NEW YORK Johnson Controls Inc. (JCI) expects higher sales and margins next year, including in its lead recycling and battery manufacturing division, on slightly higher 2013 automotive production in North America.
The Milwaukee-based company forecast net sales across all divisions of about $43.5 billion for 2013, up 3 to 4 percent from 2012.
The Power Solutions division, which comprises its lead recycling and battery manufacturing operations, is expected to yield a sales increase of 10 to 12 percent in 2013 due to higher battery volumes across all regions and channels, led by higher production in China, market share growth and increasing market demand for absorbent glass mat (AGM) batteries used in start-stop vehicles, the company said.
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, it added.
JCI chief financial officer Bruce McDonald had said in October that higher scrap battery acquisition costs had created a financial headwind for much of 2012, particularly with the company building inventory for its new battery recycling plant in Florence, S.C. (amm.com, Oct. 31
Meanwhile, the company on Wednesday estimated 2013 capital expenditures at $1.4 billion, down from $1.8 billion in 2012. Some 80 percent of that is associated with growth and margin expansion opportunities, including increased manufacturing capacity for AGM batteries and on expansion in emerging markets, JCI said.
In addition to forecasting slightly higher 2013 automotive production in North America, JCI estimated the global automotive backlog at $3.7 billion.
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, chief executive officer Stephen Roell said in a statement.