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    Johnson Controls Reports Strong Q1 Results; Raises FY25 Guidance

    2/5/25 6:55:00 AM ET
    $JCI
    Industrial Machinery/Components
    Industrials
    Get the next $JCI alert in real time by email
    • Q1 sales increased 4% and organic sales increased 10%*
    • Q1 GAAP EPS of $0.55; Q1 Adjusted EPS* of $0.64
    • Q1 Orders increased 16% organically year-over-year
    • Building Solutions backlog of $13.2 billion increased 11% organically year-over-year
    • Initiates fiscal Q2 and raises full year fiscal 2025 guidance*

    *

    This news release contains non-GAAP financial measures. Definitions and reconciliations of the non-GAAP financial measures can be found in the attached footnotes. Non-GAAP measures should be considered in addition to, and not as replacements for, the most comparable GAAP measures.

    CORK, Ireland, Feb. 5, 2025 /PRNewswire/ -- Johnson Controls International plc (NYSE:JCI), a global leader for smart, healthy and sustainable buildings, today reported fiscal first quarter 2025 GAAP earnings per share ("EPS") of $0.55. Adjusted EPS was $0.64.

    Sales in the quarter of $5.4 billion increased 4% over the prior year on an as reported basis and 10% organically. GAAP income from continuing operations was $363 million. Adjusted income from continuing operations was $426 million.

    "I am proud of another strong quarter delivered by the Johnson Controls team, which reflects our successful strategy to simplify our portfolio and position our Company as a leading pure-play building solutions provider," said George Oliver, Chairman and CEO. "We are driving results based on our unique value proposition, with an ability to serve our customers over the lifecycle of the building. The significant progress in our transformation is enabling us to achieve more consistent and predictable performance, as well as our ability to deliver value for our stakeholders."

    FISCAL Q1 SEGMENT RESULTS

    The financial highlights presented in the tables below exclude discontinued operations and are in accordance with GAAP, unless otherwise indicated. All comparisons are to the fiscal first quarter of 2024.

    A slide presentation to accompany the results can be found in the Investor Relations section of Johnson Controls' website at http://investors.johnsoncontrols.com.

    Building Solutions North America





    Fiscal Q1

    (in millions)



    2025



    2024



    Change

    Sales



    $     2,744



    $     2,487



    10 %

    Segment EBITA













    GAAP



    332



    285



    16 %

    Adjusted (non-GAAP)



    332



    285



    16 %

    Segment EBITA Margin %













    GAAP



    12.1 %



    11.5 %



              60 bp

    Adjusted (non-GAAP)



    12.1 %



    11.5 %



              60 bp

    Sales in the quarter of $2.7 billion increased 10% over the prior year. Organic sales also increased 10% over the prior year, led by high teens growth in Applied HVAC and Controls.

    Excluding M&A and adjusted for foreign currency, orders increased 18% year-over-year and backlog of $9.3 billion increased 12% year-over-year.

    Segment EBITA margin of 12.1% expanded 60 basis points versus the prior year driven by the execution of our higher margin backlog.

    Building Solutions EMEA/LA (Europe, Middle East, Africa/Latin America)





    Fiscal Q1

    (in millions)



    2025



    2024



    Change

    Sales



    $     1,073



    $     1,038



    3 %

    Segment EBITA













    GAAP



    108



    80



    35 %

    Adjusted (non-GAAP)



    108



    80



    35 %

    Segment EBITA Margin %













    GAAP



    10.1 %



    7.7 %



            240 bp 

    Adjusted (non-GAAP)



    10.1 %



    7.7 %



            240 bp 

    Sales in the quarter of $1.1 billion increased 3% over the prior year. Organic sales grew 6% versus the prior year quarter led by 10% growth in Service. Fire and Security sales increased high single digits.

    Excluding M&A and adjusted for foreign currency, orders increased 6% year-over-year and backlog of $2.5 billion increased 5% year-over-year.

    Segment EBITA margin of 10.1% expanded 240 basis points versus the prior year driven by productivity improvements and positive mix from growth in Service.

    Building Solutions Asia Pacific





    Fiscal Q1

    (in millions)



    2025



    2024



    Change

    Sales



    $        527



    $        507



    4 %

    Segment EBITA













    GAAP



    49



    46



    7 %

    Adjusted (non-GAAP)



    49



    46



    7 %

    Segment EBITA Margin %













    GAAP



    9.3 %



    9.1 %



              20 bp

    Adjusted (non-GAAP)



    9.3 %



    9.1 %



              20 bp

    Sales in the quarter of $527 million increased 4% versus the prior year. Organic sales increased 5% versus the prior year led by 14% growth in Service.

    Excluding M&A and adjusted for foreign currency, orders increased 32% year-over-year and backlog of $1.5 billion increased 22% year-over-year.

    Segment EBITA margin of 9.3% increased 20 basis points versus the prior year driven by positive mix from the Service business.

    Global Products





    Fiscal Q1

    (in millions)



    2025



    2024



    Change

    Sales



    $     1,082



    $     1,177



    (8 %)

    Segment EBITA













    GAAP



    326



    267



    22 %

    Adjusted (non-GAAP)



    326



    267



    22 %

    Segment EBITA Margin %













    GAAP



    30.1 %



    22.7 %



            740 bp 

    Adjusted (non-GAAP)



    30.1 %



    22.7 %



            740 bp 

    Sales in the quarter of $1.1 billion declined 8% versus the prior year. Organic sales grew 15% versus the prior year led by over 30% growth in Applied HVAC.

    Segment EBITA margin of 30.1% expanded 740 basis points versus the prior year due to increased volumes and enhanced operational efficiencies.

    Corporate





    Fiscal Q1

    (in millions)



    2025



    2024



    Change

    Corporate Expense













    GAAP



    $           171



    $           139



    23 %

    Adjusted (non-GAAP)



    127



    116



    9 %

    Adjusted Corporate expense in Q1 2025 excludes certain transaction/separation costs and transformation costs. Adjusted Corporate expense in Q1 2024 excludes certain transaction/separation costs and cyber incident costs.

    OTHER Q1 ITEMS

    • Cash provided by operating activities was $249 million. Free cash flow was $133 million and adjusted free cash flow was $603 million.
    • The Company paid dividends of $245 million.
    • The Company repurchased 4.1 million shares of common stock for $330 million.

    GUIDANCE

    The following forward-looking statements regarding organic sales growth, adjusted segment EBITA margin, adjusted segment EBITA margin improvement and adjusted EPS are non-GAAP financial measures and are presented on a continuing operations basis excluding the Residential and Light Commercial HVAC business, which was classified as discontinued operations beginning in the fiscal fourth quarter of 2024. These non-GAAP financial measures are derived by excluding certain amounts from the corresponding financial measures determined in accordance with GAAP. The determination of the amounts excluded is a matter of management judgment and depends upon, among other factors, the nature of the underlying expense or income amounts recognized in a given period and the high variability of certain amounts, such as mark-to-market adjustments. Organic revenue growth excludes the effect of acquisitions, divestitures and foreign currency. The Company is unable to present a quantitative reconciliation of the aforementioned forward-looking non-GAAP financial measures to its most directly comparable forward-looking GAAP financial measures because such information is not available, and management cannot reliably predict the necessary components of such GAAP measures without unreasonable effort or expense. The unavailable information could have a significant impact on the Company's fiscal 2025 second quarter and full year GAAP financial results from continuing operations.

    The Company initiated fiscal 2025 second quarter guidance:

    • Organic sales growth of mid-single digits
    • Adjusted segment EBITA margin of ~16.5%
    • Adjusted EPS before special items of ~$0.77 to $0.79

    The Company raised fiscal 2025 full year guidance:

    • Organic sales growth of mid-single digits (unchanged)
    • Adjusted segment EBITA margin improvement of more than 80 basis points, year-over-year (previously more than 50 bps)
    • Adjusted EPS before special items of ~$3.50 to $3.60 (previously ~$3.40 to $3.50)

    CONFERENCE CALL & WEBCAST INFO

    Johnson Controls will host a conference call to discuss this quarter's results at 8:30 a.m. ET today, which can be accessed by dialing 844-763-8274 (in the United States) or +1-412-717-9224 (outside the United States), or via webcast. A slide presentation will accompany the prepared remarks and has been posted on the investor relations section of the Johnson Controls website at https://investors.johnsoncontrols.com/news-and-events/events-and-presentations. A replay will be made available approximately two hours following the conclusion of the conference call.

    ABOUT JOHNSON CONTROLS

    At Johnson Controls (NYSE:JCI), we transform the environments where people live, work, learn and play. As the global leader in smart, healthy and sustainable buildings, our mission is to reimagine the performance of buildings to serve people, places and the planet.  

    Building on a proud history of nearly 140 years of innovation, we deliver the blueprint of the future for industries such as healthcare, schools, data centers, airports, stadiums, manufacturing and beyond through OpenBlue, our comprehensive digital offering.

    Today, Johnson Controls offers the world's largest portfolio of building technology and software as well as service solutions from some of the most trusted names in the industry.

    Visit www.johnsoncontrols.com for more information and follow @Johnson Controls on social platforms.

    JOHNSON CONTROLS CONTACTS:

    INVESTOR CONTACTS:

    MEDIA CONTACT:









    Jim Lucas

    Danielle Canzanella



    Direct: +1 414.340.1752

    Direct: +1 203.499.8297



    Email: [email protected]

    Email: [email protected]









    Michael Gates





    Direct: +1 414.524.5785





    Email: [email protected] 





    JOHNSON CONTROLS INTERNATIONAL PLC CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

    Johnson Controls International plc has made statements in this communication that are forward-looking and therefore are subject to risks and uncertainties. All statements in this document other than statements of historical fact are, or could be, "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. In this communication, statements regarding Johnson Controls future financial position, sales, costs, earnings, cash flows, other measures of results of operations, synergies and integration opportunities, capital expenditures, debt levels and market outlook are forward-looking statements. Words such as "may," "will," "expect," "intend," "estimate," "anticipate," "believe," "should," "forecast," "project" or "plan" and terms of similar meaning are also generally intended to identify forward-looking statements.  However, the absence of these words does not mean that a statement is not forward-looking. Johnson Controls cautions that these statements are subject to numerous important risks, uncertainties, assumptions and other factors, some of which are beyond its control, that could cause its actual results to differ materially from those expressed or implied by such forward-looking statements, including, among others, risks related to: Johnson Controls' ability to develop or acquire new products and technologies that achieve market acceptance and meet applicable quality and regulatory requirements; the ability of Johnson Controls to execute on its operating model and drive organizational improvement; Johnson Controls' ability to successfully execute and complete portfolio simplification, including the completion of the divestiture of the Residential and Light Commercial business, as well as the possibility that the expected benefits of such actions will not be realized or will not be realized within the expected time frame; the ability to hire and retain senior management and other key personnel, including successfully executing Johnson Controls' Chief Executive Officer succession plan; the ability to innovate and adapt to emerging technologies, ideas and trends in the marketplace, including the incorporation of technologies such as artificial intelligence; the ability to manage general economic, business and capital market conditions, including the impact of recessions, economic downturns and global price inflation; fluctuations in the cost and availability of public and private financing for Johnson Controls' customers; the ability to manage macroeconomic and geopolitical volatility, including supply chain shortages, restrictive trade measures and the conflict between Russia and Ukraine and the ongoing conflicts in the Middle East; managing the risks and impacts of potential and actual security breaches, cyberattacks, privacy breaches or data breaches; maintaining and improving the capacity, reliability and security of Johnson Controls' enterprise information technology infrastructure; the ability to manage the lifecycle cybersecurity risk in the development, deployment and operation of Johnson Controls' digital platforms and services; changes to laws or policies governing foreign trade, including economic sanctions, tariffs, foreign exchange and capital controls, import/export controls or other trade restrictions; fluctuations in currency exchange rates; changes or uncertainty in laws, regulations, rates, policies, or interpretations that impact Johnson Controls' business operations or tax status; the ability to adapt to global climate change, climate change regulation and successfully meet Johnson Controls' public sustainability commitments; the outcome of litigation and governmental proceedings; the risk of infringement or expiration of intellectual property rights; Johnson Controls' ability to manage disruptions caused by catastrophic or geopolitical events, such as natural disasters, armed conflict, political change, climate change, pandemics and outbreaks of contagious diseases and other adverse public health developments; any delay or inability of Johnson Controls to realize the expected benefits and synergies of recent portfolio transactions; the tax treatment of recent portfolio transactions; significant transaction costs and/or unknown liabilities associated with such transactions; labor shortages, work stoppages, union negotiations, labor disputes and other matters associated with the labor force; and the cancellation of or changes to commercial arrangements. A detailed discussion of risks related to Johnson Controls business is included in the section entitled "Risk Factors" in Johnson Controls Annual Report on Form 10-K for the fiscal year filed with the SEC, which is available at www.sec.gov and www.johnsoncontrols.com under the "Investors" tab. The description of certain of these risks is supplemented in Item 1A of Part II of Johnson Controls subsequently filed 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 communication are made only as of the date of this document, unless otherwise specified, and, except as required by law, Johnson Controls assumes no obligation, and disclaims any obligation, to update such statements to reflect events or circumstances occurring after the date of this communication.

     

    FINANCIAL STATEMENTS







    Johnson Controls International plc



    Consolidated Statements of Income



    (in millions, except per share data; unaudited)









    Three Months Ended

    December 31,





    2024



    2023



    Net sales









    Products and systems

    $                   3,685



    $                   3,604



    Services

    1,741



    1,605





    5,426



    5,209



    Cost of sales









    Products and systems

    2,456



    2,490



    Services

    1,044



    941





    3,500



    3,431













    Gross profit

    1,926



    1,778













    Selling, general and administrative expenses

    1,399



    1,334



    Restructuring and impairment costs

    33



    35



    Net financing charges

    86



    87



    Equity loss

    —



    (2)













    Income from continuing operations before income taxes

    408



    320













    Income tax provision (benefit)

    47



    (20)













    Income from continuing operations

    361



    340













    Income from discontinued operations, net of tax (Note 3)

    90



    64













    Net income

    451



    404













    Income (loss) attributable to noncontrolling interests









    Continuing operations

    (2)



    —



    Discontinued operations

    34



    30













    Net income attributable to Johnson Controls

    $                      419



    $                      374













    Income attributable to Johnson Controls









    Continuing operations

    $                      363



    $                      340



    Discontinued operations

    56



    34



    Total

    $                      419



    $                      374













    Basic earnings per share attributable to Johnson Controls









    Continuing operations

    $                     0.55



    $                     0.50



    Discontinued operations

    0.08



    0.05



    Total

    $                     0.63



    $                     0.55













    Diluted earnings per share attributable to Johnson Controls









    Continuing operations

    $                     0.55



    $                     0.50



    Discontinued operations

    0.08



    0.05



    Total

    $                     0.63



    $                     0.55



     

    Johnson Controls International plc

    Condensed Consolidated Statements of Financial Position

    (in millions; unaudited)





    December 31, 2024



    September 30, 2024

    Assets















    Cash and cash equivalents

    $                   1,237



    $                      606

    Accounts receivable - net

    5,614



    6,051

    Inventories

    1,739



    1,774

    Current assets held for sale

    1,658



    1,595

    Other current assets

    1,041



    1,153

    Current assets

    11,289



    11,179









    Property, plant and equipment - net

    2,418



    2,403

    Goodwill

    16,412



    16,725

    Other intangible assets - net

    3,963



    4,130

    Noncurrent assets held for sale

    2,986



    3,210

    Other noncurrent assets

    5,030



    5,048

    Total assets

    $                 42,098



    $                 42,695









    Liabilities and Equity















    Short-term debt

    $                      882



    $                      953

    Current portion of long-term debt

    522



    536

    Accounts payable

    3,214



    3,389

    Accrued compensation and benefits

    917



    1,048

    Deferred revenue

    2,211



    2,160

    Current liabilities held for sale

    1,322



    1,431

    Other current liabilities

    2,015



    2,438

    Current liabilities

    11,083



    11,955









    Long-term debt

    8,589



    8,004

    Pension and postretirement benefits

    192



    217

    Noncurrent liabilities held for sale

    407



    405

    Other noncurrent liabilities

    4,697



    4,753

    Long-term liabilities

    13,885



    13,379









    Shareholders' equity attributable to Johnson Controls

    15,900



    16,098

    Noncontrolling interests

    1,230



    1,263

    Total equity

    17,130



    17,361

    Total liabilities and equity

    $                 42,098



    $                 42,695

     

    Johnson Controls International plc

    Consolidated Statements of Cash Flows

    (in millions; unaudited)





    Three Months Ended December 31,



    2024



    2023

    Operating Activities of Continuing Operations







    Income from continuing operations attributable to Johnson Controls

    $                  363



    $                  340

    Loss from continuing operations attributable to noncontrolling interests

    (2)



    —

    Income from continuing operations

    361



    340

    Adjustments to reconcile net income to cash provided by operating activities:







    Depreciation and amortization

    193



    208

    Pension and postretirement income and contributions

    (16)



    (16)

    Deferred income taxes

    (54)



    (80)

    Noncash restructuring and impairment charges

    8



    9

    Equity-based compensation

    28



    29

    Other - net

    8



    (22)

    Changes in assets and liabilities, excluding acquisitions and divestitures:







    Accounts receivable

    284



    40

    Inventories

    (15)



    (106)

    Other assets

    (171)



    (195)

    Restructuring reserves

    2



    (14)

    Accounts payable and accrued liabilities

    (407)



    (315)

    Accrued income taxes

    28



    11

    Cash provided (used) by operating activities from continuing

    operations

    249



    (111)









    Investing Activities of Continuing Operations







    Capital expenditures

    (116)



    (82)

    Other - net

    11



    18

    Cash used by investing activities from continuing operations

    (105)



    (64)









    Financing Activities of Continuing Operations







    Net proceeds from borrowings with maturities less than three months

    12



    1,116

    Proceeds from debt

    775



    422

    Stock repurchases and retirements

    (330)



    —

    Payment of cash dividends

    (245)



    (252)

    Employee equity-based compensation withholding taxes

    (29)



    (23)

    Other - net

    18



    (27)

    Cash provided by financing activities from continuing operations

    201



    1,236









    Discontinued Operations







    Cash used by operating activities

    (2)



    (135)

    Cash used by investing activities

    (10)



    (10)

    Cash used by financing activities

    —



    (8)

    Cash used by discontinued operations

    (12)



    (153)

    Effect of exchange rate changes on cash, cash equivalents and restricted cash

    154



    60

    Change in cash, cash equivalents and restricted cash held for sale

    4



    5

    Increase in cash, cash equivalents and restricted cash

    491



    973

    Cash, cash equivalents and restricted cash at beginning of period

    767



    917

    Cash, cash equivalents and restricted cash at end of period

    1,258



    1,890

    Less: Restricted cash

    21



    91

    Cash and cash equivalents at end of period

    $               1,237



    $               1,799

     

    FOOTNOTES

    1.   Sale of Residential and Light Commercial HVAC Business

    The Company signed a definitive agreement in July 2024 to sell its Residential and Light Commercial HVAC business (the "R&LC Business"), which includes the North America Ducted businesses and the global Residential joint venture with Hitachi Global Life Solutions, Inc. ("Hitachi"), of which Johnson Controls owns 60% and Hitachi owns 40%. The R&LC Business, which was previously reported in the Global Products segment, meets the criteria to be classified as a discontinued operation and, as a result, its historical financial results are reflected in the consolidated financial statements as a discontinued operation, and assets and liabilities were retrospectively reclassified as held for sale for all periods presented. Unless otherwise noted, all activities and amounts reported in the following footnotes include only continuing operations of the Company and exclude activities and amounts related to the R&LC business.

    2.   Non-GAAP Measures

    The Company reports various non-GAAP measures in this earnings release and the related earnings presentation.  Non-GAAP measures should be considered in addition to, and not as replacements for, the most comparable GAAP measures. Refer to footnotes three through eight for further information on the calculations of the non-GAAP measures and reconciliations of the non-GAAP measures to the most comparable GAAP measures.

    Organic sales

    Organic sales growth excludes the impact of acquisitions, divestitures and foreign currency. Management believes organic sales growth is useful to investors in understanding period-over-period sales results and trends.

    Cash flow

    Management believes free cash flow and adjusted free cash flow measures are useful to investors in understanding the strength of the Company and its ability to generate cash. These non-GAAP measures can also be used to evaluate the Company's ability to generate cash flow from operations and the impact that this cash flow has on its liquidity. Management also believes adjusted free cash flows are useful to investors in understanding period-over-period cash flows, cash trends and ongoing cash flows of the Company.

    Adjusted free cash flow and adjusted free cash flow conversion are non-GAAP measures which exclude the impacts of the following:

    • JC Capital cash flows primarily include activity associated with finance/notes receivables and inventory and/or capital expenditures related to lease arrangements. JC Capital net income is primarily related to interest income on the finance/notes receivable and profit recognized on arrangements with sales-type lease components.
    • Effective January 1, 2024, the Company has excluded the impact of discontinuing its accounts receivables factoring programs from adjusted free cash flow and adjusted free cash flow conversion. The Company has also re-baselined the prior year adjusted free cash flow measures to present a more comparative measure without the impact of factoring.
    • Cash payments related to the water systems AFFF settlement and cash receipts for AFFF-related insurance recoveries.

    Adjusted financial measures

    Adjusted financial measures include adjusted segment EBITA, adjusted net income, adjusted earnings per share, adjusted EBIT, adjusted EBITDA and adjusted corporate expenses. These non-GAAP measures are derived by excluding certain amounts from the corresponding financial measures determined in accordance with GAAP. The determination of the excluded amounts is a matter of management judgment and depends upon the nature and variability of the underlying expense or income amounts and other factors.

    As detailed in the tables included in footnotes five through eight, the following items were excluded from certain financial measures:

    • Net mark-to-market adjustments are the result of adjusting restricted asbestos investments and pension and postretirement plan assets to their current market value. These adjustments may have a favorable or unfavorable impact on results.
    • Restructuring and impairment costs, net of NCI represents restructuring costs attributable to Johnson Controls including costs associated with exit plans or other restructuring plans that will have a more significant impact on the underlying cost structure of the organization. Impairment costs primarily relate to write-downs of goodwill, intangible assets and assets held for sale to their fair value.
    • Water systems AFFF settlement and insurance recoveries include amounts related to a settlement with a nationwide class of public water systems concerning the use of AFFF manufactured and sold by a subsidiary of the Company, and AFFF-related insurance recoveries.
    • Transaction/separation costs include costs associated with significant mergers and acquisitions.
    • Transformation costs represent incremental expenses incurred in association with strategic growth initiatives and cost saving opportunities in order to realize the benefits of portfolio simplification and the Company's lifecycle solutions strategy.
    • Earn-out adjustments relate to earn-out liabilities associated with certain significant acquisitions and may have a favorable or unfavorable impact on results.
    • Cyber incident costs primarily represent expenses, net of insurance recoveries, associated with the response to, and remediation of, a cybersecurity incident which occurred in September 2023.
    • Global products product quality issue are costs related to a product quality issue within the Global Products segment that is unusual due to the magnitude of the expected cost to remediate in comparison to typical product quality issues experienced by the Company.
    • Loss on divestiture relates to the sale of the ADTi business.
    • EMEA/LA joint venture loss relates to certain non-recurring losses associated with the equity method accounting of a joint venture company.
    • Discrete tax items, net includes the net impact of discrete tax items within the period, including the following types of items: changes in estimates associated with valuation allowances, changes in estimates associated with reserves for uncertain tax positions, withholding taxes recorded upon changes in indefinite re-investment assertions for businesses to be disposed of, impacts from statutory rate changes, and the recording of significant tax credits.
    • Related tax impact includes the tax impact of the various excluded items.

    Management believes the exclusion of these items is useful to investors due to the unusual nature and/or magnitude of the amounts. When considered together with unadjusted amounts, adjusted financial measures are useful to investors in understanding period-over-period operating results, business trends and ongoing operations of the Company. Management may also use these metrics as guides in forecasting, budgeting and long-term planning processes and for compensation purposes.

    Debt ratios

    Management believes that net debt to adjusted EBITDA, a non-GAAP measure, is useful to understanding the Company's financial condition as the ratio provides an overview of the extent to which the Company relies on external debt financing for its funding and also is a measure of risk to its shareholders.

    3.   Sales

    The following tables detail the changes in sales from continuing operations attributable to organic growth, foreign currency, acquisitions, divestitures and other (unaudited):



    Three Months Ended December 31

    Net sales

    Building Solutions









    (in millions)

    North

    America



    EMEA/LA



    Asia

    Pacific



    Total



    Global

    Products



    Total JCI

    plc

    Net sales - 2023

    $  2,487



    $  1,038



    $    507



    $  4,032



    $  1,177



    $  5,209

    Base year adjustments























    Divestitures and other

    —



    —



    —



    —



    (233)



    (233)

    Foreign currency

    (3)



    (25)



    (3)



    (31)



    (2)



    (33)

    Adjusted base net sales

    2,484



    1,013



    504



    4,001



    942



    4,943

    Acquisitions

    —



    3



    —



    3



    —



    3

    Organic growth

    260



    57



    23



    340



    140



    480

    Net sales - 2024

    $  2,744



    $  1,073



    $    527



    $  4,344



    $  1,082



    $  5,426

























    Growth %:























    Net sales

    10 %



    3 %



    4 %



    8 %



    (8) %



    4 %

    Organic growth

    10 %



    6 %



    5 %



    8 %



    15 %



    10 %

     



    Three Months Ended December 31

    Products and systems revenue

    Building Solutions









    (in millions)

    North

    America



    EMEA/LA



    Asia

    Pacific



    Total



    Global

    Products



    Total JCI

    plc

    Products and systems revenue - 2023

    $  1,518



    $    572



    $    337



    $ 2,427



    $  1,177



    $  3,604

    Base year adjustments























    Divestitures and other

    —



    —



    —



    —



    (233)



    (233)

    Foreign currency

    —



    (12)



    (3)



    (15)



    (2)



    (17)

    Adjusted products and systems revenue

    1,518



    560



    334



    2,412



    942



    3,354

    Acquisitions

    —



    2



    —



    2



    —



    2

    Organic growth

    176



    13



    —



    189



    140



    329

    Products and systems revenue -  2024

    $  1,694



    $    575



    $    334



    $ 2,603



    $  1,082



    $  3,685

























    Growth %:























    Products and systems revenue

    12 %



    1 %



    (1) %



    7 %



    (8) %



    2 %

    Organic growth

    12 %



    2 %



    — %



    8 %



    15 %



    10 %

     



    Three Months Ended December 31

    Service revenue

    Building Solutions









    (in millions)

    North

    America



    EMEA/LA



    Asia

    Pacific



    Total



    Global

    Products



    Total JCI

    plc

    Service revenue - 2023

    $    969



    $    466



    $    170



    $ 1,605



    $       —



    $  1,605

    Base year adjustments























    Divestitures and other

    —



    —



    —



    —



    —



    —

    Foreign currency

    (3)



    (13)



    —



    (16)



    —



    (16)

    Adjusted base service revenue

    966



    453



    170



    1,589



    —



    1,589

    Acquisitions

    —



    1



    —



    1



    —



    1

    Organic growth

    84



    44



    23



    151



    —



    151

    Service revenue -  2024

    $  1,050



    $    498



    $    193



    $ 1,741



    $       —



    $  1,741

























    Growth %:























    Service revenue

    8 %



    7 %



    14 %



    8 %



    — %



    8 %

    Organic growth

    9 %



    10 %



    14 %



    10 %



    — %



    10 %

    4.   Cash Flow, Free Cash Flow and Free Cash Flow Conversion

    The following table includes free cash flow and free cash flow conversion (unaudited):



    Three Months Ended December 31,

    (in millions)

    2024



    2023

    Cash provided (used) by operating activities from continuing operations

    $                  249



    $               (111)



    Capital expenditures

    (116)



    (82)



    Free cash flow (non-GAAP)

    $                  133



    $               (193)













    Income from continuing operations attributable to Johnson Controls

    $                  363



    $                  340



    Free cash flow conversion from net income (non-GAAP)

    37 %



    (57) %



    The following table includes adjusted free cash flow and adjusted free cash flow conversion (unaudited):





    Three Months Ended December 31,

    (in millions)



    2024



    2023

    Free cash flow (non-GAAP)



    $                  133



    $                 (193)

    Adjustments:









    JC Capital cash used by operating activities



    66



    88

    Water systems AFFF settlement cash payments and

         insurance recoveries



    397



    —

    Impact from discontinuation of factoring programs



    7



    —

    Adjusted free cash flow (non-GAAP)



    603



    (105)

    Prior year impact from factoring programs



    —



    (85)

    Re-baselined adjusted free cash flow  (non-GAAP)



    $                  603



    $                 (190)











    Adjusted net income attributable to JCI (non-GAAP)



    $                  426



    $                  315

    JC Capital net income



    (5)



    (2)

    Adjusted net income attributable to JCI, excluding JC

         Capital (non-GAAP)



    $                  421



    $                  313

    Adjusted free cash flow conversion (non-GAAP)



    143 %



    (61) %

    5.   EBITA, EBIT and Corporate Expense

    The Company evaluates the performance of its business units primarily on segment EBITA. The following table includes continuing operations:



    Three Months Ended December 31,





    Actual



    Adjusted

    (Non-GAAP)



    (in millions; unaudited)

    2024



    2023



    2024



    2023





















    Segment EBITA

















    Building Solutions North America

    $        332



    $        285



    $        332



    $        285



    Building Solutions EMEA/LA

    108



    80



    108



    80



    Building Solutions Asia Pacific

    49



    46



    49



    46



    Global Products

    326



    267



    326



    267





















    EBIT (non-GAAP)

















    Income (loss) from continuing operations:

















    Attributable to Johnson Controls

    $        363



    $        340



    $        426



    $        315



    Attributable to noncontrolling interests (1)

    (2)



    —



    (2)



    —



    Income from continuing operations

    361



    340



    424



    315



    Less: Income tax provision (benefit)  (2)

    47



    (20)



    58



    41



    Income before income taxes

    408



    320



    482



    356



    Net financing charges

    86



    87



    86



    87



                   EBIT (non-GAAP)

    $        494



    $        407



    $        568



    $        443







    (1)

    Adjusted income attributable to noncontrolling interests excludes the impact of restructuring and impairment costs.





    (2)

    Adjusted income tax provision (benefit) excludes the related tax impacts of pre-tax adjusting items.

    The following table reconciles Corporate expense from continuing operations as reported to the comparable adjusted amounts (unaudited):



    Three Months Ended December 31,



    (in millions)

    2024



    2023













    Corporate expense (GAAP)

    $                   171



    $                   139













    Adjusting items:









    Transaction/separation costs

    (11)



    —



    Transformation costs

    (33)



    —



    Cyber incident costs

    —



    (23)



    Adjusted corporate expense (non-GAAP)

    $                   127



    $                   116



    6.   Net Income and Diluted Earnings Per Share 

    The following tables reconcile income from continuing operations attributable to JCI and diluted earnings per share from continuing operations as reported to the comparable adjusted amounts (unaudited):



    Three Months Ended December 31,



    Income from continuing

    operations attributable to JCI



    Diluted earnings

     per share

    (in millions, except per share)

    2024



    2023



    2024



    2023

















    As reported (GAAP)

    $             363



    $             340



    $            0.55



    $            0.50

















    Adjusting items:















    Net mark-to-market adjustments

    1



    (22)



    —



    (0.03)

    Restructuring and impairment costs, net of NCI

    33



    35



    0.05



    0.05

    Water systems AFFF insurance recoveries

    (4)



    —



    (0.01)



    —

    Transaction/separation costs

    11



    —



    0.02



    —

    Transformation costs

    33



    —



    0.05



    —

    Cyber incident costs

    —



    23



    —



    0.03

    Discrete tax items

    —



    (57)



    —



    (0.08)

    Related tax impact

    (11)



    (4)



    (0.02)



    (0.01)

    Adjusted (non-GAAP)*

    $             426



    $             315



    $            0.64



    $            0.46





    *

    May not sum due to rounding

    The following table reconciles the denominators used to calculate basic and diluted earnings per share (in millions; unaudited):



    Three Months Ended

    December 31,





    2024



    2023









    Weighted average shares outstanding









    Basic weighted average shares outstanding

    662.0



    680.7



    Effect of dilutive securities:









    Stock options, unvested restricted stock and

    unvested performance share awards

    3.0



    1.7



    Diluted weighted average shares outstanding

    665.0



    682.4



    7.   Debt Ratios

    The following table includes continuing operations and details net debt to income before income taxes and net debt to adjusted EBITDA (unaudited):

    (in millions)

    December 31,

    2024



    September 30,

    2024



    December 31,

    2023

    Short-term debt

    $              882



    $              953



    $           1,981

    Current portion of long-term debt

    522



    536



    652

    Long-term debt

    8,589



    8,004



    7,959

    Total debt

    9,993



    9,493



    10,592

    Less: cash and cash equivalents

    1,237



    606



    1,799

    Net debt

    $           8,756



    $           8,887



    $           8,793













    Last twelve months income before income taxes

    $           1,610



    $           1,522



    $           1,335













    Net debt to income before income taxes

                     5.4x



                     5.8x



                     6.6x













    Last twelve months adjusted EBITDA (non-GAAP)

    $           3,733



    $           3,623



    $           3,295













    Net debt to adjusted EBITDA (non-GAAP)

    2.3x



    2.5x



    2.7x

    The following table reconciles income from continuing operations to adjusted EBIT and adjusted EBITDA (unaudited):



    Twelve Months Ended

    (in millions)

    December 31,

    2024



    September 30,

    2024



    December 31,

    2023

    Income from continuing operations

    $             1,432



    $             1,411



    $             1,820

    Income tax provision (benefit)

    178



    111



    (485)

    Income before income taxes

    1,610



    1,522



    1,335

    Net financing charges

    341



    342



    283

    EBIT

    1,951



    1,864



    1,618

    Adjusting items:











    Net mark-to-market adjustments

    (24)



    (47)



    76

    Restructuring and impairment costs

    507



    509



    741

    Water systems AFFF settlement

    750



    750



    —

    Water systems AFFF insurance recoveries

    (371)



    (367)



    —

    Earn-out adjustments

    (68)



    (68)



    (30)

    Transaction/separation costs

    43



    32



    92

    Transformation costs

    33



    —



    —

    Cyber incident costs

    4



    27



    23

    Global Products product quality issue

    33



    33



    —

    Loss on divestiture

    42



    42



    —

    EMEA/LA joint venture loss

    17



    17



    —

    Adjusted EBIT (non-GAAP)

    2,917



    2,792



    2,520

    Depreciation and amortization

    816



    831



    775

    Adjusted EBITDA (non-GAAP)

    $             3,733



    $             3,623



    $             3,295

    8.   Income Taxes

    The Company's effective tax rate before consideration of certain excluded items was approximately 12.0% for the three months ending December 31, 2024 and 11.5% for the three months ending December 31, 2023.

     

    Johnson Controls Logo. (PRNewsFoto/JOHNSON CONTROLS, INC.) (PRNewsFoto/)

     

    Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/johnson-controls-reports-strong-q1-results-raises-fy25-guidance-302368272.html

    SOURCE Johnson Controls International plc

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