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þ
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
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|
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|
Wisconsin
|
|
39-0380010
|
(State or Other Jurisdiction of
|
|
(I.R.S. Employer
|
Incorporation or Organization)
|
|
Identification No.)
|
|
|
|
5757 North Green Bay Avenue
|
|
|
Milwaukee, Wisconsin
|
|
53209
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
|
|
|
|
Class
|
|
Shares Outstanding at March 31, 2016
|
Common Stock: $1.00 par value per share
|
|
648,370,147
|
|
|
|
|
|
Johnson Controls, Inc.
Consolidated Statements of Financial Position
(in millions, except par value; unaudited)
|
|||||||||||
|
|
|
|
|
|
||||||
|
March 31, 2016
|
|
September 30, 2015
|
|
March 31, 2015
|
||||||
Assets
|
|
|
|
|
|
||||||
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
358
|
|
|
$
|
597
|
|
|
$
|
164
|
|
Accounts receivable - net
|
5,987
|
|
|
5,751
|
|
|
5,384
|
|
|||
Inventories
|
2,922
|
|
|
2,377
|
|
|
2,414
|
|
|||
Assets held for sale
|
17
|
|
|
55
|
|
|
1,969
|
|
|||
Other current assets
|
1,774
|
|
|
1,689
|
|
|
1,790
|
|
|||
Current assets
|
11,058
|
|
|
10,469
|
|
|
11,721
|
|
|||
|
|
|
|
|
|
||||||
Property, plant and equipment - net
|
6,397
|
|
|
5,870
|
|
|
5,870
|
|
|||
Goodwill
|
7,042
|
|
|
6,824
|
|
|
6,788
|
|
|||
Other intangible assets - net
|
1,576
|
|
|
1,516
|
|
|
1,558
|
|
|||
Investments in partially-owned affiliates
|
2,736
|
|
|
2,143
|
|
|
1,239
|
|
|||
Noncurrent assets held for sale
|
—
|
|
|
—
|
|
|
693
|
|
|||
Other noncurrent assets
|
2,390
|
|
|
2,773
|
|
|
3,091
|
|
|||
Total assets
|
$
|
31,199
|
|
|
$
|
29,595
|
|
|
$
|
30,960
|
|
|
|
|
|
|
|
||||||
Liabilities and Equity
|
|
|
|
|
|
||||||
|
|
|
|
|
|
||||||
Short-term debt
|
$
|
1,236
|
|
|
$
|
52
|
|
|
$
|
1,321
|
|
Current portion of long-term debt
|
647
|
|
|
813
|
|
|
815
|
|
|||
Accounts payable
|
5,360
|
|
|
5,174
|
|
|
4,640
|
|
|||
Accrued compensation and benefits
|
947
|
|
|
1,090
|
|
|
815
|
|
|||
Liabilities held for sale
|
—
|
|
|
42
|
|
|
1,511
|
|
|||
Other current liabilities
|
3,602
|
|
|
3,275
|
|
|
2,807
|
|
|||
Current liabilities
|
11,792
|
|
|
10,446
|
|
|
11,909
|
|
|||
|
|
|
|
|
|
||||||
Long-term debt
|
5,143
|
|
|
5,745
|
|
|
5,448
|
|
|||
Pension and postretirement benefits
|
781
|
|
|
767
|
|
|
785
|
|
|||
Other noncurrent liabilities
|
2,364
|
|
|
1,886
|
|
|
1,834
|
|
|||
Long-term liabilities
|
8,288
|
|
|
8,398
|
|
|
8,067
|
|
|||
|
|
|
|
|
|
||||||
Commitments and contingencies (Note 19)
|
|
|
|
|
|
||||||
|
|
|
|
|
|
||||||
Redeemable noncontrolling interests
|
237
|
|
|
212
|
|
|
202
|
|
|||
|
|
|
|
|
|
||||||
Common stock, $1.00 par value
|
718
|
|
|
717
|
|
|
713
|
|
|||
Capital in excess of par value
|
3,088
|
|
|
3,030
|
|
|
2,895
|
|
|||
Retained earnings
|
10,380
|
|
|
10,838
|
|
|
10,649
|
|
|||
Treasury stock, at cost
|
(3,163
|
)
|
|
(3,152
|
)
|
|
(2,598
|
)
|
|||
Accumulated other comprehensive loss
|
(1,039
|
)
|
|
(1,057
|
)
|
|
(1,076
|
)
|
|||
Shareholders’ equity attributable to Johnson Controls, Inc.
|
9,984
|
|
|
10,376
|
|
|
10,583
|
|
|||
Noncontrolling interests
|
898
|
|
|
163
|
|
|
199
|
|
|||
Total equity
|
10,882
|
|
|
10,539
|
|
|
10,782
|
|
|||
Total liabilities and equity
|
$
|
31,199
|
|
|
$
|
29,595
|
|
|
$
|
30,960
|
|
Johnson Controls, Inc.
Consolidated Statements of Income
(in millions, except per share data; unaudited)
|
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net sales
|
|
|
|
|
|
|
|
||||||||
Products and systems*
|
$
|
8,161
|
|
|
$
|
8,292
|
|
|
$
|
16,214
|
|
|
$
|
17,015
|
|
Services*
|
870
|
|
|
906
|
|
|
1,746
|
|
|
1,807
|
|
||||
|
9,031
|
|
|
9,198
|
|
|
17,960
|
|
|
18,822
|
|
||||
Cost of sales
|
|
|
|
|
|
|
|
||||||||
Products and systems*
|
6,707
|
|
|
7,004
|
|
|
13,404
|
|
|
14,410
|
|
||||
Services*
|
595
|
|
|
621
|
|
|
1,194
|
|
|
1,230
|
|
||||
|
7,302
|
|
|
7,625
|
|
|
14,598
|
|
|
15,640
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Gross profit
|
1,729
|
|
|
1,573
|
|
|
3,362
|
|
|
3,182
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Selling, general and administrative expenses
|
(1,144
|
)
|
|
(975
|
)
|
|
(2,226
|
)
|
|
(1,980
|
)
|
||||
Restructuring and impairment costs
|
(229
|
)
|
|
—
|
|
|
(229
|
)
|
|
—
|
|
||||
Net financing charges
|
(74
|
)
|
|
(69
|
)
|
|
(142
|
)
|
|
(140
|
)
|
||||
Equity income
|
117
|
|
|
82
|
|
|
253
|
|
|
184
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations before income taxes
|
399
|
|
|
611
|
|
|
1,018
|
|
|
1,246
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Income tax provision
|
868
|
|
|
132
|
|
|
997
|
|
|
250
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss) from continuing operations
|
(469
|
)
|
|
479
|
|
|
21
|
|
|
996
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Income from discontinued operations, net of tax (Note 4)
|
—
|
|
|
78
|
|
|
—
|
|
|
107
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
(469
|
)
|
|
557
|
|
|
21
|
|
|
1,103
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations attributable to
noncontrolling interests
|
61
|
|
|
27
|
|
|
101
|
|
|
63
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Income from discontinued operations attributable to
noncontrolling interests
|
—
|
|
|
1
|
|
|
—
|
|
|
4
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to Johnson Controls, Inc.
|
$
|
(530
|
)
|
|
$
|
529
|
|
|
$
|
(80
|
)
|
|
$
|
1,036
|
|
|
|
|
|
|
|
|
|
||||||||
Amounts attributable to Johnson Controls, Inc. common
shareholders:
|
|
|
|
|
|
|
|
||||||||
Income (loss) from continuing operations
|
$
|
(530
|
)
|
|
$
|
452
|
|
|
$
|
(80
|
)
|
|
$
|
933
|
|
Income from discontinued operations
|
—
|
|
|
77
|
|
|
—
|
|
|
103
|
|
||||
Net income (loss)
|
$
|
(530
|
)
|
|
$
|
529
|
|
|
$
|
(80
|
)
|
|
$
|
1,036
|
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings (loss) per share attributable to Johnson Controls, Inc.
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
(0.82
|
)
|
|
$
|
0.69
|
|
|
$
|
(0.12
|
)
|
|
$
|
1.42
|
|
Discontinued operations
|
—
|
|
|
0.12
|
|
|
—
|
|
|
0.16
|
|
||||
Net income (loss) **
|
$
|
(0.82
|
)
|
|
$
|
0.81
|
|
|
$
|
(0.12
|
)
|
|
$
|
1.57
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings (loss) per share attributable to Johnson Controls, Inc.
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
(0.82
|
)
|
|
$
|
0.68
|
|
|
$
|
(0.12
|
)
|
|
$
|
1.40
|
|
Discontinued operations
|
—
|
|
|
0.12
|
|
|
—
|
|
|
0.15
|
|
||||
Net income (loss) **
|
$
|
(0.82
|
)
|
|
$
|
0.80
|
|
|
$
|
(0.12
|
)
|
|
$
|
1.56
|
|
*
|
Products and systems consist of Automotive Experience and Power Solutions products and systems and Building Efficiency installed systems. Services are Building Efficiency technical services.
|
**
|
Certain items do not sum due to rounding.
|
Johnson Controls, Inc.
Consolidated Statements of Comprehensive Income (Loss)
(in millions; unaudited)
|
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
(469
|
)
|
|
$
|
557
|
|
|
$
|
21
|
|
|
$
|
1,103
|
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
203
|
|
|
(504
|
)
|
|
26
|
|
|
(855
|
)
|
||||
Realized and unrealized gains (losses) on derivatives
|
5
|
|
|
7
|
|
|
2
|
|
|
(3
|
)
|
||||
Pension and postretirement plans
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss)
|
208
|
|
|
(497
|
)
|
|
28
|
|
|
(861
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Total comprehensive income (loss)
|
(261
|
)
|
|
60
|
|
|
49
|
|
|
242
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Comprehensive income attributable to noncontrolling interests
|
90
|
|
|
6
|
|
|
111
|
|
|
45
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Comprehensive income (loss) attributable to Johnson Controls, Inc.
|
$
|
(351
|
)
|
|
$
|
54
|
|
|
$
|
(62
|
)
|
|
$
|
197
|
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Operating Activities
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to Johnson Controls, Inc.
|
$
|
(530
|
)
|
|
$
|
529
|
|
|
$
|
(80
|
)
|
|
$
|
1,036
|
|
Income from continuing operations attributable to noncontrolling interests
|
61
|
|
|
27
|
|
|
101
|
|
|
63
|
|
||||
Income from discontinued operations attributable to noncontrolling interests
|
—
|
|
|
1
|
|
|
—
|
|
|
4
|
|
||||
Net income (loss)
|
(469
|
)
|
|
557
|
|
|
21
|
|
|
1,103
|
|
||||
Adjustments to reconcile net income to cash provided by operating activities:
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization
|
219
|
|
|
205
|
|
|
445
|
|
|
429
|
|
||||
Pension and postretirement benefit income
|
(17
|
)
|
|
(1
|
)
|
|
(34
|
)
|
|
(15
|
)
|
||||
Pension and postretirement contributions
|
(34
|
)
|
|
(28
|
)
|
|
(53
|
)
|
|
(52
|
)
|
||||
Equity in earnings of partially-owned affiliates, net of dividends received
|
(97
|
)
|
|
(77
|
)
|
|
(207
|
)
|
|
(169
|
)
|
||||
Deferred income taxes
|
345
|
|
|
152
|
|
|
331
|
|
|
248
|
|
||||
Non-cash restructuring and impairment costs
|
29
|
|
|
—
|
|
|
29
|
|
|
—
|
|
||||
Gain on divestitures
|
—
|
|
|
(200
|
)
|
|
—
|
|
|
(200
|
)
|
||||
Fair value adjustment of equity investment
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
||||
Equity-based compensation
|
23
|
|
|
25
|
|
|
51
|
|
|
46
|
|
||||
Other
|
4
|
|
|
4
|
|
|
5
|
|
|
(1
|
)
|
||||
Changes in assets and liabilities, excluding acquisitions and divestitures:
|
|
|
|
|
|
|
|
||||||||
Receivables
|
(124
|
)
|
|
(299
|
)
|
|
75
|
|
|
111
|
|
||||
Inventories
|
(98
|
)
|
|
(81
|
)
|
|
(168
|
)
|
|
(101
|
)
|
||||
Other assets
|
242
|
|
|
22
|
|
|
134
|
|
|
(107
|
)
|
||||
Restructuring reserves
|
141
|
|
|
(68
|
)
|
|
67
|
|
|
(145
|
)
|
||||
Accounts payable and accrued liabilities
|
83
|
|
|
246
|
|
|
(311
|
)
|
|
(456
|
)
|
||||
Accrued income taxes
|
391
|
|
|
(97
|
)
|
|
240
|
|
|
(491
|
)
|
||||
Cash provided by operating activities
|
634
|
|
|
360
|
|
|
621
|
|
|
200
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Investing Activities
|
|
|
|
|
|
|
|
||||||||
Capital expenditures
|
(261
|
)
|
|
(294
|
)
|
|
(543
|
)
|
|
(556
|
)
|
||||
Sale of property, plant and equipment
|
5
|
|
|
3
|
|
|
14
|
|
|
17
|
|
||||
Acquisition of businesses, net of cash acquired
|
—
|
|
|
(9
|
)
|
|
(133
|
)
|
|
(22
|
)
|
||||
Business divestitures
|
22
|
|
|
141
|
|
|
40
|
|
|
141
|
|
||||
Changes in long-term investments
|
—
|
|
|
(47
|
)
|
|
—
|
|
|
(45
|
)
|
||||
Other
|
1
|
|
|
6
|
|
|
5
|
|
|
11
|
|
||||
Cash used by investing activities
|
(233
|
)
|
|
(200
|
)
|
|
(617
|
)
|
|
(454
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Financing Activities
|
|
|
|
|
|
|
|
||||||||
Increase in short-term debt - net
|
619
|
|
|
267
|
|
|
1,140
|
|
|
1,165
|
|
||||
Repayment of long-term debt
|
(807
|
)
|
|
(131
|
)
|
|
(814
|
)
|
|
(140
|
)
|
||||
Stock repurchases
|
—
|
|
|
(210
|
)
|
|
—
|
|
|
(810
|
)
|
||||
Payment of cash dividends
|
(188
|
)
|
|
(171
|
)
|
|
(356
|
)
|
|
(317
|
)
|
||||
Proceeds from the exercise of stock options
|
4
|
|
|
57
|
|
|
20
|
|
|
162
|
|
||||
Dividends paid to noncontrolling interests
|
(73
|
)
|
|
(9
|
)
|
|
(227
|
)
|
|
(20
|
)
|
||||
Other
|
(3
|
)
|
|
(25
|
)
|
|
3
|
|
|
(33
|
)
|
||||
Cash provided (used) by financing activities
|
(448
|
)
|
|
(222
|
)
|
|
(234
|
)
|
|
7
|
|
||||
Effect of exchange rate changes on cash and cash equivalents
|
(9
|
)
|
|
39
|
|
|
(9
|
)
|
|
(18
|
)
|
||||
Cash held for sale
|
—
|
|
|
19
|
|
|
—
|
|
|
20
|
|
||||
Decrease in cash and cash equivalents
|
(56
|
)
|
|
(4
|
)
|
|
(239
|
)
|
|
(245
|
)
|
||||
Cash and cash equivalents at beginning of period
|
414
|
|
|
168
|
|
|
597
|
|
|
409
|
|
||||
Cash and cash equivalents at end of period
|
$
|
358
|
|
|
$
|
164
|
|
|
$
|
358
|
|
|
$
|
164
|
|
1.
|
Financial Statements
|
|
March 31, 2016
|
|
September 30, 2015
|
|
March 31, 2015
|
||||||
|
|
|
|
|
|
||||||
Current assets
|
$
|
308
|
|
|
$
|
281
|
|
|
$
|
269
|
|
Noncurrent assets
|
123
|
|
|
128
|
|
|
134
|
|
|||
Total assets
|
$
|
431
|
|
|
$
|
409
|
|
|
$
|
403
|
|
|
|
|
|
|
|
||||||
Current liabilities
|
$
|
225
|
|
|
$
|
232
|
|
|
$
|
200
|
|
Noncurrent liabilities
|
32
|
|
|
34
|
|
|
35
|
|
|||
Total liabilities
|
$
|
257
|
|
|
$
|
266
|
|
|
$
|
235
|
|
|
March 31, 2015
|
||||||||||
|
Previously
Reported
|
|
Revised
|
|
Effect of
Change
|
||||||
Consolidated Statement of Financial Position
|
|
|
|
|
|
||||||
Other current assets
|
$
|
2,262
|
|
|
$
|
1,790
|
|
|
$
|
(472
|
)
|
Other noncurrent assets
|
2,709
|
|
|
3,091
|
|
|
382
|
|
|||
Other current liabilities
|
2,870
|
|
|
2,807
|
|
|
(63
|
)
|
|||
Other noncurrent liabilities
|
1,861
|
|
|
1,834
|
|
|
(27
|
)
|
2.
|
New Accounting Standards
|
3.
|
Acquisitions and Divestitures
|
4.
|
Discontinued Operations
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||
|
2015
|
|
2015
|
||||
|
|
|
|
||||
Net sales
|
$
|
803
|
|
|
$
|
1,845
|
|
|
|
|
|
||||
Income from discontinued operations before income taxes
|
227
|
|
|
269
|
|
||
Provision for income taxes on discontinued operations
|
149
|
|
|
162
|
|
||
Income from discontinued operations attributable to noncontrolling interests, net of tax
|
1
|
|
|
4
|
|
||
Income from discontinued operations
|
$
|
77
|
|
|
$
|
103
|
|
|
March 31, 2015
|
||||||||||
|
Interiors
|
|
Global Workplace Solutions
|
|
Total
|
||||||
|
|
|
|
|
|
||||||
Accounts receivable - net
|
$
|
583
|
|
|
$
|
582
|
|
|
$
|
1,165
|
|
Inventories
|
219
|
|
|
6
|
|
|
225
|
|
|||
Other current assets
|
175
|
|
|
80
|
|
|
255
|
|
|||
Property, plant and equipment - net
|
583
|
|
|
26
|
|
|
609
|
|
|||
Goodwill
|
21
|
|
|
216
|
|
|
237
|
|
|||
Other intangible assets - net
|
3
|
|
|
18
|
|
|
21
|
|
|||
Investments in partially-owned affiliates
|
58
|
|
|
—
|
|
|
58
|
|
|||
Other noncurrent assets
|
36
|
|
|
56
|
|
|
92
|
|
|||
Assets held for sale
|
$
|
1,678
|
|
|
$
|
984
|
|
|
$
|
2,662
|
|
|
|
|
|
|
|
||||||
Short-term debt
|
$
|
18
|
|
|
$
|
1
|
|
|
$
|
19
|
|
Accounts payable
|
633
|
|
|
425
|
|
|
1,058
|
|
|||
Accrued compensation and benefits
|
42
|
|
|
71
|
|
|
113
|
|
|||
Other current liabilities
|
165
|
|
|
156
|
|
|
321
|
|
|||
Liabilities held for sale
|
$
|
858
|
|
|
$
|
653
|
|
|
$
|
1,511
|
|
5.
|
Percentage-of-Completion Contracts
|
6.
|
Inventories
|
|
March 31, 2016
|
|
September 30, 2015
|
|
March 31, 2015
|
||||||
|
|
|
|
|
|
||||||
Raw materials and supplies
|
$
|
1,241
|
|
|
$
|
1,084
|
|
|
$
|
1,062
|
|
Work-in-process
|
439
|
|
|
369
|
|
|
391
|
|
|||
Finished goods
|
1,242
|
|
|
924
|
|
|
961
|
|
|||
Inventories
|
$
|
2,922
|
|
|
$
|
2,377
|
|
|
$
|
2,414
|
|
7.
|
Goodwill and Other Intangible Assets
|
|
|
|
Business Acquisitions
|
|
Business Divestitures
|
|
Currency Translation and Other
|
|
|
||||||||||
|
September 30,
|
|
|
|
|
March 31,
|
|||||||||||||
|
2015
|
|
|
|
|
2016
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Building Efficiency
|
|
|
|
|
|
|
|
|
|
||||||||||
Systems and Service North America
|
$
|
978
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
978
|
|
Products North America
|
1,701
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,701
|
|
|||||
Asia
|
389
|
|
|
193
|
|
|
—
|
|
|
(12
|
)
|
|
570
|
|
|||||
Rest of World
|
310
|
|
|
4
|
|
|
—
|
|
|
2
|
|
|
316
|
|
|||||
Automotive Experience
|
|
|
|
|
|
|
|
|
|
||||||||||
Seating
|
2,364
|
|
|
—
|
|
|
—
|
|
|
26
|
|
|
2,390
|
|
|||||
Power Solutions
|
1,082
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
1,087
|
|
|||||
Total
|
$
|
6,824
|
|
|
$
|
197
|
|
|
$
|
—
|
|
|
$
|
21
|
|
|
$
|
7,042
|
|
|
March 31, 2016
|
|
September 30, 2015
|
|
March 31, 2015
|
||||||||||||||||||||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||||||||
Amortized intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Patented technology
|
$
|
47
|
|
|
$
|
(28
|
)
|
|
$
|
19
|
|
|
$
|
80
|
|
|
$
|
(59
|
)
|
|
$
|
21
|
|
|
$
|
82
|
|
|
$
|
(58
|
)
|
|
$
|
24
|
|
Customer relationships
|
1,013
|
|
|
(238
|
)
|
|
775
|
|
|
975
|
|
|
(206
|
)
|
|
769
|
|
|
982
|
|
|
(180
|
)
|
|
802
|
|
|||||||||
Miscellaneous
|
383
|
|
|
(144
|
)
|
|
239
|
|
|
307
|
|
|
(123
|
)
|
|
184
|
|
|
296
|
|
|
(107
|
)
|
|
189
|
|
|||||||||
Total amortized intangible assets
|
1,443
|
|
|
(410
|
)
|
|
1,033
|
|
|
1,362
|
|
|
(388
|
)
|
|
974
|
|
|
1,360
|
|
|
(345
|
)
|
|
1,015
|
|
|||||||||
Unamortized intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Trademarks/trade names
|
543
|
|
|
—
|
|
|
543
|
|
|
542
|
|
|
—
|
|
|
542
|
|
|
543
|
|
|
—
|
|
|
543
|
|
|||||||||
Total intangible assets
|
$
|
1,986
|
|
|
$
|
(410
|
)
|
|
$
|
1,576
|
|
|
$
|
1,904
|
|
|
$
|
(388
|
)
|
|
$
|
1,516
|
|
|
$
|
1,903
|
|
|
$
|
(345
|
)
|
|
$
|
1,558
|
|
8.
|
Product Warranties
|
|
Six Months Ended
March 31, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Balance at beginning of period
|
$
|
300
|
|
|
$
|
319
|
|
Accruals for warranties issued during the period
|
157
|
|
|
136
|
|
||
Accruals from acquisition and divestitures
|
37
|
|
|
—
|
|
||
Accruals related to pre-existing warranties (including changes in estimates)
|
8
|
|
|
(2
|
)
|
||
Settlements made (in cash or in kind) during the period
|
(152
|
)
|
|
(144
|
)
|
||
Currency translation
|
2
|
|
|
(7
|
)
|
||
Balance at end of period
|
$
|
352
|
|
|
$
|
302
|
|
9.
|
Significant Restructuring and Impairment Costs
|
|
Employee Severance and Termination Benefits
|
|
Long-Lived Asset Impairments
|
|
Other
|
|
Currency
Translation |
|
Total
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Original Reserve
|
$
|
194
|
|
|
$
|
29
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
229
|
|
Utilized—cash
|
(3
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(4
|
)
|
|||||
Utilized—noncash
|
—
|
|
|
(29
|
)
|
|
—
|
|
|
2
|
|
|
(27
|
)
|
|||||
Balance at March 31, 2016
|
$
|
191
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
2
|
|
|
$
|
198
|
|
|
Employee Severance and Termination Benefits
|
|
Long-Lived Asset Impairments
|
|
Other
|
|
Currency
Translation |
|
Total
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Original Reserve
|
$
|
191
|
|
|
$
|
183
|
|
|
$
|
23
|
|
|
$
|
—
|
|
|
$
|
397
|
|
Utilized—cash
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Utilized—noncash
|
—
|
|
|
(183
|
)
|
|
—
|
|
|
—
|
|
|
(183
|
)
|
|||||
Balance at September 30, 2015
|
$
|
191
|
|
|
$
|
—
|
|
|
$
|
23
|
|
|
$
|
—
|
|
|
$
|
214
|
|
Utilized—cash
|
(37
|
)
|
|
—
|
|
|
(23
|
)
|
|
—
|
|
|
(60
|
)
|
|||||
Utilized—noncash
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|||||
Balance at March 31, 2016
|
$
|
154
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
156
|
|
|
Employee Severance and Termination Benefits
|
|
Long-Lived Asset Impairments
|
|
Goodwill Impairment
|
|
Other
|
|
Currency
Translation |
|
Total
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Original Reserve
|
$
|
191
|
|
|
$
|
134
|
|
|
$
|
47
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
377
|
|
Utilized—cash
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
||||||
Utilized—noncash
|
—
|
|
|
(134
|
)
|
|
(47
|
)
|
|
—
|
|
|
(6
|
)
|
|
(187
|
)
|
||||||
Balance at September 30, 2014
|
$
|
183
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
(6
|
)
|
|
$
|
182
|
|
Utilized—cash
|
(65
|
)
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(70
|
)
|
||||||
Utilized—noncash
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13
|
)
|
|
(13
|
)
|
||||||
Balance at September 30, 2015
|
$
|
118
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(19
|
)
|
|
$
|
99
|
|
Utilized—cash
|
(31
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(31
|
)
|
||||||
Utilized—noncash
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
||||||
Balance at March 31, 2016
|
$
|
87
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(21
|
)
|
|
$
|
66
|
|
|
Employee Severance and Termination Benefits
|
|
Long-Lived Asset Impairments
|
|
Goodwill Impairment
|
|
Other
|
|
Currency
Translation |
|
Total
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Original Reserve
|
$
|
392
|
|
|
$
|
156
|
|
|
$
|
430
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
985
|
|
Utilized—cash
|
(26
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
||||||
Utilized—noncash
|
—
|
|
|
(156
|
)
|
|
(430
|
)
|
|
(4
|
)
|
|
4
|
|
|
(586
|
)
|
||||||
Transfer to liabilities held for sale
|
(31
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(31
|
)
|
||||||
Balance at September 30, 2013
|
$
|
335
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
4
|
|
|
$
|
342
|
|
Utilized—cash
|
(144
|
)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(147
|
)
|
||||||
Utilized—noncash
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11
|
)
|
|
(11
|
)
|
||||||
Transfer from liabilities held for sale
|
31
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
31
|
|
||||||
Transfer to liabilities held for sale
|
(24
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24
|
)
|
||||||
Balance at September 30, 2014
|
$
|
198
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(7
|
)
|
|
$
|
191
|
|
Utilized—cash
|
(113
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(113
|
)
|
||||||
Utilized—noncash
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
(10
|
)
|
||||||
Balance at September 30, 2015
|
$
|
85
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(17
|
)
|
|
$
|
68
|
|
Utilized—cash
|
(33
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(33
|
)
|
||||||
Utilized—noncash
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
||||||
Balance at March 31, 2016
|
$
|
52
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(18
|
)
|
|
$
|
34
|
|
10.
|
Income Taxes
|
Tax Jurisdiction
|
|
Tax Years Covered
|
|
|
|
Belgium
|
|
2010 - 2012
|
Brazil
|
|
2004 - 2008, 2011 - 2012
|
Canada
|
|
2008 - 2013
|
France
|
|
2002 - 2013
|
Germany
|
|
2007 - 2012
|
Italy
|
|
2006, 2011
|
Korea
|
|
2008 - 2014
|
Mexico
|
|
2011
|
Spain
|
|
2013
|
United Kingdom
|
|
2011 - 2013
|
11.
|
Pension and Postretirement Plans
|
|
U.S. Pension Plans
|
||||||||||||||
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Service cost
|
$
|
4
|
|
|
$
|
7
|
|
|
$
|
8
|
|
|
$
|
15
|
|
Interest cost
|
25
|
|
|
31
|
|
|
50
|
|
|
61
|
|
||||
Expected return on plan assets
|
(46
|
)
|
|
(45
|
)
|
|
(93
|
)
|
|
(90
|
)
|
||||
Net periodic benefit credit
|
$
|
(17
|
)
|
|
$
|
(7
|
)
|
|
$
|
(35
|
)
|
|
$
|
(14
|
)
|
|
Non-U.S. Pension Plans
|
||||||||||||||
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Service cost
|
$
|
4
|
|
|
$
|
6
|
|
|
$
|
9
|
|
|
$
|
13
|
|
Interest cost
|
10
|
|
|
12
|
|
|
20
|
|
|
24
|
|
||||
Expected return on plan assets
|
(13
|
)
|
|
(13
|
)
|
|
(26
|
)
|
|
(26
|
)
|
||||
Net periodic benefit cost
|
$
|
1
|
|
|
$
|
5
|
|
|
$
|
3
|
|
|
$
|
11
|
|
|
Postretirement Benefits
|
||||||||||||||
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Service cost
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
1
|
|
Interest cost
|
2
|
|
|
3
|
|
|
3
|
|
|
5
|
|
||||
Expected return on plan assets
|
(2
|
)
|
|
(3
|
)
|
|
(5
|
)
|
|
(6
|
)
|
||||
Amortization of prior service credit
|
(1
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|
(1
|
)
|
||||
Net periodic benefit credit
|
$
|
(1
|
)
|
|
$
|
(1
|
)
|
|
$
|
(2
|
)
|
|
$
|
(1
|
)
|
12.
|
Debt and Financing Arrangements
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Interest expense, net of capitalized interest costs
|
$
|
69
|
|
|
$
|
72
|
|
|
$
|
142
|
|
|
$
|
143
|
|
Banking fees and bond cost amortization
|
5
|
|
|
6
|
|
|
13
|
|
|
12
|
|
||||
Interest income
|
(3
|
)
|
|
(1
|
)
|
|
(5
|
)
|
|
(4
|
)
|
||||
Net foreign exchange results for financing activities
|
3
|
|
|
(8
|
)
|
|
(8
|
)
|
|
(11
|
)
|
||||
Net financing charges
|
$
|
74
|
|
|
$
|
69
|
|
|
$
|
142
|
|
|
$
|
140
|
|
13.
|
Earnings Per Share
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Income (Loss) Available to Common Shareholders
|
|
|
|
|
|
|
|
||||||||
Income (loss) from continuing operations
|
$
|
(530
|
)
|
|
$
|
452
|
|
|
$
|
(80
|
)
|
|
$
|
933
|
|
Income from discontinued operations
|
—
|
|
|
77
|
|
|
—
|
|
|
103
|
|
||||
Basic and diluted income (loss) available to common
shareholders
|
$
|
(530
|
)
|
|
$
|
529
|
|
|
$
|
(80
|
)
|
|
$
|
1,036
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted Average Shares Outstanding
|
|
|
|
|
|
|
|
||||||||
Basic weighted average shares outstanding
|
648.2
|
|
|
654.4
|
|
|
648.0
|
|
|
657.9
|
|
||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||||||
Stock options, unvested restricted stock and
unvested performance share awards
|
—
|
|
|
6.8
|
|
|
—
|
|
|
6.8
|
|
||||
Diluted weighted average shares outstanding
|
648.2
|
|
|
661.2
|
|
|
648.0
|
|
|
664.7
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Antidilutive Securities
|
|
|
|
|
|
|
|
||||||||
Options to purchase common shares
|
—
|
|
|
0.5
|
|
|
—
|
|
|
0.4
|
|
14.
|
Equity and Noncontrolling Interests
|
|
Three Months Ended March 31, 2016
|
|
Three Months Ended March 31, 2015
|
||||||||||||||||||||
|
Equity
Attributable to
Johnson
Controls, Inc.
|
|
Equity
Attributable to
Noncontrolling
Interests
|
|
Total Equity
|
|
Equity
Attributable to
Johnson
Controls, Inc.
|
|
Equity
Attributable to
Noncontrolling
Interests
|
|
Total Equity
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Beginning balance, December 31
|
$
|
10,506
|
|
|
$
|
931
|
|
|
$
|
11,437
|
|
|
$
|
10,823
|
|
|
$
|
263
|
|
|
$
|
11,086
|
|
Total comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income (loss)
|
(530
|
)
|
|
50
|
|
|
(480
|
)
|
|
529
|
|
|
16
|
|
|
545
|
|
||||||
Foreign currency translation adjustments
|
175
|
|
|
18
|
|
|
193
|
|
|
(481
|
)
|
|
(3
|
)
|
|
(484
|
)
|
||||||
Realized and unrealized gains on derivatives
|
4
|
|
|
1
|
|
|
5
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||||
Other comprehensive income (loss)
|
179
|
|
|
19
|
|
|
198
|
|
|
(475
|
)
|
|
(3
|
)
|
|
(478
|
)
|
||||||
Comprehensive income (loss)
|
(351
|
)
|
|
69
|
|
|
(282
|
)
|
|
54
|
|
|
13
|
|
|
67
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other changes in equity:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash dividends—common stock
|
(189
|
)
|
|
—
|
|
|
(189
|
)
|
|
(170
|
)
|
|
—
|
|
|
(170
|
)
|
||||||
Dividends attributable to noncontrolling interests
|
—
|
|
|
(29
|
)
|
|
(29
|
)
|
|
—
|
|
|
(8
|
)
|
|
(8
|
)
|
||||||
Repurchases of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(210
|
)
|
|
—
|
|
|
(210
|
)
|
||||||
Change in noncontrolling interest share
|
—
|
|
|
(73
|
)
|
|
(73
|
)
|
|
—
|
|
|
(69
|
)
|
|
(69
|
)
|
||||||
Other, including options exercised
|
18
|
|
|
—
|
|
|
18
|
|
|
86
|
|
|
—
|
|
|
86
|
|
||||||
Ending balance, March 31
|
$
|
9,984
|
|
|
$
|
898
|
|
|
$
|
10,882
|
|
|
$
|
10,583
|
|
|
$
|
199
|
|
|
$
|
10,782
|
|
|
Six Months Ended March 31, 2016
|
|
Six Months Ended March 31, 2015
|
||||||||||||||||||||
|
Equity
Attributable to
Johnson
Controls, Inc.
|
|
Equity
Attributable to
Noncontrolling
Interests
|
|
Total Equity
|
|
Equity
Attributable to
Johnson
Controls, Inc.
|
|
Equity
Attributable to
Noncontrolling
Interests
|
|
Total Equity
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Beginning balance, September 30
|
$
|
10,376
|
|
|
$
|
163
|
|
|
$
|
10,539
|
|
|
$
|
11,311
|
|
|
$
|
251
|
|
|
$
|
11,562
|
|
Total comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income (loss)
|
(80
|
)
|
|
70
|
|
|
(10
|
)
|
|
1,036
|
|
|
36
|
|
|
1,072
|
|
||||||
Foreign currency translation adjustments
|
15
|
|
|
9
|
|
|
24
|
|
|
(832
|
)
|
|
(3
|
)
|
|
(835
|
)
|
||||||
Realized and unrealized gains (losses) on derivatives
|
3
|
|
|
1
|
|
|
4
|
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
||||||
Pension and postretirement plans
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
||||||
Other comprehensive income (loss)
|
18
|
|
|
10
|
|
|
28
|
|
|
(839
|
)
|
|
(3
|
)
|
|
(842
|
)
|
||||||
Comprehensive income (loss)
|
(62
|
)
|
|
80
|
|
|
18
|
|
|
197
|
|
|
33
|
|
|
230
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other changes in equity:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash dividends—common stock
|
(377
|
)
|
|
—
|
|
|
(377
|
)
|
|
(342
|
)
|
|
—
|
|
|
(342
|
)
|
||||||
Dividends attributable to noncontrolling interests
|
—
|
|
|
(36
|
)
|
|
(36
|
)
|
|
—
|
|
|
(16
|
)
|
|
(16
|
)
|
||||||
Repurchases of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(810
|
)
|
|
—
|
|
|
(810
|
)
|
||||||
Change in noncontrolling interest share
|
—
|
|
|
691
|
|
|
691
|
|
|
—
|
|
|
(69
|
)
|
|
(69
|
)
|
||||||
Other, including options exercised
|
47
|
|
|
—
|
|
|
47
|
|
|
227
|
|
|
—
|
|
|
227
|
|
||||||
Ending balance, March 31
|
$
|
9,984
|
|
|
$
|
898
|
|
|
$
|
10,882
|
|
|
$
|
10,583
|
|
|
$
|
199
|
|
|
$
|
10,782
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Beginning balance, December 31
|
$
|
216
|
|
|
$
|
209
|
|
Net income
|
11
|
|
|
12
|
|
||
Foreign currency translation adjustments
|
10
|
|
|
(20
|
)
|
||
Realized and unrealized gains on derivatives
|
—
|
|
|
1
|
|
||
Ending balance, March 31
|
$
|
237
|
|
|
$
|
202
|
|
|
Six Months Ended
March 31, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Beginning balance, September 30
|
$
|
212
|
|
|
$
|
194
|
|
Net income
|
31
|
|
|
31
|
|
||
Foreign currency translation adjustments
|
2
|
|
|
(20
|
)
|
||
Realized and unrealized gains (losses) on derivatives
|
(2
|
)
|
|
1
|
|
||
Dividends
|
(6
|
)
|
|
(4
|
)
|
||
Ending balance, March 31
|
$
|
237
|
|
|
$
|
202
|
|
|
Three Months Ended
March 31,
|
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Foreign currency translation adjustments
|
|
|
|
||||
Balance at beginning of period
|
$
|
(1,207
|
)
|
|
$
|
(599
|
)
|
Aggregate adjustment for the period (net of tax effect of $5 and $(4))
|
175
|
|
|
(481
|
)
|
||
Balance at end of period
|
(1,032
|
)
|
|
(1,080
|
)
|
||
|
|
|
|
||||
Realized and unrealized gains (losses) on derivatives
|
|
|
|
||||
Balance at beginning of period
|
(8
|
)
|
|
(6
|
)
|
||
Current period changes in fair value (net of tax effect of $1 and $1)
|
5
|
|
|
4
|
|
||
Reclassification to income (net of tax effect of $0 and $1) *
|
(1
|
)
|
|
2
|
|
||
Balance at end of period
|
(4
|
)
|
|
—
|
|
||
|
|
|
|
||||
Pension and postretirement plans
|
|
|
|
||||
Balance at beginning of period
|
(3
|
)
|
|
4
|
|
||
Reclassification to income (net of tax effect of $0) **
|
(1
|
)
|
|
(1
|
)
|
||
Other changes (net of tax effect of $0)
|
1
|
|
|
1
|
|
||
Balance at end of period
|
(3
|
)
|
|
4
|
|
||
|
|
|
|
||||
Accumulated other comprehensive loss, end of period
|
$
|
(1,039
|
)
|
|
$
|
(1,076
|
)
|
|
Six Months Ended
March 31,
|
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Foreign currency translation adjustments
|
|
|
|
||||
Balance at beginning of period
|
$
|
(1,047
|
)
|
|
$
|
(248
|
)
|
Aggregate adjustment for the period (net of tax effect of $1 and $(2))
|
15
|
|
|
(832
|
)
|
||
Balance at end of period
|
(1,032
|
)
|
|
(1,080
|
)
|
||
|
|
|
|
||||
Realized and unrealized gains (losses) on derivatives
|
|
|
|
||||
Balance at beginning of period
|
(7
|
)
|
|
4
|
|
||
Current period changes in fair value (net of tax effect of $1 and $(4))
|
1
|
|
|
(5
|
)
|
||
Reclassification to income (net of tax effect of $1 and $1) *
|
2
|
|
|
1
|
|
||
Balance at end of period
|
(4
|
)
|
|
—
|
|
||
|
|
|
|
||||
Pension and postretirement plans
|
|
|
|
||||
Balance at beginning of period
|
(3
|
)
|
|
7
|
|
||
Reclassification to income (net of tax effect of $0 and $(1)) **
|
(1
|
)
|
|
(4
|
)
|
||
Other changes (net of tax effect of $0)
|
1
|
|
|
1
|
|
||
Balance at end of period
|
(3
|
)
|
|
4
|
|
||
|
|
|
|
||||
Accumulated other comprehensive loss, end of period
|
$
|
(1,039
|
)
|
|
$
|
(1,076
|
)
|
15.
|
Derivative Instruments and Hedging Activities
|
|
|
|
|
Volume Outstanding as of
|
|||||||
Commodity
|
|
Units
|
|
March 31, 2016
|
|
September 30, 2015
|
|
March 31, 2015
|
|||
|
|
|
|
|
|
|
|
|
|||
Copper
|
|
Pounds
|
|
7,155,000
|
|
|
14,648,000
|
|
|
7,805,000
|
|
Lead
|
|
Metric Tons
|
|
4,595
|
|
|
6,785
|
|
|
10,952
|
|
Aluminum
|
|
Metric Tons
|
|
2,785
|
|
|
5,700
|
|
|
1,830
|
|
Tin
|
|
Metric Tons
|
|
688
|
|
|
2,080
|
|
|
1,000
|
|
|
Derivatives and Hedging Activities Designated as
Hedging Instruments under ASC 815
|
|
Derivatives and Hedging Activities Not Designated
as Hedging Instruments under ASC 815
|
||||||||||||||||||||
|
March 31,
|
|
September 30,
|
|
March 31,
|
|
March 31,
|
|
September 30,
|
|
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2015
|
|
2016
|
|
2015
|
|
2015
|
||||||||||||
Other current assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency exchange derivatives
|
$
|
21
|
|
|
$
|
31
|
|
|
$
|
50
|
|
|
$
|
—
|
|
|
$
|
27
|
|
|
$
|
28
|
|
Commodity derivatives
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Interest rate swaps
|
—
|
|
|
1
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cross-currency interest rate swaps
|
—
|
|
|
5
|
|
|
20
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other noncurrent assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate swaps
|
3
|
|
|
5
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Equity swap
|
—
|
|
|
—
|
|
|
—
|
|
|
147
|
|
|
164
|
|
|
205
|
|
||||||
Total assets
|
$
|
25
|
|
|
$
|
42
|
|
|
$
|
74
|
|
|
$
|
147
|
|
|
$
|
191
|
|
|
$
|
233
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency exchange derivatives
|
$
|
30
|
|
|
$
|
37
|
|
|
$
|
50
|
|
|
$
|
30
|
|
|
$
|
26
|
|
|
$
|
22
|
|
Commodity derivatives
|
3
|
|
|
7
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cross-currency interest rate swaps
|
7
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Current portion of long-term debt
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed rate debt swapped to floating
|
403
|
|
|
801
|
|
|
801
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Long-term debt
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency denominated debt
|
329
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Fixed rate debt swapped to floating
|
450
|
|
|
855
|
|
|
853
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total liabilities
|
$
|
1,222
|
|
|
$
|
1,701
|
|
|
$
|
1,711
|
|
|
$
|
30
|
|
|
$
|
26
|
|
|
$
|
22
|
|
|
Fair Value of Assets
|
|
Fair Value of Liabilities
|
||||||||||||||||||||
|
March 31,
|
|
September 30,
|
|
March 31,
|
|
March 31,
|
|
September 30,
|
|
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2015
|
|
2016
|
|
2015
|
|
2015
|
||||||||||||
Gross amount recognized
|
$
|
172
|
|
|
$
|
233
|
|
|
$
|
307
|
|
|
$
|
1,252
|
|
|
$
|
1,727
|
|
|
$
|
1,733
|
|
Gross amount eligible for offsetting
|
(10
|
)
|
|
(8
|
)
|
|
(25
|
)
|
|
(10
|
)
|
|
(8
|
)
|
|
(25
|
)
|
||||||
Net amount
|
$
|
162
|
|
|
$
|
225
|
|
|
$
|
282
|
|
|
$
|
1,242
|
|
|
$
|
1,719
|
|
|
$
|
1,708
|
|
|
|
|
|
Amount of Gain (Loss) Reclassified from AOCI into Income
|
||||||||||||||
Derivatives in ASC 815 Cash Flow Hedging Relationships
|
|
Location of Gain (Loss) Reclassified
from AOCI into Income
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|||||||||||
Foreign currency exchange derivatives
|
|
Cost of sales
|
|
$
|
5
|
|
|
$
|
(2
|
)
|
|
$
|
5
|
|
|
$
|
(1
|
)
|
Commodity derivatives
|
|
Cost of sales
|
|
(5
|
)
|
|
(2
|
)
|
|
(9
|
)
|
|
(2
|
)
|
||||
Forward treasury locks
|
|
Net financing charges
|
|
1
|
|
|
1
|
|
|
1
|
|
|
1
|
|
||||
Total
|
|
|
|
$
|
1
|
|
|
$
|
(3
|
)
|
|
$
|
(3
|
)
|
|
$
|
(2
|
)
|
Derivatives in ASC 815 Cash Flow Hedging Relationships
|
|
Amount of Gain (Loss) Recognized in AOCI on Derivative
|
||||||||||
|
March 31, 2016
|
|
September 30, 2015
|
|
March 31, 2015
|
|||||||
Foreign currency exchange derivatives
|
|
$
|
(6
|
)
|
|
$
|
(5
|
)
|
|
$
|
1
|
|
Commodity derivatives
|
|
(2
|
)
|
|
(7
|
)
|
|
(6
|
)
|
|||
Forward treasury locks
|
|
4
|
|
|
5
|
|
|
5
|
|
|||
Total
|
|
$
|
(4
|
)
|
|
$
|
(7
|
)
|
|
$
|
—
|
|
|
|
|
|
Amount of Gain (Loss) Recognized in Income on Derivative
|
||||||||||||||
Derivatives in ASC 815 Fair Value Hedging Relationships
|
|
Location of Gain (Loss) Recognized in Income on Derivative
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|||||||||||
Interest rate swaps
|
|
Net financing charges
|
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
(3
|
)
|
|
$
|
5
|
|
Fixed rate debt swapped to floating
|
|
Net financing charges
|
|
(2
|
)
|
|
(3
|
)
|
|
3
|
|
|
(5
|
)
|
||||
Total
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
Amount of Gain (Loss) Recognized in Income on Derivative
|
||||||||||||||
Derivatives Not Designated as Hedging Instruments under ASC 815
|
|
Location of Gain (Loss) Recognized in Income on Derivative
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|||||||||||
Foreign currency exchange derivatives
|
|
Cost of sales
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
(1
|
)
|
|
$
|
(3
|
)
|
Foreign currency exchange derivatives
|
|
Net financing charges
|
|
(14
|
)
|
|
2
|
|
|
(14
|
)
|
|
—
|
|
||||
Equity swap
|
|
Selling, general and administrative
|
|
(2
|
)
|
|
8
|
|
|
(8
|
)
|
|
27
|
|
||||
Total
|
|
|
|
$
|
(16
|
)
|
|
$
|
9
|
|
|
$
|
(23
|
)
|
|
$
|
24
|
|
16.
|
Fair Value Measurements
|
|
Fair Value Measurements Using:
|
||||||||||||||
|
Total as of
March 31, 2016
|
|
Quoted Prices
in Active
Markets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Other current assets
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
$
|
21
|
|
|
$
|
—
|
|
|
$
|
21
|
|
|
$
|
—
|
|
Commodity derivatives
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Other noncurrent assets
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
3
|
|
|
—
|
|
|
3
|
|
|
—
|
|
||||
Investments in marketable common stock
|
4
|
|
|
4
|
|
|
—
|
|
|
—
|
|
||||
Equity swap
|
147
|
|
|
147
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
$
|
176
|
|
|
$
|
151
|
|
|
$
|
25
|
|
|
$
|
—
|
|
Other current liabilities
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
$
|
60
|
|
|
$
|
—
|
|
|
$
|
60
|
|
|
$
|
—
|
|
Commodity derivatives
|
3
|
|
|
—
|
|
|
3
|
|
|
—
|
|
||||
Cross-currency interest rate swaps
|
7
|
|
|
—
|
|
|
7
|
|
|
—
|
|
||||
Current portion of long-term debt
|
|
|
|
|
|
|
|
||||||||
Fixed rate debt swapped to floating
|
403
|
|
|
—
|
|
|
403
|
|
|
—
|
|
||||
Long-term debt
|
|
|
|
|
|
|
|
||||||||
Foreign currency denominated debt
|
329
|
|
|
329
|
|
|
—
|
|
|
—
|
|
||||
Fixed rate debt swapped to floating
|
450
|
|
|
—
|
|
|
450
|
|
|
—
|
|
||||
Total liabilities
|
$
|
1,252
|
|
|
$
|
329
|
|
|
$
|
923
|
|
|
$
|
—
|
|
|
Fair Value Measurements Using:
|
||||||||||||||
|
Total as of
September 30, 2015
|
|
Quoted Prices
in Active
Markets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Other current assets
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
$
|
58
|
|
|
$
|
—
|
|
|
$
|
58
|
|
|
$
|
—
|
|
Interest rate swaps
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Cross-currency interest rate swaps
|
5
|
|
|
—
|
|
|
5
|
|
|
—
|
|
||||
Other noncurrent assets
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
5
|
|
|
—
|
|
|
5
|
|
|
—
|
|
||||
Investments in marketable common stock
|
4
|
|
|
4
|
|
|
—
|
|
|
—
|
|
||||
Equity swap
|
164
|
|
|
164
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
$
|
237
|
|
|
$
|
168
|
|
|
$
|
69
|
|
|
$
|
—
|
|
Other current liabilities
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
$
|
63
|
|
|
$
|
—
|
|
|
$
|
63
|
|
|
$
|
—
|
|
Commodity derivatives
|
7
|
|
|
—
|
|
|
7
|
|
|
—
|
|
||||
Cross-currency interest rate swaps
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Current portion of long-term debt
|
|
|
|
|
|
|
|
||||||||
Fixed rate debt swapped to floating
|
801
|
|
|
—
|
|
|
801
|
|
|
—
|
|
||||
Long-term debt
|
|
|
|
|
|
|
|
||||||||
Fixed rate debt swapped to floating
|
855
|
|
|
—
|
|
|
855
|
|
|
—
|
|
||||
Total liabilities
|
$
|
1,727
|
|
|
$
|
—
|
|
|
$
|
1,727
|
|
|
$
|
—
|
|
17.
|
Impairment of Long-Lived Assets
|
18.
|
Segment Information
|
•
|
The North America Unitary Products business, Air Distribution Technologies business and refrigeration systems business, as well as heating, ventilating and air conditioning (HVAC) products installed for Navy and Marine customers, previously included in the "Other" segment, are now part of a new reportable segment named "Products North America."
|
•
|
The building controls parts business in North America, previously included in the "North America Systems and Service" segment, is now part of the "Products North America" segment.
|
•
|
The remainder of the "Other" segment has been renamed "Rest of World."
|
•
|
Certain reportable segment allocation methodologies have been refined for centralized costs such as engineering and headquarters.
|
•
|
Systems and Service North America provides products and services to non-residential building and industrial applications in the North American marketplace. The products and services include HVAC and controls systems, energy efficiency solutions and technical services, including inspection, scheduled maintenance, and repair and replacement of mechanical and control systems.
|
•
|
Products North America designs and produces heating and air conditioning solutions for residential and light commercial applications, and also markets products and refrigeration systems to the replacement and new construction markets in the North American marketplace. Products North America also includes HVAC products installed for Navy and Marine customers globally.
|
•
|
Asia provides HVAC, controls and refrigeration systems and technical services to the Asian marketplace. Asia also includes the Johnson Controls-Hitachi Air Conditioning joint venture, which was formed October 1, 2015.
|
•
|
Rest of World provides HVAC, controls and refrigeration systems and technical services to markets in Europe, the Middle East and Latin America.
|
•
|
Seating produces automotive seat metal structures and mechanisms, foam, trim, fabric and complete seat systems.
|
•
|
Interiors produces instrument panels, floor consoles and door panels.
|
|
Net Sales
|
||||||||||||||
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Building Efficiency
|
|
|
|
|
|
|
|
||||||||
Systems and Service North America
|
$
|
1,034
|
|
|
$
|
959
|
|
|
$
|
2,018
|
|
|
$
|
1,916
|
|
Products North America
|
546
|
|
|
545
|
|
|
1,103
|
|
|
1,103
|
|
||||
Asia
|
1,162
|
|
|
428
|
|
|
2,154
|
|
|
929
|
|
||||
Rest of World
|
408
|
|
|
445
|
|
|
831
|
|
|
926
|
|
||||
|
3,150
|
|
|
2,377
|
|
|
6,106
|
|
|
4,874
|
|
||||
Automotive Experience
|
|
|
|
|
|
|
|
||||||||
Seating
|
4,177
|
|
|
4,141
|
|
|
8,263
|
|
|
8,276
|
|
||||
Interiors
|
121
|
|
|
1,092
|
|
|
268
|
|
|
2,240
|
|
||||
|
4,298
|
|
|
5,233
|
|
|
8,531
|
|
|
10,516
|
|
||||
Power Solutions
|
1,583
|
|
|
1,588
|
|
|
3,323
|
|
|
3,432
|
|
||||
Total net sales
|
$
|
9,031
|
|
|
$
|
9,198
|
|
|
$
|
17,960
|
|
|
$
|
18,822
|
|
|
Segment Income (Loss)
|
||||||||||||||
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Building Efficiency
|
|
|
|
|
|
|
|
||||||||
Systems and Service North America
|
$
|
88
|
|
|
$
|
84
|
|
|
$
|
181
|
|
|
$
|
148
|
|
Products North America
|
27
|
|
|
49
|
|
|
44
|
|
|
93
|
|
||||
Asia
|
102
|
|
|
26
|
|
|
164
|
|
|
75
|
|
||||
Rest of World
|
4
|
|
|
7
|
|
|
(1
|
)
|
|
7
|
|
||||
|
221
|
|
|
166
|
|
|
388
|
|
|
323
|
|
||||
Automotive Experience
|
|
|
|
|
|
|
|
||||||||
Seating
|
184
|
|
|
229
|
|
|
350
|
|
|
430
|
|
||||
Interiors
|
33
|
|
|
21
|
|
|
45
|
|
|
54
|
|
||||
|
217
|
|
|
250
|
|
|
395
|
|
|
484
|
|
||||
Power Solutions
|
264
|
|
|
264
|
|
|
606
|
|
|
579
|
|
||||
Total segment income
|
$
|
702
|
|
|
$
|
680
|
|
|
$
|
1,389
|
|
|
$
|
1,386
|
|
|
|
|
|
|
|
|
|
||||||||
Restructuring and impairment costs
|
(229
|
)
|
|
—
|
|
|
(229
|
)
|
|
—
|
|
||||
Net financing charges
|
(74
|
)
|
|
(69
|
)
|
|
(142
|
)
|
|
(140
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations before income taxes
|
$
|
399
|
|
|
$
|
611
|
|
|
$
|
1,018
|
|
|
$
|
1,246
|
|
19.
|
Commitments and Contingencies
|
20.
|
Merger Transaction
|
|
Three Months Ended
March 31, |
|
|
|
Six Months Ended
March 31, |
|
|
||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Net sales
|
$
|
9,031
|
|
|
$
|
9,198
|
|
|
-2
|
%
|
|
$
|
17,960
|
|
|
$
|
18,822
|
|
|
-5
|
%
|
|
Three Months Ended
March 31, |
|
|
|
Six Months Ended
March 31, |
|
|
||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cost of sales
|
$
|
7,302
|
|
|
$
|
7,625
|
|
|
-4
|
%
|
|
$
|
14,598
|
|
|
$
|
15,640
|
|
|
-7
|
%
|
Gross profit
|
1,729
|
|
|
1,573
|
|
|
10
|
%
|
|
3,362
|
|
|
3,182
|
|
|
6
|
%
|
||||
% of sales
|
19.1
|
%
|
|
17.1
|
%
|
|
|
|
18.7
|
%
|
|
16.9
|
%
|
|
|
|
Three Months Ended
March 31, |
|
|
|
Six Months Ended
March 31, |
|
|
||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Selling, general and administrative expenses
|
$
|
1,144
|
|
|
$
|
975
|
|
|
17
|
%
|
|
$
|
2,226
|
|
|
$
|
1,980
|
|
|
12
|
%
|
% of sales
|
12.7
|
%
|
|
10.6
|
%
|
|
|
|
12.4
|
%
|
|
10.5
|
%
|
|
|
|
Three Months Ended
March 31, |
|
|
|
Six Months Ended
March 31, |
|
|
||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net financing charges
|
$
|
74
|
|
|
$
|
69
|
|
|
7
|
%
|
|
$
|
142
|
|
|
$
|
140
|
|
|
1
|
%
|
|
Three Months Ended
March 31, |
|
|
|
Six Months Ended
March 31, |
|
|
||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Equity income
|
$
|
117
|
|
|
$
|
82
|
|
|
43
|
%
|
|
$
|
253
|
|
|
$
|
184
|
|
|
38
|
%
|
|
Three Months Ended
March 31, |
|
|
|
Six Months Ended
March 31, |
|
|
||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Income tax provision
|
$
|
868
|
|
|
$
|
132
|
|
|
*
|
|
$
|
997
|
|
|
$
|
250
|
|
|
*
|
Effective tax rate
|
218
|
%
|
|
22
|
%
|
|
|
|
98
|
%
|
|
20
|
%
|
|
|
|
Three Months Ended
March 31, |
|
|
|
Six Months Ended
March 31, |
|
|
|||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Income from continuing operations attributable to noncontrolling interests
|
$
|
61
|
|
|
$
|
27
|
|
|
*
|
|
$
|
101
|
|
|
$
|
63
|
|
|
60
|
%
|
Income from discontinued operations attributable to noncontrolling interests
|
—
|
|
|
1
|
|
|
*
|
|
—
|
|
|
4
|
|
|
*
|
|
|
Three Months Ended
March 31, |
|
|
|
Six Months Ended
March 31, |
|
|
||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Systems and Service North America
|
$
|
1,034
|
|
|
$
|
959
|
|
|
8
|
%
|
|
$
|
2,018
|
|
|
$
|
1,916
|
|
|
5
|
%
|
Products North America
|
546
|
|
|
545
|
|
|
0
|
%
|
|
1,103
|
|
|
1,103
|
|
|
0
|
%
|
||||
Asia
|
1,162
|
|
|
428
|
|
|
*
|
|
|
2,154
|
|
|
929
|
|
|
*
|
|
||||
Rest of World
|
408
|
|
|
445
|
|
|
-8
|
%
|
|
831
|
|
|
926
|
|
|
-10
|
%
|
||||
|
$
|
3,150
|
|
|
$
|
2,377
|
|
|
33
|
%
|
|
$
|
6,106
|
|
|
$
|
4,874
|
|
|
25
|
%
|
•
|
The increase in Systems and Service North America was due to higher volumes of controls systems and service ($90 million), partially offset by lower volumes related to a prior year business divestiture ($8 million) and
the unfavorable impact of foreign currency translation ($7 million). The increase in volumes was primarily attributable to favorable market share changes.
|
•
|
The increase in Products North America was due to higher volumes of residential products ($3 million), partially offset by the unfavorable impact of foreign currency translation ($2 million).
|
•
|
The increase in Asia was due to incremental sales related to the JCH joint venture ($737 million) and higher service volumes ($20 million), partially offset by the unfavorable impact of foreign currency translation ($14 million), and lower volumes of equipment and control systems ($9 million).
|
•
|
The decrease in Rest of World was due to the unfavorable impact of foreign currency translation ($19 million), and lower volumes in Latin America ($12 million) and Europe ($10 million), partially offset by higher volumes in the Middle East ($4 million). The net decrease in volumes was primarily attributable to unfavorable local economic conditions and the discontinuance of certain products.
|
•
|
The increase in Systems and Service North America was due to higher volumes of controls systems and service ($138 million), partially offset by the unfavorable impact of foreign currency translation ($19 million) and lower volumes related to a prior year business divestiture ($17 million). The increase in volumes was primarily attributable to favorable market share changes.
|
•
|
Products North America was level with the prior year due to higher volumes of residential products ($10 million), offset by the unfavorable impact of foreign currency translation ($10 million).
|
•
|
The increase in Asia was due to incremental sales related to the JCH joint venture ($1,274 million) and higher service volumes ($29 million), partially offset by the unfavorable impact of foreign currency translation ($44 million), and lower volumes of equipment and control systems ($34 million).
|
•
|
The decrease in Rest of World was due to the unfavorable impact of foreign currency translation ($67 million), and lower volumes in Latin America ($28 million) and Europe ($23 million), partially offset by higher volumes in the Middle East($23 million). The net decrease in volumes was primarily attributable to unfavorable local economic conditions and the discontinuance of certain products.
|
|
Three Months Ended
March 31, |
|
|
|
Six Months Ended
March 31, |
|
|
||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Systems and Service North America
|
$
|
88
|
|
|
$
|
84
|
|
|
5
|
%
|
|
$
|
181
|
|
|
$
|
148
|
|
|
22
|
%
|
Products North America
|
27
|
|
|
49
|
|
|
-45
|
%
|
|
44
|
|
|
93
|
|
|
-53
|
%
|
||||
Asia
|
102
|
|
|
26
|
|
|
*
|
|
|
164
|
|
|
75
|
|
|
*
|
|
||||
Rest of World
|
4
|
|
|
7
|
|
|
-43
|
%
|
|
(1
|
)
|
|
7
|
|
|
*
|
|
||||
|
$
|
221
|
|
|
$
|
166
|
|
|
33
|
%
|
|
$
|
388
|
|
|
$
|
323
|
|
|
20
|
%
|
•
|
The increase in Systems and Service North America was due to higher volumes ($22 million), partially offset by unfavorable margin rates ($7 million), current year transaction costs ($6 million), higher selling, general and administrative expenses ($3 million), lower income due to a prior year business divestiture ($1 million) and the unfavorable impact of foreign currency translation ($1 million).
|
•
|
The decrease in Products North America was due to higher selling, general and administrative expenses due to global product expansion and related sales force investments ($25 million), and current year transaction costs ($3 million), partially offset by favorable margin rates ($4 million), higher volumes ($1 million) and prior year transaction costs ($1 million).
|
•
|
The increase in Asia was due primarily to incremental operating income related to the JCH joint venture exclusive of global investments in related products and technologies ($85 million), prior year transaction and integration costs ($6 million), higher volumes ($3 million), and lower selling, general and administrative expenses ($2 million), partially offset
|
•
|
The decrease in Rest of World was due to lower volumes ($5 million), current year transaction costs ($3 million), and higher selling, general and administrative expenses ($1 million), partially offset by a gain on acquisition of a partially-owned affiliate ($4 million) and higher equity income ($2 million).
|
•
|
The increase in Systems and Service North America was due to higher volumes ($32 million), and lower selling, general and administrative expenses as a result of restructuring actions ($15 million), partially offset by current year transaction costs ($6 million), unfavorable margin rates ($3 million), the unfavorable impact of foreign currency translation ($3 million) and lower income due to a prior year business divestiture ($2 million).
|
•
|
The decrease in Products North America was due to higher selling, general and administrative expenses due to global product expansion and related sales force investments ($51 million), current year transaction costs ($4 million) and the unfavorable impact of foreign currency translation ($1 million), partially offset by higher volumes ($3 million), prior year transaction costs ($2 million), higher equity income ($1 million) and favorable margin rates ($1 million).
|
•
|
The increase in Asia was due primarily to incremental operating income related to the JCH joint venture exclusive of global investments in related products and technologies ($106 million), prior year transaction and integration costs ($12 million), and lower selling, general and administrative expenses ($3 million), partially offset by current year transaction and integration costs ($24 million), the unfavorable impact of foreign currency translation ($6 million) and unfavorable margin rates ($2 million).
|
•
|
The decrease in Rest of World was due to lower volumes ($8 million), higher selling, general and administrative expenses ($7 million), current year transaction costs ($3 million) and the unfavorable impact of foreign currency translation ($1 million), partially offset by higher equity income ($7 million) and a gain on acquisition of a partially-owned affiliate ($4 million).
|
|
Three Months Ended
March 31, |
|
|
|
Six Months Ended
March 31, |
|
|
||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Seating
|
$
|
4,177
|
|
|
$
|
4,141
|
|
|
1
|
%
|
|
$
|
8,263
|
|
|
$
|
8,276
|
|
|
0
|
%
|
Interiors
|
121
|
|
|
1,092
|
|
|
-89
|
%
|
|
268
|
|
|
2,240
|
|
|
-88
|
%
|
||||
|
$
|
4,298
|
|
|
$
|
5,233
|
|
|
-18
|
%
|
|
$
|
8,531
|
|
|
$
|
10,516
|
|
|
-19
|
%
|
•
|
The increase in Seating was due to higher volumes ($161 million), partially offset by the unfavorable impact of foreign currency translation ($107 million), and net unfavorable pricing and commercial settlements ($18 million). The higher volumes were attributable to growth in North America and Asia, partially offset by softness in Europe and South America due to changes in automotive production levels.
|
•
|
The decrease in Interiors was due to the deconsolidation of the majority of the Interiors business in the prior year ($948 million) and lower volumes primarily due to plant wind downs ($25 million), partially offset by the favorable impact of foreign currency translation ($2 million).
|
•
|
The decrease in Seating was due to the unfavorable impact of foreign currency translation ($365 million), and net unfavorable pricing and commercial settlements ($46 million), partially offset by higher volumes ($379 million) and incremental sales related to a prior year business acquisition ($19 million). The higher volumes were attributable to growth in North America and Asia, partially offset by softness in Europe and South America due to changes in automotive production levels.
|
•
|
The decrease in Interiors was due to the deconsolidation of the majority of the Interiors business in the prior year ($1,937 million), lower volumes primarily due to plant wind downs ($20 million), the unfavorable impact of foreign currency translation ($10 million), and net unfavorable pricing and commercial settlements ($5 million).
|
|
Three Months Ended
March 31, |
|
|
|
Six Months Ended
March 31, |
|
|
||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Seating
|
$
|
184
|
|
|
$
|
229
|
|
|
-20
|
%
|
|
$
|
350
|
|
|
$
|
430
|
|
|
-19
|
%
|
Interiors
|
33
|
|
|
21
|
|
|
57
|
%
|
|
45
|
|
|
54
|
|
|
-17
|
%
|
||||
|
$
|
217
|
|
|
$
|
250
|
|
|
-13
|
%
|
|
$
|
395
|
|
|
$
|
484
|
|
|
-18
|
%
|
•
|
The decrease in Seating was due to current year separation costs related to the proposed Automotive Experience spin-off ($107 million), unfavorable mix due to lower volumes at higher margin platforms ($14 million) and the unfavorable impact of foreign currency translation ($5 million), partially offset by lower operating costs as a result of restructuring actions and operational efficiencies ($20 million), higher volumes ($15 million), net favorable pricing and commercial settlements ($13 million), lower selling, general and administrative expenses as a result of restructuring actions and other cost reduction initiatives ($12 million), lower purchasing costs resulting from supplier price concessions ($12 million), higher equity income ($6 million) and lower engineering expenses ($3 million).
|
•
|
The increase in Interiors was due to favorable settlements related to prior year business divestitures ($22 million), prior year transaction costs ($11 million), lower selling, general and administrative expenses ($6 million), and lower operating costs ($4 million), partially offset by the impact of the July 2, 2015 joint venture transaction and related prior year held for sale depreciation impact ($30 million), and lower volumes ($1 million).
|
•
|
The decrease in Seating was due to current year separation costs related to the proposed Automotive Experience spin-off ($194 million), unfavorable mix due to lower volumes at higher margin platforms ($17 million) and the unfavorable impact of foreign currency translation ($15 million), partially offset by higher volumes ($39 million), lower selling, general and administrative expenses ($32 million) and lower operating costs ($28 million) as a result of restructuring actions and other cost reduction initiatives, lower purchasing costs resulting from supplier price concessions ($20 million), lower engineering expenses ($13 million), higher equity income ($8 million), net favorable pricing and commercial settlements ($4 million), and incremental operating income related to a prior year business acquisition ($2 million).
|
•
|
The decrease in Interiors was due to the impact of the July 2, 2015 joint venture transaction and related prior year held for sale depreciation impact ($54 million), net unfavorable pricing and commercial settlements ($5 million), the unfavorable impact of foreign currency translation ($1 million) and current year integration costs ($1 million), partially offset by favorable settlements related to prior year business divestitures ($22 million), prior year transaction costs ($17 million), lower selling, general and administrative expenses ($12 million), and lower operating costs ($1 million).
|
|
Three Months Ended
March 31, |
|
|
|
Six Months Ended
March 31, |
|
|
||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
$
|
1,583
|
|
|
$
|
1,588
|
|
|
0
|
%
|
|
$
|
3,323
|
|
|
$
|
3,432
|
|
|
-3
|
%
|
Segment income
|
264
|
|
|
264
|
|
|
0
|
%
|
|
606
|
|
|
579
|
|
|
5
|
%
|
•
|
Net sales decreased due to the unfavorable impact of foreign currency translation ($48 million) and the impact of lower lead costs on pricing ($40 million), partially offset by higher sales volumes ($52 million), and favorable pricing and product mix ($31 million). The increase in volumes was driven by higher absorbent glass mat (AGM) battery volumes and growth in China. Additionally, higher AGM volumes contributed to favorable product mix.
|
•
|
Segment income was level with the prior year due to higher volumes ($14 million), favorable pricing and product mix ($14 million), lower selling, general and administrative expenses due to lower employee related expenses and cost reduction initiatives ($9 million), and higher equity income ($1 million), offset by higher operating costs to satisfy supply for increased customer demand and launch costs associated with the addition of new capacity in China ($30 million), and the unfavorable impact of foreign currency translation ($8 million).
|
•
|
Net sales decreased due to the unfavorable impact of foreign currency translation ($166 million) and the impact of lower lead costs on pricing ($85 million), partially offset by higher sales volumes ($107 million), and favorable pricing and product mix ($35 million). The increase in volumes was driven by higher AGM battery volumes and growth in China. Additionally, higher AGM volumes contributed to favorable product mix.
|
•
|
Segment income increased due to favorable pricing and product mix ($33 million), higher volumes ($31 million), lower selling, general and administrative expenses due to lower employee related expenses and cost reduction initiatives ($29 million), and higher equity income ($1 million), partially offset by higher operating costs to satisfy supply for increased customer demand and launch costs associated with the addition of new capacity in China ($39 million), and the unfavorable impact of foreign currency translation ($28 million).
|
|
March 31,
|
|
September 30,
|
|
|
|
March 31,
|
|
|
||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2015
|
|
Change
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
Current assets
|
$
|
11,058
|
|
|
$
|
10,469
|
|
|
|
|
$
|
11,721
|
|
|
|
||
Current liabilities
|
(11,792
|
)
|
|
(10,446
|
)
|
|
|
|
(11,909
|
)
|
|
|
|||||
|
(734
|
)
|
|
23
|
|
|
*
|
|
|
(188
|
)
|
|
*
|
|
|||
|
|
|
|
|
|
|
|
|
|
||||||||
Less: Cash
|
(358
|
)
|
|
(597
|
)
|
|
|
|
(164
|
)
|
|
|
|||||
Add: Short-term debt
|
1,236
|
|
|
52
|
|
|
|
|
1,321
|
|
|
|
|||||
Add: Current portion of long-term debt
|
647
|
|
|
813
|
|
|
|
|
815
|
|
|
|
|||||
Less: Assets held for sale
|
(17
|
)
|
|
(55
|
)
|
|
|
|
(1,969
|
)
|
|
|
|||||
Add: Liabilities held for sale
|
—
|
|
|
42
|
|
|
|
|
1,511
|
|
|
|
|||||
Working capital (as defined)
|
$
|
774
|
|
|
$
|
278
|
|
|
*
|
|
|
$
|
1,326
|
|
|
-42
|
%
|
|
|
|
|
|
|
|
|
|
|
||||||||
Accounts receivable
|
$
|
5,987
|
|
|
$
|
5,751
|
|
|
4
|
%
|
|
$
|
5,384
|
|
|
11
|
%
|
Inventories
|
2,922
|
|
|
2,377
|
|
|
23
|
%
|
|
2,414
|
|
|
21
|
%
|
|||
Accounts payable
|
5,360
|
|
|
5,174
|
|
|
4
|
%
|
|
4,640
|
|
|
16
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
||||||||
* Measure not meaningful
|
|
|
|
|
|
|
|
|
|
•
|
The Company defines working capital as current assets less current liabilities, excluding cash, short-term debt, the current portion of long-term debt, and the current portion of assets and liabilities held for sale. Management believes that this measure of working capital, which excludes financing-related items, provides a more useful measurement of the Company’s operating performance.
|
•
|
The increase in working capital at
March 31, 2016
as compared to
September 30, 2015
was primarily due the impact of the JCH joint venture, timing of tax payments and lower accrued compensation and benefits primarily due to timing of incentive compensation payments. Compared to
March 31, 2015
, the decrease in working capital was primarily due an increase in accounts payable due to timing of supplier payments, partially offset by the impact of the JCH joint venture and an increase in account receivable due to timing of customer receipts.
|
•
|
The Company’s days sales in accounts receivable at
March 31, 2016
were 56, equal to 56 at
September 30, 2015
and higher than 55 at
March 31, 2015
. There have been no significant adverse changes in the level of overdue receivables or changes in revenue recognition methods.
|
•
|
The Company’s inventory turns for the three months ended
March 31, 2016
were slightly lower than the comparable periods ended
September 30, 2015
and
March 31, 2015
, primarily due to changes in inventory production levels.
|
•
|
Days in accounts payable at
March 31, 2016
were 68 days, lower than 74 days at the comparable period ended
September 30, 2015
, and higher than 67 days at the comparable period ended
March 31, 2015
.
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
(in millions)
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Cash provided by operating activities
|
$
|
634
|
|
|
$
|
360
|
|
|
$
|
621
|
|
|
$
|
200
|
|
Cash used by investing activities
|
(233
|
)
|
|
(200
|
)
|
|
(617
|
)
|
|
(454
|
)
|
||||
Cash provided (used) by financing activities
|
(448
|
)
|
|
(222
|
)
|
|
(234
|
)
|
|
7
|
|
||||
Capital expenditures
|
(261
|
)
|
|
(294
|
)
|
|
(543
|
)
|
|
(556
|
)
|
•
|
The increase in cash provided by operating activities for the three months ended
March 31, 2016
was primarily due to higher income tax payments in the prior year and favorable changes in accounts receivable, partially offset by unfavorable changes in accounts payable and accrued liabilities. The increase in cash provided by operating activities for the six months ended
March 31, 2016
was primarily due to higher income tax payments in the prior year, and favorable changes in accounts payable and accrued liabilities.
|
•
|
The increase in cash used by investing activities for the three months ended
March 31, 2016
was primarily due to cash received from business divestitures in the prior year, partially offset by changes in long-term investments in the prior year and lower capital expenditures. The increase in cash used by investing activities for the six months ended
March 31, 2016
was primarily due to cash paid for the JCH joint venture in the current year, partially offset by cash received from business divestitures in the prior year.
|
•
|
The increase in cash used by financing activities for the three and six months ended
March 31, 2016
was primarily due to an increase in repayments of debt in the current year and an increase in dividends paid to noncontrolling interests related to the JCH joint venture in the current year, partially offset by prior year stock repurchases and short-term debt increases in the current year.
|
•
|
The decrease in capital expenditures for the three and six months ended
March 31, 2016
primarily relates to lower capital investments in the Automotive Experience business, partially offset by higher capital investments in the Power Solutions business.
|
|
March 31,
|
|
September 30,
|
|
|
|
March 31,
|
|
|
||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2015
|
|
Change
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
Short-term debt
|
$
|
1,236
|
|
|
$
|
52
|
|
|
|
|
$
|
1,321
|
|
|
|
||
Current portion of long-term debt
|
647
|
|
|
813
|
|
|
|
|
815
|
|
|
|
|||||
Long-term debt
|
5,143
|
|
|
5,745
|
|
|
|
|
5,448
|
|
|
|
|||||
Total debt
|
7,026
|
|
|
6,610
|
|
|
6
|
%
|
|
7,584
|
|
|
-7
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
||||||||
Shareholders’ equity attributable to Johnson Controls, Inc.
|
9,984
|
|
|
10,376
|
|
|
-4
|
%
|
|
10,583
|
|
|
-6
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
||||||||
Total capitalization
|
$
|
17,010
|
|
|
$
|
16,986
|
|
|
0
|
%
|
|
$
|
18,167
|
|
|
-6
|
%
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total debt as a % of total capitalization
|
41
|
%
|
|
39
|
%
|
|
|
|
42
|
%
|
|
|
•
|
The Company believes the percentage of total debt to total capitalization is useful to understanding the Company’s financial condition as it provides a review of the extent to which the Company relies on external debt financing for its funding and is a measure of risk to its shareholders.
|
•
|
At March 31, 2016 and 2015, the Company had committed bilateral euro denominated revolving credit facilities totaling 200 million euro. Additionally, at March 31, 2016 and 2015, the Company had committed bilateral U.S. dollar denominated revolving credit facilities totaling $225 million. As of March 31, 2016, facilities in the amount of 200 million euro are scheduled to expire in fiscal year 2016 and facilities in the amount of $225 million are scheduled to expire in fiscal year 2017. There were draws of $90 million on these revolving facilities as of March 31, 2016.
|
•
|
In February 2016, the Company entered into a nine-month, $100 million, floating rate term loan scheduled to mature in November 2016. Proceeds from the term loan were used for general corporate purposes.
|
•
|
In February 2016, the Company terminated a 37 million euro committed revolving credit facility scheduled to mature in September 2016, and subsequently entered into a nine-month, 100 million euro, floating rate term loan scheduled to mature in October 2016. Proceeds from the term loan were used for general corporate purposes.
|
•
|
In January 2016, the Company entered into a ten-month, $200 million, floating rate term loan scheduled to mature in October 2016. Proceeds from the term loan were used for general corporate purposes.
|
•
|
In January 2016, the Company entered into a ten-month, $125 million, floating rate term loan scheduled to mature in October 2016. Proceeds from the term loan were used for general corporate purposes.
|
•
|
In January 2016, the Company entered into a one-year, $90 million, committed revolving credit facility scheduled to mature in January 2017. The Company drew on the full credit facility during the quarter ended March 31, 2016. Proceeds from the revolving credit facility were used for general corporate purposes.
|
•
|
In January 2016, the Company retired $800 million in principal amount, plus accrued interest, of its 5.5% fixed rate notes that matured in January 2016.
|
•
|
In December 2015, the Company entered into a nine-month, $125 million, floating rate term loan scheduled to mature in September 2016. Proceeds from the term loan were used for general corporate purposes.
|
•
|
In December 2015, the Company entered into a nine-month, $200 million, floating rate term loan scheduled to mature in September 2016. Proceeds from the term loan were used for general corporate purposes.
|
•
|
In June 2015, the Company entered into a five-year, 37 billion yen floating rate syndicated term loan scheduled to mature in June 2020. Proceeds from the syndicated term loan were used for general corporate purposes.
|
•
|
In May 2015, the Company made a partial repayment of 32 million euro in principal amount, plus accrued interest, of its 70 million euro floating rate credit facility scheduled to mature in November 2017.
|
•
|
In March 2015, the Company retired $125 million in principal amount, plus accrued interest, of its 7.7% fixed rate notes that matured in March 2015.
|
•
|
In February 2015, the Company entered into a seven-month, $150 million, floating rate term loan scheduled to mature in September 2015. Proceeds from the term loan were used for general corporate purposes. The loan was repaid in September 2015.
|
•
|
In January 2015, the Company entered into a one-year, $90 million, committed revolving credit facility scheduled to mature in January 2016. The Company drew on the full credit facility during the quarter ended March 31, 2015. Proceeds from the revolving credit facility were used for general corporate purposes. The $90 million was repaid in September 2015.
|
•
|
In December 2014, the Company entered into a nine-month, $500 million, floating rate term loan scheduled to mature in September 2015. Proceeds from the term loan were used for general corporate purposes. The loan was repaid in September 2015.
|
•
|
In December 2014, the Company entered into a nine-month, $100 million, floating rate term loan scheduled to mature in September 2015. Proceeds from the term loan were used for general corporate purposes. The loan was repaid in September 2015.
|
•
|
The Company also selectively makes use of short-term credit lines. The Company estimates that, as of
March 31, 2016
, it could borrow up to $1.6 billion based on average borrowing levels during the quarter on committed credit lines.
|
•
|
The Company believes its capital resources and liquidity position at
March 31, 2016
are adequate to meet projected needs. The Company believes requirements for working capital, capital expenditures, dividends, stock repurchases, pension contributions, debt maturities and any potential acquisitions in the remainder of fiscal 2016 will continue to be funded from operations, supplemented by short- and long-term borrowings, if required. The Company currently manages its short-term debt position in the U.S. and euro commercial paper markets and bank loan markets. In the event the Company is unable to issue commercial paper, it would have the ability to draw on its $2.5 billion revolving credit facility, which matures in August 2018. There were no draws on the revolving credit facility as of
March 31, 2016
. As such, the Company believes it has sufficient financial resources to fund operations and meet its obligations for the foreseeable future.
|
•
|
In March 2016, the Company entered into a new credit agreement intended to replace its existing credit agreement upon the consummation of the expected merger between the Company and Tyco. The new credit agreement provides for a $2.0 billion revolving credit facility that matures in August 2020, which will become available only upon the consummation of the merger and the satisfaction of certain other closing conditions.
|
•
|
The Company earns a significant amount of its operating income outside the U.S., which is deemed to be permanently reinvested in foreign jurisdictions. The Company currently does not intend nor foresee a need to repatriate these funds. However, in fiscal 2016, the Company did provide income tax expense related to a change in the Company's assertion over permanently reinvested earnings as a result of the proposed spin-off of the Automotive Experience business. Except as noted, the Company’s intent is for such earnings to be reinvested by the subsidiaries or to be repatriated only when it would be tax effective through the utilization of foreign tax credits. The Company expects existing domestic cash and liquidity to continue to be sufficient to fund the Company’s domestic operating activities and cash commitments for investing and financing activities for at least the next twelve months and thereafter for the foreseeable future. In addition, the Company expects existing foreign cash, cash equivalents, short-term investments and cash flows from operations to continue to be sufficient to fund the Company’s foreign operating activities and cash commitments for investing activities, such as material capital expenditures, for at least the next twelve months and thereafter for the foreseeable future. Should the Company require more capital in the U.S. than is generated by operations domestically, the Company could elect to raise capital in the U.S. through debt or equity issuances. This alternative could result in increased interest expense or other dilution of the Company’s earnings. The Company has borrowed funds domestically and continues to have the ability to borrow funds domestically at reasonable interest rates.
|
•
|
The Company’s debt financial covenants require a minimum consolidated shareholders’ equity attributable to Johnson Controls, Inc. of at least $3.5 billion at all times and allow a maximum aggregated amount of 10% of consolidated shareholders’ equity attributable to Johnson Controls, Inc. for liens and pledges. For purposes of calculating the Company’s covenants, consolidated shareholders’ equity attributable to Johnson Controls, Inc. is calculated without giving effect to (i) the application of ASC 715-60, "Defined Benefit Plans - Other Postretirement," or (ii) the cumulative foreign currency translation adjustment. As of
March 31, 2016
, consolidated shareholders’ equity attributable to Johnson Controls, Inc. as defined per the Company’s debt financial covenants was $11.0 billion and there was a maximum of $250 million of liens outstanding. The Company expects to remain in compliance with all covenants and other requirements set forth in its credit agreements and indentures for the foreseeable future. None of the Company’s debt agreements limit access to stated borrowing levels or require accelerated repayment in the event of a decrease in the Company’s credit rating.
|
Period
|
Total Number of
Shares Purchased
|
|
Average Price
Paid per Share
|
|
Total Number of
Shares Purchased as
Part of the Publicly
Announced Program
|
|
Approximate Dollar
Value of Shares that
May Yet be
Purchased under the
Programs
|
|||||
1/1/16 - 1/31/16
|
|
|
|
|
|
|
|
|||||
Purchases by Company
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
1,039,079,297
|
|
2/1/16 - 2/29/16
|
|
|
|
|
|
|
|
|||||
Purchases by Company
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
1,039,079,297
|
|
3/1/16 - 3/31/16
|
|
|
|
|
|
|
|
|||||
Purchases by Company
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
1,039,079,297
|
|
1/1/16 - 1/31/16
|
|
|
|
|
|
|
|
|||||
Purchases by Citibank
|
—
|
|
|
—
|
|
|
—
|
|
|
NA
|
|
|
2/1/16 - 2/29/16
|
|
|
|
|
|
|
|
|||||
Purchases by Citibank
|
—
|
|
|
—
|
|
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3/1/16 - 3/31/16
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Purchases by Citibank
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JOHNSON CONTROLS, INC.
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Date: April 29, 2016
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By:
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/s/ Brian J. Stief
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Brian J. Stief
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Executive Vice President and
Chief Financial Officer
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Exhibit No.
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Description
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2.1
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Agreement and Plan of Merger, dated as of January 24, 2016, by and among Johnson Controls, Inc., Tyco International plc, and certain other parties named therein, including Jagara Merger Sub, LLC (incorporated by reference to Exhibit 2.1 to Johnson Controls, Inc.’s Current Report on Form 8-K filed January 27, 2016) (Commission File No. 1-5097).
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4.1
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Amendment No. 1 to Credit Agreement, dated as of March 10, 2016, among Johnson Controls, Inc., the financial institutions parties thereto and JPMorgan Chase Bank, N.A., as administrative agent (incorporated by reference to Exhibit 4.1 to Johnson Controls, Inc.’s Current Report on Form 8-K filed March 16, 2016) (Commission File No. 1-5097).
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4.2
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Credit Agreement, dated as of March 10, 2016, among Johnson Controls, Inc., the financial institutions parties thereto and JPMorgan Chase Bank, N.A., as administrative agent (incorporated by reference to Exhibit 4.2 to Johnson Controls, Inc.’s Current Report on Form 8-K filed March 16, 2016) (Commission File No. 1-5097).
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10.1
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Amended and Restated Executive Employment Agreement, dated as of January 24, 2016, by and between Johnson Controls, Inc. and Alex A. Molinaroli (incorporated by reference to Exhibit 10.1 to Johnson Controls, Inc.’s Current Report on Form 8-K filed January 27, 2016) (Commission File No. 1-5097) (Commission File No. 1-5097).
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10.2
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Amended and Restated Change of Control Executive Employment Agreement, dated as of January 24, 2016, by and between Johnson Controls, Inc. and Alex A. Molinaroli (incorporated by reference to Exhibit 10.2 to Johnson Controls, Inc.’s Current Report on Form 8-K filed January 27, 2016) (Commission File No. 1-5097).
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10.3
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Amendment to the Amended and Restated Change of Control Executive Employment Agreement, dated as of April 1, 2016, by and between Johnson Controls, Inc. and Alex Molinaroli.
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10.4
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Global Assignment Letter between Johnson Controls, Inc. and Trent Nevill dated as of April 1, 2016.
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15
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Letter of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm, dated April 29, 2016, relating to Financial Information.
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31.1
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Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
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31.2
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Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
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32
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Certification of Periodic Financial Report by the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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101
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The following materials from Johnson Controls, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2016, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Statements of Financial Position, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Comprehensive Income (Loss), (iv) the Consolidated Statements of Cash Flows, and (v) Notes to Consolidated Financial Statements.
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1.
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The reference to "$10 million" in Section 3(b)(ix) is hereby amended to refer to "$20 million."
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2.
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Section 3(b)(x) is deleted in its entirety.
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3.
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The references to "Inaugural Awards" in Sections 5(b) and 5(c) are hereby amended to refer to "Inaugural Equity Grant."
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4.
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Except as expressly amended by this Amendment, all terms and conditions of the COC Agreement shall remain in full force and effect. This Amendment shall be governed by and construed in accordance with the laws of the State of Wisconsin, without reference to principles of conflict of laws. This Amendment may be executed in two or more counterparts, each of which shall be deemed an original, and all of which shall constitute one and the same instrument.
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1.
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I have reviewed this quarterly report on Form 10-Q of Johnson Controls, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Alex A. Molinaroli
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Alex A. Molinaroli
Chairman, President and Chief Executive Officer
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1.
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I have reviewed this quarterly report on Form 10-Q of Johnson Controls, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Brian J. Stief
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Brian J. Stief
Executive Vice President and
Chief Financial Officer
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1.
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the Quarterly Report on Form 10-Q for the quarter ended
March 31, 2016
(Periodic Report) to which this statement is an exhibit fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)) and
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2.
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information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of Johnson Controls, Inc.
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/s/ Alex A. Molinaroli
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Alex A. Molinaroli
Chairman, President and Chief Executive Officer
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/s/ Brian J. Stief
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Brian J. Stief
Executive Vice President and
Chief Financial Officer
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