Summary
Johnson Controls International plc (JCI), in its 10-Q/A filing for the period ending December 28, 2006, reported net revenue of $10.3 billion for the quarter, a significant increase from $9.6 billion in the prior year period. This growth was primarily driven by an increase in revenue from product sales. Despite the top-line growth, operating income saw a slight decrease to $1.18 billion from $1.22 billion, attributed to higher separation and restructuring costs. Net income for the quarter was $793 million, a substantial rise from $579 million in the comparable prior year period, partly due to the inclusion of income from discontinued operations and a favorable tax adjustment in the current period. The company is actively engaged in a plan to separate into three distinct, publicly traded companies: Tyco Healthcare, Tyco Electronics, and a combined Tyco Fire and Security/Engineered Products and Services. This separation is expected to occur in the second calendar quarter of 2007 and is anticipated to incur significant separation costs, estimated at the higher end of a previously disclosed range of $1.2 to $1.6 billion after tax. The company also noted a restatement of prior period financial statements due to errors in income tax accounting, which primarily impacted the 2005 fiscal year, resulting in a reduction of income tax expense.
Key Highlights
- 1Net revenue increased by 7.6% year-over-year to $10.3 billion for the quarter ended December 29, 2006.
- 2Operating income decreased by 3.8% to $1.18 billion, impacted by increased separation and restructuring costs.
- 3Net income significantly increased to $793 million from $579 million in the prior year quarter, aided by discontinued operations and tax adjustments.
- 4The company is proceeding with its plan to separate into three independent public companies, expected in Q2 2007.
- 5Significant separation costs are anticipated, estimated at the higher end of $1.2 billion to $1.6 billion (after-tax).
- 6Prior period financial statements were restated due to income tax accounting errors, impacting prior year's results.
- 7Capital expenditures increased substantially to $663 million from $298 million in the prior year quarter, reflecting investments in property, plant, and equipment.