As part efforts to reduce costs and improve efficiency, Johnson Controls has announced it plans to initiate restructuring activities in its third quarter which will result in an estimated after-tax charge of $130 to $140m, or $0.66 to $0.71 per share.
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The restructuring charge relates to cost reduction initiatives mainly in its vehicle interiors and building efficiency businesses and includes workforce reductions and plant consolidations.
The company expects to substantially complete the changes over the next 12 months.
The automotive-related restructuring is focused on improving the profitability associated with the manufacturing and supply of instrument panels, headliners and other interior components in North America.
In Europe, it reflects actions intended to increase the efficiency of its seating component operations.
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By GlobalDataJohnson Controls said it expects to record non-recurring tax benefits in the third quarter of approximately $135m, or approximately $0.68 per share.
The tax benefits principally result from the reversal of a German deferred tax asset valuation allowance, due to the sustained profitability and expectations for future profitability of the company’s operations in the country.
The company’s third quarter ends on 30 June and it will report earnings on 19 July.
