Johnson Controls International plc · NYSE:JCI
Johnson Controls International — Tyco International — Q1 FY2015 Earnings Presentation
29 slides from Johnson Controls International's earnings presentation, Jan 30, 2015
Slide 1: First Quarter Review
First Quarter Review 30 / January / 2015
Slide 2: Forward-Looking Statements / Safe Harbor
Forward-Looking Statements / Safe Harbor This presentation contains a number of forward-looking statements. In many cases forward-looking statements are identified by words, and variations of words, such as "anticipate", "estimate", "believe", “commit”, "continue", "could", "intend", "may", "plan",
Slide 3: Significant Progress In Innovative Solutions And M&A
Significant Progress In Innovative Solutions And M&A Launched “Tyco On” – our Committed $470M in Q1’15 for five integrated data and smart services acquisitions focused on strategic growth platform • First Choice Facilities (“FCF”) – Designs, • ExacTech – Increases service efficiency in installs and
Slide 4: Q1 2015 Results – Financial Overview
Q1 2015 Results – Financial Overview (EPS amounts are fully diluted and attributable to Tyco ordinary shareholders) ($ in millions, except per-share amounts) Q1FY15 Q1FY14 Change Revenue $2,479 $2,493 (1%) Segment Operating Income before special items* $326 $322 1% Segment Operating Margin before sp
Slide 5: First Quarter Highlights
First Quarter Highlights Revenue of $2.48 billion increases organically 2% year over year • Products +10%, Service +1% and Installation flat • Acquisition growth of 1% was more than offset by a 4% negative impact from foreign currency exchange rates Before special items, segment operating income* wa
Slide 6: First Quarter Highlights Continued
First Quarter Highlights Continued Orders growth of 2% year over year, excluding impact of foreign currency • North America I&S +6%, Products +7% and ROW I&S (5%) Backlog of $4.8 billion increased 3% on a year over year basis and 2% on a quarter sequential basis, excluding impact of foreign currency
Slide 7: First Quarter – NA Installation & Services
First Quarter – NA Installation & Services ($ in millions) Organic revenue* relatively flat Q1FY15 Q1FY14 Change • Service grew 1% Revenue $951 $957 (1%) • Installation declined 1% Operating Income* $131 $129 2% Foreign currency rates Operating Margin* 13.8% 13.5% +30bps negatively impacted revenues
Slide 8: First Quarter – ROW Installation & Services
First Quarter – ROW Installation & Services ($ in millions) Organic revenue* was relatively Q1FY15 Q1FY14 Change flat with modest growth in both installation and service Revenue $917 $971 (6%) Operating Income* $90 $103 (13%) A 2% benefit from acquisitions was offset by a 7% negative Operating Margi
Slide 9: First Quarter – Global Products
First Quarter – Global Products ($ in millions) Organic revenue* increased 10% Q1FY145 Q1FY14 Change • Driven by strong growth across all Revenue $611 $565 8% three platforms, led by Security Products and Life Safety Operating Income* $105 $90 17% • Included a 2% benefit from increased shipments of
Slide 10: Other Items
Other Items Corporate expense before special items* was $55 million in the quarter • Outlook: Expect Q2 fiscal 2015 corporate expense before special items to be at a similar level Tax rate excluding special items was 17.5% for the quarter • Outlook: Expect Q2 tax rate before special items to be in t
Slide 11: 2015 Foreign Exchange Impact
2015 Foreign Exchange Impact Original FX Current FX Guidance Guidance Q4’14 Earnings Call Q1’15 Earnings Call 2015 Revenue ($255M) ($585M) Headwind (~4%) (~6%) Top Foreign Currency Exposures 2015 EPS ($0.07) ($0.16) Original FX Current FX Headwind Rates* Rates* Variance EUR/USD 1.26 1.12 (11%) GBP/U
Slide 12: Q2'15 Outlook
Q2’15 Outlook (EPS amounts are fully diluted and attributable to Tyco ordinary shareholders) ($ in millions, except per-share amounts) Q2FY15 Guidance (2%) Organic growth ~3% Revenue on a Reported Basis Acquisitions contribute 1% vs. Prior Year FX headwind of 6%; (~$150M) Segment Operating Mar
Slide 13: Normalizing Q2 FY2014 For $21M Insurance Recovery
Normalizing Q2 FY2014 For $21M Insurance Recovery (EPS amounts are fully diluted and attributable to Tyco ordinary shareholders) As Reported Insurance Normalized ($ in millions, except per-share amounts) Q2 FY2014 Recovery Q2 FY2014 Total Revenue $2,481 $2,481 North America I&S $939 $939 ROW I&S $93
Slide 14: Q2'15 EPS Bridge
Q2’15 EPS Bridge Segment Operating Income & Margin* $0.48 - $0.05 ($0.03) $0.46 ($0.04) $0.05 $0.50 $0.42 Reported $21M Insurance Normalized Operations Share Count FX Headwind Q2'15 EPS* Q2'14 EPS* Recovery Q2'14 EPS* Guidance Q2’15 EPS Up 14% - 19% On Normalized Basis * Before special items. 14
Slide 15: 2015 Full Year Outlook
2015 Full Year Outlook (EPS amounts are fully diluted and attributable to Tyco ordinary shareholders) ($ in millions, except per-share amounts) Original* Revised EPS Bridge Guidance Guidance $2.35 - $2.30 - $2.45 ~($0.09) ~$0.04 $2.40 Similar to 2015 Revenue ~10.5B Last Year Organic Growth ~4% ~4% N
Slide 16: Appendix
Appendix
Slide 17: Consolidated Statements of Operations
TYCO INTERNATIONAL PLC CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except per share data) (Unaudited) Quarters Ended December 26, December 27, 2014 2013 Revenue from product sales $ 1,488 $ 1,468 Service revenue 991 1,025 Net revenue 2,479 2,493 Cost of product sales 1,022 999 Cost of servic
Slide 18: Results of Segments
TYCO INTERNATIONAL PLC RESULTS OF SEGMENTS (in millions) (Unaudited) Quarters Ended December 26, December 27, 2014 2013 Net Revenue NA Installation & Services $ 951 $ 957 ROW Installation & Services 917 971 Global Products 611 565 Total Net Revenue $ 2,479 $ 2,493 Operating Income and Margin NA Inst
Slide 19: Consolidated Balance Sheets
TYCO INTERNATIONAL PLC CONSOLIDATED BALANCE SHEETS (in millions) (Unaudited) December 26, September 26, 2014 2014 Assets Current Assets: Cash and cash equivalents $ 473 $ 892 Accounts receivable, net 1,718 1,750 Inventories 658 628 Prepaid expenses and other current assets 890 1,153 Deferred income
Slide 20: Consolidated Statements of Cash Flows
TYCO INTERNATIONAL PLC CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) (Unaudited) For the Quarters Ended December 26, December 27, 2014 2013 Cash Flows From Operating Activities: Net income attributable to Tyco ordinary shareholders $ 162 $ 270 Noncontrolling interest in subsidiaries net (loss)
Slide 21: Free Cash Flow Reconciliation
Reconciliation to "Free Cash Flow": Net cash provided by operating activities $ 96 $ 100 Capital expenditures, net (65) (59) Acquisition of dealer generated customer accounts and bulk account purchases (4) (11) Payment of contingent consideration (23) — Free Cash Flow $ 4 $ 30 Reconciliation to "Adj
Slide 22: Organic Growth Reconciliation - Revenue
TYCO INTERNATIONAL PLC ORGANIC GROWTH RECONCILIATION - REVENUE (in millions) (Unaudited) Quarter Ended December 26, 2014 Base Year Adjustments Adjusted Net Revenue for the Fiscal Net Revenue for the Quarter Ended Divestitures / 2014 Base Quarter Ended (1) December 27, 2013 Other Revenue Foreign Curr
Slide 23: Earnings Per Share Summary
Earnings Per Share Summary (Unaudited) Quarter Ended Quarter Ended Dec. 26, 2014 Dec. 27, 2013 Diluted EPS from Continuing Operations Attributable to Tyco Shareholders (GAAP) $ 0.38 $ 0.52 expense / (benefit) Restructuring and repositioning activities 0.12 0.01 Separation costs included in SG&A — 0.
Slide 24: Quarter Ended December 26, 2014 Reconciliation
Tyco International plc For the Quarter Ended December 26, 2014 (in millions, except per share data) (Unaudited) expense / (benefit) Segments NA ROW Installation Installation Global Segment Corporate Total & Services & Services Products Revenue and Other Revenue Revenue (GAAP) $951 $917 $611 $2,479 $
Slide 25: Quarter Ended December 27, 2013 Reconciliation
Tyco International plc For the Quarter Ended December 27, 2013 (in millions, except per share data) (Unaudited) expense / (benefit) Segments NA ROW Installation Installation Global Segment Corporate Total & Services & Services Products Revenue and Other Revenue Revenue (GAAP) $957 $971 $565 $2,493 $
Slide 26: Quarter Ended March 28, 2014 Reconciliation
Tyco International Ltd. For the Quarter Ended March 28, 2014 (in millions, except per share data (Unaudited) expense / (benefit) Segments NA Installation ROW Installation Global Segment Corporate Total & Services & Services Products Revenue and Other Revenue Revenue (GAAP) $939 $937 $605 $2,481 ‐ $2
Slide 27: 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, in each case “before special items,” are non-GAAP measures and should not be considered replac
Slide 28: 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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