CORK, Ireland, May 1, 2020 /PRNewswire/ -- Johnson Controls
International plc (NYSE: JCI) announced its fiscal second quarter
results, including a set of immediate actions in response to the
evolving conditions and unprecedented uncertainty related to the
novel coronavirus (COVID-19) pandemic.
"The health and wellness of our employees and their families
will continue to be our priority. In an effort to protect our
employees, including those on the front lines supporting customers
and in all facilities, we have taken extra precautions to ensure
this priority is met. I would like to thank each of our 105,000
employees for their continuous efforts in the battle against
COVID-19, and for going the extra mile for our customers and
stakeholders," said George Oliver,
chairman and CEO.
"We have also taken decisive actions to control operating costs
and further enhance our liquidity position. Given our strong
balance sheet and the improved fundamentals built over the past two
years, I believe we are in an excellent position to weather the
economic uncertainty and capitalize on the recovery," Oliver said.
"Since the start of this crisis, our goal as a company has been
twofold – first and foremost, to protect the health and safety of
all of our employees and their families. Second, to work diligently
with our customers and partners to ensure the continued
functionality of critical infrastructure and essential facilities
around the world. I am proud to say that our teams have exceled on
both fronts."
"Our position as the leader in intelligent and sustainable
building solutions enables Johnson Controls to deliver the outcomes
that matter most to our customers. The depth and breadth of our
product portfolio, combined with proven expertise and expansive
global footprint provides us with a unique advantage as the
evolution of the built environment accelerates," Oliver
added.
Johnson Controls financial position remains strong, with access
to liquidity including two senior revolving credit facilities – a
one-year $500 million facility and a
five-year $2.5 billion facility.
Given the increasingly uncertain environment, the Company has taken
proactive measures to increase near-term financial flexibility,
electing to opportunistically raise $675
million via European financing arrangements and $575 million in bank term loans. In
addition, as planned the Company repaid with existing cash a
$500 million bond that matured in
March 2020.
The Company reported fiscal second quarter 2020 GAAP earnings
per share ("EPS") from continuing operations, including special
items, of $0.28. Excluding these
items, adjusted EPS from continuing operations was $0.42, up 31% versus the prior year period (see
attached footnotes for non-GAAP reconciliation).
Sales of $5.4 billion decreased 6%
compared to the prior year and declined 5% organically. This
includes a 6 to 7 percentage point headwind related to the
estimated impact of COVID-19.
GAAP earnings before interest and taxes ("EBIT") was
$308 million and EBIT margin was
5.7%. Adjusted EBIT was $440 million
and adjusted EBIT margin was 8.1%, in-line with prior year results.
Adjusted EBIT was negatively impacted by approximately $80 to $100 million
attributable to the estimated net impact of COVID-19.
Income and EPS amounts attributable to Johnson Controls
ordinary shareholders
($ 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 second 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
|
|
|
Q2
2019
|
Q2
2020
|
|
Q2
2019
|
Q2
2020
|
Change
|
Sales
|
$5,779
|
$5,444
|
|
$5,779
|
$5,444
|
(6%)
|
Segment
EBITA
|
664
|
617
|
|
671
|
619
|
(8%)
|
EBIT
|
419
|
308
|
|
469
|
440
|
(6%)
|
Net income
from
continuing
operations
|
240
|
213
|
|
287
|
317
|
+10%
|
Diluted EPS from
continuing operations
|
$0.26
|
$0.28
|
|
$0.32
|
$0.42
|
+31%
|
The adjusted results include the estimated net impact
attributable to COVID-19 which is summarized below.
Sales
|
($350 –
390M)
|
Segment
EBITA
|
($90 –
110M)
|
EBIT
|
($80 –
100M)
|
Net income
from
continuing
operations
|
($49 –
62M)
|
Diluted EPS from
continuing operations
|
($0.05 –
0.07)
|
BUSINESS RESULTS
Building Solutions North America
|
GAAP
|
GAAP
|
|
Adjusted
|
Adjusted
|
|
|
Q2
2019
|
Q2
2020
|
|
Q2
2019
|
Q2
2020
|
Change
|
Sales
|
$2,187
|
$2,175
|
|
$2,187
|
$2,175
|
(1%)
|
Segment
EBITA
|
$257
|
$251
|
|
$259
|
$253
|
(2%)
|
Segment EBITA margin
%
|
11.8%
|
11.5%
|
|
11.8%
|
11.6%
|
(20bps)
|
Sales in the quarter of $2.2
billion, decreased approximately 1% versus the prior year.
Organic sales were flat versus the prior year. Growth in
Performance Solutions was offset by a decline in Fire &
Security and HVAC & Controls was consistent with the prior
year.
Orders in the quarter, excluding M&A and adjusted for
foreign currency, decreased 7% year-over-year. Backlog at the
end of the quarter of $5.8 billion
increased 4% year-over-year, excluding M&A and adjusted for
foreign currency.
Adjusted segment EBITA was $253
million, down 2% versus the prior year. Adjusted segment
EBITA margin of 11.6% declined 20 basis points versus the prior
year as productivity savings and cost synergies, were more than
offset by the volume decline.
Building Solutions EMEA/LA (Europe, Middle
East, Africa/Latin America)
|
GAAP
|
GAAP
|
|
Adjusted
|
Adjusted
|
|
|
Q2
2019
|
Q2
2020
|
|
Q2
2019
|
Q2
2020
|
Change
|
Sales
|
$878
|
$850
|
|
$878
|
$850
|
(3%)
|
Segment
EBITA
|
$80
|
$85
|
|
$81
|
$85
|
5%
|
Segment EBITA margin
%
|
9.1%
|
10.0%
|
|
9.2%
|
10.0%
|
80bps
|
Sales in the quarter of $850
million decreased 3% versus the prior year. Organic sales
declined nearly 1% versus the prior year as growth in service was
more than offset by a decline in project installations.
Growth in Industrial Refrigeration was more than offset by a
decline in HVAC & Controls and Fire & Security.
Orders in the quarter, excluding M&A and adjusted for
foreign currency, decreased 4% year-over-year. Backlog at the
end of the quarter of $1.7 billion
increased 6% year-over-year, excluding M&A and adjusted for
foreign currency.
Adjusted segment EBITA was $85
million, up 5% versus the prior year. Adjusted segment EBITA
margin of 10.0% expanded 80 basis points over the prior year,
including a 30 basis point headwind related to foreign
currency. Adjusting for foreign currency, the underlying
margin improved 110 basis points driven by the benefit from
productivity savings and cost synergies.
Building Solutions Asia Pacific
|
GAAP
|
GAAP
|
|
Adjusted
|
Adjusted
|
|
|
Q2
2019
|
Q2
2020
|
|
Q2
2019
|
Q2
2020
|
Change
|
Sales
|
$628
|
$525
|
|
$628
|
$525
|
(16%)
|
Segment
EBITA
|
$76
|
$65
|
|
$76
|
$65
|
(15%)
|
Segment EBITA margin
%
|
12.1%
|
12.4%
|
|
12.1%
|
12.4%
|
30bps
|
Sales in the quarter of $525
million decreased 16% versus the prior year. Organic sales
declined 14% versus the prior year primarily driven by a decline in
project installations and, to a lesser extent, service.
The sharp decline in China was
predominately within HVAC & Controls.
Orders in the quarter, excluding M&A and adjusted for
foreign currency, decreased 11% year-over-year. Backlog at
the end of the quarter of $1.5
billion increased 3% year-over-year, excluding M&A and
adjusted for foreign currency.
Adjusted segment EBITA was $65
million, down 15% versus the prior year. Adjusted segment
EBITA margin of 12.4% expanded 30 basis points over the prior year
as favorable mix and the benefit of productivity savings and cost
synergies more than offset the volume decline.
Global Products
|
GAAP
|
GAAP
|
|
Adjusted
|
Adjusted
|
|
|
Q2
2019
|
Q2
2020
|
|
Q2
2019
|
Q2
2020
|
Change
|
Sales
|
$2,086
|
$1,894
|
|
$2,086
|
$1,894
|
(9%)
|
Segment
EBITA
|
$251
|
$216
|
|
$255
|
$216
|
(15%)
|
Segment EBITA margin
%
|
12.0%
|
11.4%
|
|
12.2%
|
11.4%
|
(80bps)
|
Sales in the quarter of $1.9
billion decreased 9% versus the prior year. Organic sales
declined 8% versus the prior year. Sales within Building
Management Systems were consistent with the prior year while sales
within HVAC & Refrigeration Equipment and Specialty Products
declined versus the prior year.
Adjusted segment EBITA was $216
million, down 15% versus the prior year. Adjusted segment
EBITA margin of 11.4% contracted 80 basis points over the prior
year as positive price/cost as well as the benefit of productivity
savings and cost synergies was more than offset by the volume
decline.
Corporate
|
GAAP
|
GAAP
|
|
Adjusted
|
Adjusted
|
|
|
Q2
2019
|
Q2
2020
|
|
Q2
2019
|
Q2
2020
|
Change
|
Corporate
expense
|
($167)
|
($118)
|
|
($104)
|
($82)
|
(21%)
|
Adjusted Corporate expense was $82
million in the quarter, a decrease of 21% compared to the
prior year, driven primarily by continued productivity savings and
cost synergies, COVID-19 mitigating actions, and cost reductions
related to the Power Solutions sale.
OTHER ITEMS
- Cash provided by operating activities from continuing
operations was $0.2 billion and
capital expenditures were $0.1
billion in the quarter, resulting in free cash flow from
continuing operations of less than $0.1
billion. Adjusted free cash flow was $0.2 billion, which excludes net cash outflows of
$0.1 billion primarily related to
restructuring and integration costs.
- During the quarter, the Company repurchased approximately 21
million shares for $816 million. The
Company suspended its share repurchase program in mid-March.
- During the quarter, the Company recorded a pre-tax impairment
charge of $62 million related to
indefinite lived intangible assets.
- During the quarter, the Company repaid a $500 million bond which matured in March 2020.
- In April, the Company raised $675
million via European financing arrangements, with an average
interest rate of 1.0% and a 6-month term.
- In April, the Company raised $575
million in bank term loans, with an average interest rate of
2.7% and a 1-year term.
SECOND HALF FRAMEWORK
As a result of the challenging and uncertain macro environment
attributable to the impact of COVID-19, the Company is withdrawing
its previously communicated fiscal year 2020 guidance and has
provided the below framework related to the second half of the
fiscal year.
Organic Revenue
Decline
|
(15 – 20%)
|
Mitigating Cost
Actions
|
$400 –
450M
|
Net Decrementals on
Revenue
|
Low 20s
|
JOHNSON CONTROLS
CONTACTS:
|
|
|
|
INVESTORS:
|
MEDIA:
|
|
|
Antonella
Franzen
|
Phil
Clement
|
Direct:
609.720.4665
|
Direct:
414.208.5161
|
Email:
antonella.franzen@jci.com
|
Email:
phil.clement@jci.com
|
|
|
Ryan
Edelman
|
Fraser
Engerman
|
Direct:
609.720.4545
|
Direct:
414.308.8321
|
Email:
ryan.edelman@jci.com
|
Email:
fraser.engerman@jci.com
|
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: Johnson
Controls' ability to manage general economic, business and
geopolitical conditions, including the impacts of natural
disasters, pandemics and outbreaks of contagious diseases and other
adverse public health developments, such as the COVID-19 pandemic,
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.
The description of certain of these risks is supplemented in Item
1A of Part II of Johnson Controls' subsequently filed Quarterly
Reports on Form 10-Q. 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
March 31,
|
|
|
2020
|
|
2019
|
|
|
|
|
|
Net sales
|
$ 5,444
|
|
$ 5,779
|
Cost of
sales
|
3,643
|
|
3,935
|
|
Gross
profit
|
1,801
|
|
1,844
|
|
|
|
|
|
Selling, general and
administrative expenses
|
(1,451)
|
|
(1,458)
|
Restructuring and
impairment costs
|
(62)
|
|
-
|
Net financing
charges
|
(59)
|
|
(98)
|
Equity
income
|
20
|
|
33
|
|
|
|
|
|
Income from
continuing operations before income taxes
|
249
|
|
321
|
|
|
|
|
|
Income tax
provision
|
13
|
|
47
|
|
|
|
|
|
Income from
continuing operations
|
236
|
|
274
|
|
|
|
|
|
Income from
discontinued operations, net of tax
|
-
|
|
284
|
|
|
|
|
|
Net income
|
236
|
|
558
|
|
|
|
|
|
Less: Income from
continuing operations attributable to noncontrolling
interests
|
23
|
|
34
|
|
|
|
|
|
Less: Income from
discontinued operations attributable to noncontrolling
interests
|
-
|
|
9
|
|
|
|
|
|
Net income
attributable to JCI
|
$
213
|
|
$
515
|
|
|
|
|
|
Income from
continuing operations
|
$
213
|
|
$
240
|
Income from
discontinued operations
|
-
|
|
275
|
|
|
|
|
|
Net income
attributable to JCI
|
$
213
|
|
$
515
|
|
|
|
|
|
Diluted earnings per
share from continuing operations
|
$
0.28
|
|
$
0.26
|
Diluted earnings per
share from discontinued operations
|
-
|
|
0.30
|
Diluted earnings per
share*
|
$
0.28
|
|
$
0.57
|
|
|
|
|
|
Diluted weighted
average shares
|
757.1
|
|
905.9
|
Shares outstanding at
period end
|
743.9
|
|
898.1
|
|
* May not sum due to
rounding.
|
JOHNSON CONTROLS
INTERNATIONAL PLC
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
|
(in millions, except
per share data; unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
March 31,
|
|
|
2020
|
|
2019
|
|
|
|
|
|
Net sales
|
$ 11,020
|
|
$ 11,243
|
Cost of
sales
|
7,416
|
|
7,674
|
|
Gross
profit
|
3,604
|
|
3,569
|
|
|
|
|
|
Selling, general and
administrative expenses
|
(2,878)
|
|
(2,896)
|
Restructuring and
impairment costs
|
(173)
|
|
-
|
Net financing
charges
|
(111)
|
|
(183)
|
Equity
income
|
63
|
|
75
|
|
|
|
|
|
Income from
continuing operations before income taxes
|
505
|
|
565
|
|
|
|
|
|
Income tax
provision
|
78
|
|
155
|
|
|
|
|
|
Income from
continuing operations
|
427
|
|
410
|
|
|
|
|
|
Income from
discontinued operations, net of tax
|
-
|
|
547
|
|
|
|
|
|
Net income
|
427
|
|
957
|
|
|
|
|
|
Less: Income from
continuing operations attributable to noncontrolling
interests
|
55
|
|
63
|
|
|
|
|
|
Less: Income from
discontinued operations attributable to noncontrolling
interests
|
-
|
|
24
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to JCI
|
$
372
|
|
$
870
|
|
|
|
|
|
Income from
continuing operations
|
$
372
|
|
$
347
|
Income from
discontinued operations
|
-
|
|
523
|
|
|
|
|
|
Net income
attributable to JCI
|
$
372
|
|
$
870
|
|
|
|
|
|
Diluted earnings per
share from continuing operations
|
$
0.49
|
|
$
0.38
|
Diluted earnings per
share from discontinued operations
|
-
|
|
0.57
|
Diluted earnings per
share
|
$
0.49
|
|
$
0.95
|
|
|
|
|
|
Diluted weighted
average shares
|
765.6
|
|
915.6
|
Shares outstanding at
period end
|
743.9
|
|
898.1
|
JOHNSON CONTROLS
INTERNATIONAL PLC
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
|
(in millions;
unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
September
30,
|
|
|
2020
|
|
2019
|
ASSETS
|
|
|
|
|
Cash and cash
equivalents
|
$
1,006
|
|
$
2,805
|
Accounts receivable -
net
|
5,492
|
|
5,770
|
Inventories
|
2,030
|
|
1,814
|
Assets held for
sale
|
91
|
|
98
|
Other current
assets
|
1,336
|
|
1,906
|
|
Current
assets
|
9,955
|
|
12,393
|
|
|
|
|
|
Property, plant and
equipment - net
|
3,274
|
|
3,348
|
Goodwill
|
|
18,072
|
|
18,178
|
Other intangible
assets - net
|
5,391
|
|
5,632
|
Investments in
partially-owned affiliates
|
869
|
|
853
|
Noncurrent assets
held for sale
|
46
|
|
60
|
Other noncurrent
assets
|
2,795
|
|
1,823
|
|
Total
assets
|
$ 40,402
|
|
$
42,287
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
Short-term debt and
current portion of long-term debt
|
$
1,430
|
|
$
511
|
Accounts payable and
accrued expenses
|
3,813
|
|
4,535
|
Liabilities held for
sale
|
39
|
|
44
|
Other current
liabilities
|
4,227
|
|
3,980
|
|
Current
liabilities
|
9,509
|
|
9,070
|
|
|
|
|
|
Long-term
debt
|
5,640
|
|
6,708
|
Other noncurrent
liabilities
|
6,165
|
|
5,680
|
Shareholders' equity
attributable to JCI
|
18,084
|
|
19,766
|
Noncontrolling
interests
|
1,004
|
|
1,063
|
|
Total liabilities and
equity
|
$ 40,402
|
|
$
42,287
|
JOHNSON CONTROLS
INTERNATIONAL PLC
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(in millions;
unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
|
|
|
2020
|
|
2019
|
Operating
Activities
|
|
|
|
Net income
attributable to JCI from continuing operations
|
$
213
|
|
$ 240
|
Income from
continuing operations attributable to noncontrolling
interests
|
23
|
|
34
|
|
|
|
|
|
|
|
Net income from
continuing operations
|
236
|
|
274
|
|
|
|
|
|
|
|
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)
|
|
(28)
|
|
Pension and
postretirement contributions
|
(15)
|
|
(16)
|
|
Equity in earnings of
partially-owned affiliates, net of dividends received
|
(19)
|
|
(31)
|
|
Deferred income
taxes
|
(58)
|
|
460
|
|
Non-cash
restructuring and impairment costs
|
62
|
|
-
|
|
Other -
net
|
40
|
|
5
|
|
Changes in assets and
liabilities, excluding acquisitions and divestitures:
|
|
|
|
|
|
Accounts
receivable
|
7
|
|
(285)
|
|
|
Inventories
|
(147)
|
|
(99)
|
|
|
Other
assets
|
(58)
|
|
34
|
|
|
Restructuring
reserves
|
(71)
|
|
(34)
|
|
|
Accounts payable and
accrued liabilities
|
(107)
|
|
209
|
|
|
Accrued income
taxes
|
118
|
|
(518)
|
|
|
|
Cash provided by
operating activities from continuing operations
|
155
|
|
182
|
|
|
|
|
|
|
|
Investing
Activities
|
|
|
|
Capital
expenditures
|
(124)
|
|
(125)
|
Acquisition of
businesses, net of cash acquired
|
(10)
|
|
-
|
Other -
net
|
19
|
|
2
|
|
|
|
Cash used by
investing activities from continuing operations
|
(115)
|
|
(123)
|
|
|
|
|
|
|
|
Financing
Activities
|
|
|
|
Increase (decrease)
in short and long-term debt - net
|
(177)
|
|
530
|
Stock
repurchases
|
(816)
|
|
(533)
|
Payment of cash
dividends
|
(199)
|
|
(239)
|
Dividends paid to
noncontrolling interests
|
-
|
|
(89)
|
Proceeds from the
exercise of stock options
|
18
|
|
38
|
Employee equity-based
compensation withholding
|
(12)
|
|
(2)
|
|
|
|
Cash used by
financing activities from continuing operations
|
(1,186)
|
|
(295)
|
|
|
|
|
|
|
|
Discontinued
Operations
|
|
|
|
Net cash provided
(used) by operating activities
|
(14)
|
|
309
|
Net cash used by
investing activities
|
-
|
|
(87)
|
Net cash used by
financing activities
|
-
|
|
(17)
|
|
|
|
Net cash flows
provided (used) by discontinued operations
|
(14)
|
|
205
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
7
|
|
5
|
Changes in cash held
for sale
|
-
|
|
(28)
|
Decrease in cash,
cash equivalents and restricted cash
|
$(1,153)
|
|
$ (54)
|
JOHNSON CONTROLS
INTERNATIONAL PLC
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(in millions;
unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
March 31,
|
|
|
|
|
2020
|
|
2019
|
Operating
Activities
|
|
|
|
Net income
attributable to JCI from continuing operations
|
$
372
|
|
$
347
|
Income from
continuing operations attributable to noncontrolling
interests
|
55
|
|
63
|
|
|
|
|
|
|
|
Net income from
continuing operations
|
427
|
|
410
|
|
|
|
|
|
|
|
Adjustments to
reconcile net income from continuing operations to cash provided by
operating activities:
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
414
|
|
422
|
|
Pension and
postretirement benefit income
|
(80)
|
|
(57)
|
|
Pension and
postretirement contributions
|
(27)
|
|
(37)
|
|
Equity in earnings of
partially-owned affiliates, net of dividends received
|
(11)
|
|
(67)
|
|
Deferred income
taxes
|
(61)
|
|
503
|
|
Non-cash
restructuring and impairment costs
|
116
|
|
-
|
|
Other -
net
|
56
|
|
33
|
|
Changes in assets and
liabilities, excluding acquisitions and divestitures:
|
|
|
|
|
|
Accounts
receivable
|
244
|
|
(139)
|
|
|
Inventories
|
(261)
|
|
(321)
|
|
|
Other
assets
|
(150)
|
|
(29)
|
|
|
Restructuring
reserves
|
(38)
|
|
(59)
|
|
|
Accounts payable and
accrued liabilities
|
(605)
|
|
(17)
|
|
|
Accrued income
taxes
|
642
|
|
(539)
|
|
|
|
Cash provided by
operating activities from continuing operations
|
666
|
|
103
|
|
|
|
|
|
|
|
Investing
Activities
|
|
|
|
Capital
expenditures
|
(250)
|
|
(278)
|
Acquisition of
businesses, net of cash acquired
|
(58)
|
|
(13)
|
Business
divestitures, net of cash divested
|
-
|
|
6
|
Other -
net
|
20
|
|
26
|
|
|
|
Cash used by
investing activities from continuing operations
|
(288)
|
|
(259)
|
|
|
|
|
|
|
|
Financing
Activities
|
|
|
|
Increase (decrease)
in short and long-term debt - net
|
(167)
|
|
1,544
|
Stock
repurchases
|
(1,467)
|
|
(1,000)
|
Payment of cash
dividends
|
(402)
|
|
(479)
|
Proceeds from the
exercise of stock options
|
39
|
|
51
|
Dividends paid to
noncontrolling interests
|
(5)
|
|
(132)
|
Employee equity-based
compensation withholding
|
(32)
|
|
(23)
|
Other -
net
|
(2)
|
|
-
|
|
|
|
Cash used by
financing activities from continuing operations
|
(2,036)
|
|
(39)
|
|
|
|
|
|
|
|
Discontinued
Operations
|
|
|
|
Net cash provided
(used) by operating activities
|
(208)
|
|
502
|
Net cash used by
investing activities
|
-
|
|
(153)
|
Net cash used by
financing activities
|
-
|
|
(28)
|
|
|
|
Net cash flows
provided (used) by discontinued operations
|
(208)
|
|
321
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
64
|
|
(38)
|
Changes in cash held
for sale
|
-
|
|
(30)
|
Increase
(decrease) in cash, cash equivalents and restricted
cash
|
$(1,802)
|
|
$
58
|
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
March 31,
|
|
Six Months Ended
March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Actual
|
|
Adjusted
Non-GAAP
|
|
Actual
|
|
Adjusted
Non-GAAP
|
|
Actual
|
|
Adjusted
Non-GAAP
|
|
Actual
|
|
Adjusted
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Building Solutions
North America
|
|
$
2,175
|
|
$
2,175
|
|
$
2,187
|
|
$
2,187
|
|
$
4,342
|
|
$
4,342
|
|
$
4,303
|
|
$
4,303
|
|
|
|
|
|
|
|
|
|
|
|
Building Solutions
EMEA/LA
|
|
850
|
|
850
|
|
878
|
|
878
|
|
1,778
|
|
1,778
|
|
1,785
|
|
1,785
|
|
|
|
|
|
|
|
|
|
|
|
Building Solutions
Asia Pacific
|
|
525
|
|
525
|
|
628
|
|
628
|
|
1,154
|
|
1,154
|
|
1,241
|
|
1,241
|
|
|
|
|
|
|
|
|
|
|
|
Global
Products
|
|
1,894
|
|
1,894
|
|
2,086
|
|
2,086
|
|
3,746
|
|
3,746
|
|
3,914
|
|
3,914
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
5,444
|
|
$
5,444
|
|
$
5,779
|
|
$
5,779
|
|
$ 11,020
|
|
$ 11,020
|
|
$ 11,243
|
|
$ 11,243
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment EBITA
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Building Solutions
North America
|
|
$
251
|
|
$
253
|
|
$
257
|
|
$
259
|
|
$
509
|
|
$
512
|
|
$
507
|
|
$
512
|
|
|
|
|
|
|
|
|
|
|
|
Building Solutions
EMEA/LA
|
|
85
|
|
85
|
|
80
|
|
81
|
|
175
|
|
175
|
|
157
|
|
158
|
|
|
|
|
|
|
|
|
|
|
|
Building Solutions
Asia Pacific
|
|
65
|
|
65
|
|
76
|
|
76
|
|
137
|
|
137
|
|
142
|
|
142
|
|
|
|
|
|
|
|
|
|
|
|
Global
Products
|
|
216
|
|
216
|
|
251
|
|
255
|
|
419
|
|
420
|
|
441
|
|
449
|
|
|
|
|
|
|
|
|
|
|
|
Segment EBITA
|
|
617
|
|
619
|
|
664
|
|
671
|
|
1,240
|
|
1,244
|
|
1,247
|
|
1,261
|
|
|
|
|
|
|
|
|
|
|
|
Corporate expenses
(2)
|
|
(118)
|
|
(82)
|
|
(167)
|
|
(104)
|
|
(236)
|
|
(163)
|
|
(303)
|
|
(197)
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangible assets
|
|
(97)
|
|
(97)
|
|
(98)
|
|
(98)
|
|
(193)
|
|
(193)
|
|
(195)
|
|
(195)
|
|
|
|
|
|
|
|
|
|
|
|
Net mark-to-market
adjustments (3)
|
|
(32)
|
|
-
|
|
20
|
|
-
|
|
(22)
|
|
-
|
|
(1)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and
impairment costs (4)
|
|
(62)
|
|
-
|
|
-
|
|
-
|
|
(173)
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
EBIT (5)
|
|
308
|
|
440
|
|
419
|
|
469
|
|
616
|
|
888
|
|
748
|
|
869
|
|
|
|
|
|
|
|
|
|
|
|
EBIT margin
|
|
5.7%
|
|
8.1%
|
|
7.3%
|
|
8.1%
|
|
5.6%
|
|
8.1%
|
|
6.7%
|
|
7.7%
|
|
|
|
|
|
|
|
|
|
|
|
Net financing
charges
|
|
(59)
|
|
(59)
|
|
(98)
|
|
(98)
|
|
(111)
|
|
(111)
|
|
(183)
|
|
(183)
|
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations before income taxes
|
|
249
|
|
381
|
|
321
|
|
371
|
|
505
|
|
777
|
|
565
|
|
686
|
|
|
|
|
|
|
|
|
|
|
|
Income tax provision
(6)
|
|
(13)
|
|
(52)
|
|
(47)
|
|
(50)
|
|
(78)
|
|
(105)
|
|
(155)
|
|
(93)
|
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations
|
|
236
|
|
329
|
|
274
|
|
321
|
|
427
|
|
672
|
|
410
|
|
593
|
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations attributable to noncontrolling
interests
|
|
(23)
|
|
(12)
|
|
(34)
|
|
(34)
|
|
(55)
|
|
(49)
|
|
(63)
|
|
(63)
|
|
|
|
|
|
|
|
|
|
|
|
Net income from
continuing operations attributable to JCI
|
|
$
213
|
|
$
317
|
|
$
240
|
|
$
287
|
|
$
372
|
|
$
623
|
|
$
347
|
|
$
530
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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 March
31, 2020 and 2019 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
|
|
|
|
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
Segment EBITA as
reported
|
$
251
|
|
$
257
|
|
$
85
|
|
$
80
|
|
$
65
|
|
$
76
|
|
$
216
|
|
$
251
|
|
$
617
|
|
$
664
|
|
|
|
|
|
|
|
|
|
Segment EBITA margin
as reported
|
11.5%
|
|
11.8%
|
|
10.0%
|
|
9.1%
|
|
12.4%
|
|
12.1%
|
|
11.4%
|
|
12.0%
|
|
11.3%
|
|
11.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusting
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Integration
costs
|
2
|
|
2
|
|
-
|
|
1
|
|
-
|
|
-
|
|
-
|
|
4
|
|
2
|
|
7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted segment
EBITA
|
$
253
|
|
$
259
|
|
$
85
|
|
$
81
|
|
$
65
|
|
$
76
|
|
$
216
|
|
$
255
|
|
$
619
|
|
$
671
|
|
|
|
|
|
|
|
|
|
Adjusted segment
EBITA margin
|
11.6%
|
|
11.8%
|
|
10.0%
|
|
9.2%
|
|
12.4%
|
|
12.1%
|
|
11.4%
|
|
12.2%
|
|
11.4%
|
|
11.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following is the
six months ended March 31, 2020 and 2019 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
|
|
|
|
|
|
|
|
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
Segment EBITA as
reported
|
$
509
|
|
$
507
|
|
$
175
|
|
$
157
|
|
$
137
|
|
$
142
|
|
$
419
|
|
$
441
|
|
$
1,240
|
|
$
1,247
|
|
|
|
|
|
|
|
|
|
Segment EBITA margin
as reported
|
11.7%
|
|
11.8%
|
|
9.8%
|
|
8.8%
|
|
11.9%
|
|
11.4%
|
|
11.2%
|
|
11.3%
|
|
11.3%
|
|
11.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusting
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Integration
costs
|
3
|
|
5
|
|
-
|
|
1
|
|
-
|
|
-
|
|
1
|
|
8
|
|
4
|
|
14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted segment
EBITA
|
$
512
|
|
$
512
|
|
$
175
|
|
$
158
|
|
$
137
|
|
$
142
|
|
$
420
|
|
$
449
|
|
$
1,244
|
|
$
1,261
|
|
|
|
|
|
|
|
|
|
Adjusted segment
EBITA margin
|
11.8%
|
|
11.9%
|
|
9.8%
|
|
8.9%
|
|
11.9%
|
|
11.4%
|
|
11.2%
|
|
11.5%
|
|
11.3%
|
|
11.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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 March 31, 2020 excludes $36 million of
integration costs. Adjusted Corporate expenses for the six months
ended March 31, 2020 excludes $73 million of integration costs.
Adjusted Corporate expenses for the three months ended March 31,
2019 excludes $61 million of integration costs and $2 million of
transaction costs. Adjusted Corporate expenses for the six months
ended March 31, 2019 excludes $102 million of integration costs and
$4 million of transaction costs.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3) The three months
ended March 31, 2020 exclude the net mark-to-market adjustments on
restricted investments of $32 million. The six months ended March
31, 2020 exclude the net mark-to-market adjustments on restricted
investments of $22 million. The three months ended March 31, 2019
exclude the net mark-to-market adjustments on restricted
investments of $20 million. The six months ended March 31, 2019
exclude the net mark-to-market adjustments on restricted
investments of $1 million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4) Restructuring and
impairment costs for the three months ended March 31, 2020 of $62
million are excluded from the adjusted non-GAAP results.
Restructuring and impairment costs for the six months ended March
31, 2020 of $173 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 March 31, 2020 excludes
tax benefits from tax audit reserve adjustments of $22 million, net
mark-to-market adjustments of $7 million, integration costs of $6
million, and restructuring and impairment costs of $4 million.
Adjusted income tax provision for the six months ended March 31,
2020 excludes tax benefits from tax audit reserve adjustments of
$22 million, restructuring and impairment costs of $20 million,
integration costs of $11 million and net mark-to-market adjustments
of $4 million, partially offset by tax provisions related to
Switzerland tax reform of $30 million. Adjusted income tax
provision for the three months ended March 31, 2019 excludes the
tax benefits of integration costs of $7 million and transaction
costs of $1 million, partially offset by the tax provision for net
mark-to-market adjustments of $5 million. Adjusted income tax
provision for the six months ended March 31, 2019 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 $13 million and transaction costs
of $1 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
|
|
Net Income
Attributable
to JCI plc
|
|
Net Income
Attributable
to JCI plc from
Continuing Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
Six Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
March 31,
|
|
March 31,
|
|
March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share as
reported for JCI plc
|
$
0.28
|
|
$
0.57
|
|
$
0.28
|
|
$
0.26
|
|
$
0.49
|
|
$
0.95
|
|
$
0.49
|
|
$
0.38
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusting
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction
costs
|
-
|
|
0.02
|
|
-
|
|
-
|
|
-
|
|
0.05
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Related tax
impact
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(0.01)
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Integration
costs
|
0.05
|
|
0.08
|
|
0.05
|
|
0.08
|
|
0.10
|
|
0.13
|
|
0.10
|
|
0.13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Related tax
impact
|
(0.01)
|
|
(0.01)
|
|
(0.01)
|
|
(0.01)
|
|
(0.01)
|
|
(0.01)
|
|
(0.01)
|
|
(0.01)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
mark-to-market adjustments
|
0.04
|
|
(0.02)
|
|
0.04
|
|
(0.02)
|
|
0.03
|
|
-
|
|
0.03
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Related tax
impact
|
(0.01)
|
|
0.01
|
|
(0.01)
|
|
0.01
|
|
(0.01)
|
|
-
|
|
(0.01)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring
and impairment costs
|
0.08
|
|
-
|
|
0.08
|
|
-
|
|
0.23
|
|
-
|
|
0.23
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Related tax
impact
|
(0.01)
|
|
-
|
|
(0.01)
|
|
-
|
|
(0.03)
|
|
-
|
|
(0.03)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NCI impact of
restructuring and impairment
|
-
|
|
-
|
|
-
|
|
-
|
|
(0.01)
|
|
-
|
|
(0.01)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cease of Power
Solutions depreciation / amortization expense
|
-
|
|
(0.07)
|
|
-
|
|
-
|
|
-
|
|
(0.10)
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Related tax
impact
|
-
|
|
0.02
|
|
-
|
|
-
|
|
-
|
|
0.03
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discrete tax
items
|
(0.03)
|
|
-
|
|
(0.03)
|
|
-
|
|
0.01
|
|
0.16
|
|
0.01
|
|
0.08
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NCI impact of
discrete tax items
|
0.01
|
|
-
|
|
0.01
|
|
-
|
|
0.01
|
|
-
|
|
0.01
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings per
share for JCI plc*
|
$
0.42
|
|
$
0.59
|
|
$
0.42
|
|
$
0.32
|
|
$
0.81
|
|
$
1.20
|
|
$
0.81
|
|
$
0.58
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* 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
|
|
Six Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding for JCI plc
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted
average shares outstanding
|
754.8
|
|
902.5
|
|
762.4
|
|
912.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of dilutive
securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock options,
unvested restricted stock and unvested performance share
awards
|
2.3
|
|
3.4
|
|
3.2
|
|
3.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted
average shares outstanding
|
757.1
|
|
905.9
|
|
765.6
|
|
915.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company has
presented forward-looking statements regarding organic net sales,
net decrementals and adjusted free cash flow conversion, 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 framework for
organic net sales 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 March 31, 2020
versus the three months ended March 31, 2019, including organic
growth, is shown below (unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
Net Sales for the
Three Months Ended
March 31, 2019
|
|
Base Year Adjustments
-
Divestitures and Other
|
|
Adjusted Base Net
Sales for the Three
Months Ended
March 31, 2019
|
|
Acquisitions
|
|
Foreign
Currency
|
|
Organic
Growth
|
|
Net Sales for the
Three
Months Ended
March 31, 2020
|
|
Building Solutions
North America
|
$
2,187
|
|
$
-
|
|
-
|
|
$
2,187
|
|
$
-
|
|
-
|
|
$
(2)
|
|
-
|
|
$
(10)
|
|
-
|
|
$
2,175
|
|
-1%
|
|
Building Solutions
EMEA/LA
|
878
|
|
2
|
|
-
|
|
880
|
|
10
|
|
1%
|
|
(33)
|
|
-4%
|
|
(7)
|
|
-1%
|
|
850
|
|
-3%
|
|
Building Solutions
Asia Pacific
|
628
|
|
-
|
|
-
|
|
628
|
|
2
|
|
-
|
|
(15)
|
|
-2%
|
|
(90)
|
|
-14%
|
|
525
|
|
-16%
|
|
Total field
|
3,693
|
|
2
|
|
-
|
|
3,695
|
|
12
|
|
-
|
|
(50)
|
|
-1%
|
|
(107)
|
|
-3%
|
|
3,550
|
|
-4%
|
|
Global
Products
|
2,086
|
|
(7)
|
|
-
|
|
2,079
|
|
2
|
|
-
|
|
(13)
|
|
-1%
|
|
(174)
|
|
-8%
|
|
1,894
|
|
-9%
|
|
Total net sales
|
$
5,779
|
|
$
(5)
|
|
-
|
|
$
5,774
|
|
$
14
|
|
-
|
|
$
(63)
|
|
-1%
|
|
$
(281)
|
|
-5%
|
|
$
5,444
|
|
-6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The components of the
changes in net sales for the six months ended March 31, 2020 versus
the six months ended March 31, 2019, including organic growth, is
shown below (unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
Net Sales for the
Six
Months Ended
March 31, 2019
|
|
Base Year Adjustments
-
Divestitures and Other
|
|
Adjusted Base Net
Sales for the
Six Months Ended
March 31, 2019
|
|
Acquisitions
|
|
Foreign
Currency
|
|
Organic
Growth
|
|
Net Sales for the
Six
Months Ended
March 31, 2020
|
|
Building Solutions
North America
|
$
4,303
|
|
$
(2)
|
|
-
|
|
$
4,301
|
|
$
-
|
|
-
|
|
$
(2)
|
|
-
|
|
$
43
|
|
1%
|
|
$
4,342
|
|
1%
|
|
Building Solutions
EMEA/LA
|
1,785
|
|
(23)
|
|
-1%
|
|
1,762
|
|
15
|
|
1%
|
|
(58)
|
|
-3%
|
|
59
|
|
3%
|
|
1,778
|
|
-
|
|
Building Solutions
Asia Pacific
|
1,241
|
|
-
|
|
-
|
|
1,241
|
|
4
|
|
-
|
|
(20)
|
|
-2%
|
|
(71)
|
|
-6%
|
|
1,154
|
|
-7%
|
|
Total field
|
7,329
|
|
(25)
|
|
-
|
|
7,304
|
|
19
|
|
-
|
|
(80)
|
|
-1%
|
|
31
|
|
-
|
|
7,274
|
|
-
|
|
Global
Products
|
3,914
|
|
(15)
|
|
-
|
|
3,899
|
|
3
|
|
-
|
|
(10)
|
|
-
|
|
(146)
|
|
-4%
|
|
3,746
|
|
-4%
|
|
Total net sales
|
$
11,243
|
|
$
(40)
|
|
-
|
|
$
11,203
|
|
$
22
|
|
-
|
|
$
(90)
|
|
-1%
|
|
$
(115)
|
|
-1%
|
|
$11,020
|
|
-2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The components of the
changes in segment EBITA and EBIT for the three months ended March
31, 2020 versus the three months ended March 31, 2019, including
organic growth, is shown below (unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
Adjusted Segment
EBITA / EBIT for the
Three Months Ended
March 31, 2019
|
|
Base Year Adjustments
-
Divestitures and Other
|
|
Adjusted Base
Segment
EBITA / EBIT for the
Three Months Ended
March 31, 2019
|
|
Acquisitions
|
|
Foreign
Currency
|
|
Organic
Growth
|
|
Adjusted Segment
EBITA / EBIT for
the Three
Months Ended
March 31, 2020
|
|
Building Solutions
North America
|
$
259
|
|
$
-
|
|
-
|
|
$
259
|
|
$
-
|
|
-
|
|
$
-
|
|
-
|
|
$
(6)
|
|
-2%
|
|
$
253
|
|
-2%
|
|
Building Solutions
EMEA/LA
|
81
|
|
-
|
|
-
|
|
81
|
|
2
|
|
2%
|
|
(6)
|
|
-7%
|
|
8
|
|
10%
|
|
85
|
|
5%
|
|
Building Solutions
Asia Pacific
|
76
|
|
-
|
|
-
|
|
76
|
|
-
|
|
-
|
|
(1)
|
|
-1%
|
|
(10)
|
|
-13%
|
|
65
|
|
-14%
|
|
Total field
|
416
|
|
-
|
|
-
|
|
416
|
|
2
|
|
-
|
|
(7)
|
|
-2%
|
|
(8)
|
|
-2%
|
|
403
|
|
-3%
|
|
Global
Products
|
255
|
|
(1)
|
|
-
|
|
254
|
|
-
|
|
-
|
|
(2)
|
|
-1%
|
|
(36)
|
|
-14%
|
|
216
|
|
-15%
|
|
Total adjusted segment EBITA
|
671
|
|
(1)
|
|
-
|
|
670
|
|
$
2
|
|
-
|
|
$
(9)
|
|
-1%
|
|
$
(44)
|
|
-7%
|
|
619
|
|
-8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
expenses
|
(104)
|
|
-
|
|
|
|
(104)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(82)
|
|
21%
|
|
Amortization of
intangible assets
|
(98)
|
|
-
|
|
|
|
(98)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(97)
|
|
1%
|
|
Total adjusted EBIT
|
$
469
|
|
$
(1)
|
|
|
|
$
468
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
440
|
|
-6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The components of the
changes in segment EBITA and EBIT for the six months ended March
31, 2020 versus the six months ended March 31, 2019, including
organic growth, is shown below (unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
Adjusted Segment
EBITA / EBIT for the
Six Months Ended
March 31, 2019
|
|
Base Year Adjustments
-
Divestitures and Other
|
|
Adjusted Base
Segment
EBITA / EBIT for the
Six Months Ended
March 31, 2019
|
|
Acquisitions
|
|
Foreign
Currency
|
|
Organic
Growth
|
|
Adjusted Segment
EBITA / EBIT for
the Six Months Ended
March 31, 2020
|
|
Building Solutions
North America
|
$
512
|
|
$
-
|
|
-
|
|
$
512
|
|
$
-
|
|
-
|
|
$
-
|
|
-
|
|
$
-
|
|
-
|
|
$
512
|
|
-
|
|
Building Solutions
EMEA/LA
|
158
|
|
(1)
|
|
-1%
|
|
157
|
|
3
|
|
2%
|
|
(9)
|
|
-6%
|
|
24
|
|
15%
|
|
175
|
|
11%
|
|
Building Solutions
Asia Pacific
|
142
|
|
-
|
|
-
|
|
142
|
|
1
|
|
1%
|
|
(1)
|
|
-1%
|
|
(5)
|
|
-4%
|
|
137
|
|
-4%
|
|
Total field
|
812
|
|
(1)
|
|
-
|
|
811
|
|
4
|
|
-
|
|
(10)
|
|
-1%
|
|
19
|
|
2%
|
|
824
|
|
2%
|
|
Global
Products
|
449
|
|
(1)
|
|
-
|
|
448
|
|
(1)
|
|
-
|
|
(3)
|
|
-1%
|
|
(24)
|
|
-5%
|
|
420
|
|
-6%
|
|
Total adjusted segment EBITA
|
1,261
|
|
(2)
|
|
-
|
|
1,259
|
|
$
3
|
|
-
|
|
$
(13)
|
|
-1%
|
|
$
(5)
|
|
-
|
|
1,244
|
|
-1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
expenses
|
(197)
|
|
-
|
|
|
|
(197)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(163)
|
|
17%
|
|
Amortization of
intangible assets
|
(195)
|
|
-
|
|
|
|
(195)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(193)
|
|
1%
|
|
Total adjusted EBIT
|
$
869
|
|
$
(2)
|
|
|
|
$
867
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
888
|
|
2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 and six months ended March 31, 2020 and 2019
reconciliation of free cash flow, adjusted free cash flow and
adjusted free cash flow conversion for continuing operations
(unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
billions)
|
Three Months
Ended
March 31, 2020
|
|
Three Months
Ended
March 31, 2019
|
|
Six Months
Ended
March 31, 2020
|
|
Six Months
Ended
March 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash provided by
operating activities from continuing operations
|
$
0.2
|
|
$
0.2
|
|
$
0.7
|
|
$
0.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
(0.1)
|
|
(0.1)
|
|
(0.3)
|
|
(0.3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported free cash
flow *
|
-
|
|
0.1
|
|
0.4
|
|
(0.2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusting
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction/integration
costs
|
-
|
|
0.1
|
|
0.2
|
|
0.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring
payments
|
0.1
|
|
-
|
|
0.1
|
|
0.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonrecurring
tax refunds
|
-
|
|
-
|
|
(0.6)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
adjusting items
|
0.1
|
|
0.1
|
|
(0.3)
|
|
0.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted free cash
flow *
|
$
0.2
|
|
$
0.2
|
|
$
0.1
|
|
$
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income
from continuing operations attributable to JCI
|
$
0.3
|
|
$
0.3
|
|
$
0.6
|
|
$
0.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted free cash
flow conversion
|
|
|
67%
|
|
|
|
67%
|
|
|
|
17%
|
|
|
|
0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* May not sum due to
rounding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5. Net
Debt to EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company provides
financial information regarding net debt to adjusted EBITDA, which
is a non-GAAP performance measure. The Company believes the total
net debt to adjusted EBITDA ratio 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 March 31, 2020 and December 31, 2019 calculation of net debt
to adjusted EBITDA (unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
March 31,
2020
|
|
December 31,
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term debt and
current portion of long-term debt
|
$
1,430
|
|
$
1,362
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
5,640
|
|
5,920
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total debt
|
7,070
|
|
7,282
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: cash and cash
equivalents
|
1,006
|
|
2,160
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net
debt
|
$
6,064
|
|
$
5,122
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Last twelve months
adjusted EBITDA
|
$
3,326
|
|
$
3,359
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net debt to
adjusted EBITDA
|
1.8x
|
|
1.5x
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following is the
last twelve months ended March 31, 2020 and December 31, 2019
reconciliation of income from continuing operations to adjusted
EBIT and adjusted EBITDA, which are non-GAAP performance measures
(unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
Last Twelve
Months
Ended
March 31, 2020
|
|
Last Twelve
Months
Ended
December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations
|
$
1,306
|
|
$
1,344
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
benefit
|
(310)
|
|
(276)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net financing
charges
|
278
|
|
317
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT
|
1,274
|
|
1,385
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusting
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction costs
|
7
|
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Integration costs
|
267
|
|
297
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
mark-to-market adjustments
|
639
|
|
587
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and impairment costs
|
408
|
|
346
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax
indemnification reserve release
|
(226)
|
|
(226)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Environmental reserve
|
140
|
|
140
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBIT
(1)
|
2,509
|
|
2,538
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
817
|
|
821
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(1)
|
$
3,326
|
|
$
3,359
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The Company's
definition of adjusted EBIT and adjusted EBITDA excludes special
items because these costs are not considered to be directly related
to the underlying operating performance of its businesses.
Management believes this non-GAAP measure is useful to investors in
understanding the ongoing operations and business trends of the
Company.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6.
Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 and six months ending March 31, 2020 and March 31, 2019 is
approximately 13.5%.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7.
Restructuring and Impairment Costs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The three months
ended March 31, 2020 include restructuring and impairment costs of
$62 million related to indefinite-lived intangible asset
impairments primarily related to the Company's retail business. The
six months ended March 31, 2020 include restructuring and
impairment costs of $173 million related primarily to workforce
reductions, plant closures and asset impairments.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8.
Leases
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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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multimedia:http://www.prnewswire.com/news-releases/johnson-controls-reports-fiscal-q2-results-and-provides-updates-related-to-the-impact-of-covid-19-301050711.html
SOURCE Johnson Controls International plc