CORK, Ireland, Jan. 31, 2020 /PRNewswire/ -- Johnson
Controls International plc (NYSE: JCI) today reported fiscal first
quarter 2020 GAAP earnings per share ("EPS") from continuing
operations, including special items, of $0.21. Excluding these items, adjusted EPS
from continuing operations was $0.40,
up 54% versus the prior year period (see attached footnotes for
non-GAAP reconciliation).
Sales of $5.6 billion increased 2%
compared to the prior year and grew 3% organically.
GAAP earnings before interest and taxes ("EBIT") was
$308 million and EBIT margin was
5.5%. Adjusted EBIT was $448 million
and adjusted EBIT margin was 8.0%, up 70 basis points over the
prior year. Excluding the impact of M&A and foreign
currency, the underlying adjusted EBIT margin increased 80 basis
points.
"Our first quarter results reflect a strong start to fiscal
2020, marking the fifth consecutive quarter of organic double-digit
adjusted EBIT growth as a pure-play buildings technology
company. Our performance in the quarter reflects a continued
commitment to solid execution and to improving the underlying
fundamentals of our business, which is shared throughout the
organization," said George Oliver,
chairman and CEO. "We deliver the safest, most secure and
sustainable solutions for our customers given our robust portfolio
of products and services. This, along with our strong balance
sheet, positions us well to continue to deliver long-term
shareholder value," Oliver added.
Income and EPS amounts attributable to Johnson Controls
ordinary shareholders
($ millions, except per-share amounts)
The financial highlights presented in the tables below are in
accordance with GAAP, unless otherwise indicated. All comparisons
are to the fiscal first quarter of 2019. The results of Power
Solutions are reported as discontinued operations in all periods
presented.
Organic sales growth, organic EBITA growth, segment EBITA,
adjusted segment EBITA, EBIT, adjusted EBIT, adjusted EPS from
continuing operations and adjusted free cash flow are non-GAAP
financial measures. For a reconciliation of these non-GAAP measures
and detail of the special items, refer to the attached
footnotes. A slide presentation to accompany the results can
be found in the Investor Relations section of Johnson Controls'
website at http://investors.johnsoncontrols.com.
|
GAAP
|
GAAP
|
|
Adjusted
|
Adjusted
|
|
|
Q1
2019
|
Q1
2020
|
|
Q1
2019
|
Q1
2020
|
Change
|
Sales
|
$5,464
|
$5,576
|
|
$5,464
|
$5,576
|
+2%
|
Segment
EBITA
|
583
|
623
|
|
590
|
625
|
+6%
|
EBIT
|
329
|
308
|
|
400
|
448
|
+12%
|
Net income
from
continuing
operations
|
107
|
159
|
|
243
|
306
|
+26%
|
Diluted EPS from
continuing operations
|
$0.12
|
$0.21
|
|
$0.26
|
$0.40
|
+54%
|
BUSINESS RESULTS
Building Solutions North America
|
GAAP
|
GAAP
|
|
Adjusted
|
Adjusted
|
|
|
Q1
2019
|
Q1
2020
|
|
Q1
2019
|
Q1
2020
|
Change
|
Sales
|
$2,116
|
$2,167
|
|
$2,116
|
$2,167
|
2%
|
Segment
EBITA
|
$250
|
$258
|
|
$253
|
$259
|
2%
|
Segment EBITA margin
%
|
11.8%
|
11.9%
|
|
12.0%
|
12.0%
|
-
|
Sales in the quarter of $2.2
billion, increased 2% versus the prior year. Organic
sales increased 3% versus the prior year led by strength in Fire
& Security and, to a lesser extent, HVAC & Controls.
This growth was partially offset by a decline in Performance
Solutions.
Orders in the quarter, excluding M&A and adjusted for
foreign currency, decreased 1% year-over-year off a strong prior
year and due to timing between quarters. Backlog at the end
of the quarter of $5.8 billion
increased 7% year-over-year, excluding M&A and adjusted for
foreign currency.
Adjusted segment EBITA was $259
million, up 2% versus the prior year. Adjusted segment EBITA
margin of 12.0% was consistent with the prior year as favorable
volume leverage as well as productivity savings and cost synergies,
were offset by Retail mix.
Building Solutions EMEA/LA (Europe, Middle
East, Africa/Latin America)
|
GAAP
|
GAAP
|
|
Adjusted
|
Adjusted
|
|
|
Q1
2019
|
Q1
2020
|
|
Q1
2019
|
Q1
2020
|
Change
|
Sales
|
$907
|
$928
|
|
$907
|
$928
|
2%
|
Segment
EBITA
|
$77
|
$90
|
|
$77
|
$90
|
17%
|
Segment EBITA margin
%
|
8.5%
|
9.7%
|
|
8.5%
|
9.7%
|
120bps
|
Sales in the quarter of $928
million increased 2% versus the prior year. Organic
sales grew 7% versus the prior year driven by strong growth in
project installations and service. Growth was positive across
all regions and across HVAC & Controls, Fire & Security and
Industrial Refrigeration.
Orders in the quarter, excluding M&A and adjusted for
foreign currency, increased 4% year-over-year. Backlog at the
end of the quarter of $1.7 billion
increased 8% year-over-year, excluding M&A and adjusted for
foreign currency.
Adjusted segment EBITA was $90
million, up 17% versus the prior year. Adjusted segment
EBITA margin of 9.7% expanded 120 basis points over the prior year,
including a 10 basis point headwind related to foreign
currency. Adjusting for foreign currency, the underlying
margin improved 130 basis points driven by favorable volume
leverage as well as the benefit from productivity savings and cost
synergies.
Building Solutions Asia Pacific
|
GAAP
|
GAAP
|
|
Adjusted
|
Adjusted
|
|
|
Q1
2019
|
Q1
2020
|
|
Q1
2019
|
Q1
2020
|
Change
|
Sales
|
$613
|
$629
|
|
$613
|
$629
|
3%
|
Segment
EBITA
|
$66
|
$72
|
|
$66
|
$72
|
9%
|
Segment EBITA margin
%
|
10.8%
|
11.4%
|
|
10.8%
|
11.4%
|
60bps
|
Sales in the quarter of $629
million increased 3% versus the prior year. Organic
sales also increased 3% versus the prior year driven by growth in
project installations, particularly in Fire & Security.
Orders in the quarter, excluding M&A and adjusted for
foreign currency, increased 1% year-over-year. Backlog at the
end of the quarter of $1.6 billion
increased 2% year-over-year, excluding M&A and adjusted for
foreign currency.
Adjusted segment EBITA was $72
million, up 9% versus the prior year. Adjusted segment EBITA
margin of 11.4% expanded 60 basis points over the prior year driven
by favorable volume leverage and the benefit of productivity
savings and cost synergies.
Global Products
|
GAAP
|
GAAP
|
|
Adjusted
|
Adjusted
|
|
|
Q1
2019
|
Q1
2020
|
|
Q1
2019
|
Q1
2020
|
Change
|
Sales
|
$1,828
|
$1,852
|
|
$1,828
|
$1,852
|
1%
|
Segment
EBITA
|
$190
|
$203
|
|
$194
|
$204
|
5%
|
Segment EBITA margin
%
|
10.4%
|
11.0%
|
|
10.6%
|
11.0%
|
40bps
|
Sales in the quarter of $1.9
billion increased 1% versus the prior year. Organic sales
increased 2% versus the prior year led by strong growth in Building
Management Systems and, to a lesser extent, Specialty Products.
Sales of HVAC & Refrigeration Equipment were consistent with
the prior year.
Adjusted segment EBITA was $204
million, up 5% versus the prior year. Adjusted segment EBITA
margin of 11.0% expanded 40 basis points over the prior year,
including a 10 basis point headwind related to foreign
currency. Adjusting for foreign currency, the underlying
margin improved 50 basis points driven by positive price/cost as
well as the benefit of productivity savings and cost
synergies.
Corporate
|
GAAP
|
GAAP
|
|
Adjusted
|
Adjusted
|
|
|
Q1
2019
|
Q1
2020
|
|
Q1
2019
|
Q1
2020
|
Change
|
Corporate
expense
|
($136)
|
($118)
|
|
($93)
|
($81)
|
(13%)
|
Adjusted Corporate expense was $81
million in the quarter, a decrease of 13% compared to the
prior year, driven primarily by continued productivity savings and
cost synergies, as well as cost reductions related to the Power
Solutions sale.
OTHER ITEMS
- As expected during the quarter, the Company received an income
tax refund of $0.6 billion.
- Cash provided by operating activities from continuing
operations was $0.5 billion and
capital expenditures were $0.1
billion in the quarter, resulting in free cash flow from
continuing operations of $0.4
billion. Adjusted free cash flow was an outflow of
$0.1 billion, which excludes net cash
inflows of $0.4 billion primarily
related to an income tax refund partially offset by integration
costs.
- During the quarter, the Company repurchased approximately 15
million shares for $651 million.
- During the quarter, the Company recorded a pre-tax
restructuring and impairment charge of $111
million primarily related to workforce reductions, plant
closures and asset impairments.
- During the quarter, the Company adopted Accounting Standards
Codification (ASC) 842, Leases, which resulted in an increase to
other noncurrent assets of $1.1
billion, other current liabilities of $0.3 billion and other noncurrent liabilities of
$0.8 billion.
About Johnson Controls:
At Johnson Controls, we transform the environments where people
live, work, learn and play. From optimizing building performance to
improving safety and enhancing comfort, we drive the outcomes that
matter most. We deliver our promise in industries such as
healthcare, education, data centers, and manufacturing. With a
global team of 105,000 experts in more than 150 countries and over
130 years of innovation, we are the power behind our customers'
mission. Our leading portfolio of building technology and solutions
includes some of the most trusted names in the industry, such as
Tyco®, YORK®, Metasys®,
Ruskin®, Titus®, Frick®,
PENN®, Sabroe®, Simplex®,
Ansul® and Grinnell®. For more information,
visit www.johnsoncontrols.com or follow us @johnsoncontrols on
Twitter
Johnson Controls International plc
Cautionary Statement Regarding Forward-Looking
Statements
Johnson Controls International plc has made statements in this
communication that are forward-looking and therefore are
subject to risks and uncertainties. All statements in this document
other than statements of historical fact are, or could
be, "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. In this
communication, statements regarding
Johnson Controls' future financial position, sales,
costs, earnings, cash flows, other measures of results of
operations, synergies and integration opportunities,
capital expenditures and debt levels are
forward-looking statements. Words such as "may," "will," "expect,"
"intend," "estimate," "anticipate," "believe," "should,"
"forecast," "project" or "plan" and terms of similar
meaning are also generally intended to identify forward-looking
statements. However, the absence of these words does not mean
that a statement is not forward-looking. Johnson Controls
cautions that these statements are subject to numerous important
risks, uncertainties, assumptions and other factors, some of which
are beyond Johnson Controls' control, that could cause
Johnson Controls' actual results to differ
materially from those expressed or implied by such forward-looking
statements, including, among others, risks related
to: any delay or inability of Johnson Controls to
realize the expected benefits and synergies of recent
portfolio transactions such as the merger with Tyco and the
disposition of the Power Solutions business, changes in tax
laws (including but not limited to the Tax Cuts and Jobs Act
enacted in December 2017),
regulations, rates, policies or interpretations, the loss of key
senior management, the tax treatment of recent portfolio
transactions, significant transaction costs and/or
unknown liabilities associated with such transactions, the
outcome of actual or potential litigation relating
to such transactions, the risk that disruptions
from recent transactions will harm Johnson Controls'
business, the strength of the U.S. or other economies,
changes to laws or policies governing foreign trade, including
increased tariffs or trade restrictions, energy and commodity
prices, the availability of raw materials and component products,
currency exchange rates, maintaining the capacity, reliability and
security of our information technology infrastructure, the risk of
infringement or expiration of intellectual property rights, work
stoppages, union negotiations, labor disputes and other matters
associated with the labor force, the outcome of litigation and
governmental proceedings and cancellation of or changes to
commercial arrangements. A detailed discussion of risks
related to Johnson Controls' business is included in the section
entitled "Risk Factors" in Johnson Controls' Annual Report on Form
10-K for the 2019 fiscal year filed with the SEC on November 21, 2019, which is available at
www.sec.gov and www.johnsoncontrols.com under the "Investors" tab.
Shareholders, potential investors and others should consider these
factors in evaluating the forward-looking statements and should not
place undue reliance on such statements. The forward-looking
statements included in this communication are made only
as of the date of this document, unless otherwise specified, and,
except as required by law, Johnson Controls assumes no obligation,
and disclaims any obligation, to update such statements to reflect
events or circumstances occurring after the date of this
communication.
Non-GAAP Financial Information
The Company's press release contains financial information
regarding adjusted earnings per share, which is a non-GAAP
performance measure. The adjusting items include restructuring and
impairment costs, transaction costs, integration costs, net
mark-to-market adjustments, and discrete tax items. Financial
information regarding organic sales, EBIT, EBIT margin, segment
EBITA, adjusted segment EBITA, adjusted organic segment EBITA,
adjusted segment EBITA margin, free cash flow and adjusted free
cash flow, are also presented, which are non-GAAP performance
measures. Adjusted segment EBITA excludes special items such as
transaction costs and integration costs because these costs are not
considered to be directly related to the underlying operating
performance of its business units. Management believes that,
when considered together with unadjusted amounts, these non-GAAP
measures are useful to investors in understanding
period-over-period operating results and business trends of the
Company. Management may also use these metrics as guides in
forecasting, budgeting and long-term planning processes and for
compensation purposes. These metrics should be considered in
addition to, and not as replacements for, the most comparable GAAP
measure. For further information on the calculation of thee
non-GAAP measures and a reconciliation of these non-GAAP measures,
refer to the attached footnotes.
JOHNSON CONTROLS
INTERNATIONAL PLC
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
|
(in millions, except
per share data; unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
|
|
2019
|
|
|
2018
|
|
|
|
|
|
|
Net sales
|
$ 5,576
|
|
|
$ 5,464
|
Cost of
sales
|
3,773
|
|
|
3,739
|
|
Gross
profit
|
1,803
|
|
|
1,725
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
(1,427)
|
|
|
(1,438)
|
Restructuring and
impairment costs
|
(111)
|
|
|
-
|
Net financing
charges
|
(52)
|
|
|
(85)
|
Equity
income
|
43
|
|
|
42
|
|
|
|
|
|
|
Income from
continuing operations before income taxes
|
256
|
|
|
244
|
|
|
|
|
|
|
Income tax
provision
|
65
|
|
|
108
|
|
|
|
|
|
|
Income from
continuing operations
|
191
|
|
|
136
|
|
|
|
|
|
|
Income from
discontinued operations, net of tax
|
-
|
|
|
263
|
|
|
|
|
|
|
Net income
|
191
|
|
|
399
|
|
|
|
|
|
|
Less: Income from
continuing operations
|
|
|
|
|
|
attributable to
noncontrolling interests
|
32
|
|
|
29
|
|
|
|
|
|
|
Less: Income from
discontinued operations
|
|
|
|
|
|
attributable to
noncontrolling interests
|
-
|
|
|
15
|
|
|
|
|
|
|
Net income
attributable to JCI
|
$
159
|
|
|
$
355
|
|
|
|
|
|
|
Income from
continuing operations
|
$
159
|
|
|
$
107
|
Income from
discontinued operations
|
-
|
|
|
248
|
|
|
|
|
|
|
Net income
attributable to JCI
|
$
159
|
|
|
$
355
|
|
|
|
|
|
|
Diluted earnings per
share from continuing operations
|
$
0.21
|
|
|
$
0.12
|
Diluted earnings per
share from discontinued operations
|
-
|
|
|
0.27
|
Diluted earnings per
share*
|
$
0.21
|
|
|
$
0.38
|
|
|
|
|
|
|
Diluted weighted
average shares
|
774.0
|
|
|
925.2
|
Shares outstanding at
period end
|
764.0
|
|
|
912.7
|
|
|
|
|
|
|
* May not sum due to
rounding.
|
|
|
|
|
JOHNSON CONTROLS
INTERNATIONAL PLC
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
|
|
(in millions;
unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31,
|
|
September
30,
|
|
|
|
2019
|
|
2019
|
|
ASSETS
|
|
|
|
|
|
Cash and cash
equivalents
|
$
2,160
|
|
$
2,805
|
|
Accounts receivable -
net
|
5,612
|
|
5,770
|
|
Inventories
|
1,953
|
|
1,814
|
|
Assets held for
sale
|
87
|
|
98
|
|
Other current
assets
|
1,508
|
|
1,906
|
|
|
Current
assets
|
11,320
|
|
12,393
|
|
|
|
|
|
|
|
Property, plant and
equipment - net
|
3,341
|
|
3,348
|
|
Goodwill
|
|
18,351
|
|
18,178
|
|
Other intangible
assets - net
|
5,610
|
|
5,632
|
|
Investments in
partially-owned affiliates
|
865
|
|
853
|
|
Noncurrent assets
held for sale
|
46
|
|
60
|
|
Other noncurrent
assets
|
2,980
|
|
1,823
|
|
|
Total
assets
|
$
42,513
|
|
$
42,287
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
Short-term debt and
current portion of long-term debt
|
$
1,362
|
|
$
511
|
|
Accounts payable and
accrued expenses
|
4,180
|
|
4,535
|
|
Liabilities held for
sale
|
44
|
|
44
|
|
Other current
liabilities
|
4,106
|
|
3,980
|
|
|
Current
liabilities
|
9,692
|
|
9,070
|
|
|
|
|
|
|
|
Long-term
debt
|
5,920
|
|
6,708
|
|
Other noncurrent
liabilities
|
6,470
|
|
5,680
|
|
Shareholders' equity
attributable to JCI
|
19,329
|
|
19,766
|
|
Noncontrolling
interests
|
1,102
|
|
1,063
|
|
|
Total liabilities and
equity
|
$
42,513
|
|
$
42,287
|
JOHNSON CONTROLS
INTERNATIONAL PLC
|
|
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(in millions;
unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
|
|
|
|
|
|
2019
|
|
|
2018
|
Operating
Activities
|
|
|
|
|
Net income
attributable to JCI from continuing operations
|
$
159
|
|
|
$
107
|
Income from
continuing operations attributable to noncontrolling
interests
|
32
|
|
|
29
|
|
|
|
|
|
|
|
|
|
|
Net income from
continuing operations
|
191
|
|
|
136
|
|
|
|
|
|
|
|
|
|
|
Adjustments to
reconcile net income from continuing operations to cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
207
|
|
|
211
|
|
|
Pension and
postretirement benefit income
|
(40)
|
|
|
(29)
|
|
|
Pension and
postretirement contributions
|
(12)
|
|
|
(21)
|
|
|
Equity in earnings of
partially-owned affiliates, net of dividends received
|
8
|
|
|
(36)
|
|
|
Deferred income
taxes
|
(3)
|
|
|
43
|
|
|
Non-cash
restructuring and impairment costs
|
54
|
|
|
-
|
|
|
Other -
net
|
16
|
|
|
28
|
|
|
Changes in assets and
liabilities, excluding acquisitions and divestitures:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
237
|
|
|
146
|
|
|
|
|
Inventories
|
(114)
|
|
|
(222)
|
|
|
|
|
Other
assets
|
(92)
|
|
|
(63)
|
|
|
|
|
Restructuring
reserves
|
33
|
|
|
(25)
|
|
|
|
|
Accounts payable and
accrued liabilities
|
(498)
|
|
|
(226)
|
|
|
|
|
Accrued income
taxes
|
524
|
|
|
(21)
|
|
|
|
|
|
Cash provided (used)
by operating activities from continuing operations
|
511
|
|
|
(79)
|
|
|
|
|
|
|
|
|
|
|
Investing
Activities
|
|
|
|
|
Capital
expenditures
|
(126)
|
|
|
(153)
|
Acquisition of
businesses, net of cash acquired
|
(48)
|
|
|
(13)
|
Business
divestitures, net of cash divested
|
-
|
|
|
6
|
Other -
net
|
1
|
|
|
24
|
|
|
|
|
|
Cash used by
investing activities from continuing operations
|
(173)
|
|
|
(136)
|
|
|
|
|
|
|
|
|
|
|
Financing
Activities
|
|
|
|
|
Increase in short and
long-term debt - net
|
10
|
|
|
1,014
|
Stock
repurchases
|
(651)
|
|
|
(467)
|
Payment of cash
dividends
|
(203)
|
|
|
(240)
|
Dividends paid to
noncontrolling interests
|
(5)
|
|
|
(43)
|
Proceeds from the
exercise of stock options
|
21
|
|
|
13
|
Employee equity-based
compensation withholding
|
(20)
|
|
|
(21)
|
Other -
net
|
(2)
|
|
|
-
|
|
|
|
|
|
Cash provided (used)
by financing activities from continuing operations
|
(850)
|
|
|
256
|
|
|
|
|
|
|
|
|
|
|
Discontinued
Operations
|
|
|
|
|
Net cash provided
(used) by operating activities
|
(194)
|
|
|
193
|
Net cash used by
investing activities
|
-
|
|
|
(66)
|
Net cash used by
financing activities
|
-
|
|
|
(11)
|
|
|
|
|
|
Net cash flows
provided (used) by discontinued operations
|
(194)
|
|
|
116
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
57
|
|
|
(43)
|
Changes in cash held
for sale
|
-
|
|
|
(2)
|
Increase
(decrease) in cash, cash equivalents and restricted
cash
|
$(649)
|
|
|
$
112
|
FOOTNOTES
|
1.
Financial Summary
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company evaluates
the performance of its business units primarily on segment earnings
before interest, taxes and amortization (EBITA), which represents
income from continuing operations before income taxes and
noncontrolling interests, excluding general corporate expenses,
intangible asset amortization, net financing charges, restructuring
and impairment costs, and the net mark-to-market adjustments
related to restricted asbestos investments and pension and
postretirement plans. The financial results shown below are for
continuing operations and exclude the Power Solutions
business.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions;
unaudited)
|
|
|
Three Months Ended
December 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Actual
|
|
Adjusted
Non-GAAP
|
|
Actual
|
|
Adjusted
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Building Solutions
North America
|
|
|
$2,167
|
|
$
2,167
|
|
$2,116
|
|
$
2,116
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Building Solutions
EMEA/LA
|
|
|
928
|
|
928
|
|
907
|
|
907
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Building Solutions
Asia Pacific
|
|
|
629
|
|
629
|
|
613
|
|
613
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global
Products
|
|
|
1,852
|
|
1,852
|
|
1,828
|
|
1,828
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
|
$5,576
|
|
$
5,576
|
|
$5,464
|
|
$
5,464
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment EBITA
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Building Solutions
North America
|
|
|
$
258
|
|
$
259
|
|
$
250
|
|
$
253
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Building Solutions
EMEA/LA
|
|
|
90
|
|
90
|
|
77
|
|
77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Building Solutions
Asia Pacific
|
|
|
72
|
|
72
|
|
66
|
|
66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global
Products
|
|
|
203
|
|
204
|
|
190
|
|
194
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment EBITA
|
|
|
623
|
|
625
|
|
583
|
|
590
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate expenses
(2)
|
|
|
(118)
|
|
(81)
|
|
(136)
|
|
(93)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangible assets
|
|
|
(96)
|
|
(96)
|
|
(97)
|
|
(97)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net mark-to-market
adjustments (3)
|
|
|
10
|
|
-
|
|
(21)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and
impairment costs (4)
|
|
|
(111)
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT (5)
|
|
|
308
|
|
448
|
|
329
|
|
400
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT margin
|
|
|
5.5%
|
|
8.0%
|
|
6.0%
|
|
7.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net financing
charges
|
|
|
(52)
|
|
(52)
|
|
(85)
|
|
(85)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations before income taxes
|
|
256
|
|
396
|
|
244
|
|
315
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax provision
(6)
|
|
|
(65)
|
|
(53)
|
|
(108)
|
|
(43)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations
|
|
|
191
|
|
343
|
|
136
|
|
272
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations attributable to noncontrolling
interests
|
|
|
(32)
|
|
(37)
|
|
(29)
|
|
(29)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income from
continuing operations attributable to JCI
|
|
$
159
|
|
$
306
|
|
$
107
|
|
$
243
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The Company's
press release contains financial information regarding segment
EBITA, adjusted segment EBITA and adjusted segment EBITA margins,
which are non-GAAP performance measures. The Company's definition
of adjusted segment EBITA excludes special items because these
costs are not considered to be directly related to the underlying
operating performance of its businesses. Management believes these
non-GAAP measures are useful to investors in understanding the
ongoing operations and business trends of the
Company.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A reconciliation of
segment EBITA to income from continuing operations is shown earlier
within this footnote. The following is the three months ended
December 31, 2019 and 2018 reconciliation of segment EBITA and
segment EBITA margin as reported to adjusted segment EBITA and
adjusted segment EBITA margin (unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
Building
Solutions
North America
|
|
Building
Solutions
EMEA/LA
|
|
Building
Solutions
Asia Pacific
|
|
Global
Products
|
|
Consolidated
JCI plc
|
|
|
|
|
|
|
|
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment EBITA as
reported
|
$ 258
|
|
$
250
|
|
$
90
|
|
$
77
|
|
$
72
|
|
$ 66
|
|
$
203
|
|
$190
|
|
$623
|
|
$583
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment EBITA margin
as reported
|
11.9%
|
|
11.8%
|
|
9.7%
|
|
8.5%
|
|
11.4%
|
|
10.8%
|
|
11.0%
|
|
10.4%
|
|
11.2%
|
|
10.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusting
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Integration
costs
|
1
|
|
3
|
|
-
|
|
-
|
|
-
|
|
-
|
|
1
|
|
4
|
|
2
|
|
7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted segment
EBITA
|
$ 259
|
|
$
253
|
|
$
90
|
|
$
77
|
|
$
72
|
|
$ 66
|
|
$
204
|
|
$194
|
|
$625
|
|
$590
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted segment
EBITA margin
|
12.0%
|
|
12.0%
|
|
9.7%
|
|
8.5%
|
|
11.4%
|
|
10.8%
|
|
11.0%
|
|
10.6%
|
|
11.2%
|
|
10.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) Adjusted
Corporate expenses excludes special items because these costs are
not considered to be directly related to the underlying operating
performance of the Company's business. Adjusted Corporate expenses
for the three months ended December 31, 2019 excludes $37 million
of integration costs. Adjusted Corporate expenses for the three
months ended December 31, 2018 excludes $41 million of integration
costs and $2 million of transaction costs.
|
|
|
|
(3) The three months
ended December 31, 2019 exclude the net mark-to-market adjustments
on restricted investments of $10 million. The three months ended
December 31, 2018 exclude the net mark-to-market adjustments on
restricted investments of $21 million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4) Restructuring and
impairment costs for the three months ended December 31, 2019 of
$111 million are excluded from the adjusted non-GAAP results. The
restructuring actions and impairment costs related primarily to
workforce reductions, plant closures and asset
impairments.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5) Management
defines earnings before interest and taxes (EBIT) as income from
continuing operations before net financing charges, income taxes
and noncontrolling interests. EBIT is a non-GAAP performance
measure. Management believes this non-GAAP measure is useful to
investors in understanding the ongoing operations and business
trends of the Company. A reconciliation of EBIT to income from
continuing operations is shown earlier within this
footnote.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6) Adjusted income
tax provision for the three months ended December 31, 2019 excludes
tax provisions related to Switzerland tax reform of $30 million and
net mark-to-market adjustments of $3 million, partially offset by
tax benefits for restructuring and impairment costs of $16 million
and integration costs of $5 million. Adjusted income tax provision
for the three months ended December 31, 2018 excludes the tax
provision for valuation allowance adjustments of $76 million as a
result of changes in U.S. tax law, partially offset by the tax
benefits for integration costs of $6 million and net mark-to-market
adjustments of $5 million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2.
Diluted Earnings Per Share Reconciliation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company's press
release contains financial information regarding adjusted earnings
per share, which is a non-GAAP performance measure. The adjusting
items include transaction/integration costs, net mark-to-market
adjustments, restructuring and impairment costs, impact of ceasing
the depreciation and amortization expense for the Power Solutions
business as the business is held for sale, and discrete tax items.
The Company excludes these items because they are not considered to
be directly related to the underlying operating performance of the
Company. Management believes these non-GAAP measures are useful to
investors in understanding the ongoing operations and business
trends of the Company.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A reconciliation of
diluted earnings per share as reported to adjusted diluted earnings
per share for the respective periods is shown below
(unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
Attributable
to JCI plc
|
|
Net Income
Attributable
to JCI plc from
Continuing Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share as
reported for JCI plc
|
$0.21
|
|
$
0.38
|
|
$
0.21
|
|
$
0.12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusting
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction
costs
|
-
|
|
0.03
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Integration
costs
|
0.05
|
|
0.05
|
|
0.05
|
|
0.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Related tax
impact
|
(0.01)
|
|
(0.01)
|
|
(0.01)
|
|
(0.01)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
mark-to-market adjustments
|
(0.01)
|
|
0.02
|
|
(0.01)
|
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Related tax
impact
|
-
|
|
(0.01)
|
|
-
|
|
(0.01)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring
and impairment costs
|
0.14
|
|
-
|
|
0.14
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Related tax
impact
|
(0.02)
|
|
-
|
|
(0.02)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NCI impact of
restructuring and impairment
|
(0.01)
|
|
-
|
|
(0.01)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cease of Power
Solutions depreciation / amortization expense
|
-
|
|
(0.03)
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Related tax
impact
|
-
|
|
0.01
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discrete tax
items
|
0.04
|
|
0.16
|
|
0.04
|
|
0.08
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings per
share for JCI plc*
|
$0.40
|
|
$
0.61
|
|
$
0.40
|
|
$
0.26
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* May not sum due to
rounding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table
reconciles the denominators used to calculate basic and diluted
earnings per share for JCI plc (in millions;
unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding for JCI plc
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted
average shares outstanding
|
769.9
|
|
921.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of dilutive
securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
options, unvested restricted stock and unvested performance
share awards
|
4.1
|
|
3.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted
average shares outstanding
|
774.0
|
|
925.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company has
presented forward-looking statements regarding adjusted EPS from
continuing operations, organic net sales growth, organic adjusted
EBITA growth, organic adjusted EBIT growth, adjusted segment EBITA
margin, adjusted EBIT margin and adjusted free cash flow conversion
for the full fiscal year of 2020, which are non-GAAP financial
measures. These non-GAAP financial measures are derived by
excluding certain amounts, expenses, income or cash flows from the
corresponding financial measures determined in accordance with
GAAP. The determination of the amounts that are excluded from these
non-GAAP financial measures are a matter of management judgment and
depends upon, among other factors, the nature of the underlying
expense or income amounts recognized in a given period, including
but not limited to the high variability of the net mark-to-market
adjustments and the effect of foreign currency exchange
fluctuations. Our fiscal 2020 outlook for organic net sales and
adjusted EBITA and EBIT growth also excludes the effect of
acquisitions, divestitures and foreign currency. We are unable to
present a quantitative reconciliation of the aforementioned
forward-looking non-GAAP financial measures to their most directly
comparable forward-looking GAAP financial measures because such
information is not available and management cannot reliably predict
all of the necessary components of such GAAP measures without
unreasonable effort or expense. The unavailable information could
have a significant impact on the Company's full year 2020 GAAP
financial results.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3.
Organic Growth Reconciliation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The components of the
changes in net sales for the three months ended December 31, 2019
versus the three months ended December 31, 2018, including organic
growth, is shown below (unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
Net Sales for the
Three Months Ended
December 31, 2018
|
|
Base Year Adjustments
-
Divestitures and Other
|
|
Adjusted Base Net
Sales for the
Three Months Ended
December 31, 2018
|
|
Acquisitions
|
|
Foreign
Currency
|
|
Organic
Growth
|
|
Net Sales for the
Three Months Ended
December 31, 2019
|
|
|
|
|
|
Building Solutions
North America
|
$
2,116
|
|
$
(2)
|
|
-
|
|
$
2,114
|
|
$
-
|
|
-
|
|
$
-
|
|
-
|
|
$ 53
|
|
3%
|
|
$2,167
|
|
3%
|
|
|
|
|
|
Building Solutions
EMEA/LA
|
907
|
|
(25)
|
|
-3%
|
|
882
|
|
5
|
|
1%
|
|
(25)
|
|
-3%
|
|
66
|
|
7%
|
|
928
|
|
5%
|
|
|
|
|
|
Building Solutions
Asia Pacific
|
613
|
|
-
|
|
-
|
|
613
|
|
2
|
|
-
|
|
(5)
|
|
-1%
|
|
19
|
|
3%
|
|
629
|
|
3%
|
|
|
|
|
|
Total field
|
3,636
|
|
(27)
|
|
-1%
|
|
3,609
|
|
7
|
|
-
|
|
(30)
|
|
-1%
|
|
138
|
|
4%
|
|
3,724
|
|
3%
|
|
|
|
|
|
Global
Products
|
1,828
|
|
(8)
|
|
-
|
|
1,820
|
|
1
|
|
-
|
|
3
|
|
-
|
|
28
|
|
2%
|
|
1,852
|
|
2%
|
|
|
|
|
|
Total net sales
|
$
5,464
|
|
$
(35)
|
|
-1%
|
|
$
5,429
|
|
$
8
|
|
-
|
|
$ (27)
|
|
-
|
|
$166
|
|
3%
|
|
$5,576
|
|
3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The components of the
changes in segment EBITA and EBIT for the three months ended
December 31, 2019 versus the three months ended December 31, 2018,
including organic growth, is shown below (unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
Adjusted Segment
EBITA / EBIT for the
Three Months Ended
December 31, 2018
|
|
Base Year Adjustments
-
Divestitures and Other
|
|
Adjusted Base
Segment
EBITA / EBIT for the
Three Months Ended
December 31, 2018
|
|
Acquisitions
|
|
Foreign
Currency
|
|
Organic
Growth
|
|
Adjusted Segment
EBITA / EBIT for the
Three Months Ended
December 31, 2019
|
|
|
|
|
|
Building Solutions
North America
|
$
253
|
|
$
-
|
|
-
|
|
$
253
|
|
$
-
|
|
-
|
|
$
-
|
|
-
|
|
$
6
|
|
2%
|
|
$
259
|
|
2%
|
|
|
|
|
|
Building Solutions
EMEA/LA
|
77
|
|
(1)
|
|
-1%
|
|
76
|
|
1
|
|
1%
|
|
(3)
|
|
-4%
|
|
16
|
|
21%
|
|
90
|
|
18%
|
|
|
|
|
|
Building Solutions
Asia Pacific
|
66
|
|
-
|
|
-
|
|
66
|
|
1
|
|
2%
|
|
-
|
|
-
|
|
5
|
|
8%
|
|
72
|
|
9%
|
|
|
|
|
|
Total field
|
396
|
|
(1)
|
|
-
|
|
395
|
|
2
|
|
1%
|
|
(3)
|
|
-1%
|
|
27
|
|
7%
|
|
421
|
|
7%
|
|
|
|
|
|
Global
Products
|
194
|
|
-
|
|
-
|
|
194
|
|
(1)
|
|
-1%
|
|
(1)
|
|
-1%
|
|
12
|
|
6%
|
|
204
|
|
5%
|
|
|
|
|
|
Total adjusted segment EBITA
|
590
|
|
(1)
|
|
-
|
|
589
|
|
$
1
|
|
-
|
|
$
(4)
|
|
-1%
|
|
$ 39
|
|
7%
|
|
625
|
|
6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
expenses
|
(93)
|
|
-
|
|
|
|
(93)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(81)
|
|
13%
|
|
|
|
|
|
Amortization of
intangible assets
|
(97)
|
|
-
|
|
|
|
(97)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(96)
|
|
1%
|
|
|
|
|
|
Total adjusted EBIT
|
$
400
|
|
$
(1)
|
|
|
|
$
399
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
448
|
|
12%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4.
Adjusted Free Cash Flow Reconciliation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company's press
release contains financial information regarding free cash flow,
adjusted free cash flow and adjusted free cash flow conversion,
which are non-GAAP performance measures. Free cash flow is defined
as cash provided by operating activities less capital expenditures.
Adjusted free cash flow excludes special items, as included in the
table below, because these cash flows are not considered to be
directly related to its underlying businesses. Adjusted free cash
flow conversion is defined as adjusted free cash flow divided by
adjusted net income. Management believes these non-GAAP measures
are useful to investors in understanding the strength of the
Company and its ability to generate cash.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following is the
three months ended December 31, 2019 and 2018 reconciliation of
free cash flow, adjusted free cash flow and adjusted free cash flow
conversion for continuing operations (unaudited):
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(in
billions)
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Three Months
Ended
December 31, 2019
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Three Months
Ended
December 31, 2018
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Cash provided by
operating activities from continuing operations
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$
0.5
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$
(0.1)
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Capital
expenditures
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(0.1)
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(0.2)
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Reported free cash
flow
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0.4
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(0.3)
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Adjusting
items:
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Transaction/integration costs
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0.1
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0.1
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Income tax
refunds
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(0.6)
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-
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Total
adjusting items *
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(0.4)
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0.1
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Adjusted free cash
flow *
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$
(0.1)
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$
(0.2)
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Adjusted net income
from continuing operations
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attributable to JCI
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$
0.3
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$
0.2
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Adjusted free cash
flow conversion
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-33%
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-100%
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* May not sum due to
rounding
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5. Net
Debt to Capitalization
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The Company provides
financial information regarding net debt as a percentage of total
capitalization, which is a non-GAAP performance measure. The
Company believes the percentage of total net debt to total
capitalization is useful to understanding the Company's financial
condition as it provides a review of the extent to which the
Company relies on external debt financing for its funding and is a
measure of risk to its shareholders. The following is the December
31, 2019 and September 30, 2019 calculation of net debt as a
percentage of total capitalization (unaudited):
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(in
millions)
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December 31,
2019
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September 30,
2019
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Short-term debt and
current portion of long-term debt
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$
1,362
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$
511
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Long-term
debt
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5,920
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6,708
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Total debt
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7,282
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7,219
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Less: cash and cash
equivalents
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2,160
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2,805
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Total net
debt
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5,122
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4,414
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Shareholders' equity
attributable to JCI
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19,329
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19,766
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Total
capitalization
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$
24,451
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$
24,180
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Total net debt as a %
of total capitalization
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20.9%
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18.3%
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6.
Income Taxes
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The Company's
effective tax rate from continuing operations before consideration
of transaction/integration costs, net mark-to-market adjustments,
restructuring and impairment costs, and discrete tax items for the
three months ending December 31, 2019 and 2018 is approximately
13.5%.
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7.
Restructuring and Impairment Costs
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The three months
ended December 31, 2019 include restructuring and impairment costs
of $111 million related primarily to workforce reductions, plant
closures and asset impairments.
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8.
Leases
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On October 1, 2019,
the Company adopted ASU 2016-02, "Leases (Topic 842)," which
requires recognition of operating leases as a lease asset and
liabilities on the balance sheet. The adoption of the new
guidance resulted in recognition of a right-of-use asset and
related lease liabilities of $1.1 billion.
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CONTACT:
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Investors:
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Antonella
Franzen
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(609)
720-4665
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Ryan
Edelman
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(609)
720-4545
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Media:
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Fraser
Engerman
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(414)
524-2733
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View original content to download
multimedia:http://www.prnewswire.com/news-releases/johnson-controls-reports-strong-start-to-the-fiscal-year-and-reaffirms-full-year-guidance-300996615.html
SOURCE Johnson Controls