Tier One supplier Johnson Controls (JCI) booked a 25% year on year rise in first fiscal quarter 2013/14 operating income to US$686m on sales up 5% to $10.9bn.
Net income of $469million, or $0.69 per share, compared with $359m/$0.52 in Q1 2012/13.
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“The significant improvement in profitability resulted from our focus on execution and cost discipline. We also benefitted from the higher levels of global automotive production,” said JCI chairman and CEO Alex Molinaroli.
During the fiscal first quarter, JCI, which makes automotive interiors, batteries and building products, said it would sell its remaining electronics business to Visteon, had signed a memorandum of understanding for a joint venture with Hitachi to expand its building product line and had launched a strategic review of its auto interiors operation.
Automotive interior revenues in the first quarter were up 10% to $5.8bn as automotive production rose worldwide. JCI said Q1 industry production increased 5% in North America, 2% in Europe and 14% in China. Its seating and interiors sales increased “at a double digit rate” while electronics sales were up 7%. Revenues in China, primarily related to seating and generated through non-consolidated joint ventures, increased 33% to $1.9bn.
Automotive interior income was $232m, more than double the $101m booked a year earlier, due to improvements in the seating business, with segment income of $176m in the current quarter, compared with $85m last year. Overall interiors improvement was due to higher global production levels, cost reduction and improved efficiency in JCI’s metals and mechanisms business.
Q1 battery sales rose 6% to $1.8bn versus $1.7bn a year earlier. Global OEM shipments increased 12% while aftermarket volume was up 1%. Segment income was up 12% to $308m due to higher volumes and other factors.
Johnson Controls said it expects earnings per share of $0.64 – $0.66 in the second quarter. It also confirmed guidance for earnings of $3.15 – $3.30 per share for the full fiscal year.
“Much of the improvement we have forecast for fiscal 2014 is based on activities within our control. Our first quarter results demonstrate that we are on track to deliver on the expectations we have set,” added Molinaroli.
“We remain focused on operational improvements to drive continued increases in profitability and shareholder value and expect 2014 to be a year of record sales and earnings.”
