Johnson Controls International plc · NYSE:JCI
Johnson Controls International — Tyco International — Q2 2013 Earnings Presentation
22 slides from Johnson Controls International's earnings presentation, Apr 26, 2013
Slide 1: Second Quarter Review
Second Quarter Review 26 / April / 2013
Slide 2: Forward-Looking Statements / Safe Harbor
Forward-Looking Statements / Safe Harbor This presentation contains a number of forward-looking statements. Words and variations of words such as “outlook”, “expect”, “intend”, “will”, “anticipate”, “believe”, “propose”, “potential”, “continue”, “opportunity”, “estimate”, “project” and similar expre
Slide 3: Executing Our Growth Strategy
Executing Our Growth Strategy Installation & Services businesses • Accelerated service revenue growth from 2% last quarter to 3% • Improved installation execution Global Products businesses • Mid-single digit organic revenue growth outpaces market On track with sourcing and productivity initiatives
Slide 4: Capital Allocation
Capital Allocation Acquisition metrics • Strategic fit • ROIC well in excess of risk adjusted WACC • Strong growth potential • EPS accretion by year 2 Deep pipeline of attractive acquisition candidates Acquisitions announced • First City Care Security – installation and service provider with experti
Slide 5: Q2 2013 Results – Financial Overview
Q2 2013 Results – Financial Overview (EPS amounts are attributable to Tyco common shareholders) ($ in millions, except per-share amounts) ($ in millions) Q2FY13 Q2FY12 Change Revenue $2,608 $2,542 3% Segment Operating Income before special items * $321 $300 7% Segment Operating Margin before special
Slide 6: Q2 Highlights
Q2 Highlights Revenue of $2.6 billion with organic revenue* growth of 2% • Products +7%, Service +3% and Installation (3%) Segment operating margin before special items* of 12.3% • Continued growth of higher margin service revenue • Productivity and restructuring benefits • Incremental growth invest
Slide 7: Second Quarter – NA Installation & Services
Second Quarter – NA Installation & Services ($ in millions) Q2FY13 Q2FY12 Change Organic revenue* in line with prior year Revenue $953 $953 ̶ • Service was up 2% Operating Income* $104 $92 13% • Installation declined 3% Operating Margin* 10.9% 9.7% Year over year operating margin expansion driven by
Slide 8: Second Quarter – ROW Installation & Services
Second Quarter – ROW Installation & Services ($ in millions) Q2FY13 Q2FY12 Change Organic revenue* increased 1% • Service grew 5% Revenue $1,077 $1,070 1% • Installation declined 4% Operating Income* $120 $119 1% Operating Margin* 11.1% 11.1% Operating margin consistent with prior year Orders increa
Slide 9: Second Quarter – Global Products
Second Quarter – Global Products ($ in millions) Q2FY13 Q2FY12 Change Organic revenue* grew 7% with growth across all three product Revenue $578 $519 11% platforms Operating Income* $97 $89 9% Operating leverage from Operating Margin* 16.8% 17.1% increased volume was offset by 80 basis point increme
Slide 10: Other Items
Other Items Free cash flow* was $134 million in Q2 and included $75 million of cash paid for special items, primarily separation and restructuring activities. Adjusted free cash flow* was $209 million Corporate expense before special items was $54 million in the quarter • Outlook: Expect Corporate e
Slide 11: Appendix
Appendix
Slide 12: Consolidated Statements of Operations
TYCO INTERNATIONAL LTD. CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except per share data) (Unaudited) Quarters Ended Six Months Ended March 29, March 30, March 29, March 30, 2013 2012 2013 2012 Revenue from product sales $ 1,437 $ 1,407 $ 2,880 $ 2,776 Service revenue 1,171 1,135 2,328 2,24
Slide 13: Results of Segments
TYCO INTERNATIONAL LTD. RESULTS OF SEGMENTS (in millions) (Unaudited) Quarters Ended Six Months Ended March 29, March 30, March 29, March 30, 2013 2012 2013 2012 Net Revenue NA Installation & Services $ 953 $ 953 $ 1,929 $ 1,915 ROW Installation & Services 1,077 1,070 2,167 2,126 Global Products 578
Slide 14: Consolidated Balance Sheets
TYCO INTERNATIONAL LTD. CONSOLIDATED BALANCE SHEETS (in millions) (Unaudited) March 29, September 28, 2013 2012 Assets Cash and cash equivalents $430 $844 Accounts receivable, net 1,649 1,696 Inventories 654 634 Prepaid expenses and other current assets 930 884 Deferred income taxes 295 295 Total cu
Slide 15: Consolidated Statements of Cash Flows
TYCO INTERNATIONAL LTD. CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) (Unaudited) For the Quarters Ended For the Six Months Ended March 29, March 30, March 29, March 30, 2013 2012 2013 2012 Cash Flows From Operating Activities: Net income attributable to Tyco common shareholders $ 72 $ 323 $ 2
Slide 16: Organic Growth Reconciliation - Revenue
Tyco International Ltd. Organic Growth Reconciliation - Revenue (in millions) (Unaudited) Quarter Ended March 29, 2013 Base Year Adjustments Adjusted Net Revenue for the Quarter Ended (Divestitures) 2012 Base Net Revenue for the Quarter Ended March 30, 2012 Revenue Foreign Currency Acquisitions Othe
Slide 17: Earnings Per Share Summary
Earnings Per Share Summary (Unaudited) Quarter Ended Quarter Ended March 29, 2013 March 30, 2012 Diluted EPS from Continuing Operations Attributable to Tyco Shareholders (GAAP) $0.16 $0.29 expense / (benefit) Restructuring and repositioning activities 0.04 0.03 Separation costs included in SG&A 0.04
Slide 18: Reconciliation for Quarter Ended March 29, 2013
Tyco International Ltd. For the Quarter Ended March 29, 2013 (in millions, except per share data) (Unaudited) expense / (benefit) Segments NA Installation ROW Installation Global Segment Corporate Total & Service & Service Products Revenue and Other Revenue Revenue (GAAP) $953 $1,077 $578 $2,608 - $
Slide 19: Reconciliation for Quarter Ended March 30, 2012
Tyco International Ltd. For the Quarter Ended March 30, 2012 (in millions, except per share data) (Unaudited) expense / (benefit) Segments NA Installation ROW Installation Global Segment Corporate Total & Service & Service Products Revenue and Other Revenue Revenue (GAAP) $953 $1,070 $519 $2,542 - $
Slide 20: Non-GAAP Measures
Non-GAAP Measures Organic revenue, free cash flow (outflow) (FCF), and income from continuing operations, earnings per share (EPS) from continuing operations, operating income and segment operating income, and normalized EPS, in each case “before special items,” are non-GAAP measures and should not
Slide 21: Non-GAAP Measures Continued
Non-GAAP Measures Continued The limitation associated with using these cash flow metrics is that they adjust for cash items that are ultimately within management's and the Board of Directors' discretion to direct and therefore may imply that there is less or more cash that is available for the compa
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