Johnson Controls expects 30% earnings hike in Q1'14

30 Oct '13

3 min read

Johnson Controls expects earnings increase 30% in Q1’ 2014 and announces intention to explore strategic options for automotive interiors business.

For the fiscal 2013 fourth quarter, Johnson Controls reported net income of $105 million, or $0.15 per share, on $11.0 billion in revenues. Excluding restructuring and non-recurring items in the 2013 and 2012 fiscal fourth quarters, highlights (non-GAAP) include:

-Net revenues of $11.0 billion vs. $10.4 billion in Q4 2012, up six percent

-Record income from business segments of $920 million compared with $725 million a year ago, up 27 percent

-Record net income of $657 million versus $526 million in Q4 2012, up 25 percent

-Diluted earnings per share of $0.95 versus $0.77 in the same quarter last year, up 23 percent

-Cash provided by operating activities of $1.0 billion; net debt reduction of approximately $1.2 billion, including HomeLink divestiture proceeds

Non-recurring items that impacted reported Q4 2013 and Q4 2012 earnings include:

2013 fourth quarter (net charge of $0.80 per share):

-A $454 million net gain ($235 million after-tax) on the sale of two businesses, primarily related to the HomeLink automotive electronics business which was sold to Gentex Corporation on September 27, 2013

-A $758 million ($694 million after-tax) restructuring and non-cash impairment charge related primarily to severance costs ($215 million) and a write-down of Automotive Interiors business goodwill ($430 million)

-A non-cash mark-to-market gain of $405 million ($236 million after-tax) associated with pension and retiree medical benefits and a $69 million ($42 million after-tax) pension settlement gain

-Tax charges of $371 million primarily related to valuation allowance provisions and the repatriation of Automotive Electronics accumulated foreign earnings

2012 fourth quarter (net charge of $0.78 per share):

-A $245 million ($228 million after-tax) restructuring charge

-A non-cash mark-to-market charge of $447 million ($271 million after-tax) associated with pension and retiree medical benefits

-A tax charge of $35 million

"While the macro-economic environment continues to be challenging, each of our businesses generated top line growth in the fourth quarter. Even more importantly, they all had significant improvements in profitability. It is particularly pleasing that our efforts to improve execution and control costs are gaining traction," said Alex Molinaroli, Johnson Controls chief executive officer.

"I would like to thank Steve Roell, who retired as CEO on September 30, for his many years of service to the company and our customers. Steve led Johnson Controls through some of the most difficult market and economic conditions in our history, and we will always appreciate his leadershipand vision," said Molinaroli. Steve Roell remains chairman of the company's Board of Directors until December 31, 2013.

Johnson Controls

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