The bottom line at Tyco International (NYSE:TYC) continues to be cluttered by unusual items, but at least those don't include any ice sculptures or $800 shower curtains. In fact, if its $600 million makeover pays off, the Inside Value recommendation could soon be known less for management shenanigans and more as a great turnaround story.

For those just tuning in, the company has gone through an extensive overhaul, throwing off money-losing units and picking up others that complement its remaining segments, especially its security services unit and its valves and pipes business. While Tyco used to be diversified with a capital "D," making everything from fiber optics to adult incontinence products, it has recently slimmed down. In June, it spun off its health-care business into Covidien (NYSE:COV) and its electronics segment into Tyco Electronics (NYSE:TEL).

But the remaining businesses with Tyco International still compete with a wide range of rivals, including Brinks (NYSE:BCO) and United Technologies (NYSE:UTX) in fire and security services, and Flowserve (NYSE:FLS) in valves, pipes, and fittings.

On the surface, the company's latest quarter and fiscal year are nothing to write home about. Revenue rose 8.9% to $5 billion for the quarter and 8.3% to $18.8 billion for the year. But operating income shrank 25% to $402 million for the quarter, leaving it with an operating loss of $1.7 billion for the year.

Underneath those numbers, however, is some good news. The single biggest extraordinary item pressing down on the company's financials is now history. That item -- $2.86 billion for settlement of a shareholder lawsuit related to the aforementioned shenanigans -- was paid in the third quarter, thus closing that chapter of Tyco's history.

Yet also weighing heavily on the bottom line are charges for the ongoing $600 million makeover announced a year ago. The good news is that the company plans to complete its restructuring next year and should start to see some cost savings. On Thursday's conference call, management put those savings at $100 million in 2008 and $150 million or more in 2009.

The other buzz is that Tyco has made some progress in expanding its operating margins. If you don't count those makeover costs, four of the company's five operating segments posted better margins for the year, including a 150-basis-point jump in the valve, pipe, and fittings business. Overall, the future looks bright for Tyco.

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Tyco International, Covidien, and Tyco Electronics are all Motley Fool Inside Value recommendations. Try the market-beating newsletter service free for 30 days.

Fool contributor Ron Vlieger doesn't own shares in any of the companies mentioned, but does welcome your questions or comments. The Motley Fool has a disclosure policy.