Core Insights - Johnson Controls has been recognized as a top thermal management provider for data centers by ABI Research, highlighting its innovation and customer-centric approach in the industry [1][2] Group 1: Company Recognition and Positioning - Johnson Controls consistently exceeds market expectations in thermal management across various industries, particularly in mission-critical infrastructure like data centers [2] - The company’s comprehensive product portfolio and ability to deliver end-to-end solutions solidify its leadership in the thermal management space [2][3] - The recognition from ABI Research reflects Johnson Controls' commitment to providing innovative and scalable solutions tailored to the evolving needs of the data center industry [3] Group 2: Product Innovations - Johnson Controls offers a range of air-cooled and water-cooled chillers designed for hyperscale and colocation data centers, with the YORK® YVAM chiller capable of reducing energy consumption by up to 40% [2] - The YVAM chiller operates with zero water on-site and utilizes ultra-low GWP refrigerant, ensuring reliability and efficiency with a noise level of 65 dBA [2] - Quick Start technology in the YVAM allows it to return to full load in just three minutes after a power interruption, enhancing operational efficiency [2] Group 3: Strategic Developments - In June 2024, Johnson Controls launched a Global Data Center Solutions organization to address rapid industry growth, enhancing production capacity and reducing lead times [5] - This specialized organization enables the company to provide consistent, high-quality solutions globally while adapting to regional needs in North America, EMEA, and APAC [5] Group 4: Customer-Centric Approach - Customers have praised Johnson Controls for its "one-stop" integrated approach that caters to the entire lifecycle of buildings, including thermal management, building automation, and energy efficiency [3]

Core Viewpoint - Johnson Controls International plc will present at Citi's 2025 Global Industrial Tech and Mobility Conference, highlighting its leadership in smart, healthy, and sustainable buildings [1]. Company Overview - Johnson Controls is recognized as the global leader in smart, healthy, and sustainable buildings, aiming to enhance building performance for people, places, and the planet [3]. - The company has a rich history of 140 years of innovation and offers a comprehensive digital solution called OpenBlue, which serves various industries including healthcare, education, data centers, airports, and manufacturing [4]. - Johnson Controls provides the largest portfolio of building technology and software, along with service solutions from trusted industry names [4].

Financial Performance - Net sales for the three months ended December 31, 2024, increased by 4% to $5,426 million compared to $5,209 million in the same period of 2023, driven by higher organic sales of $480 million [190]. - Gross profit rose by 8% to $1,926 million, with a gross margin of 35.5%, up from 34.1% in the prior year, primarily due to margin improvements in the Building Solutions segments [192]. - Total net sales increased by 4% to $5.426 billion in Q4 2024 from $5.209 billion in Q4 2023 [201]. - The Company reported a 10% increase in net sales when excluding the impact of foreign currency translation and business acquisitions and divestitures, driven by strong growth in Products and Systems [190]. - Segment EBITA for Building Solutions North America rose by 16% to $332 million in Q4 2024 from $285 million in Q4 2023 [202]. - Cash provided by operating activities was $249 million in Q4 2024, a significant improvement from $(111) million in Q4 2023 [208]. Restructuring and Costs - The Company expects to incur approximately $400 million in one-time restructuring costs over fiscal 2025, 2026, and 2027, with anticipated annual cost savings of approximately $500 million upon full completion of the restructuring plan [186]. - Selling, General and Administrative (SG&A) expenses increased by 5% to $1,399 million, representing 25.8% of sales, primarily due to transformation and transaction/separation costs [194]. - Restructuring and impairment costs decreased to $33 million in Q4 2024 from $35 million in Q4 2023 [196]. Debt and Liabilities - Total debt increased to $9.993 billion as of December 31, 2024, compared to $9.493 billion as of September 30, 2024 [209]. - Current assets of the Obligor Group as of December 31, 2024, were $696 million, while current liabilities were $7,536 million [217]. - Noncurrent liabilities for the Obligor Group as of December 31, 2024, totaled $8,395 million, compared to $7,836 million as of September 30, 2024 [217]. - The Obligor Group's total current liabilities increased by approximately 12% from $6,726 million as of September 30, 2024, to $7,536 million as of December 31, 2024 [217]. - The Company has various senior notes with aggregate principal amounts including €500 million at 0.375% due 2027 and $700 million at 5.500% due 2029 [216]. Market and Economic Conditions - The Company anticipates that ongoing geopolitical tensions and tariffs may negatively impact revenue growth and margins in future periods [183]. - The Building Solutions Asia Pacific segment's performance is expected to be impacted by the stabilization of economic conditions in China, which remains tempered [178]. - The Company experienced a negative impact of $33 million from foreign currency translation on net sales during the three months ended December 31, 2024 [190]. Dividends and Cash Proceeds - The company declared a dividend of $0.37 per common share in Q4 2024 and plans to continue dividends throughout fiscal 2025 [211]. - The company expects to receive approximately $5.0 billion in net cash proceeds from the sale of its R&LC HVAC business, anticipated to close in Q4 2025 [211]. Tax and Financing - Income tax provision increased to $47 million in Q4 2024 compared to a benefit of $(20) million in Q4 2023, with an effective tax rate of 11.5% [198]. - Net financing charges slightly decreased to $86 million in Q4 2024 from $87 million in Q4 2023 [197]. Other Considerations - The Company is leveraging its OpenBlue digital software platform to enhance energy efficiency and sustainability in buildings, aligning with increasing demand driven by government regulations [180]. - The Obligor Group does not have sales or gross profit reported, highlighting a focus on debt management rather than revenue generation [216]. - There have been no material changes in the Company's critical accounting estimates since the last Annual Report [219]. - The Company has not experienced any adverse changes in market risk exposures as of December 31, 2024 [220]. - The Company may purchase its outstanding debt depending on market conditions and liquidity requirements, indicating potential material amounts involved [216].

Core Insights - Johnson Controls International plc (JCI) reported adjusted earnings of 64 cents per share for Q1 fiscal 2025, exceeding the Zacks Consensus Estimate of 59 cents, marking a 39.1% year-over-year increase [1] - Total revenues for continuing operations reached $5.43 billion, surpassing the consensus estimate of $5.33 billion, with a year-over-year increase of 4.2% and organic revenue growth of 10% [1] Q1 Segmental Results - **Building Solutions North America**: Revenues were $2.74 billion, up 10% year over year, with organic sales also increasing by 10%. Adjusted EBITA rose 16% to $332 million [2] - **Building Solutions Europe, Middle East, Africa/Latin America**: Revenues totaled $1.07 billion, a 3% increase year over year, with organic sales climbing 6%. Adjusted EBITA was $108 million, up 35% [3] - **Building Solutions Asia Pacific**: Revenues increased 4% to $527 million, with organic sales growing 5%. Adjusted EBITA was $49 million, up 7% [3] - **Global Products**: Revenues were $1.08 billion, down 8% year over year, but organic sales increased by 15%. Adjusted EBITA rose 21.6% to $326 million [4] Margin Profile - JCI's cost of sales increased 2% year over year to approximately $3.5 billion. Gross profit rose 8.3% to $1.9 billion, with a margin increase of 140 basis points to 35.5%. Selling, general and administrative expenses were $1.4 billion, up 4.9% year over year [5] Financial Position - As of December 31, 2024, JCI had cash and cash equivalents of $1.24 billion, up from $606 million at the end of fiscal 2024. Long-term debt increased to $8.6 billion from $8 billion [6] Cash Flow and Share Repurchase - In Q1 fiscal 2025, JCI generated net cash of $249 million from operating activities, compared to a cash outflow of $111 million in the same period last year. Free cash flow was $133 million, a turnaround from a free cash outflow of $193 million in the prior year. The company repurchased 4.1 million shares for approximately $330 million [7] Guidance - For Q2, JCI anticipates mid-single digit organic revenue growth and an adjusted segment EBITA margin of approximately 16.5%. Adjusted earnings are expected to be in the range of 77-79 cents per share [8] - For FY25, JCI expects organic revenue growth in the mid-single digit range and an adjusted segment EBITA margin improvement of more than 80 basis points. Adjusted earnings are projected to be between $3.50 and $3.60 per share [9][10]

Core Insights - Johnson Controls (JCI) reported $5.43 billion in revenue for the quarter ended December 2024, reflecting an 11% year-over-year decline, while EPS increased to $0.64 from $0.51 a year ago [1] - The revenue exceeded the Zacks Consensus Estimate of $5.33 billion, resulting in a surprise of +1.86%, and the EPS also surpassed the consensus estimate of $0.59 with a surprise of +8.47% [1] Revenue Breakdown - Net Sales for Building Solutions North America reached $2.74 billion, exceeding the average estimate of $2.69 billion, marking a +10.3% change year-over-year [4] - Net Sales for Building Solutions Asia Pacific were $527 million, surpassing the average estimate of $491.31 million, with a +3.9% year-over-year change [4] - Net Sales for Building Solutions EMEA/LA stood at $1.07 billion, matching the average estimate, reflecting a +3.4% year-over-year change [4] - Global Products reported Net Sales of $1.08 billion, slightly below the average estimate of $1.10 billion, showing a significant year-over-year decline of -47.5% [4] Profitability Metrics - Total Segment Adjusted EBITA for Global Products was $326 million, exceeding the average estimate of $279.49 million [4] - Total Segment Adjusted EBITA for Corporate Expense was -$127 million, worse than the average estimate of -$110 million [4] Stock Performance - Johnson Controls' shares have returned -2.4% over the past month, contrasting with the Zacks S&P 500 composite's +1.7% change, and the stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance in the near term [3]

Key TakeawaysJohnson Controls shares led the S&P 500's gainers Wednesday morning after the company's first-quarter results beat expectations.The company's revenue and profits rose year-over-year, and its outlook for second-quarter and full-year earnings also topped estimates.The industrial manufacturer also announced Joakim Weidemanis as its new CEO, who will take over the top job in March. Shares of Johnson Controls International (JCI) surged to lead S&P 500 gainers on Wednesday morning after the company's ...

Financial Data and Key Metrics Changes - Organic revenue grew by 10% with adjusted EPS of $0.64, up nearly 40% year-over-year, exceeding guidance by $0.04 [28][29] - Adjusted segment margin expanded by 200 basis points to 15% [28] - Free cash flow improved by nearly $800 million year-over-year, reaching approximately $600 million [29] Business Line Data and Key Metrics Changes - Global Products saw organic sales growth of 15%, with Applied HVAC growing over 30% [30] - Building Solutions orders grew by 16%, with North America orders increasing by 18% [32] - Service backlog grew by 8% and system backlog by 12% year-over-year, with total Building Solutions backlog at a record $13.2 billion [37] Market Data and Key Metrics Changes - Orders in Asia Pacific grew by 32%, led by 40% growth in systems [34] - North America sales increased by 10% organically, with EMEALA growing by 6% [35] - The healthcare vertical is experiencing increased demand for advanced HVAC systems and fire protection solutions [21] Company Strategy and Development Direction - The company is focused on building a leading pure-play building solutions provider, emphasizing operational excellence and innovation [8][12] - The transition to new CEO Joakim Weidemanis is expected to continue the momentum and capitalize on growth opportunities [10][11] - The strategy includes leveraging AI and technology to enhance service offerings and customer intimacy [17][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining momentum and delivering long-term shareholder value, raising guidance for the year [14][40] - Concerns about potential tariff impacts were noted, with a cautious approach to future growth expectations [58][72] - The company anticipates mid-single-digit organic sales growth for the full year, with a strong backlog providing visibility into future revenue [39][41] Other Important Information - The company ended the first quarter with $1.2 billion in available cash and net debt decreased to 2.3 times [29] - The transition to a new CEO was described as a result of a rigorous succession planning process [7][10] Q&A Session Summary Question: What mandates are being delivered to the new CEO? - The new CEO is expected to leverage his operational background and focus on growth potential while continuing the established strategy [46][48] Question: How does free cash conversion include cash restructuring payments? - Free cash conversion includes $250 million of restructuring cash, which is a headwind against achieving 100% conversion [49][50] Question: Any concerns about guidance despite strong orders? - Management noted that the second half of the year presents tougher comparisons, particularly in Q4, but does not anticipate slowing growth [56][57] Question: Is there an expectation for accelerated growth in the data center business? - Both orders and revenue in the data center segment are expected to accelerate compared to 2024 [60] Question: Are orders now longer duration than before? - There is a shift towards longer cycle businesses, with a focus on building stronger customer relationships [65][68] Question: What is the outlook for margins moving forward? - Margins are expected to improve, particularly in EMEA/LA and global products, with a focus on operational efficiency [93][94] Question: How is the company addressing potential tariff impacts? - The company has evolved its manufacturing strategy to mitigate tariff impacts and is working on supply chain resilience [77][79] Question: What are the capital deployment priorities? - The company plans to return 100% of free cash flow to shareholders and reduce leverage with proceeds from divestitures [138][139]

FISCAL Q1 2025 Earnings Conference Call February 5, 2025 FORWARD-LOOKING AND CAUTIONARY STATEMENTS/NON-GAAP FINANCIAL INFORMATION Johnson Controls International plc cautionary statement regarding forward-looking statements Johnson Controls International plc has made statements in this communication that are forward-looking and therefore are subject to risks and uncertainties. All statements in this document other than statements of historical fact are, or could be, "forward-looking statements" within the me ...

Financial Performance - Q1 2025 GAAP earnings per share (EPS) was $0.55, with adjusted EPS at $0.64[2] - Sales for the quarter reached $5.4 billion, a 4% increase year-over-year, with organic sales growth of 10%[3] - Net sales for the three months ended December 31, 2024, increased to $5,426 million, up from $5,209 million in the same period of 2023, representing a growth of 4.2%[27] - Gross profit rose to $1,926 million, compared to $1,778 million in the prior year, reflecting an increase of 8.3%[27] - Income from continuing operations attributable to Johnson Controls was $363 million, up from $340 million, marking a growth of 6.8%[27] - The company reported a net income of $451 million, compared to $404 million in the same quarter of the previous year, an increase of 11.6%[27] - Basic earnings per share attributable to Johnson Controls increased to $0.63, compared to $0.55 in the previous year, a rise of 14.5%[27] - Adjusted net income attributable to Johnson Controls for Q4 2024 was $426 million, compared to $315 million in Q4 2023[48] Sales and Orders - Orders increased 16% organically year-over-year, and the Building Solutions backlog rose to $13.2 billion, an 11% organic increase[6] - Building Solutions North America segment sales were $2.744 billion, up 10% year-over-year, with a segment EBITA margin of 12.1%, expanding 60 basis points[7] - Building Solutions EMEA/LA segment sales were $1.073 billion, a 3% increase year-over-year, with a segment EBITA margin of 10.1%, expanding 240 basis points[9] - Building Solutions Asia Pacific segment sales were $527 million, a 4% increase year-over-year, with orders up 32% year-over-year and a backlog of $1.5 billion, increasing 22%[11] - Global Products segment sales declined 8% to $1.082 billion, but organic sales grew 15%, driven by over 30% growth in Applied HVAC[13] - Products and systems revenue increased by 12% to $3,604 million in 2023, driven by organic growth of 12% in North America[43] - Service revenue for 2023 was $1,605 million, reflecting an 8% growth, with organic growth of 9% in North America[43] Cash Flow and Guidance - Cash provided by operating activities was $249 million, with free cash flow at $133 million and adjusted free cash flow at $603 million[18] - The company raised its fiscal 2025 full-year guidance, projecting adjusted EPS of approximately $3.50 to $3.60[23] - The company initiated fiscal Q2 guidance with expectations of mid-single-digit organic sales growth and an adjusted segment EBITA margin improvement of more than 80 basis points year-over-year[23] - Free cash flow for Q4 2024 was $133 million, a significant improvement from a negative $193 million in Q4 2023[44] - Adjusted free cash flow for Q4 2024 reached $603 million, compared to a negative $105 million in Q4 2023[45] Debt and Assets - Total assets decreased to $42,098 million from $42,695 million, a decline of 1.4%[29] - Total liabilities also decreased to $24,968 million from $25,334 million, a reduction of 1.4%[29] - Total debt as of December 31, 2024, is $9,993 million, a 5.3% increase from $9,493 million on September 30, 2024[50] - Net debt decreased to $8,756 million from $8,887 million in the previous quarter, reflecting a 1.5% reduction[50] - Long-term debt increased to $8,589 million as of December 31, 2024, from $8,004 million on September 30, 2024[50] - Current portion of long-term debt decreased to $522 million from $536 million in the previous quarter[50] Operational Changes - The company signed a definitive agreement in July 2024 to sell its Residential and Light Commercial HVAC business, which will be classified as a discontinued operation[34] Tax and Income Metrics - The effective tax rate for the three months ending December 31, 2024, was approximately 12.0%, compared to 11.5% for the same period in 2023[52] - Income from continuing operations for the twelve months ended December 31, 2024, was $1,432 million, slightly up from $1,411 million in the previous quarter[51] - Adjusted EBITDA for the twelve months ended December 31, 2024, reached $3,733 million, up 3.0% from $3,623 million in the previous quarter[51] - Adjusted EBIT for the twelve months ended December 31, 2024, was $2,917 million, a 4.5% increase from $2,792 million in the previous quarter[51]

Weidemanis, Danaher Veteran, to Succeed George R. OliverCORK, Ireland, Feb. 5, 2025 /PRNewswire/ -- Johnson Controls (NYSE: JCI), a global leader for smart, healthy and sustainable buildings, today announced that its Board of Directors has appointed Joakim Weidemanis as Chief Executive Officer effective March 12, 2025, following the Company's Annual General Meeting of Shareholders. He succeeds George R. Oliver following a thorough succession planning process.  Joakim Weidemanis View PDF Joakim Weidema ...