<PAGE>

                         SECURITIES AND EXCHANGE COMMISSION 
                              Washington, D.C. 20549
                       ------------------------------------

            FORM 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) 
                            OF THE SECURITIES EXCHANGE ACT OF 1934

                   For the quarterly period ended March 31, 1997
 
                                       OR 
              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) 
                     OF THE SECURITIES EXCHANGE ACT OF 1934
 
                     FOR THE TRANSITION PERIOD FROM      TO
                                                    -----    -------
                                     1-5482 
                             (Commission File Number)
                 ----------------------------------------------

                              TYCO INTERNATIONAL LTD. 
              (Exact name of registrant as specified in its charter)
 


     Massachusetts                                   04-2297459
 (State of Incorporation)                           (IRS Employer
                                                Identification Number)

 
                     One Tyco Park, Exeter, New Hampshire 03833 
               (Address of registrant's principal executive office) 

                                 603-778-9700 
                       (Registrant's telephone number)
                 -----------------------------------------------

   Indicate by check mark whether the registrant (1) has filed all reports
   required to be filed by Section 13 or 15(d) of the Securities Exchange Act 
   of 1934 during the preceding 12 months (or for such shorter period that the
   registrant was required to file such reports), and (2) has been subject to 
   such filing requirements for the past 90 days. Yes X . No .

   The number of shares of common stock outstanding as of May 9, 1997 was
   168,357,982.


<PAGE>
                            TYCO INTERNATIONAL LTD.
 
                               INDEX TO FORM 10-Q
 
<TABLE>
<CAPTION>
                                                                                                                PAGE
                                                                                                                -----
<S>                                                                                                          <C>
Part I--Financial Information:
  Item 1--Financial Statements -

    Consolidated Balance Sheets--March 31, 1997 and June 30, 1996..........................................         1-2

    Consolidated Statements of Income for the Third Quarter and Nine Months ended March 31, 1997 and
     1996..................................................................................................           3

    Consolidated Statements of Changes in Shareholders' Equity for the Nine Months ended March 31, 1997 and
     1996..................................................................................................           4

    Consolidated Statements of Cash Flows for the Nine Months ended March 31, 1997 and 1996................           5

    Notes to Consolidated Financial Statements.............................................................           6

  Item 2--Management's Discussion and Analysis of Financial Condition and Operating Results................          10

Part II--Other Information:

  Item 6--Exhibits and Reports on Form 8-K.................................................................          14

</TABLE>
 
<PAGE>

                                 PART I--FINANCIAL INFORMATION

                                 ITEM 1--FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEETS

ASSETS

<TABLE>
<CAPTION>
                                                                                      (UNAUDITED)
(IN THOUSANDS)                                                                       MARCH 31, 1997  JUNE 30, 1996
-----------------------------------------------------------------------------------  --------------  -------------
<S>                                                                                  <C>             <C>
Current Assets:
Cash and cash equivalents..........................................................   $     63,204    $    69,404
Receivables, less allowance for doubtful accounts of $63,334 in fiscal 1997 and
  $36,672 in fiscal 1996...........................................................        956,874        688,741
Contracts in process...............................................................        125,118        130,473
Inventories........................................................................        839,884        608,526
Deferred income taxes..............................................................        147,468        126,282
Prepaid expenses and other current assets..........................................         92,872         72,098
                                                                                     --------------  -------------
                                                                                         2,225,420      1,695,524
                                                                                     --------------  -------------
Property, Plant and Equipment:
Land...............................................................................         46,413         37,560
Buildings..........................................................................        408,476        320,034
Machinery and equipment............................................................      1,129,463        934,918
Leasehold improvements.............................................................         33,025         22,658
Construction in progress...........................................................        121,616         52,289
Accumulated depreciation...........................................................       (741,362)      (641,717)
                                                                                     --------------  -------------
                                                                                           997,631        725,742
                                                                                     --------------  -------------
Goodwill and Other Intangible Assets...............................................      2,071,453      1,232,617

Reorganization Value in Excess of Identifiable Assets..............................         97,778        102,591

Deferred Income Taxes..............................................................         61,909         69,823

Other Assets.......................................................................        152,065        127,639
                                                                                     --------------  -------------
Total Assets.......................................................................   $  5,606,256    $ 3,953,936
                                                                                     --------------  -------------
                                                                                     --------------  -------------
</TABLE>
 
See notes to consolidated financial statements.

                                      1
<PAGE>

LIABILITIES AND SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
                                                                                      (UNAUDITED)
(IN THOUSANDS EXCEPT SHARE DATA)                                                     MARCH 31, 1997  JUNE 30, 1996
-----------------------------------------------------------------------------------  --------------  -------------
<S>                                                                                  <C>             <C>
Current Liabilities:
Loans payable and current maturities of long-term debt.............................   $    115,726    $   127,822
Accounts payable...................................................................        598,224        470,819
Accrued expenses...................................................................        706,017        506,270
Contracts in process--billings in excess of costs..................................        147,988         89,640
Income taxes.......................................................................        103,630         84,196
Deferred income taxes..............................................................         12,038         13,063
                                                                                     --------------  -------------
                                                                                         1,683,623      1,291,810
                                                                                     --------------  -------------
Long-term Debt.....................................................................        838,232        511,622

Other Liabilities..................................................................        212,908        192,839

Deferred Income Taxes..............................................................         25,755         19,226

Commitments and Contingencies

Shareholders' Equity:

Preferred stock, $1 par value, authorized 2,000,000 shares; none outstanding.......        --             --
Common stock, $.50 par value, authorized 500,000,000 shares; outstanding
  166,829,391 shares in fiscal 1997 and 152,977,282 shares in fiscal 1996, net of
  reacquired shares of 12,998,106 in fiscal 1997 and 16,024,221 in fiscal 1996 (at
  cost)............................................................................         83,414         76,488
Capital in excess of par value, net of deferred compensation of $25,151 in fiscal
  1997 and $11,500 in fiscal 1996..................................................      1,312,508        627,985
Currency translation adjustment....................................................        (75,787)       (34,571)
Retained earnings..................................................................      1,525,603      1,268,537
                                                                                     --------------  -------------
                                                                                         2,845,738      1,938,439
                                                                                     --------------  -------------
Total Liabilities and Shareholders' Equity.........................................   $  5,606,256    $ 3,953,936
                                                                                     --------------  -------------
                                                                                     --------------  -------------
</TABLE>

See notes to consolidated financial statements.

                                      2
<PAGE>

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

<TABLE>
<CAPTION>

             FOR THE PERIODS ENDED MARCH 31,                  FISCAL THIRD QUARTER         FISCAL NINE MONTHS
                      1997 AND 1996                        --------------------------  --------------------------
          (IN THOUSANDS EXCEPT PER SHARE DATA)                 1997          1996          1997          1996
---------------------------------------------------------  ------------  ------------  ------------  ------------
<S>                                                        <C>           <C>           <C>           <C>
Sales....................................................  $  1,654,241  $  1,257,619  $  4,746,297  $  3,717,706
                                                           ------------  ------------  ------------  ------------
Costs and Expenses:

Cost of sales............................................     1,194,536       910,078     3,439,645     2,715,724
Selling, general and administrative......................       264,764       195,378       768,380       586,260
Interest.................................................        20,131        16,309        72,888        46,646
                                                           ------------  ------------  ------------  ------------
                                                              1,479,431     1,121,765     4,280,913     3,348,630
                                                           ------------  ------------  ------------  ------------
Income before income taxes...............................       174,810       135,854       465,384       369,076

Income taxes.............................................       (68,106)      (56,380)     (184,310)     (153,167)
                                                           ------------  ------------  ------------  ------------
Net Income...............................................  $    106,704  $     79,474  $    281,074  $    215,909
                                                           ------------  ------------  ------------  ------------
                                                           ------------  ------------  ------------  ------------
Net Income Per Share.....................................  $        .67  $        .52  $       1.79  $       1.41
                                                           ------------  ------------  ------------  ------------
                                                           ------------  ------------  ------------  ------------
Cash dividends per common share..........................  $        .05  $        .05  $        .15  $        .15
                                                           ------------  ------------  ------------  ------------
                                                           ------------  ------------  ------------  ------------
Common equivalent shares.................................       159,841       152,791       157,300       152,809
                                                           ------------  ------------  ------------  ------------
                                                           ------------  ------------  ------------  ------------
</TABLE>
 
See notes to consolidated financial statements.
 
                                      3
<PAGE>

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED)

For the Nine Months ended March 31, 1997 and 1996

<TABLE>
<CAPTION>

                                                           COMMON STOCK    CAPITAL IN    CURRENCY
                                                             $.50 PAR      EXCESS OF    TRANSLATION    RETAINED
(IN THOUSANDS)                                                 VALUE       PAR VALUE    ADJUSTMENT     EARNINGS
---------------------------------------------------------  -------------  ------------  -----------  ------------
<S>                                                        <C>            <C>           <C>          <C>
Balance at June 30, 1995.................................    $  76,366    $    582,450   $  (9,451)  $    985,316
Net income...............................................                                                 215,909
Dividends................................................                                                 (22,900)
Restricted stock grants, cancellations, tax benefits and
  other..................................................          (17)         22,911
Warrants, options exercised..............................           12             188
Currency translation adjustment..........................                                  (19,884)
Amortization of deferred compensation....................                        7,543
Common stock reacquired..................................         (101)         (6,769)
                                                           -------------  ------------  -----------  ------------
Balance at March 31, 1996................................    $  76,260    $    606,323   $ (29,335)  $  1,178,325
                                                           -------------  ------------  -----------  ------------
                                                           -------------  ------------  -----------  ------------
Balance at June 30, 1996.................................    $  76,488    $    627,985   $ (34,571)  $  1,268,537

Net income...............................................                                                 281,074
Dividends................................................                                                 (24,008)
Restricted stock grants, cancellations, tax benefits and
  other..................................................          283           1,749
Warrants, options exercised..............................          141           6,341
Currency translation adjustment..........................                                  (41,216)
Amortization of deferred compensation....................                        8,411
Sale of common stock.....................................        5,000         556,027
Issuance of treasury stock for acquisition...............        1,537         114,515
Other treasury stock transactions, net...................          (35)         (2,520)
                                                           -------------  ------------  -----------  ------------
Balance at March 31, 1997................................    $  83,414    $  1,312,508   $ (75,787)  $  1,525,603
                                                           -------------  ------------  -----------  ------------
                                                           -------------  ------------  -----------  ------------
</TABLE>

See notes to consolidated financial statements.

                                      4
<PAGE>

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
 
<TABLE>
<CAPTION>

                          FOR THE NINE MONTHS ENDED MARCH 31,
                                     (IN THOUSANDS)                                          1997         1996
----------------------------------------------------------------------------------------  -----------  -----------
<S>                                                                                       <C>          <C>
Cash Flows From Operating Activities:
Net income..............................................................................  $   281,074  $   215,909
Adjustments to reconcile net income to net cash provided by operating activities:
  Depreciation..........................................................................       90,152       69,647
  Amortization..........................................................................       52,534       37,048
  Deferred income taxes.................................................................       39,966       38,330
  Provision for losses on accounts receivable and inventory writedowns..................       28,817       20,647
  Changes in assets and liabilities net of the effects of acquisitions:
    Increase in accounts receivable and contracts in process............................      (34,794)     (62,017)
    Increase in inventory...............................................................     (105,963)     (27,101)
    Decrease in accounts payable and accrued expenses...................................     (130,194)     (77,938)
    Increase in income taxes payable....................................................       10,553        7,540
    Other...............................................................................       (3,273)       4,195
                                                                                          -----------  -----------
  Net cash provided by operating activities.............................................      228,872      226,260
                                                                                          -----------  -----------
Cash Flows From Investing Activities:

Capital expenditures....................................................................     (151,431)     (90,215)
Purchase of businesses, net of cash acquired............................................     (784,148)    (245,318)
Proceeds from sale of acquired assets...................................................      --            49,768
                                                                                          -----------  -----------
  Net cash used in investing activities.................................................     (935,579)    (285,765)
                                                                                          -----------  -----------
Cash Flows From Financing Activities:

Proceeds from long-term debt............................................................      298,490      --
(Payments on) proceeds from lines of credit.............................................     (136,913)      84,671
Proceeds from sale of common stock......................................................      561,027      --
Dividends paid..........................................................................      (23,270)     (22,900)
Issuance of stock and warrants..........................................................        6,482          200
Common stock reacquired.................................................................       (5,309)      (6,870)
                                                                                          -----------  -----------
  Net cash provided by financing activities.............................................      700,507       55,101
                                                                                          -----------  -----------
Decrease in cash and cash equivalents...................................................       (6,200)      (4,404)
Cash and cash equivalents at beginning of year..........................................       69,404       66,021
                                                                                          -----------  -----------
Cash and cash equivalents at end of period..............................................  $    63,204  $    61,617
                                                                                          -----------  -----------
                                                                                          -----------  -----------
</TABLE>

See notes to consolidated financial statements.

                                      5
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.   The unaudited financial statements presented herein have been 
     prepared in accordance with the instructions to Form 10-Q and do not 
     include all of the information and note disclosures required by 
     generally accepted accounting principles. These statements should be 
     read in conjunction with the financial statements and notes thereto 
     included in the Company's Form 10-K for the year ended June 30, 1996. 
     The accompanying financial statements have not been examined by 
     independent accountants in accordance with generally accepted auditing 
     standards, but in the opinion of management such financial statements 
     include all adjustments, consisting only of normal recurring 
     adjustments, necessary to summarize fairly the Company's financial 
     position and results of operations.
 
2.   During the first nine months of fiscal 1997 the Company acquired 
     companies in each of its business segments for an aggregate of $1.06 
     billion, including $784.1 million in cash, approximately 3.1 million 
     shares of the Company's common stock, valued at $116.1 million, and the 
     assumption of approximately $155.0 million in debt. The cash portion of 
     the consideration for the acquisitions was provided by cash on hand and 
     borrowings under the Company's credit agreement and uncommitted lines of 
     credit. Each of the acquisitions was accounted for as a purchase, and 
     the results of operations of the acquired companies were included in the 
     consolidated results of the Company from their respective acquisition 
     dates. As a result of the acquisitions, approximately $863.2 million in 
     goodwill was recorded by the Company, which reflects, for each 
     acquisition, the excess of the purchase price, liabilities assumed and 
     additional purchase liabilities recorded over the fair value of assets 
     acquired. Additional purchase liabilities included approximately $34.6 
     million for transaction and other direct costs, $38.7 million for 
     severance costs and $27.6 million for costs associated with the shut 
     down and consolidation of certain acquired facilities. At March 31, 1997 
     liabilities for approximately $16.6 million in transaction and other 
     costs, $27.1 million in severance costs and $22.8 million for facility 
     related costs associated with fiscal 1997 acquisitions remained on the 
     balance sheet, and liabilities for approximately $8.7 million in 
     severance costs and $4.1 million for facility related costs associated 
     with fiscal 1996 acquisitions remained on the balance sheet.

3.   On March 17, 1997, the Company entered into a definitive merger 
     agreement pursuant to which Tyco will effectively acquire ADT Limited 
     ("ADT"), an installer and servicer of electronic security systems, in a 
     stock for stock transaction. A subsidiary of ADT will merge with and 
     into Tyco, and Tyco shareholders will receive one share of ADT for each 
     Tyco share they currently hold. ADT shareholders, through a reverse 
     stock split, will receive 0.48133 of an ADT share for each ADT share 
     they currently hold. ADT will be renamed Tyco International Ltd. ("New 
     Tyco"). Immediately following the closing of the transaction former Tyco 
     shareholders will own approximately 64% of the outstanding shares of New 
     Tyco and ADT shareholders will own approximately 36% of the outstanding 
     shares of New Tyco. The transaction, which will be taxable to Tyco 
     shareholders and accounted for as a pooling of interests, is contingent 
     upon customary regulatory review and approval by the shareholders of 
     both companies. The Boards of Directors of both companies have approved 
     the transaction, which is expected to close on or about June 30, 1997.

                                      6
<PAGE>

     On April 11, 1997, the Company entered into an agreement with AT&T 
     to acquire its submarine systems business ("SSI") for cash of 
     approximately $850.0 million. SSI is a world leader in the design, 
     development, manufacture, installation, supply and maintenance of 
     undersea fiber optic telecommunication cable systems. The acquisition 
     will be accounted for as a purchase and is expected to close in June 
     1997.

     On May 13,1997, the Company entered into a definitive merger 
     agreement pursuant to which Tyco will acquire INBRAND in a stock for 
     stock transaction valued at approximately $320 million. INBRAND 
     manufactures and distributes adult incontinence products, as well as 
     feminine hygiene products and disposable baby diapers to hospitals, 
     retail and alternate care sites throughout North America and Europe. The 
     acquisition, which will be accounted for as a pooling of interests, will 
     be structured with INBRAND shareholders receiving 0.43 shares of Tyco 
     stock for each share of INBRAND stock outstanding. The transaction is 
     contingent upon customary regulatory review and approval by the INBRAND 
     shareholders. The transaction is expected to close following the 
     completion of the aforementioned transaction with ADT.

4. LONG-TERM DEBT IS AS FOLLOWS:

<TABLE>
<CAPTION>
                                                                                             MARCH 31,   JUNE 30,
(IN THOUSANDS)                                                                                  1997       1996
-------------------------------------------------------------------------------------------  ----------  ---------
<S>                                                                                          <C>         <C>
Credit agreement...........................................................................  $   --      $  --
Uncommitted lines of credit................................................................      57,400     91,000
8.125% public notes due 1999...............................................................     144,941    144,924
6.5% public notes due 2001.................................................................     298,567     --
6.375% public notes due 2004...............................................................     104,445    104,386
9.5% public debentures due 2022............................................................     199,604    199,592
8.0% public debentures due 2023............................................................      49,961     49,960
Other......................................................................................      99,040     49,582
                                                                                             ----------  ---------
                                                                                                953,958    639,444
Less current portion and loans payable.....................................................     115,726    127,822
                                                                                             ----------  ---------
                                                                                             $  838,232  $ 511,622
                                                                                             ----------  ---------
                                                                                             ----------  ---------
</TABLE>
 
     Under the Company's credit agreement with a group of commercial 
     banks, which was renegotiated in December 1996, the Company has the 
     right to borrow $300 million or a portion thereof until December 2001 
     for its general corporate purposes. The principal amount then 
     outstanding will be due and payable at that time. Interest payable on 
     borrowings is variable based upon the Company's option of selecting 
     either a Eurodollar rate plus 0.21%, a certificate of deposit rate plus 
     0.335%, or a base rate, as defined.

     The Company's uncommitted lines of credit are borrowings from 
     commercial banks on an "as offered" basis. The borrowings and repayments 
     occur daily and contain no significant terms other than due dates and 
     interest rates. The due dates generally range from overnight to 90 days 
     and interest rates approximate those available under the credit 
     agreement.

                                      7
<PAGE>

     In October 1996, the Company issued $300 million principal amount of 
     6.5% notes due 2001. The net proceeds were used to redeem debt assumed 
     with the acquisition of Carlisle Plastics as well as to reduce certain 
     amounts outstanding under the Company's credit agreement and uncommitted 
     lines of credit.
 
     Under its various loan agreements, the Company is required to meet 
     certain covenants, none of which is considered restrictive to the 
     operations of the Company.

5.   The Company has an agreement under which it sells participating 
     interests in a defined pool of trade accounts receivable. The proceeds 
     of sale are less than the face amount of accounts receivable sold by an 
     amount which approximates the purchaser's financing cost of issuing its 
     own commercial paper backed by these accounts receivable. The discount 
     from the face amount of receivables sold during the third quarter of 
     fiscal 1997 and fiscal 1996 was $3.0 million and $2.8 million, 
     respectively. The discount from the face amount of receivables sold 
     during the first nine months of fiscal 1997 and 1996 was $9.2 million 
     and $9.5 million, respectively. These amounts have been included in 
     selling, general and administrative expense in the Company's 
     Consolidated Statements of Income.
 
6.   Selected information for the Company's four industry segments is as 
     follows (in thousands):

<TABLE>
<CAPTION>

                                                              THIRD QUARTER ENDED          NINE MONTHS ENDED
                                                                   MARCH 31,                   MARCH 31,
                                                           --------------------------  --------------------------
<S>                                                        <C>           <C>           <C>           <C>
                                                               1997          1996          1997          1996
                                                           ------------  ------------  ------------  ------------
Sales:

Disposable and Specialty Products........................  $    499,605  $    357,734  $  1,446,351  $  1,060,600
Fire and Safety Services.................................       630,131       497,151     1,882,828     1,452,043
Flow Control Products....................................       379,439       276,193     1,035,548       840,364
Electrical and Electronic Components.....................       145,066       126,541       381,570       364,699
                                                           ------------  ------------  ------------  ------------
                                                           $  1,654,241  $  1,257,619  $  4,746,297  $  3,717,706
                                                           ------------  ------------  ------------  ------------
                                                           ------------  ------------  ------------  ------------
Income Before Income Taxes:

Disposable and Specialty Products........................  $     89,828  $     75,397  $    260,075  $    205,615
Fire and Safety Services.................................        46,689        33,235       135,722        90,563
Flow Control Products....................................        41,987        28,441       104,885        80,152
Electrical and Electronic Components.....................        28,769        24,314        72,044        67,113
                                                           ------------  ------------  ------------  ------------
  Total operations.......................................       207,273       161,387       572,726       443,443
Interest expense.........................................       (20,131)      (16,309)      (72,888)      (46,646)
Corporate and other amounts..............................       (12,332)       (9,224)      (34,454)      (27,721)
                                                           ------------  ------------  ------------  ------------
                                                           $    174,810  $    135,854  $    465,384  $    369,076
                                                           ------------  ------------  ------------  ------------
                                                           ------------  ------------  ------------  ------------
</TABLE>
 
7.  Inventories are classified as follows (in thousands):

<TABLE>
<CAPTION>

                                                                                     MARCH 31, 1997  JUNE 30, 1996
                                                                                     --------------  -------------
<S>                                                                                  <C>             <C>
  Purchased materials and manufactured parts.......................................    $  236,595     $   162,600
  Work in process..................................................................       143,765         108,733
  Finished goods...................................................................       459,524         337,193
                                                                                     --------------  -------------
                                                                                       $  839,884     $   608,526
                                                                                     --------------  -------------
                                                                                     --------------  -------------
</TABLE>
 
                                      8
<PAGE>

8.   In the normal course of business, the Company is liable for contract 
     completion and product performance. In addition, the Company is in 
     receipt of notifications from various environmental agencies that 
     conditions at a number of sites where hazardous wastes were disposed of 
     by the Company and other persons may require cleanup and other possible 
     remedial action. In the opinion of management, these obligations will 
     not materially affect the Company's financial position or results of 
     operations.
 
9.   In January 1997 the Company filed a shelf registration to enable 
     it to offer from time to time unsecured debt securities or shares of 
     common stock, or any combination of the foregoing, at an aggregate 
     initial offering price not to exceed $900 million. The Securities and 
     Exchange Commission has declared the shelf registration effective. In 
     March 1997, the Company sold 10 million shares of common stock at $57.75 
     per share. The net proceeds from the sale of $561.0 million were used to 
     repay indebtedness incurred for previous acquisitions. In April 1997, 
     the company sold an additional 1.5 million shares at $57.75 per share 
     and received net proceeds of $84.2 million.
 
10.  The Financial Accounting Standards Board (the "FASB") has issued 
     Statement of Financial Accounting Standards ("SFAS") No. 123, 
     "Accounting for Stock-Based Compensation." The standard defines a fair 
     value based method of accounting for employee stock options. The 
     compensation expense arising from this method can be reflected in the 
     financial statements or, alternatively, the pro forma net income and 
     income per share effect of the fair value based accounting can be 
     disclosed in the footnotes to the financial statements. The Company will 
     adopt SFAS 123 in fiscal 1997 and expects to adopt the footnote 
     disclosure alternative.
 
     In February 1997, the FASB issued SFAS No. 128, "Earnings Per 
     Share," which is effective for fiscal years ending after December 15, 
     1997, including interim periods. Earlier adoption is not permitted. 
     However, an entity is permitted to disclose pro forma earnings per share 
     amounts computed under SFAS 128 in the notes to the financial statements 
     in periods prior to adoption. The statement requires restatement of all 
     prior period earnings per share data presented after the effective date. 
     SFAS 128 specifies the computation, presentation and disclosure 
     requirements for earnings per share and is substantially similar to the 
     standard recently issued by the International Accounting Standards 
     Committee entitled International Accounting Standards, Earnings Per 
     Share. The Company will adopt SFAS 128 in fiscal 1998 and has not yet 
     determined its impact.
 
                                      9
<PAGE>


                  ITEM 2--MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                     FINANCIAL CONDITION AND OPERATING RESULTS

OVERVIEW
 
For the first nine months of fiscal 1997, net income was $281.1 million, or 
$1.79 per share, compared with $215.9 million, or $1.41 per share, for the 
first nine months of fiscal 1996. The increase was attributable to strong 
earnings in each of the Company's business segments.
 
RESULTS OF OPERATIONS
 
Third Quarter of Fiscal 1997 Compared to Third Quarter of Fiscal 1996:
 
Sales increased 32% during the third quarter of fiscal 1997 to $1.65 billion 
from $1.26 billion in the third quarter of fiscal 1996. Sales of the 
Disposable and Specialty Products group increased $141.9 million to $499.6 
million, or 40%, due to increased sales at Kendall, Ludlow, and Armin, as 
well as the inclusion of Carlisle Plastics ("Carlisle") acquired in September 
1996. The increase in sales resulted principally from the Carlisle 
acquisition. Sales at Kendall increased primarily due to increased volume in 
the Polyken business. Armin's sales increased due to higher selling prices. 
Sales of the Fire and Safety Services group increased $133.0 million to 
$630.1 million, or 27%, reflecting increased sales in each geographic region 
of the contracting businesses, primarily due to an increase in the volume of 
service business, as well as the inclusion of Thorn Security Group ("Thorn") 
acquired in July 1996. Sales of the Flow Control Products group increased 
$103.2 million to $379.4 million, or 37%, principally reflecting increased 
volume at the European Flow Control operations, primarily from businesses 
acquired in the second and third quarters of fiscal 1997, and at Mueller, 
which includes businesses acquired in the first quarter of fiscal 1997, as 
well as increased volume in existing businesses. Sales of the Electrical and 
Electronic Components group increased $18.5 million to $145.1 million, or 
15%, due to increased sales at the Printed Circuit Group operations primarily 
resulting from the operations of ElectroStar, Inc. ("ElectroStar"), acquired 
in January 1997, partially offset by decreased sales at Allied's electrical 
conduit operations and at Simplex, where there was a decrease in kilometers 
of cable shipped.

For the third quarter of fiscal 1997, as compared to the third quarter of 
fiscal 1996, operating profits of the Disposable and Specialty Products group 
increased $14.4 million to $89.8 million, or 19%, due primarily to higher 
earnings at Kendall, principally due to the Polyken business, and Ludlow, as 
well as the inclusion of Carlisle, which accounted for a substantial portion 
of the increased profits. Operating profits of the Fire and Safety Services 
group increased $13.5 million to $46.7 million, or 41%, due to higher margins 
in contracting, primarily in North America, Europe and Asia, and the 
inclusion of Thorn. The higher margins in contracting were the result of a 
higher mix of service work within the contracting businesses. Operating 
profits of the Flow Control Products group increased $13.5 million to $42.0 
million, or 48%, due to increased earnings at each of the group's operations, 
which include businesses acquired in the first, second and third quarters. 
Increases in Europe Flow Control were primarily the result of acquisitions. 
Increases at Mueller and Grinnell's distribution operations were the result 
of margin increases and the impact of cost reductions. Operating profits of 
the Electrical and Electronic Components group increased $4.5 million to 
$28.8 million, or 18%, due principally to higher earnings at 

                                     10

<PAGE>

the Printed Circuit Group, including ElectroStar, partially offset by a 
decrease at Simplex and at Allied's electrical conduit operations.

The impact on the consolidated sales and results of operations from changes 
in foreign exchange rates relative to the value of the U.S. dollar for the 
third quarter of fiscal 1997 as compared to the same period of fiscal 1996 
was not material.

Interest expense increased $3.8 million to $20.1 million during the third 
quarter of fiscal 1997 from the third quarter of fiscal 1996 due to higher 
average debt balances for monies borrowed to make acquisitions.
 
FIRST NINE MONTHS OF FISCAL 1997 COMPARED WITH FIRST NINE MONTHS OF FISCAL 1996:
 
Sales during the first nine months of fiscal 1997 were $4.75 billion, a 28% 
increase over fiscal 1996 sales of $3.72 billion. Sales of the Disposable and 
Specialty Products group increased $385.8 million to $1.45 billion, or 36%, 
due to increased sales principally at Kendall, Ludlow and Armin, as well as 
the inclusion of Carlisle from September 1996. The increase in sales resulted 
principally from the Carlisle acquisition. Sales at Kendall increased 
primarily due to increased volume in both the Healthcare and Polyken 
businesses. Armin's sales increased due to higher selling prices. Sales of 
the Fire and Safety Services group increased $430.8 million to $1.88 billion, 
or 30%, due to increased sales in the contracting business in each geographic 
region, primarily due to an increase in the volume of service business, as 
well as the inclusion of Thorn and Earth Tech. Sales of the Flow Control 
Products group increased $195.2 million to $1.04 billion, or 23%, reflecting 
higher volume at Europe Flow Control, primarily from businesses acquired in 
the second and third quarters of fiscal 1997, as well as from Mueller, 
including businesses acquired in the first quarter of fiscal 1997, as well as 
increased volume in existing businesses, and Grinnell's distribution 
operations, where sales increased due to price increases. Sales of the 
Electrical and Electronic Components group increased $16.9 million to $381.6 
million, or 5%, resulting principally from increased sales at the Printed 
Circuit Group operations, where approximately 60% of the Group's increase 
resulted from the acquisition of ElectroStar, partially offset by lower sales 
of underwater communications cable systems at Simplex, where there was a 
decrease in kilometers of cable shipped.
 
For the first nine months of fiscal 1997 as compared to the first nine months 
of fiscal 1996, operating profits of the Disposable and Specialty Products 
group increased $54.5 million to $260.1 million, or 27%, reflecting higher 
earnings at Kendall, resulting from the volume increases noted above, and 
Ludlow, as well as the inclusion of Carlisle from September 1996. Operating 
profits of the Fire and Safety Services group rose $45.2 million to $135.7 
million, or 50%, due principally to higher margins at fire protection 
operations in each geographic region, as well as the inclusion of Thorn and 
Earth Tech. The higher margins in fire protection were the result of a higher 
mix of service work within the contracting businesses. The operating profits 
of the Flow Control Products group increased $24.7 million to $104.9 million, 
or 31%, resulting principally from increased earnings at Allied, Mueller and 
European distribution operations, including businesses acquired during fiscal 
1997. Increases in Europe Flow Control were primarily the result of 
acquisitions. Increases at Allied and Mueller were the result of margin 
increases and the impact of cost reductions. Operating profits of the 
Electrical and Electronic Components group increased $4.9 million to $72.0 
million, or 7%, due to increased earnings at the Printed Circuit Group 
operations and Allied's electrical conduit operations, partially offset by 
decreased earnings at Simplex.

                                     11

<PAGE>

The impact on the consolidated sales and results of operations from changes 
in foreign exchange rates relative to the value of the U.S. dollar for the 
first nine months of fiscal 1997 as compared to the same period of fiscal 
1996 was not material.
 
Interest expense increased $26.2 million to $72.9 million during the first 
nine months of fiscal 1997 as compared to the first nine months of fiscal 
1996 due principally to higher average debt balances for monies borrowed to 
make acquisitions.
 
LIQUIDITY AND CAPITAL RESOURCES
 
As presented in the Consolidated Statement of Cash Flows, net cash provided 
by operating activities was $228.9 million during the first nine months of 
fiscal 1997. The significant changes in working capital accounts were an 
increase of $34.8 million in accounts receivable and contracts in process, 
$106.0 million in inventory and a $130.2 million decrease in accounts payable 
and accrued expenses. Net changes in other working capital accounts were not 
significant during the period.
 
During the first nine months of fiscal 1997, the Company used cash to (i) 
acquire companies in each of its business segments for an aggregate of $1.06 
billion, including $784.1 million in cash, 3.1 million shares of the 
Company's common stock, valued at $116.1 million, and the assumption of 
$155.0 million in debt; (ii) purchase $151.4 million of property and 
equipment; (iii) pay dividends of $23.3 million, and (iv) reacquire shares 
for $5.3 million. The Company received net proceeds of $561.0 million from 
the sale of 10 million shares of common stock.
 
At March 31, 1997 the Company's total debt was $954.0 million as compared to 
$639.4 million at June 30, 1996. The increase resulted from the acquisitions 
discussed above, partially offset by net operating cash flows and the net 
proceeds from the sale of common stock.
 
Shareholders' equity was $2.85 billion, or $17.06 per share, at March 31, 
1997, compared to $1.94 billion, or $12.67 per share, at June 30, 1996. The 
increase is due primarily to net income of $281.1 million, the issuance of 
the Company's shares for the Carlisle acquisition, and the sale of 10 million 
shares of common stock. Total debt as a percent of total capitalization 
(total debt and shareholders' equity) was 25% both at March 31, 1997 and June 
30, 1996.
 
In October 1996 the Company issued $300 million principal amount of 6.5% 
notes due 2001. The net proceeds were used to redeem debt assumed in the 
Carlisle acquisition, as well as to reduce certain amounts outstanding under 
the Company's credit agreement and uncommitted lines of credit. The Company 
believes that its funding sources are adequate for its anticipated capital 
and operating requirements through expected cash flows from operations and 
established financing arrangements.
 
In January 1997 the Company filed a shelf registration to enable it to offer 
from time to time unsecured debt securities or shares of common stock, or any 
combination of the foregoing, at an aggregate initial offering price not to 
exceed $900 million. The Securities and Exchange Commission has declared the 
shelf registration effective. In March 1997, the Company sold 10 million 
shares of common stock at $57.75 per share. The net proceeds from the sale of 
$561.0 million were used to repay indebtedness incurred for previous 
acquisitions. In April 1997, the Company sold an additional 1.5 million 
shares at $57.75 per share and received net proceeds of $84.2 million.

                                     12

<PAGE>
 
In April 1997 the company entered into an agreement with AT&T to acquire its 
submarine systems business for approximately $850.0 million in cash. The 
Company is in the process of establishing a commercial paper program and 
increasing bank credit facilities, which will be used to fund the purchase.
 
Working capital requirements for the remainder of fiscal 1997 are not 
expected to significantly exceed fiscal 1996 levels. The level of capital 
expenditures is expected to increase in fiscal 1997 as compared to fiscal 
1996 due to recent acquisitions as well as certain capital projects in 
process, and the source of funds for such expenditures is expected to be cash 
from operations.
 
BACKLOG
 
The backlog of unfilled orders was approximately $1.53 billion at March 31, 
1997 and $1.15 billion at June 30, 1996. Backlog increased in the Company's 
Disposable and Specialty Products, Fire and Safety Services, and Flow Control 
Products segments, partially offset by a decrease in the Electrical and 
Electronic Components segment. Within Fire and Safety Services, backlog 
increased in each geographic region as well as from the acquisition of Thorn. 
Within Electrical and Electronic Components, a decrease at Simplex was 
partially offset by increases at the Printed Circuit Group.
 
ACCOUNTING PRONOUNCEMENTS
 
The Financial Accounting Standards Board (the "FASB") has issued Statement of 
Financial Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based 
Compensation." The standard defines a fair value based method of accounting 
for employee stock options. The compensation expense arising from this method 
can be reflected in the financial statements or, alternatively, the pro forma 
net income and income per share effect of the fair value based accounting can 
be disclosed in the footnotes to the financial statements. The Company will 
adopt SFAS 123 in fiscal 1997 and expects to adopt the footnote disclosure 
alternative.
 
In February 1997, the FASB issued SFAS No. 128, "Earnings Per Share," which 
is effective for fiscal years ending after December 15, 1997, including 
interim periods. Earlier adoption is not permitted. However, an entity is 
permitted to disclose pro forma earnings per share amounts computed under 
SFAS 128 in the notes to the financial statements in periods prior to 
adoption. The statement requires restatement of all prior period earnings per 
share data presented after the effective date. SFAS 128 specifies the 
computation, presentation and disclosure requirements for earnings per share 
and is substantially similar to the standard recently issued by the 
International Accounting Standards Committee entitled International 
Accounting Standards, Earnings Per Share. The company will adopt SFAS 128 in 
fiscal 1998 and has not yet determined its impact.
 
                                     13
<PAGE>


                      PART II--OTHER INFORMATION
 
ITEM 6--EXHIBITS AND REPORTS ON FORM 8-K
 
(a) Exhibits 
  
    10--Credit Agreement dated December 23, 1996 
    11--Earnings Per Share Computation 
    27--Financial Data Schedule
 
(b) Reports on Form 8-K
 
   The Company filed a Report on Form 8-K on March 4, 1997 to put on file
   the Underwriting Agreements in connection with its sale of 10 million shares
   of common stock through Merrill Lynch, Pierce, Fenner & Smith Incorporated,
   Credit Suisse First Boston Corporation, Lehman Brothers, Inc., and J.P.
   Morgan Securities, Inc.
 
   The Company filed a Report on Form 8-K on March 25, 1997 to put on file
   the Agreement and Plan of Merger, dated as of March 17, 1997, by and among
   ADT Limited, Limited Apache, Inc. and Tyco International Ltd.
 
   The Company filed a Report on Form 8-K on March 28, 1997 to put on file
   the audited financial statements of ADT Limited as of December 31, 1996 and
   1995 and for the three years in the period ended December 31, 1996, the
   unaudited pro forma combined financial information giving effect to the
   merger of ADT Limited and Tyco International Ltd. as of and for the three
   years in the period ended December 31, 1996, and the consent of Coopers &
    Lybrand.
 
                                     14
<PAGE>


        Signatures
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the 
Registrant has duly caused this report to be signed on its behalf by the 
undersigned hereunto duly authorized.
 
                                    TYCO INTERNATIONAL LTD. 

                                    /s/ Mark H. Swartz 
                                    ---------------------------------
                                   Mark H. Swartz 
                                   Vice President--Chief Financial Officer 
                                   (Principal Accounting and Financial Officer)
 



Date: May 14, 1997

                                     15
<PAGE>


                           TYCO INTERNATIONAL LTD.
 
                             INDEX TO EXHIBITS
 

EXHIBIT NO.
-----------

    10        Credit Agreement dated December 23, 1996
    11        Earnings Per Share Computation
    27        Financial Data Schedule