Tyco profit up 38% but results will be restated

High-tech manufacturing and services conglomerate Tyco International Ltd. on Wednesday posted a 38% jump in its fiscal fourth-quarter profit. But the company said it had found problems with stock option grants under prior management that would cost $171 million in after-tax expenses.

Tyco will restate results -- for 1999 through early 2002, the era of disgraced former Chief Executive L. Dennis Kozlowski -- in its 2006 financial statement to reflect additional stock-based compensation expenses for grants awarded through 2002. That will cut 2005 reported results by a penny a share.

The Princeton, N.J.-based company also unveiled a restructuring program designed to improve operating efficiency ahead of its planned breakup.

The program is expected to save $50 million in 2007 and $200 million in 2008 but bring $600 million in charges, including a $250-million cash charge next year.

“There will be some job cuts and some closures of plants or offices,” but Tyco isn’t giving details yet, spokeswoman Sheri Woodruff said.

Shares fell 3 cents to $29.90.

Net income increased to $1.27 billion, or 62 cents a share, in the three months ended Sept. 29, from $917 million, or 44 cents, a year earlier. Revenue rose 8% to $10.76 billion.