Johnson Controls Inc. posted a sharp improvement in earnings in
its fiscal third quarter as the companys European
automotive business returned to profitability.
company posted net income of $571 million for the three months
ended June 30, up 32.5 percent from $431 million in the same
period last year on sales that increased 2.4 percent to more
than $10.83 billion.
"We are pleased with
the significant improvement in profitability of all three
businesses in the third quarter. Our initiatives to reduce
costs and improve operational efficiencies continue to gather
momentum and deliver margin expansion," JCI chairman and chief
executive officer Stephen Roell said in a statement July 18.
"Despite a challenging production environment, our European
automotive business generated a profit in the quarter and
profitability improved in our automotive metals business. Cash
flow in the quarter was very strong, enabling us to reduce net
debt by more than $550 million."
Solutions segment, which supplies lead-acid batteries to the
automotive industry, generated fiscal third-quarter operating
earnings of $171 million, up 11.8 percent from $153 million a
year earlier, as strong demand in Europe continued to bolster
the segment, the company said. Additionally, the company
announced it had secured new orders that will expand battery
shipments by approximately 1 million units per year.
Experience and Building Efficiency segments also showed
significant increases in operating earnings, which the company
attributed to recent recoveries in the European and Asian
markets. The Automotive Experience segment, which focuses
primarily on automotive seating, electronics and interiors, saw
its quarterly operating earnings increase 33.5 percent to $279
million from $209 million a year ago.
"Earlier this fiscal
year, we said that our second-half performance would be
positively impacted by our restructuring initiatives,
sequential improvements in Automotive Experience European and
South American businesses, and profitability initiatives in
Building Efficiency," Roell said. "We expect the benefits of
these actions to deliver further improvements in our fiscal
fourth quarter. We are confident in our ability to increase our
earnings, strengthen our balance sheet and deliver shareholder