Johnson Controls International plc · NYSE:JCI
Johnson Controls International — Tyco International — Q4 2012 Earnings Presentation
28 slides from Johnson Controls International's earnings presentation, Nov 14, 2012
Slide 1: Fourth Quarter Review
Fourth Quarter Review 14 / November / 2012
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: 3 Year Strategy Summary
3 Year Strategy Summary Accelerate organic revenue growth over the next 3 years • Continued strong product growth • Acceleration of service growth • Expanding presence in high growth markets Execution and integration of strategic bolt-on acquisitions • Strengthen geographic footprint • Accelerate in
Slide 4: Fiscal 2012 Highlights
Fiscal 2012 Highlights Separation marks key milestone for the “new” Tyco – focused Fire & Security company Solid year for Fire & Security businesses both strategically and operationally Nice top-line growth in Products and Service, modestly offset by a decline in installation revenue, driven by proj
Slide 5: Q4 2012 Results – Financial Overview
Q4 2012 Results – Financial Overview (EPS amounts are attributable to Tyco common shareholders) ($ in millions, except per-share amounts) ($ in millions) Q4FY12 Q4FY11 Change Revenue $2,728 $2,799 (2.5%) Segment Operating Income before special items * $358 $353 1% Segment Operating Margin before spe
Slide 6: Q4 Highlights
Q4 Highlights Revenue of $2.7 billion with organic revenue* growth of 1% - Products +9%, Service +2% and Installation (4%) Segment operating margin before special items* increased 50bps year over year to 13.1% • Driven by volume leverage in Global Products, continued growth of higher margin service
Slide 7: Fourth Quarter – NA Installation & Services
Fourth Quarter – NA Installation & Services ($ in millions) Q4FY12 Q4FY11 Change Organic revenue* declined 1% • Service was in line with Revenue $1,042 $1,095 (5%) prior year Operating Income* $128 $127 1% • Installation declined 2% Operating Margin* 12.3% 11.6% +70 bps Year over year operating marg
Slide 8: Fourth Quarter – ROW Installation & Services
Fourth Quarter – ROW Installation & Services ($ in millions) Q4FY12 Q4FY11 Change Organic revenue* declined 1% • Service grew 4% Revenue $1,128 $1,219 (7%) • Installation declined 7% Operating Income* $135 $154 (12%) Operating Margin* 12.0% 12.6% (60 bps) Positive benefit of increased service revenu
Slide 9: Fourth Quarter – Global Products
Fourth Quarter – Global Products ($ in millions) Q4FY12 Q4FY11 Change Organic revenue* grew 9% Revenue $558 $485 15% • Fire Protection Products up 3% • Security Products up 24% Operating Income* $95 $72 32% • Life Safety Products up 10% Operating Margin* 17.0% 14.8% 220 bps Year over year operating
Slide 10: Other Items
Other Items Free cash flow* of $109 million in Q4 included $56 million of cash paid for special items. Adjusted free cash flow* was $165 million Corporate expense before special items was $103 million in the quarter and $331 million for the year • Includes corporate costs associated with the support
Slide 11: China Security Projects Update
China Security Projects Update Previously disclosed on 9/17/12 expected to record additional reserve in range of $40-$60 million in the 4th quarter related to security projects in China Management identified the situation, performed a full investigation and concluded with appropriate actions being t
Slide 12: Appendix
Appendix
Slide 13: Q4 Adjusted Segment Operating Margin
Q4 Adjusted Segment Operating Margin ($ millions) Q4FY12 Q4FY11 Year Over Year Operational Reported* China Adj. Adjusted Reported* China Adj. 53rd Week Adjusted Improvement Tyco Revenue $2,728 $- $2,728 $2,799 $16 $ (104) $2,711 Operating Income $358 $9 $367 $353 $3 $ (21) $335 Operating Margin 13.1
Slide 14: Impact of China Adjustments
Impact of China Adjustments Q4FY12 Q4FY11 Impact of ($ millions) Change in China Adj. OM Reported* China Adj. Adjusted Reported* China Adj. Adjusted On OM ROW Installation & Services Revenue $1,128 $- $1,128 $1,219 $16 $1,235 Operating Income $135 $9 $144 $154 $3 $157 OM Reported 12.0% 12.6% (60bps)
Slide 15: Normalized FY12 Earnings Per Share
Normalized FY12 Earnings Per Share Reconciliation to FY12 GAAP EPS FY12 EPS GAAP ($0.72) Restructuring, net $0.11 Loss on divestitures, net $0.03 Acquisition / integration costs $0.01 Asset impairment charges $0.04 Change in valuation methodology for asbestos $0.15 Legacy legal items $0.07 Former ma
Slide 16: Consolidated Statements of Operations
TYCO INTERNATIONAL LTD. CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except per share data) (Unaudited) Quarters Ended Twelve Months Ended September 28, September 30, September 28, September 30, 2012 2011 2012 2011 Revenue from product sales $ 1,557 $ 1,579 $ 5,845 $ 5,990 Service revenue 1,1
Slide 17: Results of Segments
TYCO INTERNATIONAL LTD. RESULTS OF SEGMENTS (in millions) (Unaudited) Quarters Ended Twelve Months Ended September 28, September 30, September 28, September 30, 2012 2011 2012 2011 NET REVENUE NA Installation & Services $ 1,042 $ 1,095 $ 3,962 $ 4,022 ROW Installation & Services 1,128 1,219 4,341 4,
Slide 18: Consolidated Balance Sheets
TYCO INTERNATIONAL LTD. CONSOLIDATED BALANCE SHEETS (in millions) (Unaudited) September 28, September 30, 2012 2011 Assets Cash and cash equivalents $844 $1,229 Accounts receivable, net 1,711 1,547 Inventories 634 539 Prepaid expenses and other current assets 850 666 Deferred income taxes 295 301 As
Slide 19: Consolidated Statements of Cash Flows
TYCO INTERNATIONAL LTD. CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) (Unaudited) For the Quarters Ended For the Years Ended September 28, September 30, September 28, September 30, 2012 2011 2012 2011 Cash Flows From Operating Activities: Net (loss) income attributable to Tyco common sharehold
Slide 20: Organic Growth Reconciliation - Revenue
Tyco International Ltd. Organic Growth Reconciliation - Revenue (in millions) (Unaudited) Quarter Ended September 28, 2012 Base Year Adjustments Net Revenue for the Adjusted Net Revenue for the Quarter Quarter Ended September (Divestitures) / 2011 Base Ended 30, 2011 Other (4) Revenue Foreign Curren
Slide 21: Earnings Per Share Summary
Earnings Per Share Summary (Unaudited) Quarter Ended Year Ended Quarter Ended Year Ended Sept. 28, 2012 Sept. 28, 2012 Sept. 30, 2011 Sept. 30, 2011 Diluted EPS from Continuing Operations Attributable to Tyco Shareholders (GAAP) ($1.36) ($0.72) $0.37 $1.29 expense / (benefit) Restructuring, net 0.05
Slide 22: Tyco International Ltd. – Quarter Ended September 28, 2012
Tyco International Ltd. For the Quarter Ended September 28, 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) $1,042 $1,128 $558 $2,7
Slide 23: Tyco International Ltd. – Year Ended September 28, 2012
Tyco International Ltd. For the Year Ended September 28, 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) $3,962 $4,341 $2,100 $10,4
Slide 24: Tyco International Ltd. – Quarter Ended September 30, 2011
Tyco International Ltd. For the Quarter Ended September 30, 2011 (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) $1,095 $1,219 $485 $2,7
Slide 25: Tyco International Ltd. – Year Ended September 30, 2011
Tyco International Ltd. For the Year Ended September 30, 2011 (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) $4,022 $4,434 $1,754 $10,2
Slide 26: 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, operating margin and corporate expense, in each case “before special items,” are non-GAAP measures and should not be consid
Slide 27: Non-GAAP Measures Continued
Non-GAAP Measures Continued Capital expenditures and dealer generated and bulk accounts purchased are subtracted because they represent long-term commitments. Cash paid for purchase accounting and holdback liabilities is subtracted because these cash outflows are not available for general corporate
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