Attached files
| file | filename |
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| 8-K - 8-K - JOHNSON CONTROLS INC | d285344d8k.htm |
| EX-99.1 - EX-99.1 - JOHNSON CONTROLS INC | d285344dex991.htm |
 January 19, 2012
Quarterly update
FY 2012 first quarter
Exhibit 99.2 |
 Agenda
Introduction
Glen Ponczak, Vice President, Global Investor Relations
Overview
Steve Roell, Chairman and Chief Executive Officer
Business results and financial review
Bruce McDonald, Executive Vice President and Chief Financial Officer
Q&A
FORWARD-LOOKING STATEMENT
Johnson Controls, Inc. has made forward-looking statements in this document
pertaining to its financial results for fiscal 2012 and beyond that are
based on preliminary data and are subject to risks and uncertainties. All
statements, other than statements of historical fact, are statements that
are,
or
could
be,
deemed
"forward-looking"
statements
and
include
terms
such
as
"outlook,"
"expectations,"
"estimates"
or
"forecasts."
For
those
statements, the Company cautions that numerous important factors, such as
automotive vehicle production levels, mix and schedules, energy and
commodity
prices,
the
strength
of
the
U.S.
or
other
economies,
currency
exchange
rates,
cancellation
of
or
changes
to
commercial
contracts,
changes in the levels or timing of investments in commercial buildings as well as
other factors discussed in Item 1A of Part I of the Company's most recent
Form 10-k filing (filed November 22, 2011) could affect the Company's actual results and could cause its actual consolidated results to
differ materially from those expressed in any forward-looking statement made
by, or on behalf of, the Company. 2 |
 2012
first quarter Macro environment
Mixed automotive industry production
–
Higher production (16%) in North America
–
Lower production (4%) in Europe but with some
strength in luxury segments
–
Level production in China
Unseasonably warm winter temperatures
–
Negative impact on aftermarket battery demand,
particularly in December
Lower U.S. industry residential HVAC sales
Architectural Billings Index up for October and
November, level in December
U.S. Consumer Confidence Index highest in six months
3 |
 2012
first quarter Record sales and earnings
Sales: $10.4 billion
vs. $9.5 billion in 2011 (+9%)
Segment income: $598 million
vs. $533 million in Q1 2011 (+12%)
Net income: $410 million
vs. $375 million in Q1 2011
EPS: $0.60 per diluted share
vs. $0.55 in Q1 2011 (+9%)
4
Record sales and earnings
Benefitted from strong
backlogs in Automotive
Experience and Building
Efficiency
–
Results consistent with
October 12, 2011
guidance
Outperformed our
underlying markets
–
Market share gains |
 2012
first quarter Significantly higher profitability in Europe
(acquisition impact), Asia
Launched 48 programs
Higher North America metals start-up costs
Commercial building revenues and backlog
higher in a sluggish global market
Lower residential HVAC market demand
In-line performance despite the soft demand
resulting from unseasonably warm winter
temperatures globally
AGM, vertical integration, China investments on track
5
Taking action
to improve profitability
Automotive: Hired 300 Six Sigma
Blackbelts and quality experts
Building Efficiency SG&A cost
reduction initiatives
Power Solutions
Building Efficiency
Automotive Experience |
 2012
Outlook Continuing our investment commitment for future growth and
profitability Our fundamental growth and profitability
story is intact
Capital expenditures
–
Capacity, footprint expansions, emerging
markets, vertical integration
Support for record level of Automotive
Experience new business awards
Information technology
Innovation and engineering investments
Johnson Controls
6
Maintenance
Infrastructure
71% of 2012
capital expenditures
are in support of
growth and margin
expansion initiatives
Expansion,
Equipment,
Capabilities |
 2012
first quarter Automotive Experience
2012
2011
Net sales
$5.3B
$4.6B
15%
15% increases in all geographic regions
–
Up 6%, excluding acquisitions
China sales (mostly non-consolidated): up 10% to $1.1 billion Segment income
$194M
$177M
10%
Higher volumes
North American metals launch costs
Thailand flooding impact ($0.01)
Higher JV profitability
7
Return on sales by
geography
N. America: 4%
Europe: 1%
Asia: 15%
New 3-D multi-layer cluster
introduced this month at the
Consumer Electronics Show |
 2012
first quarter Building Efficiency
2012
2011
Net sales
$3.5B
$3.4B
4%
Higher revenues in N. America, Asia, GWS
–
Asia up 13%
–
Global Workplace Solutions up 10%
–
Europe and N.A. residential HVAC lower
Solutions order activity lower than expected
Segment income
$133M
$139M
(4%)
Y-O-Y margins comparable in N.A. Systems, GWS
–
Lower in N.A. Service, Asia
Increased IT infrastructure investments
Implementing SG&A reductions
8
Commercial backlog
and orders
(at December 31, 2011)
Record $5.3B, up 8%
Backlog up in all
geographic markets,
strongest in Asia
Orders slightly higher
–
Asia up 17%
–
N.A. Service up 13%
–
N. America Systems
level
–
Latin America,
Middle East lower |
 2012
first quarter Power Solutions
2012
2011
Net sales
$1.6B
$1.6B
4%
Aftermarket volumes down 1%
–
Impact of unseasonably warm winter temperatures
Benefitted from favorable product mix
Lower Asia volumes due to Shanghai plant shut-down
Segment income
$271M
$217M 25%
Increased vertical integration
Improved product mix
Equity income benefit from joint venture investment
Shanghai plant shutdown, consolidation of hybrid
battery business
9
Changxing, China Facility |
 First
quarter 2012 Financial highlights
10
(in millions)
2012
(reported)
2011
(reported)
%
change
Sales
$10,417
$9,537
9%
Gross profit
% of sales
1,532
14.7%
1,414
14.8%
8%
SG&A expenses
1,054
947
11%
Equity income
120
66
82%
Segment income
$598
$533
12%
5.7%
5.6%
FX –
Euro to U.S. dollar average exchange rate at $1.35 in Q1 2012 vs. $1.36 in
2011 Sales –
Excluding FX, sales up 10%
Gross
profit
–
Higher
volumes
offset
by
product
mix
SG&A
–
Impact
from
2011
acquisitions
and
investments
in
innovation
and
growth
opportunities
Equity
income
–
Growth
in
Automotive
Experience
(China),
consolidation
of
Hybrid
business
in
2012 and equity income benefits in Power Solutions |
 First
quarter 2012 Financial highlights
Financing
charges-net
–
Higher
year-over-year
debt
levels
Income
tax
provision
–
Underlying
2012
tax
rate
of
19%,
consistent
with
2011
Non-controlling
interests
–
Improved
profitability
in
consolidated
Automotive
and
Power Solutions JVs
11
(in millions, except earnings per share)
2012
(reported)
2011
(reported)
Segment income
$598
$533
Financing
charges
-
net
49
35
Income before taxes
549
498
Income tax provision
104
95
Net income
445
403
Income attributable to non-controlling interests
35
28
Net income attributable to JCI
$410
$375
Diluted earnings per share
$0.60
$0.55 |
 2012
first quarter Balance sheet / cash flow
12
$350 million of pension and post-retirement
funding
Excluding 2012 pension and post-retirement
funding, cash provided by operations
increased $120 million from Q1 2011
Improvements in trade working capital in the
quarter
Increased capital spending to $538 million,
$278 million higher than Q1 2011
Increased ownership in Power Solutions
separator joint venture
Net debt / total capitalization 34% vs. 31% at
Q4 2011 |
 Factors impacting revised guidance
13
Q3/Q4
($0.10 -
$0.12) /
share
($0.01 -
$0.02) /
share
Factors
Q2
Power Solutions weather-related volumes
Indefinite shut-down of Power Solutions
Shanghai facility
Automotive N. America metals start-up
European production volumes
(19.6 million units, down 3.5% versus original assumption
of 20.1 million units, up 1.5%)
Euro at $1.30
Residential HVAC demand
Cost reduction initiatives |
 Revised fiscal 2012 outlook
14
October
guidance
January
revisions
Consolidated net
sales
$44.2B
$43.5B (up 7%)
EPS –
Q2
--
$0.52 -
$0.54
EPS –
Full Year
$2.85 -
$3.00
$2.70
-
$2.85
(up
13
–
19%)
Net financing charges
$210M -
$220M
$220M -
$230M
Capital expenditures
$1.7B
unchanged |