Johnson Controls Forecasts Gains in Sales and Earnings in Fiscal 2013
MILWAUKEE, Dec. 19, 2012
MILWAUKEE, Dec. 19, 2012 /PRNewswire/ -- Johnson Controls, Inc. (NYSE: JCI), a
global diversified company in the building and automotive industries,
announced today that it expects to post higher sales and earnings in fiscal
2013 despite a challenging economic environment.
The Company is presenting its fiscal 2013 forecast to financial analysts today
in New York. Highlights include:
oConsolidated net sales of approximately $43.5 billion, up 3 to 4 percent
oYear-on-year segment income improvement of approximately 10%
oDiluted earnings per share of approximately $2.60 to $2.70, which is level
to 4 percent higher than fiscal 2012
oSales and segment income improvement in all four of its businesses
oContinued capital investment to support growth and margin expansion
From a market perspective, Johnson Controls said that compared with 2012
markets, it expects slightly higher 2013 automotive production in North
America and China with lower production in Europe. Global non-residential
construction spending is forecast to be relatively flat in 2013 as strength in
emerging markets, especially Asia, offsets anticipated softness in North
America and Europe.
The Company said it believes it is positioned to grow faster than its
underlying markets with improved profitability over the long term.
"While we recognize the challenges of the near-term global economy, we believe
our unique strengths will enable Johnson Controls to outperform our underlying
markets. We have added management capacity and depth with talent from outside
JCI to further leverage of our competitive advantages," said Stephen A. Roell,
chairman and chief executive officer of Johnson Controls. "The company
continues to benefit from growth opportunities stemming from our investments
in technology and global expansion. We remain committed to investing for
future growth and profit improvement and are confident that our 2013
strategies and improvement initiatives position us to improve shareholder
value over the long term."
2013 Business Segment Financial Outlook
Johnson Controls provided sales and margin guidance for each of its four
business units in 2013.
Automotive Seating 2013 sales are forecast to gain approximately 2 percent,
reflecting higher production volumes in North America, partially offset by the
lower production environment in Europe. Segment margins are expected to be
approximately 4.2 to 4.4 percent in 2013 as the negative impact of lower
European production offsets improvements in operational efficiency and the
benefits from recent cost reduction initiatives.
Automotive Electronics and Interiors 2013 sales are projected to increase
approximately 2 percent, reflecting higher volumes in Asia, partially offset
by lower electronics sales in Europe. Operating leverage and operational
improvements, offset by investment in electronics product development are
forecast to result in margins of approximately 1.9 to 2.1 percent in 2013.
The combined automotive backlog for 2013 to 2015 is $3.7 billion,
approximately level with the 2012 to 2014 period due to a lower assumed auto
production rate in Europe.
Power Solutions 2013 sales are estimated to increase approximately 10 to 12
percent due to higher battery volumes across all regions and channels, led by
higher production in China, market share growth and increasing market demand
for AGM batteries which are used in Start-Stop vehicles. Segment margins are
expected to be approximately 14.6 to 14.8 percent in 2013 led by operating
leverage, an improved product mix and continued operational improvements,
offset by lead recoveries.
Building Efficiency sales are forecast to increase 2 to 4 percent in 2013 due
to growth in emerging markets and a moderate recovery in North America Systems
and Service. Segment margins are expected to increase approximately 50 basis
points to 6.4 to 6.5 percent in 2013, due to improved operating leverage,
pricing actions and the benefits of earlier cost reduction initiatives.
Johnson Controls expects to make capital investments of $1.4 billion in 2013
vs. $1.8 billion in 2012. Approximately 80% of the company's capital
expenditures in 2013 are associated with growth and margin expansion
opportunities. The higher capital expenditures focus on increased
manufacturing capacity for AGM batteries and on expansion in emerging markets.
The increased investments also will support a higher level of Automotive
Experience new business launches in 2013.
Mid-Term Financial Outlook (Through 2017)
Today, Johnson Controls also provided mid-term margin guidance for each of its
Automotive Seating forecasts annual margin expansion of 30 to 40 basis points
due to benefits from vertical integration, operational improvements and better
quoting disciplines. Longer-term, the company believes margins could improve
to 7 to 8 percent.
Annual margin expansion of 60 to 70 basis points over the mid-term is
projected for Automotive Electronics and Interiors driven by higher
profitability in Electronics, an operational turnaround in Interiors and cost
improvement initiatives. Over the next few years, margin could increase to 4
to 6 percent.
Power Solutions forecasts 200 basis points of margin expansion by 2017 led by
an improved product mix, manufacturing improvements, and benefits from
Building Efficiency expects annual margin expansion of approximately 40 to 50
basis points due to improved supply chain management, business model changes,
and growth in emerging markets.
The Strategic Review and 2013 Outlook Meeting begins at 8:30 a.m. Eastern Time
today. A webcast of the event and presentation materials are available in the
"Investors" section of www.johnsoncontrols.com.
About Johnson Controls
Johnson Controls is a global diversified technology and industrial leader
serving customers in more than 150 countries. Our 170,000 employees create
quality products, services and solutions to optimize energy and operational
efficiencies of buildings; lead-acid automotive batteries and advanced
batteries for hybrid and electric vehicles; and interior systems for
automobiles. Our commitment to sustainability dates back to our roots in 1885,
with the invention of the first electric room thermostat. Through our growth
strategies and by increasing market share we are committed to delivering value
to shareholders and making our customers successful. In 2012, Corporate
Responsibility Magazine recognized Johnson Controls as the #5 company in its
annual "100 Best Corporate Citizens" list. For additional information, please
Johnson Controls, Inc. has made statements in this document that are
forward-looking and, therefore, are subject to risks and uncertainties. All
statements in this document other than statements of historical fact are
statements that are, or could be, deemed "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995. In this
document, statements regarding future financial position, sales, costs,
earnings, cash flows, other measures of results of operations, capital
expenditures or debt levels and plans, objectives, outlook, targets, guidance
or goals are forward-looking statements. Words such as "may," "will,"
"expect," "intend," "estimate," "anticipate," "believe," "should," "forecast,"
"project" or "plan" or terms of similar meaning are also generally intended to
identify forward-looking statements. Johnson Controls cautions that these
statements are subject to numerous important risks, uncertainties, assumptions
and other factors, some of which are beyond Johnson Controls' control, that
could cause Johnson Controls' actual results to differ materially from those
expressed or implied by such forward-looking statements. These factors include
the strength of the U.S. or other economies, automotive vehicle production
levels, mix and schedules, energy and commodity prices, availability of raw
materials and component products, currency exchange rates, and cancellation of
or changes to commercial contracts, as well as other factors discussed in Item
1A of Part I of Johnson Controls' most recent Annual Report on Form 10-K for
the year ended September 30, 2012 and Johnson Controls' subsequent Quarterly
Reports on Form 10-Q. Shareholders, potential investors and others should
consider these factors in evaluating the forward-looking statements and should
not place undue reliance on such statements. The forward-looking statements
included in this document are only made as of the date of this document, and
Johnson Controls assumes no obligation, and disclaims any obligation, to
update forward-looking statements to reflect events or circumstances occurring
after the date of this document.
CONTACT: Glen L. Ponczak (Investors)
David L. Urban (Investors)
Fraser Engerman (Media)
SOURCE Johnson Controls, Inc.
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