01—Abstract
Summary
Summary of the 10-Q filed July 28, 2011. Cited figures are marked; the original filing is the authoritative source.
Johnson Controls International plc (JCI), during its fiscal third quarter ending June 24, 2011, demonstrated resilience and strategic execution amidst ongoing global economic conditions.
The company reported a modest increase in net revenue to $4.3 billiona, up 0.4% year-over-year, driven by solid performance in its Tyco Security Solutions and Tyco Fire Protection segments, with favorable foreign currency exchange rates contributing positively. Operating income saw a significant increase of 26.7% to $475 million, reflecting improved operational efficiencies and cost containment measures. The company's strategic focus on its core businesses—Tyco Security Solutions, Tyco Fire Protection, and Tyco Flow Control—is evident through ongoing segment realignments and targeted acquisitions, such as the recent acquisition of Signature Security Group.
Furthermore, JCI continued its commitment to returning capital to shareholders, evidenced by its ongoing share repurchase program and dividend payments. The company's strong cash generation and solid balance sheet provide a stable foundation for future growth and shareholder returns.
02—Key points
Key Highlights
- Net revenue increased slightly by 0.4% to $4.3 billion for the quarter ended June 24, 2011, compared to the prior year period.
- Operating income saw a substantial increase of 26.7% to $475 million, indicating improved profitability and operational efficiency.
- Tyco Security Solutions demonstrated strong growth, with net revenue up 12.7% to $2.17 billion and operating income up 41.6% to $327 million.
- The company completed a majority sale of its Electrical and Metal Products business, resulting in a significant gain of $259 million recognized in the quarter.
- Tyco continued to actively manage its capital structure, repurchasing approximately $1.3 billion of its common shares during the nine months ended June 24, 2011.
- The company reported a healthy cash position of $1.6 billion as of June 24, 2011, supported by strong operating cash flows.
- Strategic acquisitions, including Signature Security Group, were completed to bolster the Tyco Security Solutions segment.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2011, Johnson Controls International plc kept $0.08.
- Revenue$4.29B100.0%
- Cost of revenue−$2.64B61.5%
- Gross profit$1.65B38.5%
- Operating costs−$1.18B27.4%
- Operating income$475.0M11.1%
- Interest, other & tax−$116.0M2.7%
- Net income$359.0M8.4%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2011filed July 28, 2011Financial Statements
Q3 FY2011 against Q3 FY2010
| Line item | Q3 FY2011Q3 FY2010 | Change |
|---|---|---|
| Revenue | $4.29B$4.27B | +0.4% |
| Cost of Revenue | $2.64B$2.69B | −2.0% |
| Gross Profit | $1.65B$1.58B | +4.6% |
| SG&A Expenses | $1.14B$1.16B | −1.8% |
| Operating Income | $475.00M$375.00M | +26.7% |
| Interest Expense | $59.00M$71.00M | −16.9% |
| Net Income | $359.00M$254.00M | +41.3% |
| EPS (Basic) | $0.77$0.52 | +48.1% |
| EPS (Diluted) | $0.76$0.51 | +49.0% |
| Shares Outstanding (Basic) | 468.00M492.00M | −4.9% |
| Shares Outstanding (Diluted) | 475.00M496.00M | −4.2% |
05—Questions
Frequently Asked Questions
What was the overall financial performance for Johnson Controls in the third quarter of fiscal 2011?
Johnson Controls reported a net revenue of $4.3 billion for the quarter ended June 24, 2011, a slight increase of 0.4% compared to the same period last year. Operating income showed a significant improvement, rising by 26.7% to $475 million, driven by strong performance in key segments and effective cost management.
How did the company's major segments perform?
The Tyco Security Solutions segment was a standout performer, with net revenue growing by 12.7% to $2.17 billion and operating income increasing by 41.6% to $327 million. The Tyco Fire Protection segment also saw growth, with net revenue up 7.7% to $1.2 billion. The Tyco Flow Control segment experienced a 9.3% increase in net revenue to $928 million, though operating income saw a slight decrease.
What significant divestitures or gains were reported during the quarter?
Johnson Controls reported the completion of the sale of a majority interest in its Electrical and Metal Products business, resulting in a significant gain of $259 million. This strategic divestiture aligns with the company's focus on its three core businesses: Tyco Security Solutions, Tyco Fire Protection, and Tyco Flow Control.
How is the company managing its capital and returning value to shareholders?
The company maintained a strong liquidity position with $1.6 billion in cash and cash equivalents as of June 24, 2011. Johnson Controls actively repurchased approximately $1.3 billion of its common shares during the nine months ended June 24, 2011, demonstrating a commitment to returning capital to shareholders. Dividend payments were also maintained.
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