|Published:||Nov 27, 2012 3:25 PM EST|
|Updated:||Nov 28, 2012 7:31 AM EST|
BOCA RATON, Fla. (AP) - ADT's fiscal fourth-quarter net income edged up 1 percent as it added new customers. Revenue rose but it felt short of Wall Street expectations.
The electronic security and home monitoring business spun off recently by Tyco International Ltd. also announced a $2 billion stock repurchase program.
ADT shares rose 69 cents, or 1.6 percent, to $43.79 in afternoon trading Tuesday after rising briefly to a new high of $45 earlier in the session.
The ADT Corp. reported on Tuesday that it earned $94 million, or 40 cents per share, for the period ended Sept. 28. That compares with earnings of $93 million, or 39 cents per share, a year ago.
Excluding restructuring charges and separation costs, earnings were 43 cents per share. That matched the expectations of analysts surveyed by FactSet.
Revenue increased 2 percent to $812 million from $794 million, but fell short of Wall Street's $818.2 million estimate.
ADT added 284,000 new customers, giving it 6.4 million customer accounts at quarter's end, which is a 1.1 percent increase from the prior-year period.
Recurring revenue, which made up more than 90 percent of total revenue, climbed 5.2 percent on a 4.4 percent rise in the average revenue per customer and the increase in customer accounts.
For the full year, ADT earned $394 million, or $1.67 per share. In the previous year the Boca Raton, Fla. company earned $376 million, or $1.59 per share. Annual revenue climbed 4 percent to $3.23 billion from $3.11 billion.
ADT said its board approved the repurchase of $2 billion of its common stock. The buyback program expires on Nov. 27, 2015. It also declared a quarterly dividend of 12.5 cents per share. The dividend will be paid on Dec. 18 to shareholders of record on Dec. 10.
Fitch Ratings lowered its rating on ADT's credit, citing the debt the company is taking on as part of the stock repurchase. Fitch lowered its rating to 'BBB' from 'BBB+'. The new rating remains investment grade and is two notches above "junk" status.
"The downgrade also reflects management's willingness to undertake a more aggressive financial strategy soon after becoming an independent company," said analyst Robert Rulla.