Summary
Johnson Controls International plc (JCI) reported its financial results for the fiscal quarter ended June 30, 2019. The company experienced a significant boost in net income, largely driven by the gain on the sale of its Power Solutions business, which closed on April 30, 2019. This divestiture resulted in net cash proceeds of $11.6 billion. Excluding this significant event, the core business demonstrated modest revenue growth, with increases in net sales driven by higher volumes across all segments. While the sale of Power Solutions provided a substantial financial uplift, investors should note the impact of ongoing restructuring and impairment charges and a notable increase in the effective tax rate, influenced by U.S. Tax Reform and other discrete tax items. The company continues to focus on its core building technologies and solutions, with a strategic emphasis on intelligent buildings and efficient energy solutions.
Financial Highlights
53 data points| Revenue | $6.45B |
| Cost of Revenue | $4.31B |
| Gross Profit | $2.14B |
| SG&A Expenses | $1.39B |
| Operating Income | $488.00M |
| Interest Expense | $81.00M |
| Net Income | $4.19B |
| EPS (Basic) | $4.81 |
| EPS (Diluted) | $4.79 |
| Shares Outstanding (Basic) | 870.90M |
| Shares Outstanding (Diluted) | 875.20M |
Key Highlights
- 1Completed the sale of the Power Solutions business for $13.2 billion, resulting in net cash proceeds of $11.6 billion and a significant gain recognized in discontinued operations.
- 2Reported a substantial increase in net income to $4.19 billion, primarily due to the Power Solutions divestiture, compared to $723 million in the prior year's period.
- 3Net sales for continuing operations increased by 3% to $6.45 billion for the quarter, driven by higher organic sales across all segments.
- 4The company incurred $235 million in restructuring and impairment costs, a significant increase from the prior year's comparable period, related to plans to dispose of a business within its Global Products segment.
- 5The effective tax rate for continuing operations increased significantly to 52% in the current quarter from 10% in the prior year, impacted by U.S. Tax Reform, tax audit adjustments, and other discrete charges.
- 6Total debt decreased significantly by 33% to $7.3 billion, and net debt decreased by 66% to $3.6 billion, reflecting the use of proceeds from the Power Solutions divestiture.
- 7Johnson Controls repurchased approximately $4.0 billion of its ordinary shares through a modified Dutch auction tender offer in June 2019.