSPORTATION
SOLUTIONS
$3.3B
INDUSTRIAL
SOLUTIONS
$2.6B
COMMUNICATIONS
SOLUTIONS
5
LEADER IN
HARSH
ENVIRONMENTS
High pressure
Vibration
High-voltage
Moisture
High/Low
Temperature
• Connectivity scale opens sensor
opportunities
• Unmatched product range
• Major presence in every region
• Integrated functionality
• Strategic M&A
Multiple Growth Drivers Across our
Harsh Portfolio
Demands excellence
in engineering
& manufacturing
6
80%
HARSH
REVENUE
UP TO:
$2.45
$2.79
$3.31
FY12 FY13 FY14
$0.78
$0.92
$1.08
$1.24
FY12 FY13 FY14 FY15 Est.
13.2%
14.2%
15.5%
16.4%
FY12 FY13 FY14 1H FY15
Net Sales Adjusted Earnings Per Share
$ in billions except
per share amounts
Adjusted Gross Margin Adjusted Operating Margin Dividends Paid Per Share*
230bps
VS. FY12
38%
VS. FY12
*On March 3, 2015 TE shareholders increased
the annual dividend to $1.32 per share.
$11.3 $11.4
$12.0
FY12 FY13 FY14
6%
VS. FY12
15%Harsh Sales
7
35%
VS. FY12
Adjusted Operating Margin, Adjusted Gross Margin and Adjusted Earnings Per Share are non-GAAP measures;
See Appendix for description and reconciliation.
Track Record of Consistent,
Strong Operating Performance
30.6%
32.1%
33.2%
34.3%
FY12 FY13 FY14 1H FY15
260bps
VS. FY12
Dividends Per Share*
Share
Repurchases
$4.4 billion
Acquisitions*
$3.9 billion
Dividends
$2.3 billion
Major Capital Deployment**
FY08 through FY14
• Denotes dividends paid during the fiscal year.
• Shareholders approved an annual dividend of $1.32 per share
in Q2 FY15, representing an annual rate increase of 14%
8
$0.64
$0.68
$0.78
$0.92
$1.08
$ 0.40
$ 0.50
$ 0.60
$ 0.70
$ 0.80
$ 0.90
$ 1.00
$ 1.10
FY10 FY11 FY12 FY13 FY14
14% CAGR
* Includes $1.3 billion used to acquire ADC Telecommunications in 2010, which is part of our BNS business.
** Select uses of cash. Represents capital returned to shareholders and acquisition activity.
Free Cash Flow is a non-GAAP measure; See Appendix for description
Consistent Dividend Growth and
Balanced Use of Capital
Expect to return ~2/3 of free cash flow to shareholders over time
Expect to make strategic acquisitions to strengthen our position in growing markets
Track Record of
Increasing
Shareholder Value
9
• 80% of revenue from harsh environment applications
• Benefiting from the secular trend of electronic content growth and
megatrends of safe, green, and connected
• Top 10 Sensor supplier
• Announced sale of Broadband Networks business
• Focused acquisition strategy on harsh and sensors
• Operating margin expansion
• TE Operating Advantage (TEOA) driving productivity
Organic Sales Growth, Adjusted Earnings per Share, Adjusted Operating Margin and Free Cash Flow are non-
GAAP measures; See Appendix for description.
Driving Shareholder Value
Deliver 5 – 7%
Organic Revenue
Growth
Drive Double-Digit
Earnings Growth
• FCF of $1.7B in fiscal 2014
• Free cash flow ≈ Net Income
• Return ~2/3 of Capital to Shareholders over time
Generate Strong
Cash Flow
TEL S&P 500
TE 3-Year Price Performance 150%
100%
Appendix
* U.S. Generally Accepted Accounting Principles
“Organic Sales Growth,” “Adjusted Gross Margin,” “Adjusted Gross Margin Percentage,”, “Adjusted Operating Income,” “Adjusted Operating Margin,” “Adjusted Other Income, Net,”
“Adjusted Income Tax Expense,” “Adjusted Effective Tax Rate,” ”Adjusted Income from Continuing Operations,” “Adjusted Earnings Per Share,” and “Free Cash Flow” (FCF) are non-
GAAP measures and should not be considered replacements for GAAP* results.
“Organic Sales Growth” is a useful measure used by us to measure the underlying results and trends in the business. The difference between reported net sales growth (the most
comparable GAAP measure) and Organic Sales Growth (the non-GAAP measure) consists of the impact from foreign currency exchange rates and acquisitions and divestitures, if any.
Organic Sales Growth is a useful measure of our performance because it excludes items that: i) are not completely under management’s control, such as the impact of changes in foreign
currency exchange rates; or ii) do not reflect the underlying growth of the company, such as acquisition and divestiture activity. The limitation of this measure is that it excludes items that
have an impact on our sales. This limitation is best addressed by using organic sales growth in combination with the GAAP results.
We present gross margin and gross margin percentage before special items including charges or income related to restructuring and other charges and acquisition related charges, if any
("Adjusted Gross Margin“ and “Adjusted Gross Margin Percentage”). We present Adjusted Gross Margin and Adjusted Gross Margin Percentage before special items to give investors a
perspective on the underlying business results. These measures should be considered in conjunction with gross margin calculated using our GAAP results in order to understand the
amounts, character and impact of adjustments to gross margin.
We present operating income before special items including charges or income related to restructuring and other charges, acquisition related charges, impairment charges, and other
income or charges, if any (“Adjusted Operating Income”). We utilize 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 also is a significant component in our incentive compensation plans. Adjusted Operating
Income is a useful measure for investors because it provides insight into our 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 special items 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 our 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.
We present operating margin before special items including charges or income related to restructuring and other charges, acquisition related charges, impairment charges, and other
income or charges, if any (“Adjusted Operating Margin”). We present Adjusted Operating Margin before special items to give investors a perspective on the underlying business results.
This measure should be considered in conjunction with operating margin calculated using our GAAP results in order to understand the amounts, character and impact of adjustments to
operating margin.
We present other income, net before special items including tax sharing income related to certain proposed adjustments to prior period tax returns and other tax items, if any (“Adjusted
Other Income, Net”). We present Adjusted Other Income, Net as we believe that it is appropriate for investors to consider results excluding these items in addition to results in accordance
with GAAP. The difference between Adjusted Other Income, Net and other income, net (the most comparable GAAP measure) consists of tax sharing income related to certain proposed
adjustments to prior period tax returns and other tax items, if any. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or
decrease other income, net. This limitation is best addressed by using Adjusted Other Income, Net in combination with other income, net (the most comparable GAAP measure) in order to
better understand the amounts, character and impact of any increase or decrease in reported amounts.
We present income tax expense after adjusting for the tax effect of special items including charges related to restructuring and other charges, acquisition related charges, impairment
charges, other income or charges, and certain significant special tax items, if any (“Adjusted Income Tax Expense”). We present Adjusted Income Tax Expense to provide investors further
information regarding the tax effects of adjustments used in determining the non-GAAP financial measure Adjusted Income from Continuing Operations (as defined below). The difference
between Adjusted Income Tax Expense and income tax expense (the most comparable GAAP measure) is the tax effect of adjusting items and certain significant special tax items, if any.
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 Income Tax Expense in combination with income tax expense (the most comparable GAAP measure) in order to better understand the amounts, character and impact of
any increase or decrease in reported amounts.
Non-GAAP Measures
11
We present effective income tax rate after adjusting for the tax effect of special items including charges related to restructuring and other charges, acquisition related charges, impairment
charges, other income or charges, and certain significant special tax items, if any (“Adjusted Effective Tax Rate”). We present Adjusted Effective Tax Rate to provide investors further
information regarding the tax rate effects of adjustments used in determining the non-GAAP financial measure Adjusted Income from Continuing Operations (as defined below). The
difference between Adjusted Effective Tax Rate and effective income tax rate (the most comparable GAAP measure) is the tax rate effect of the adjusting items and certain significant
special tax items, if any. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease the effective income tax rate. This
limitation is best addressed by using Adjusted Effective Tax Rate in combination with effective income tax rate (the most comparable GAAP measure) in order to better understand the
amounts, character and impact of any increase or decrease in reported amounts.
We present income from continuing operations attributable to TE Connectivity Ltd. before special items including charges or income related to restructuring and other charges, acquisition
related charges, impairment charges, tax sharing income related to certain proposed adjustments to prior period tax returns and other tax items, certain significant special tax items, other
income or charges, if any, and, if applicable, related tax effects (“Adjusted Income from Continuing Operations”). We present Adjusted Income from Continuing Operations as we believe
that it is appropriate for investors to consider results excluding these items in addition to results in accordance with GAAP. Adjusted Income from Continuing Operations provides additional
information regarding our underlying operating results, trends and the comparability of these results between periods. The difference between Adjusted Income from Continuing Operations
and income from continuing operations attributable to TE Connectivity Ltd. (the most comparable GAAP measure) consists of the impact of special items and, if applicable, related tax
effects. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease our reported results. This limitation is best
addressed by using Adjusted Income from Continuing Operations in combination with income from continuing operations attributable to TE Connectivity Ltd. (the most comparable GAAP
measure) in order to better understand the amounts, character and impact of any increase or decrease in reported amounts.
We present diluted earnings per share from continuing operations attributable to TE Connectivity Ltd. before special items, including charges or income related to restructuring and other
charges, acquisition related charges, impairment charges, tax sharing income related to certain proposed adjustments to prior period tax returns and other tax items, certain significant
special tax items, other income or charges, if any, and, if applicable, related tax effects (“Adjusted Earnings Per Share”). We present Adjusted Earnings Per Share because we believe that
it is appropriate for investors to consider results excluding these items in addition to 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 special items, which may recur, but tend to be irregular as to timing, thereby making comparisons between periods more
difficult. It also is a significant component in our incentive compensation plans. The limitation of this measure is that it excludes the financial impact of items that would otherwise either
increase or decrease our reported results. This limitation is best addressed by using Adjusted Earnings Per Share in combination with diluted earnings per share from continuing
operations attributable to TE Connectivity Ltd. (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease on
reported results.
“Free Cash Flow” (FCF) is a useful measure of our ability to generate cash. It also is a significant component in our incentive compensation plans. The difference between net cash
provided by continuing operating activities (the most comparable GAAP measure) and FCF (the non-GAAP measure) consists mainly of significant cash outflows and inflows that we
believe are useful to identify. We believe free cash flow provides useful information to investors as it provides insight into the primary cash flow metric used by management to monitor and
evaluate cash flows generated from our operations.
FCF is defined as net cash provided by continuing operating activities excluding voluntary pension contributions and the cash impact of special items, if any, minus net capital expenditures.
Net capital expenditures consist of capital expenditures less proceeds from the sale of property, plant, and equipment. These items are subtracted because they represent long-term
commitments. Voluntary pension contributions are excluded from the GAAP measure because this activity is driven by economic financing decisions rather than operating activity. Certain
special items, including net payments related to pre-separation tax matters, also are considered by management in evaluating free cash flow. We believe investors should also consider
these items in evaluating our free cash flow.
FCF as presented herein may not be comparable to similarly-titled measures reported by other companies. The primary limitation of this measure is that it excludes items that have an
impact on our GAAP cash flow. Also, it subtracts certain cash items that are ultimately within management’s and the Board of Directors’ discretion to direct and may imply that there is less
or more cash available for our programs than the most comparable GAAP measure indicates. This limitation is best addressed by using FCF in combination with the GAAP cash flow
results. It should not be inferred that the entire free cash flow amount is available for future discretionary expenditures, as our definition of free cash flow does not consider certain non-
discretionary expenditures, such as debt payments. In addition, we may have other discretionary expenditures, such as discretionary dividends, share repurchases, and business
acquisitions, that are not considered in the calculation of free cash flow.
Non-GAAP Measures (cont.)
12
Reconciliation of Gross Margin and Gross
Percentage
September 26, September 27, September 28,
2014 2013 2012
Net Sales 11,973$ 11,390$ 11,325$
Cost of Sales 8,001 7,739 7,940
Gross Margin 3,972 3,651 3,385
Gross Margin Percentage 33.2% 32.1% 29.9%
Acquisition Related Charges
4 - 75
AdjustedGross Margin (1)
3,976$ 3,651$ 3,460$
AdjustedGross Margin Percentage (1)
33.2% 32.1% 30.6%
(1)
See description of non-GAAP measures contained in this appendix.
For the Years Ended
($ in milions)
13
Reconciliation of Non-GAAP Financial Measures
for the Year Ended September 28, 2012
Acquisition Restructuring
Related and Other Tax Adjusted
U.S. GAAP Charges (1)
Charges, Net Items (2)
(Non-GAAP) (3)
Operating Income 1,291$ 116$ 90$ -$ 1,497$
Operating Margin 11.4% 13.2%
Other Income, Net 50$ -$ -$ (17)$ 33$
Income Tax Expense (186)$ (24)$ (25)$ (90)$ (325)$
Income from Continuing Operations
Attributable to TEConnectivity Ltd. 1,003$ 92$ 65$ (107)$ 1,053$
DilutedEarnings per Share from
Continuing Operations Attributable
to TEConnectivity Ltd. 2.33$ 0.21$ 0.15$ (0.25)$ 2.45$
(1)
Includes $75 million of non-cash amortization associated with fair value adjustments primarily related to acquired inventories and customer
order backlog recorded in cost of sales, $27 million of acquisition and integration costs, and $14 million of restructuring charges.
(2)
Other income adjustment relates to reimbursements by Tyco International and Covidien in connection with pre-separation tax matters.
Income tax expense adjustments include income tax benefits recognized in connection with a reduction in the valuation allowance associated
with certain tax loss carryforwards and income tax expense associated with certain non-U.S. tax rate changes.
(3)
See description of non-GAAP measures contained in this appendix.
Adjustments
($ in millions, except per share data)
14
Reconciliation of Non-GAAP Financial Measures
for the Year Ended September 27, 2013
Acquisition Restructuring
Related and Other Tax Adjusted
U.S. GAAP Charges Charges, Net Items (1)
(Non-GAAP) (2)
Operating Income:
Transportation Solutions 934$ 7$ 39$ -$ 980$
Industrial Solutions 344 7 63 - 414
Communications Solutions 107 - 120 - 227
Total 1,385$ 14$ 222$ -$ 1,621$
Operating Margin 12.2% 14.2%
Other Income (Expense), Net (183)$ -$ -$ 213$ 30$
Income Tax (Expense) Benefit 75$ (5)$ (62)$ (354)$ (346)$
Income from Continuing Operations
Attributable to TEConnectivity Ltd. 1,154$ 9$ 160$ (141)$ 1,182$
DilutedEarnings per Share from
Continuing Operations Attributable
to TEConnectivity Ltd. 2.73$ 0.02$ 0.38$ (0.33)$ 2.79$
(2)
See description of non-GAAP measures contained in this appendix.
($ in millions, except per share data)
(1)
Includes $331 million of income tax benefits associated with the settlement of an audit of prior year income tax returns as well as the
related impact of $231 million to other expense pursuant to the tax sharing agreement with Tyco International and Covidien. Also includes
income tax expense related to adjustments to prior year income tax returns, income tax benefits recognized in connection with a reduction in
the valuation allowance associated with certain tax loss carryforwards, and income tax benefits recognized in connection with the lapse of
statutes of limitations for examinations of prior year income tax returns. In addition, the other income adjustment includes amounts related to
reimbursements by Tyco International and Covidien in connection with pre-separation tax matters.
Adjustments
15
Reconciliation of Non-GAAP Financial Measures
for the Year Ended September 26, 2014
Acquisition Restructuring
Related and Other Tax Adjusted
U.S. GAAP Charges (1)
Charges, Net Items (2)
(Non-GAAP) (3)
Operating Income:
Transportation Solutions 1,245$ 4$ 4$ -$ 1,253$
Industrial Solutions 431 31 7 - 469
Communications Solutions 129 - 8 - 137
Total 1,805$ 35$ 19$ -$ 1,859$
Operating Margin 15.1% 15.5%
Other Income, Net 63$ -$ -$ (39)$ 24$
Income Tax Expense (146)$ (7)$ (4)$ (239)$ (396)$
Effective Tax Rate 8.3% 22.3%
Income from Continuing Operations
Attributable to TEConnectivity Ltd. 1,614$ 28$ 15$ (278)$ 1,379$
DilutedEarnings per Share from
Continuing Operations Attributable
to TEConnectivity Ltd. 3.87$ 0.07$ 0.04$ (0.67)$ 3.31$
(2)
Includes income tax benefits of $282 million recognized in connection with a reduction in the valuation allowance associated with certain
tax loss carryforwards and income tax expense related to adjustments to prior year income tax returns. In addition, other income includes
amounts related to reimbursements by Tyco International and Covidien in connection with pre-separation tax matters, including $18 million
related to our share of a settlement agreement entered into by Tyco International with a former subsidiary.
(3)
See description of non-GAAP measures contained in this appendix.
($ in millions, except per share data)
(1)
Includes $31 million of acquisition and integration charges and $4 million of non-cash amortization associated with fair value adjustments
primarily related to acquired inventories and customer order backlog recorded in cost of sales.
Adjustments
16
17
March 27, March 28, March 27, March 28,
2015 2014 2015 2014
Net Sales 3,082$ 2,964$ 6,131$ 5,826$
Cost of Sales 2,031 1,969 4,060 3,886
Gross Margin 1,051 995 2,071 1,940
Gross Margin Percentage 34.1% 33.6% 33.8% 33.3%
Acquisition Related Charges 6 - 33 -
AdjustedGross Margin (1)
1,057$ 995$ 2,104$ 1,940$
AdjustedGross Margin Percentage (1)
34.3% 33.6% 34.3% 33.3%
(1)
See description of non-GAAP measures contained in this appendix.
For the Six Months Ended
($ in millions)
For the Quarters Ended
Reconciliation of Gross Margin & Gross
Margin Percentage
Reconciliation of Non-GAAP Financial Measures to GAAP
Financial Measures for the Six Months Ended March 27, 2015
18
Acquisition Restructuring
Related and Other Tax Adjusted
U.S. GAAP Charges (1)
Charges, Net (2)
Items (3)
(Non-GAAP) (4)
Operating Income:
Transportation Solutions 618$ 51$ 1$ -$ 670$
Industrial Solutions 170 22 18 - 210
Communications Solutions 85 - 42 - 127
Total 873$ 73$ 61$ -$ 1,007$
Operating Margin 14.2% 16.4%
Other Income (Expense), Net (75)$ -$ -$ 94$ 19$
Income Tax (Expense) Benefit 15$ (18)$ 7$ (224)$ (220)$
Effective Tax Rate NM (5)
22.8%
Income from Continuing Operations
Attributable to TEConnectivity Ltd. 751$ 55$ 68$ (130)$ 744$
DilutedEarnings per Share from
Continuing Operations Attributable
to TEConnectivity Ltd. 1.82$ 0.13$ 0.16$ (0.31)$ 1.80$
(5)
Not meaningful.
Adjustments
($ in millions, except per share data)
(3)
Includes $202 million of income tax benefits associated with the settlement of audits of prior year income tax returns as well as the related
impact of $94 million to other expense pursuant to the tax sharing agreement with Tyco International and Covidien. Also includes income tax
benefits related to the impacts of certain non-U.S. tax law changes and the associated reduction in the valuation allowance for tax loss
carryforwards.
(4)
See description of non-GAAP measures contained in this appendix.
(1)
Includes $33 million of non-cash amortization associated with fair value adjustments related to acquired inventories and customer order
backlog recorded in cost of sales, $38 million of acquisition and integration costs, and $2 million of restructuring costs.
(2)
Includes an income tax charge for the estimated tax impacts of certain intercompany dividends related to the restructuring and anticipated
sale of the Broadband Network Solutions business.
EVERY CONNECTION COUNTS
www.TE.com

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Sanford Bernstein Strategic Decisions Conference Highlights

  • 1. Sanford C. Bernstein Strategic Decisions Conference May, 2015 Tom Lynch Chief Executive Officer
  • 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 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 presentation include statements addressing our future financial condition and operating results and our planned sale of the Broadband Network Solutions business. Examples of factors that could cause actual results to differ materially from those described in the forward-looking statements include, among others, business, economic, competitive and regulatory risks, such as conditions affecting demand for products, particularly in the automotive industry and the telecommunications networks and consumer devices industries; 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; developments in the credit markets; future goodwill impairment; compliance with current and future environmental and other laws and regulations; the possible effects on us of changes in tax laws, tax treaties and other legislation; the risk that the operations of Measurement Specialties will not be successfully integrated into ours; the risk that revenue opportunities, cost savings and other anticipated synergies from the Measurement Specialties acquisition may not be fully realized or may take longer to realize than expected; and the risk that the sale of the Broadband Network Solutions business may not be consummated, or if consummated, we do not realize the anticipated benefits from such transaction. 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. 26, 2014 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. Non-GAAP Measures Where we have used non-GAAP financial measures, reconciliations to the most comparable GAAP measure are provided, along with a disclosure on the usefulness of the non-GAAP measure, in this presentation. 2 Forward-Looking Statements and Non-GAAP Measures
  • 3. Our highly engineered solutions are key enablers of the connected world TE is the World Leader in Connectivity & Sensor Solutions 3 Connectivity and Sensor Market $165BILLION TE Annual Revenue $12+BILLION Commercial Transportation Appliances Automotive Medical Data & Devices Energy Industrial Equipment Subsea Communications Aerospace & Defense Oil & Gas
  • 4. Automotive – Electronification driving 4-6% TE content growth/year Sensors – Automotive content opportunity doubles from an average of $200 to $400 per vehicle with sensors; Adds $80B to total market Aerospace – New aircraft platforms increasing TE content per design by more than 2X in new models vs. prior generations Industrial Equipment – Smart factories, 2.5X increase in robotics, and manufacturing automation, driving more TE connectors & sensors Appliances – Adoption of more smart appliances results in content growth of 3X Safe, Green, & Connected Mega Trends Driving Strong Secular Growth 4 24BILLION by 2020 total connected devices Source: GSMA & Machine Research 12BILLION Today total connected devices
  • 5. Strategic Acquisitions • Deutsch – leader in industrial transportation, aerospace, defense • Seacon – leader in oil & gas • MEAS & AST – leading sensor portfolio Track Record of Divesting Non-Core Assets • Over $4B in divestitures since 2007, including pending Broadband Networks divestiture Strategy Focused on Expanding Leadership in Harsh Connectivity & Sensing $6.1B TRANSPORTATION SOLUTIONS $3.3B INDUSTRIAL SOLUTIONS $2.6B COMMUNICATIONS SOLUTIONS 5
  • 6. LEADER IN HARSH ENVIRONMENTS High pressure Vibration High-voltage Moisture High/Low Temperature • Connectivity scale opens sensor opportunities • Unmatched product range • Major presence in every region • Integrated functionality • Strategic M&A Multiple Growth Drivers Across our Harsh Portfolio Demands excellence in engineering & manufacturing 6 80% HARSH REVENUE UP TO:
  • 7. $2.45 $2.79 $3.31 FY12 FY13 FY14 $0.78 $0.92 $1.08 $1.24 FY12 FY13 FY14 FY15 Est. 13.2% 14.2% 15.5% 16.4% FY12 FY13 FY14 1H FY15 Net Sales Adjusted Earnings Per Share $ in billions except per share amounts Adjusted Gross Margin Adjusted Operating Margin Dividends Paid Per Share* 230bps VS. FY12 38% VS. FY12 *On March 3, 2015 TE shareholders increased the annual dividend to $1.32 per share. $11.3 $11.4 $12.0 FY12 FY13 FY14 6% VS. FY12 15%Harsh Sales 7 35% VS. FY12 Adjusted Operating Margin, Adjusted Gross Margin and Adjusted Earnings Per Share are non-GAAP measures; See Appendix for description and reconciliation. Track Record of Consistent, Strong Operating Performance 30.6% 32.1% 33.2% 34.3% FY12 FY13 FY14 1H FY15 260bps VS. FY12
  • 8. Dividends Per Share* Share Repurchases $4.4 billion Acquisitions* $3.9 billion Dividends $2.3 billion Major Capital Deployment** FY08 through FY14 • Denotes dividends paid during the fiscal year. • Shareholders approved an annual dividend of $1.32 per share in Q2 FY15, representing an annual rate increase of 14% 8 $0.64 $0.68 $0.78 $0.92 $1.08 $ 0.40 $ 0.50 $ 0.60 $ 0.70 $ 0.80 $ 0.90 $ 1.00 $ 1.10 FY10 FY11 FY12 FY13 FY14 14% CAGR * Includes $1.3 billion used to acquire ADC Telecommunications in 2010, which is part of our BNS business. ** Select uses of cash. Represents capital returned to shareholders and acquisition activity. Free Cash Flow is a non-GAAP measure; See Appendix for description Consistent Dividend Growth and Balanced Use of Capital Expect to return ~2/3 of free cash flow to shareholders over time Expect to make strategic acquisitions to strengthen our position in growing markets
  • 9. Track Record of Increasing Shareholder Value 9 • 80% of revenue from harsh environment applications • Benefiting from the secular trend of electronic content growth and megatrends of safe, green, and connected • Top 10 Sensor supplier • Announced sale of Broadband Networks business • Focused acquisition strategy on harsh and sensors • Operating margin expansion • TE Operating Advantage (TEOA) driving productivity Organic Sales Growth, Adjusted Earnings per Share, Adjusted Operating Margin and Free Cash Flow are non- GAAP measures; See Appendix for description. Driving Shareholder Value Deliver 5 – 7% Organic Revenue Growth Drive Double-Digit Earnings Growth • FCF of $1.7B in fiscal 2014 • Free cash flow ≈ Net Income • Return ~2/3 of Capital to Shareholders over time Generate Strong Cash Flow TEL S&P 500 TE 3-Year Price Performance 150% 100%
  • 11. * U.S. Generally Accepted Accounting Principles “Organic Sales Growth,” “Adjusted Gross Margin,” “Adjusted Gross Margin Percentage,”, “Adjusted Operating Income,” “Adjusted Operating Margin,” “Adjusted Other Income, Net,” “Adjusted Income Tax Expense,” “Adjusted Effective Tax Rate,” ”Adjusted Income from Continuing Operations,” “Adjusted Earnings Per Share,” and “Free Cash Flow” (FCF) are non- GAAP measures and should not be considered replacements for GAAP* results. “Organic Sales Growth” is a useful measure used by us to measure the underlying results and trends in the business. The difference between reported net sales growth (the most comparable GAAP measure) and Organic Sales Growth (the non-GAAP measure) consists of the impact from foreign currency exchange rates and acquisitions and divestitures, if any. Organic Sales Growth is a useful measure of our performance because it excludes items that: i) are not completely under management’s control, such as the impact of changes in foreign currency exchange rates; or ii) do not reflect the underlying growth of the company, such as acquisition and divestiture activity. The limitation of this measure is that it excludes items that have an impact on our sales. This limitation is best addressed by using organic sales growth in combination with the GAAP results. We present gross margin and gross margin percentage before special items including charges or income related to restructuring and other charges and acquisition related charges, if any ("Adjusted Gross Margin“ and “Adjusted Gross Margin Percentage”). We present Adjusted Gross Margin and Adjusted Gross Margin Percentage before special items to give investors a perspective on the underlying business results. These measures should be considered in conjunction with gross margin calculated using our GAAP results in order to understand the amounts, character and impact of adjustments to gross margin. We present operating income before special items including charges or income related to restructuring and other charges, acquisition related charges, impairment charges, and other income or charges, if any (“Adjusted Operating Income”). We utilize 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 also is a significant component in our incentive compensation plans. Adjusted Operating Income is a useful measure for investors because it provides insight into our 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 special items 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 our 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. We present operating margin before special items including charges or income related to restructuring and other charges, acquisition related charges, impairment charges, and other income or charges, if any (“Adjusted Operating Margin”). We present Adjusted Operating Margin before special items to give investors a perspective on the underlying business results. This measure should be considered in conjunction with operating margin calculated using our GAAP results in order to understand the amounts, character and impact of adjustments to operating margin. We present other income, net before special items including tax sharing income related to certain proposed adjustments to prior period tax returns and other tax items, if any (“Adjusted Other Income, Net”). We present Adjusted Other Income, Net as we believe that it is appropriate for investors to consider results excluding these items in addition to results in accordance with GAAP. The difference between Adjusted Other Income, Net and other income, net (the most comparable GAAP measure) consists of tax sharing income related to certain proposed adjustments to prior period tax returns and other tax items, if any. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease other income, net. This limitation is best addressed by using Adjusted Other Income, Net in combination with other income, net (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease in reported amounts. We present income tax expense after adjusting for the tax effect of special items including charges related to restructuring and other charges, acquisition related charges, impairment charges, other income or charges, and certain significant special tax items, if any (“Adjusted Income Tax Expense”). We present Adjusted Income Tax Expense to provide investors further information regarding the tax effects of adjustments used in determining the non-GAAP financial measure Adjusted Income from Continuing Operations (as defined below). The difference between Adjusted Income Tax Expense and income tax expense (the most comparable GAAP measure) is the tax effect of adjusting items and certain significant special tax items, if any. 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 Income Tax Expense in combination with income tax expense (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease in reported amounts. Non-GAAP Measures 11
  • 12. We present effective income tax rate after adjusting for the tax effect of special items including charges related to restructuring and other charges, acquisition related charges, impairment charges, other income or charges, and certain significant special tax items, if any (“Adjusted Effective Tax Rate”). We present Adjusted Effective Tax Rate to provide investors further information regarding the tax rate effects of adjustments used in determining the non-GAAP financial measure Adjusted Income from Continuing Operations (as defined below). The difference between Adjusted Effective Tax Rate and effective income tax rate (the most comparable GAAP measure) is the tax rate effect of the adjusting items and certain significant special tax items, if any. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease the effective income tax rate. This limitation is best addressed by using Adjusted Effective Tax Rate in combination with effective income tax rate (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease in reported amounts. We present income from continuing operations attributable to TE Connectivity Ltd. before special items including charges or income related to restructuring and other charges, acquisition related charges, impairment charges, tax sharing income related to certain proposed adjustments to prior period tax returns and other tax items, certain significant special tax items, other income or charges, if any, and, if applicable, related tax effects (“Adjusted Income from Continuing Operations”). We present Adjusted Income from Continuing Operations as we believe that it is appropriate for investors to consider results excluding these items in addition to results in accordance with GAAP. Adjusted Income from Continuing Operations provides additional information regarding our underlying operating results, trends and the comparability of these results between periods. The difference between Adjusted Income from Continuing Operations and income from continuing operations attributable to TE Connectivity Ltd. (the most comparable GAAP measure) consists of the impact of special items and, if applicable, related tax effects. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease our reported results. This limitation is best addressed by using Adjusted Income from Continuing Operations in combination with income from continuing operations attributable to TE Connectivity Ltd. (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease in reported amounts. We present diluted earnings per share from continuing operations attributable to TE Connectivity Ltd. before special items, including charges or income related to restructuring and other charges, acquisition related charges, impairment charges, tax sharing income related to certain proposed adjustments to prior period tax returns and other tax items, certain significant special tax items, other income or charges, if any, and, if applicable, related tax effects (“Adjusted Earnings Per Share”). We present Adjusted Earnings Per Share because we believe that it is appropriate for investors to consider results excluding these items in addition to 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 special items, which may recur, but tend to be irregular as to timing, thereby making comparisons between periods more difficult. It also is a significant component in our incentive compensation plans. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease our reported results. This limitation is best addressed by using Adjusted Earnings Per Share in combination with diluted earnings per share from continuing operations attributable to TE Connectivity Ltd. (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease on reported results. “Free Cash Flow” (FCF) is a useful measure of our ability to generate cash. It also is a significant component in our incentive compensation plans. The difference between net cash provided by continuing operating activities (the most comparable GAAP measure) and FCF (the non-GAAP measure) consists mainly of significant cash outflows and inflows that we believe are useful to identify. We believe free cash flow provides useful information to investors as it provides insight into the primary cash flow metric used by management to monitor and evaluate cash flows generated from our operations. FCF is defined as net cash provided by continuing operating activities excluding voluntary pension contributions and the cash impact of special items, if any, minus net capital expenditures. Net capital expenditures consist of capital expenditures less proceeds from the sale of property, plant, and equipment. These items are subtracted because they represent long-term commitments. Voluntary pension contributions are excluded from the GAAP measure because this activity is driven by economic financing decisions rather than operating activity. Certain special items, including net payments related to pre-separation tax matters, also are considered by management in evaluating free cash flow. We believe investors should also consider these items in evaluating our free cash flow. FCF as presented herein may not be comparable to similarly-titled measures reported by other companies. The primary limitation of this measure is that it excludes items that have an impact on our GAAP cash flow. Also, it subtracts certain cash items that are ultimately within management’s and the Board of Directors’ discretion to direct and may imply that there is less or more cash available for our programs than the most comparable GAAP measure indicates. This limitation is best addressed by using FCF in combination with the GAAP cash flow results. It should not be inferred that the entire free cash flow amount is available for future discretionary expenditures, as our definition of free cash flow does not consider certain non- discretionary expenditures, such as debt payments. In addition, we may have other discretionary expenditures, such as discretionary dividends, share repurchases, and business acquisitions, that are not considered in the calculation of free cash flow. Non-GAAP Measures (cont.) 12
  • 13. Reconciliation of Gross Margin and Gross Percentage September 26, September 27, September 28, 2014 2013 2012 Net Sales 11,973$ 11,390$ 11,325$ Cost of Sales 8,001 7,739 7,940 Gross Margin 3,972 3,651 3,385 Gross Margin Percentage 33.2% 32.1% 29.9% Acquisition Related Charges 4 - 75 AdjustedGross Margin (1) 3,976$ 3,651$ 3,460$ AdjustedGross Margin Percentage (1) 33.2% 32.1% 30.6% (1) See description of non-GAAP measures contained in this appendix. For the Years Ended ($ in milions) 13
  • 14. Reconciliation of Non-GAAP Financial Measures for the Year Ended September 28, 2012 Acquisition Restructuring Related and Other Tax Adjusted U.S. GAAP Charges (1) Charges, Net Items (2) (Non-GAAP) (3) Operating Income 1,291$ 116$ 90$ -$ 1,497$ Operating Margin 11.4% 13.2% Other Income, Net 50$ -$ -$ (17)$ 33$ Income Tax Expense (186)$ (24)$ (25)$ (90)$ (325)$ Income from Continuing Operations Attributable to TEConnectivity Ltd. 1,003$ 92$ 65$ (107)$ 1,053$ DilutedEarnings per Share from Continuing Operations Attributable to TEConnectivity Ltd. 2.33$ 0.21$ 0.15$ (0.25)$ 2.45$ (1) Includes $75 million of non-cash amortization associated with fair value adjustments primarily related to acquired inventories and customer order backlog recorded in cost of sales, $27 million of acquisition and integration costs, and $14 million of restructuring charges. (2) Other income adjustment relates to reimbursements by Tyco International and Covidien in connection with pre-separation tax matters. Income tax expense adjustments include income tax benefits recognized in connection with a reduction in the valuation allowance associated with certain tax loss carryforwards and income tax expense associated with certain non-U.S. tax rate changes. (3) See description of non-GAAP measures contained in this appendix. Adjustments ($ in millions, except per share data) 14
  • 15. Reconciliation of Non-GAAP Financial Measures for the Year Ended September 27, 2013 Acquisition Restructuring Related and Other Tax Adjusted U.S. GAAP Charges Charges, Net Items (1) (Non-GAAP) (2) Operating Income: Transportation Solutions 934$ 7$ 39$ -$ 980$ Industrial Solutions 344 7 63 - 414 Communications Solutions 107 - 120 - 227 Total 1,385$ 14$ 222$ -$ 1,621$ Operating Margin 12.2% 14.2% Other Income (Expense), Net (183)$ -$ -$ 213$ 30$ Income Tax (Expense) Benefit 75$ (5)$ (62)$ (354)$ (346)$ Income from Continuing Operations Attributable to TEConnectivity Ltd. 1,154$ 9$ 160$ (141)$ 1,182$ DilutedEarnings per Share from Continuing Operations Attributable to TEConnectivity Ltd. 2.73$ 0.02$ 0.38$ (0.33)$ 2.79$ (2) See description of non-GAAP measures contained in this appendix. ($ in millions, except per share data) (1) Includes $331 million of income tax benefits associated with the settlement of an audit of prior year income tax returns as well as the related impact of $231 million to other expense pursuant to the tax sharing agreement with Tyco International and Covidien. Also includes income tax expense related to adjustments to prior year income tax returns, income tax benefits recognized in connection with a reduction in the valuation allowance associated with certain tax loss carryforwards, and income tax benefits recognized in connection with the lapse of statutes of limitations for examinations of prior year income tax returns. In addition, the other income adjustment includes amounts related to reimbursements by Tyco International and Covidien in connection with pre-separation tax matters. Adjustments 15
  • 16. Reconciliation of Non-GAAP Financial Measures for the Year Ended September 26, 2014 Acquisition Restructuring Related and Other Tax Adjusted U.S. GAAP Charges (1) Charges, Net Items (2) (Non-GAAP) (3) Operating Income: Transportation Solutions 1,245$ 4$ 4$ -$ 1,253$ Industrial Solutions 431 31 7 - 469 Communications Solutions 129 - 8 - 137 Total 1,805$ 35$ 19$ -$ 1,859$ Operating Margin 15.1% 15.5% Other Income, Net 63$ -$ -$ (39)$ 24$ Income Tax Expense (146)$ (7)$ (4)$ (239)$ (396)$ Effective Tax Rate 8.3% 22.3% Income from Continuing Operations Attributable to TEConnectivity Ltd. 1,614$ 28$ 15$ (278)$ 1,379$ DilutedEarnings per Share from Continuing Operations Attributable to TEConnectivity Ltd. 3.87$ 0.07$ 0.04$ (0.67)$ 3.31$ (2) Includes income tax benefits of $282 million recognized in connection with a reduction in the valuation allowance associated with certain tax loss carryforwards and income tax expense related to adjustments to prior year income tax returns. In addition, other income includes amounts related to reimbursements by Tyco International and Covidien in connection with pre-separation tax matters, including $18 million related to our share of a settlement agreement entered into by Tyco International with a former subsidiary. (3) See description of non-GAAP measures contained in this appendix. ($ in millions, except per share data) (1) Includes $31 million of acquisition and integration charges and $4 million of non-cash amortization associated with fair value adjustments primarily related to acquired inventories and customer order backlog recorded in cost of sales. Adjustments 16
  • 17. 17 March 27, March 28, March 27, March 28, 2015 2014 2015 2014 Net Sales 3,082$ 2,964$ 6,131$ 5,826$ Cost of Sales 2,031 1,969 4,060 3,886 Gross Margin 1,051 995 2,071 1,940 Gross Margin Percentage 34.1% 33.6% 33.8% 33.3% Acquisition Related Charges 6 - 33 - AdjustedGross Margin (1) 1,057$ 995$ 2,104$ 1,940$ AdjustedGross Margin Percentage (1) 34.3% 33.6% 34.3% 33.3% (1) See description of non-GAAP measures contained in this appendix. For the Six Months Ended ($ in millions) For the Quarters Ended Reconciliation of Gross Margin & Gross Margin Percentage
  • 18. Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Six Months Ended March 27, 2015 18 Acquisition Restructuring Related and Other Tax Adjusted U.S. GAAP Charges (1) Charges, Net (2) Items (3) (Non-GAAP) (4) Operating Income: Transportation Solutions 618$ 51$ 1$ -$ 670$ Industrial Solutions 170 22 18 - 210 Communications Solutions 85 - 42 - 127 Total 873$ 73$ 61$ -$ 1,007$ Operating Margin 14.2% 16.4% Other Income (Expense), Net (75)$ -$ -$ 94$ 19$ Income Tax (Expense) Benefit 15$ (18)$ 7$ (224)$ (220)$ Effective Tax Rate NM (5) 22.8% Income from Continuing Operations Attributable to TEConnectivity Ltd. 751$ 55$ 68$ (130)$ 744$ DilutedEarnings per Share from Continuing Operations Attributable to TEConnectivity Ltd. 1.82$ 0.13$ 0.16$ (0.31)$ 1.80$ (5) Not meaningful. Adjustments ($ in millions, except per share data) (3) Includes $202 million of income tax benefits associated with the settlement of audits of prior year income tax returns as well as the related impact of $94 million to other expense pursuant to the tax sharing agreement with Tyco International and Covidien. Also includes income tax benefits related to the impacts of certain non-U.S. tax law changes and the associated reduction in the valuation allowance for tax loss carryforwards. (4) See description of non-GAAP measures contained in this appendix. (1) Includes $33 million of non-cash amortization associated with fair value adjustments related to acquired inventories and customer order backlog recorded in cost of sales, $38 million of acquisition and integration costs, and $2 million of restructuring costs. (2) Includes an income tax charge for the estimated tax impacts of certain intercompany dividends related to the restructuring and anticipated sale of the Broadband Network Solutions business.