Summary
Johnson Controls International plc (JCI) reported its financial results for the quarter ended December 31, 2022. The company saw a 4% increase in net sales to $6.1 billion compared to the prior year quarter, driven by higher organic sales and pricing actions, though this was partially offset by unfavorable foreign currency translation. Gross profit increased by 11%, with gross profit as a percentage of sales improving to 34.5% from 32.3% in the prior year, primarily due to favorable price/cost dynamics and productivity gains. However, net income attributable to Johnson Controls significantly decreased by 69% to $118 million, impacted by a substantial rise in restructuring and impairment costs, which surged to $345 million from $49 million in the prior year, largely due to impairments related to businesses held for sale. Despite the significant drop in net income, the company's balance sheet remains solid, with total assets of $42.8 billion and total equity of $17.2 billion. Cash flows from operating activities were negative at ($296) million for the quarter, impacted by working capital timing, while investing activities used $189 million. The company ended the quarter with $1.5 billion in cash and cash equivalents and maintained adequate liquidity. Management remains focused on leveraging trends in smart, healthy, and sustainable buildings to drive growth, with significant investments in its OpenBlue platform and digital capabilities. The company also highlighted its ongoing share repurchase program and its commitment to paying dividends.
Financial Highlights
50 data points| Revenue | $6.07B |
| Cost of Revenue | $3.98B |
| Gross Profit | $2.09B |
| SG&A Expenses | $1.57B |
| Interest Expense | $69.00M |
| Net Income | $118.00M |
| EPS (Basic) | $0.17 |
| EPS (Diluted) | $0.17 |
| Shares Outstanding (Basic) | 687.00M |
| Shares Outstanding (Diluted) | 690.30M |
Key Highlights
- 1Net sales increased by 4% to $6.1 billion, driven by organic growth and pricing, despite an 8% negative impact from foreign currency translation and divestitures.
- 2Gross profit margin improved by 220 basis points to 34.5%, reflecting favorable price/cost dynamics and productivity initiatives.
- 3Net income attributable to Johnson Controls declined significantly by 69% to $118 million, primarily due to a substantial increase in restructuring and impairment costs to $345 million.
- 4Restructuring and impairment costs saw a significant rise from $49 million in the prior year quarter to $345 million, largely driven by $288 million in impairment charges for businesses classified as held for sale.
- 5Operating cash flow was negative at ($296) million, impacted by timing of accounts payable and accrued liabilities.
- 6The company repurchased $154 million of its ordinary shares during the quarter and has approximately $3.5 billion remaining under its share repurchase program.
- 7The company continues to invest in its OpenBlue platform and digital capabilities to capitalize on the growing demand for smart, healthy, and sustainable buildings.