What is the main purpose of this 8-K filing?

The main purpose of this 8-K filing is to announce Johnson Controls International plc's definitive agreement to sell its Power Solutions business and to provide supplemental non-GAAP financial information reflecting its continuing operations.

What is the Power Solutions business?

The Power Solutions business, being sold by JCI, is typically associated with the manufacturing and sale of batteries for automotive and other applications.

Why is JCI providing non-GAAP financial information?

JCI is providing non-GAAP financial information to offer investors a clearer view of the performance and trends of its continuing operations, by retrospectively treating the divested Power Solutions business as discontinued and excluding certain special items that are not directly related to ongoing business performance.

How should investors interpret the non-GAAP information?

Investors should use this non-GAAP information as a supplement to, not a replacement for, the company's GAAP financial statements. It is intended to aid in understanding period-over-period operating results and business trends of the core, continuing businesses.

JCI 8-K: Regulation FD — Nov 13, 2018

Summary

Johnson Controls International plc (JCI) announced on November 13, 2018, a significant strategic move: the definitive agreement to sell its Power Solutions business to BCP Acquisitions LLC. This divestiture is a key event for investors as it signals a reshaping of JCI's operational focus. The company is also providing supplemental unaudited non-GAAP financial information that presents its historical results as if the Power Solutions business had been classified as discontinued operations since October 1, 2016. This retrospective adjustment aims to offer a clearer view of the ongoing business performance and trends, excluding the impact of the divested segment. Investors should pay close attention to this transaction and the accompanying financial data. The sale of the Power Solutions division suggests a strategic pivot, likely to concentrate resources and management attention on its core building technologies and solutions. The supplemental non-GAAP information, which adjusts for special items like transaction and integration costs, is intended by management to provide a more comparable and insightful look at the continuing operations' underlying performance. While these non-GAAP measures are useful for understanding trends, they should always be considered alongside the most comparable GAAP measures.

Key Highlights

1JCI entered into a definitive agreement to sell its Power Solutions business to BCP Acquisitions LLC.
2The sale represents a significant strategic divestiture for Johnson Controls.
3The company is providing supplemental unaudited non-GAAP historical financial information.
4This non-GAAP data reflects continuing operations as if Power Solutions was a discontinued operation since October 1, 2016.
5Adjusted measures include net sales, segment EBITA, and segment EBITA margin.
6Special items, such as transaction/integration costs, are excluded from adjusted segment EBITA.
7Management believes these non-GAAP measures offer insights into operating results and business trends of continuing operations.

Johnson Controls International plc 8-K Report, Regulation FD Disclosure (Nov 13, 2018)

Summary

Key Highlights

Frequently Asked Questions