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þ
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Ireland
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98-0390500
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(Jurisdiction of Incorporation)
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(I.R.S. Employer Identification No.)
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One Albert Quay
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Cork, Ireland
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(Address of principal executive offices)
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Class
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Ordinary Shares Outstanding at December 31, 2016
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Ordinary Shares, $0.01 par value per share
|
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938,685,172
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Page
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Part I. Financial Information
|
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Item 1. Financial Statements (unaudited)
|
|
|
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Consolidated Statements of Financial Position at December 31, 2016 and September 30, 2016
|
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Consolidated Statements of Income for the Three Month Periods Ended December 31, 2016 and 2015
|
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Consolidated Statements of Comprehensive Income (Loss) for the Three Month Periods Ended December 31, 2016 and 2015
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Consolidated Statements of Cash Flows for the Three Month Periods Ended December 31, 2016 and 2015
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Notes to Consolidated Financial Statements
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Report of Independent Registered Public Accounting Firm
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
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Item 3. Quantitative and Qualitative Disclosures About Market Risk
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Item 4. Controls and Procedures
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Part II. Other Information
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Item 1. Legal Proceedings
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Item 1A. Risk Factors
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
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Item 6. Exhibits
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Signatures
|
Johnson Controls International plc
Consolidated Statements of Financial Position
(in millions, except par value; unaudited)
|
|||||||
|
|
|
|
||||
|
December 31, 2016
|
|
September 30, 2016
|
||||
Assets
|
|
|
|
||||
|
|
|
|
||||
Cash and cash equivalents
|
$
|
377
|
|
|
$
|
579
|
|
Accounts receivable - net
|
6,057
|
|
|
6,394
|
|
||
Inventories
|
2,943
|
|
|
2,888
|
|
||
Assets held for sale
|
173
|
|
|
5,812
|
|
||
Other current assets
|
1,416
|
|
|
1,436
|
|
||
Current assets
|
10,966
|
|
|
17,109
|
|
||
|
|
|
|
||||
Property, plant and equipment - net
|
5,556
|
|
|
5,632
|
|
||
Goodwill
|
20,772
|
|
|
21,024
|
|
||
Other intangible assets - net
|
7,290
|
|
|
7,540
|
|
||
Investments in partially-owned affiliates
|
1,030
|
|
|
990
|
|
||
Noncurrent assets held for sale
|
—
|
|
|
7,374
|
|
||
Other noncurrent assets
|
3,174
|
|
|
3,510
|
|
||
Total assets
|
$
|
48,788
|
|
|
$
|
63,179
|
|
|
|
|
|
||||
Liabilities and Equity
|
|
|
|
||||
|
|
|
|
||||
Short-term debt
|
$
|
2,379
|
|
|
$
|
1,078
|
|
Current portion of long-term debt
|
520
|
|
|
628
|
|
||
Accounts payable
|
3,453
|
|
|
4,000
|
|
||
Accrued compensation and benefits
|
1,164
|
|
|
1,333
|
|
||
Liabilities held for sale
|
31
|
|
|
4,276
|
|
||
Other current liabilities
|
3,912
|
|
|
5,016
|
|
||
Current liabilities
|
11,459
|
|
|
16,331
|
|
||
|
|
|
|
||||
Long-term debt
|
10,351
|
|
|
11,053
|
|
||
Pension and postretirement benefits
|
1,094
|
|
|
1,550
|
|
||
Noncurrent liabilities held for sale
|
—
|
|
|
3,888
|
|
||
Other noncurrent liabilities
|
5,329
|
|
|
5,033
|
|
||
Long-term liabilities
|
16,774
|
|
|
21,524
|
|
||
|
|
|
|
||||
Commitments and contingencies (Note 22)
|
|
|
|
|
|
||
|
|
|
|
||||
Redeemable noncontrolling interests
|
159
|
|
|
234
|
|
||
|
|
|
|
||||
Ordinary shares, $0.01 par value
|
9
|
|
|
9
|
|
||
Ordinary A shares, €1.00 par value
|
—
|
|
|
—
|
|
||
Preferred shares, $0.01 par value
|
—
|
|
|
—
|
|
||
Ordinary shares held in treasury, at cost
|
(45
|
)
|
|
(20
|
)
|
||
Capital in excess of par value
|
16,177
|
|
|
16,105
|
|
||
Retained earnings
|
4,669
|
|
|
9,177
|
|
||
Accumulated other comprehensive loss
|
(1,233
|
)
|
|
(1,153
|
)
|
||
Shareholders’ equity attributable to Johnson Controls
|
19,577
|
|
|
24,118
|
|
||
Noncontrolling interests
|
819
|
|
|
972
|
|
||
Total equity
|
20,396
|
|
|
25,090
|
|
||
Total liabilities and equity
|
$
|
48,788
|
|
|
$
|
63,179
|
|
Johnson Controls International plc
Consolidated Statements of Income
(in millions, except per share data; unaudited)
|
|||||||
|
|
|
|
||||
|
Three Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
Net sales
|
|
|
|
||||
Products and systems*
|
$
|
5,305
|
|
|
$
|
3,820
|
|
Services*
|
1,781
|
|
|
876
|
|
||
|
7,086
|
|
|
4,696
|
|
||
Cost of sales
|
|
|
|
||||
Products and systems*
|
3,894
|
|
|
2,840
|
|
||
Services*
|
1,078
|
|
|
599
|
|
||
|
4,972
|
|
|
3,439
|
|
||
|
|
|
|
||||
Gross profit
|
2,114
|
|
|
1,257
|
|
||
|
|
|
|
||||
Selling, general and administrative expenses
|
(1,570
|
)
|
|
(847
|
)
|
||
Restructuring and impairment costs
|
(78
|
)
|
|
—
|
|
||
Net financing charges
|
(136
|
)
|
|
(66
|
)
|
||
Equity income
|
55
|
|
|
42
|
|
||
|
|
|
|
||||
Income from continuing operations before income taxes
|
385
|
|
|
386
|
|
||
|
|
|
|
||||
Income tax provision (benefit)
|
(27
|
)
|
|
83
|
|
||
|
|
|
|
||||
Income from continuing operations
|
412
|
|
|
303
|
|
||
|
|
|
|
||||
Income (loss) from discontinued operations, net of tax (Note 5)
|
(34
|
)
|
|
187
|
|
||
|
|
|
|
||||
Net income
|
378
|
|
|
490
|
|
||
|
|
|
|
||||
Income from continuing operations attributable to noncontrolling interests
|
40
|
|
|
23
|
|
||
|
|
|
|
||||
Income from discontinued operations attributable to noncontrolling interests
|
9
|
|
|
17
|
|
||
|
|
|
|
||||
Net income attributable to Johnson Controls
|
$
|
329
|
|
|
$
|
450
|
|
|
|
|
|
||||
Amounts attributable to Johnson Controls ordinary shareholders:
|
|
|
|
||||
Income from continuing operations
|
$
|
372
|
|
|
$
|
280
|
|
Income (loss) from discontinued operations
|
(43
|
)
|
|
170
|
|
||
Net income
|
$
|
329
|
|
|
$
|
450
|
|
|
|
|
|
||||
Basic earnings (loss) per share attributable to Johnson Controls
|
|
|
|
||||
Continuing operations
|
$
|
0.40
|
|
|
$
|
0.43
|
|
Discontinued operations
|
(0.05
|
)
|
|
0.26
|
|
||
Net income
|
$
|
0.35
|
|
|
$
|
0.69
|
|
|
|
|
|
||||
Diluted earnings (loss) per share attributable to Johnson Controls
|
|
|
|
||||
Continuing operations
|
$
|
0.39
|
|
|
$
|
0.43
|
|
Discontinued operations
|
(0.05
|
)
|
|
0.26
|
|
||
Net income **
|
$
|
0.35
|
|
|
$
|
0.69
|
|
*
|
Products and systems consist of Building Technologies & Solutions and Power Solutions products and systems. Services are Building Technologies & Solutions technical services.
|
**
|
Certain items do not sum due to rounding.
|
Johnson Controls International plc
Consolidated Statements of Comprehensive Income (Loss)
(in millions; unaudited)
|
|||||||
|
|
|
|
||||
|
Three Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Net income
|
$
|
378
|
|
|
$
|
490
|
|
|
|
|
|
||||
Other comprehensive income (loss), net of tax:
|
|
|
|
||||
Foreign currency translation adjustments
|
(703
|
)
|
|
(177
|
)
|
||
Realized and unrealized gains (losses) on derivatives
|
4
|
|
|
(3
|
)
|
||
Realized and unrealized losses on marketable securities
|
(2
|
)
|
|
—
|
|
||
|
|
|
|
||||
Other comprehensive loss
|
(701
|
)
|
|
(180
|
)
|
||
|
|
|
|
||||
Total comprehensive income (loss)
|
(323
|
)
|
|
310
|
|
||
|
|
|
|
||||
Comprehensive income attributable to noncontrolling interests
|
9
|
|
|
21
|
|
||
|
|
|
|
||||
Comprehensive income (loss) attributable to Johnson Controls
|
$
|
(332
|
)
|
|
$
|
289
|
|
|
Three Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
Operating Activities
|
|
|
|
||||
Net income attributable to Johnson Controls
|
$
|
329
|
|
|
$
|
450
|
|
Income from continuing operations attributable to noncontrolling interests
|
40
|
|
|
23
|
|
||
Income from discontinued operations attributable to noncontrolling interests
|
9
|
|
|
17
|
|
||
Net income
|
378
|
|
|
490
|
|
||
Adjustments to reconcile net income to cash used by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
346
|
|
|
226
|
|
||
Pension and postretirement benefit income
|
(155
|
)
|
|
(17
|
)
|
||
Pension and postretirement contributions
|
(247
|
)
|
|
(19
|
)
|
||
Equity in earnings of partially-owned affiliates, net of dividends received
|
(64
|
)
|
|
(110
|
)
|
||
Deferred income taxes
|
580
|
|
|
(14
|
)
|
||
Non-cash restructuring and impairment charges
|
16
|
|
|
—
|
|
||
Equity-based compensation
|
37
|
|
|
28
|
|
||
Other
|
—
|
|
|
1
|
|
||
Changes in assets and liabilities, excluding acquisitions and divestitures:
|
|
|
|
||||
Accounts receivable
|
37
|
|
|
199
|
|
||
Inventories
|
(142
|
)
|
|
(70
|
)
|
||
Other assets
|
(87
|
)
|
|
(108
|
)
|
||
Restructuring reserves
|
20
|
|
|
(74
|
)
|
||
Accounts payable and accrued liabilities
|
(811
|
)
|
|
(394
|
)
|
||
Accrued income taxes
|
(1,808
|
)
|
|
(151
|
)
|
||
Cash used by operating activities
|
(1,900
|
)
|
|
(13
|
)
|
||
|
|
|
|
||||
Investing Activities
|
|
|
|
||||
Capital expenditures
|
(371
|
)
|
|
(282
|
)
|
||
Sale of property, plant and equipment
|
2
|
|
|
9
|
|
||
Acquisition of businesses, net of cash acquired
|
(3
|
)
|
|
(133
|
)
|
||
Business divestitures
|
47
|
|
|
18
|
|
||
Changes in long-term investments
|
(6
|
)
|
|
—
|
|
||
Other
|
—
|
|
|
4
|
|
||
Cash used by investing activities
|
(331
|
)
|
|
(384
|
)
|
||
|
|
|
|
||||
Financing Activities
|
|
|
|
||||
Increase in short-term debt - net
|
1,312
|
|
|
521
|
|
||
Increase in long-term debt
|
7
|
|
|
—
|
|
||
Repayment of long-term debt
|
(763
|
)
|
|
(7
|
)
|
||
Debt financing costs
|
(6
|
)
|
|
—
|
|
||
Payment of cash dividends
|
—
|
|
|
(168
|
)
|
||
Proceeds from the exercise of stock options
|
29
|
|
|
16
|
|
||
Dividends paid to noncontrolling interests
|
(31
|
)
|
|
(154
|
)
|
||
Dividend from Adient spin-off
|
2,050
|
|
|
—
|
|
||
Cash transferred to Adient related to spin-off
|
(564
|
)
|
|
—
|
|
||
Cash paid related to prior acquisitions
|
(45
|
)
|
|
—
|
|
||
Other
|
(10
|
)
|
|
6
|
|
||
Cash provided by financing activities
|
1,979
|
|
|
214
|
|
||
Effect of exchange rate changes on cash and cash equivalents
|
(55
|
)
|
|
—
|
|
||
Cash held for sale
|
105
|
|
|
(14
|
)
|
||
Decrease in cash and cash equivalents
|
(202
|
)
|
|
(197
|
)
|
||
Cash and cash equivalents at beginning of period
|
579
|
|
|
553
|
|
||
Cash and cash equivalents at end of period
|
$
|
377
|
|
|
$
|
356
|
|
1.
|
Financial Statements
|
|
December 31, 2016
|
|
September 30, 2016
|
||||
|
|
|
|
||||
Current assets
|
$
|
2
|
|
|
$
|
284
|
|
Noncurrent assets
|
54
|
|
|
98
|
|
||
Total assets
|
$
|
56
|
|
|
$
|
382
|
|
|
|
|
|
||||
Current liabilities
|
$
|
3
|
|
|
$
|
230
|
|
Noncurrent liabilities
|
44
|
|
|
29
|
|
||
Total liabilities
|
$
|
47
|
|
|
$
|
259
|
|
2.
|
New Accounting Standards
|
3.
|
Merger Transaction
|
(in millions, except for share consolidation ratio and share data)
|
|
|
||
|
|
|
||
Number of Tyco shares outstanding at September 2, 2016
|
|
427,181,743
|
|
|
Tyco share consolidation ratio
|
|
0.955
|
|
|
Tyco ordinary shares outstanding following the share consolidation
and immediately prior to the merger
|
|
407,958,565
|
|
|
JCI Inc. converted share price (1)
|
|
$
|
47.67
|
|
Fair value of equity portion of the merger consideration
|
|
$
|
19,447
|
|
Fair value of Tyco equity awards
|
|
224
|
|
|
Total fair value of consideration transferred
|
|
$
|
19,671
|
|
(1)
|
Amount equals JCI Inc. closing share price and market capitalization at September 2, 2016 (
$45.45
and
$29,012 million
, respectively) adjusted for the Tyco
$3,864 million
cash contribution used to purchase
110.8 million
shares of JCI Inc. common stock for
$34.88
per share.
|
Cash and cash equivalents
|
|
$
|
489
|
|
Accounts receivable
|
|
2,095
|
|
|
Inventories
|
|
831
|
|
|
Other current assets
|
|
609
|
|
|
Property, plant, and equipment - net
|
|
1,224
|
|
|
Goodwill
|
|
16,382
|
|
|
Intangible assets - net
|
|
6,203
|
|
|
Other noncurrent assets
|
|
536
|
|
|
Total assets acquired
|
|
$
|
28,369
|
|
|
|
|
||
Short-term debt
|
|
$
|
462
|
|
Accounts payable
|
|
723
|
|
|
Accrued compensation and benefits
|
|
306
|
|
|
Other current liabilities
|
|
1,610
|
|
|
Long-term debt
|
|
6,416
|
|
|
Long-term deferred tax liabilities
|
|
1,173
|
|
|
Long-term pension and postretirement benefits
|
|
774
|
|
|
Other noncurrent liabilities
|
|
1,064
|
|
|
Total liabilities acquired
|
|
$
|
12,528
|
|
Noncontrolling interests
|
|
34
|
|
|
Net assets acquired
|
|
$
|
15,807
|
|
Cash consideration paid to JCI Inc. shareholders
|
|
3,864
|
|
|
Total fair value of consideration transferred
|
|
$
|
19,671
|
|
|
|
Preliminary Fair Value (in millions)
|
|
Weighted Average Life (in years)
|
||
Customer relationships
|
|
$
|
2,280
|
|
|
11
|
Completed technology
|
|
1,530
|
|
|
10
|
|
Other definite-lived intangibles
|
|
223
|
|
|
8
|
|
Indefinite-lived trademarks
|
|
2,020
|
|
|
|
|
Other indefinite-lived intangibles
|
|
90
|
|
|
|
|
In-process research and development
|
|
60
|
|
|
|
|
Total identifiable intangible assets
|
|
$
|
6,203
|
|
|
|
4.
|
Acquisitions and Divestitures
|
5.
|
Discontinued Operations
|
|
Three Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Net sales
|
$
|
1,434
|
|
|
$
|
4,233
|
|
|
|
|
|
||||
Income from discontinued operations before income taxes
|
1
|
|
|
233
|
|
||
Provision for income taxes on discontinued operations
|
35
|
|
|
46
|
|
||
Income from discontinued operations attributable to noncontrolling interests, net of tax
|
9
|
|
|
17
|
|
||
Income (loss) from discontinued operations
|
$
|
(43
|
)
|
|
$
|
170
|
|
|
|
September 30, 2016
|
||
|
|
|
||
Cash
|
|
$
|
105
|
|
Cash in escrow related to Adient debt
|
|
2,034
|
|
|
Accounts receivable - net
|
|
2,071
|
|
|
Inventories
|
|
672
|
|
|
Other current assets
|
|
756
|
|
|
Assets held for sale
|
|
$
|
5,638
|
|
|
|
|
||
Property, plant and equipment - net
|
|
$
|
2,240
|
|
Goodwill
|
|
2,385
|
|
|
Other intangible assets - net
|
|
113
|
|
|
Investments in partially-owned affiliates
|
|
1,745
|
|
|
Other noncurrent assets
|
|
891
|
|
|
Noncurrent assets held for sale
|
|
$
|
7,374
|
|
|
|
|
||
Short-term debt
|
|
$
|
41
|
|
Current portion of long-term debt
|
|
38
|
|
|
Accounts payable
|
|
2,764
|
|
|
Accrued compensation and benefits
|
|
430
|
|
|
Other current liabilities
|
|
975
|
|
|
Liabilities held for sale
|
|
$
|
4,248
|
|
|
|
|
||
Long-term debt
|
|
$
|
3,441
|
|
Pension and postretirement benefits
|
|
188
|
|
|
Other noncurrent liabilities
|
|
259
|
|
|
Noncurrent liabilities held for sale
|
|
$
|
3,888
|
|
|
Three Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Depreciation and amortization
|
$
|
29
|
|
|
$
|
86
|
|
Equity in earnings of partially-owned affiliates
|
(31
|
)
|
|
(95
|
)
|
||
Deferred income taxes
|
562
|
|
|
(4
|
)
|
||
Equity-based compensation
|
1
|
|
|
3
|
|
||
Accrued income taxes
|
(808
|
)
|
|
—
|
|
||
Capital expenditures
|
(91
|
)
|
|
(100
|
)
|
|
December 31, 2016
|
|
September 30, 2016
|
||||
|
|
|
|
||||
Accounts receivable - net
|
$
|
10
|
|
|
$
|
9
|
|
Inventories
|
6
|
|
|
7
|
|
||
Other current assets
|
3
|
|
|
3
|
|
||
Property, plant and equipment - net
|
14
|
|
|
15
|
|
||
Goodwill
|
94
|
|
|
89
|
|
||
Other intangible assets - net
|
30
|
|
|
30
|
|
||
Other noncurrent assets
|
4
|
|
|
4
|
|
||
Assets held for sale
|
$
|
161
|
|
|
$
|
157
|
|
|
|
|
|
||||
Accounts payable
|
$
|
10
|
|
|
$
|
9
|
|
Other current liabilities
|
21
|
|
|
19
|
|
||
Liabilities held for sale
|
$
|
31
|
|
|
$
|
28
|
|
6.
|
Percentage-of-Completion Contracts
|
7.
|
Inventories
|
|
December 31, 2016
|
|
September 30, 2016
|
||||
|
|
|
|
||||
Raw materials and supplies
|
$
|
872
|
|
|
$
|
852
|
|
Work-in-process
|
521
|
|
|
503
|
|
||
Finished goods
|
1,550
|
|
|
1,533
|
|
||
Inventories
|
$
|
2,943
|
|
|
$
|
2,888
|
|
8.
|
Goodwill and Other Intangible Assets
|
|
December 31, 2016
|
|
September 30, 2016
|
||||||||||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||
Amortized intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Technology
|
$
|
1,494
|
|
|
$
|
(60
|
)
|
|
$
|
1,434
|
|
|
$
|
1,528
|
|
|
$
|
(24
|
)
|
|
$
|
1,504
|
|
Customer relationships
|
3,122
|
|
|
(279
|
)
|
|
2,843
|
|
|
3,168
|
|
|
(226
|
)
|
|
2,942
|
|
||||||
Miscellaneous
|
517
|
|
|
(183
|
)
|
|
334
|
|
|
519
|
|
|
(130
|
)
|
|
389
|
|
||||||
Total amortized intangible assets
|
5,133
|
|
|
(522
|
)
|
|
4,611
|
|
|
5,215
|
|
|
(380
|
)
|
|
4,835
|
|
||||||
Unamortized intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trademarks/trade names
|
2,529
|
|
|
—
|
|
|
2,529
|
|
|
2,555
|
|
|
—
|
|
|
2,555
|
|
||||||
Miscellaneous
|
150
|
|
|
—
|
|
|
150
|
|
|
150
|
|
|
—
|
|
|
150
|
|
||||||
Total intangible assets
|
$
|
7,812
|
|
|
$
|
(522
|
)
|
|
$
|
7,290
|
|
|
$
|
7,920
|
|
|
$
|
(380
|
)
|
|
$
|
7,540
|
|
9.
|
Significant Restructuring and Impairment Costs
|
|
Employee Severance and Termination Benefits
|
|
Long-Lived Asset Impairments
|
|
Other
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Original Reserve
|
$
|
62
|
|
|
$
|
15
|
|
|
$
|
1
|
|
|
$
|
78
|
|
Utilized—noncash
|
—
|
|
|
(15
|
)
|
|
(1
|
)
|
|
(16
|
)
|
||||
Balance at December 31, 2016
|
$
|
62
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
62
|
|
|
Employee Severance and Termination Benefits
|
|
Long-Lived Asset Impairments
|
|
Other
|
|
Currency
Translation |
|
Total
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Original Reserve
|
$
|
368
|
|
|
$
|
190
|
|
|
$
|
62
|
|
|
$
|
—
|
|
|
$
|
620
|
|
Acquired Tyco restructuring
reserves
|
78
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
78
|
|
|||||
Utilized—cash
|
(32
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(32
|
)
|
|||||
Utilized—noncash
|
—
|
|
|
(190
|
)
|
|
(32
|
)
|
|
1
|
|
|
(221
|
)
|
|||||
Balance at September 30, 2016
|
$
|
414
|
|
|
$
|
—
|
|
|
$
|
30
|
|
|
$
|
1
|
|
|
$
|
445
|
|
Adient spin-off impact
|
(194
|
)
|
|
—
|
|
|
(22
|
)
|
|
—
|
|
|
(216
|
)
|
|||||
Utilized—cash
|
(23
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23
|
)
|
|||||
Utilized—noncash
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
(4
|
)
|
|||||
Adjustment to acquired Tyco
restructuring reserves
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
|||||
Balance at December 31, 2016
|
$
|
197
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
(3
|
)
|
|
$
|
197
|
|
10.
|
Income Taxes
|
Tax Jurisdiction
|
|
Tax Years Covered
|
|
|
|
Belgium
|
|
2011 - 2014
|
Brazil
|
|
2011 - 2012
|
Canada
|
|
2012 - 2015
|
France
|
|
2010 - 2015
|
Germany
|
|
2007 - 2013
|
Italy
|
|
2006, 2011
|
Mexico
|
|
2009 - 2015
|
Spain
|
|
2009 - 2014
|
United Kingdom
|
|
2011 - 2014
|
11.
|
Pension and Postretirement Plans
|
|
U.S. Pension Plans
|
||||||
|
Three Months Ended
December 31,
|
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Service cost
|
$
|
5
|
|
|
$
|
4
|
|
Interest cost
|
28
|
|
|
25
|
|
||
Expected return on plan assets
|
(59
|
)
|
|
(46
|
)
|
||
Net actuarial gain
|
(117
|
)
|
|
—
|
|
||
Settlement gain
|
(8
|
)
|
|
—
|
|
||
Net periodic benefit credit
|
$
|
(151
|
)
|
|
$
|
(17
|
)
|
|
Non-U.S. Pension Plans
|
||||||
|
Three Months Ended
December 31,
|
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Service cost
|
$
|
8
|
|
|
$
|
3
|
|
Interest cost
|
12
|
|
|
6
|
|
||
Expected return on plan assets
|
(23
|
)
|
|
(8
|
)
|
||
Net periodic benefit cost (credit)
|
$
|
(3
|
)
|
|
$
|
1
|
|
|
Postretirement Benefits
|
||||||
|
Three Months Ended
December 31,
|
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Service cost
|
$
|
1
|
|
|
$
|
—
|
|
Interest cost
|
1
|
|
|
1
|
|
||
Expected return on plan assets
|
(3
|
)
|
|
(2
|
)
|
||
Net periodic benefit credit
|
$
|
(1
|
)
|
|
$
|
(1
|
)
|
12.
|
Debt and Financing Arrangements
|
|
Three Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Interest expense, net of capitalized interest costs
|
$
|
110
|
|
|
$
|
72
|
|
Banking fees and bond cost amortization
|
30
|
|
|
7
|
|
||
Interest income
|
(7
|
)
|
|
(2
|
)
|
||
Net foreign exchange results for financing activities
|
3
|
|
|
(11
|
)
|
||
Net financing charges
|
$
|
136
|
|
|
$
|
66
|
|
13.
|
Stock-Based Compensation
|
|
Three Months Ended December 31,
|
||||||||||||
|
2016
|
|
2015
|
||||||||||
|
Number Granted
|
|
Weighted Average Grant Date Fair Value
|
|
Number Granted
|
|
Weighted Average Grant Date Fair Value
|
||||||
|
|
|
|
|
|
|
|
||||||
Stock options
|
2,830,826
|
|
|
$
|
7.81
|
|
|
957,278
|
|
|
$
|
13.15
|
|
Stock appreciation rights
|
15,693
|
|
|
8.28
|
|
|
54,749
|
|
|
13.15
|
|
||
Restricted stock
|
1,512,544
|
|
|
41.74
|
|
|
2,224,207
|
|
|
43.86
|
|
||
Performance shares
|
846,725
|
|
|
48.40
|
|
|
—
|
|
|
—
|
|
|
Three Months Ended December 31,
|
||
|
2016
|
|
2015
|
Expected life of option (years)
|
4.75 & 6.5
|
|
6.4
|
Risk-free interest rate
|
1.23% - 1.48%
|
|
1.64%
|
Expected volatility of the Company’s stock
|
24.60%
|
|
36.00%
|
Expected dividend yield on the Company’s stock
|
2.21%
|
|
2.11%
|
|
Three Months Ended December 31, 2016
|
Risk-free interest rate
|
1.40%
|
Expected volatility of the Company’s stock
|
21.00%
|
14.
|
Earnings Per Share
|
|
Three Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
Income Available to Ordinary Shareholders
|
|
|
|
||||
Income from continuing operations
|
$
|
372
|
|
|
$
|
280
|
|
Income (loss) from discontinued operations
|
(43
|
)
|
|
170
|
|
||
Basic and diluted income available to shareholders
|
$
|
329
|
|
|
$
|
450
|
|
|
|
|
|
||||
Weighted Average Shares Outstanding
|
|
|
|
||||
Basic weighted average shares outstanding
|
937.2
|
|
|
647.7
|
|
||
Effect of dilutive securities:
|
|
|
|
||||
Stock options, unvested restricted stock and unvested
performance share awards
|
10.2
|
|
|
5.1
|
|
||
Diluted weighted average shares outstanding
|
947.4
|
|
|
652.8
|
|
||
|
|
|
|
||||
Antidilutive Securities
|
|
|
|
||||
Options to purchase shares
|
0.1
|
|
|
0.2
|
|
15.
|
Equity and Noncontrolling Interests
|
|
Three Months Ended December 31, 2016
|
|
Three Months Ended December 31, 2015
|
||||||||||||||||||||
|
Equity
Attributable to
Johnson Controls International plc
|
|
Equity
Attributable to
Noncontrolling
Interests
|
|
Total
Equity
|
|
Equity
Attributable to
Johnson Controls International plc
|
|
Equity
Attributable to
Noncontrolling
Interests
|
|
Total
Equity
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Beginning balance, September 30
|
$
|
24,118
|
|
|
$
|
972
|
|
|
$
|
25,090
|
|
|
$
|
10,376
|
|
|
$
|
163
|
|
|
$
|
10,539
|
|
Total comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income
|
329
|
|
|
36
|
|
|
365
|
|
|
450
|
|
|
20
|
|
|
470
|
|
||||||
Foreign currency translation adjustments
|
(659
|
)
|
|
(35
|
)
|
|
(694
|
)
|
|
(160
|
)
|
|
(9
|
)
|
|
(169
|
)
|
||||||
Realized and unrealized gains (losses) on derivatives
|
—
|
|
|
4
|
|
|
4
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
||||||
Realized and unrealized losses on marketable securities
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other comprehensive loss
|
(661
|
)
|
|
(31
|
)
|
|
(692
|
)
|
|
(161
|
)
|
|
(9
|
)
|
|
(170
|
)
|
||||||
Comprehensive income (loss)
|
(332
|
)
|
|
5
|
|
|
(327
|
)
|
|
289
|
|
|
11
|
|
|
300
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other changes in equity:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash dividends—ordinary shares
|
(236
|
)
|
|
—
|
|
|
(236
|
)
|
|
(188
|
)
|
|
—
|
|
|
(188
|
)
|
||||||
Dividends attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
|
(7
|
)
|
||||||
Change in noncontrolling interest share
|
—
|
|
|
(20
|
)
|
|
(20
|
)
|
|
—
|
|
|
764
|
|
|
764
|
|
||||||
Spin-off of Adient
|
(4,020
|
)
|
|
(138
|
)
|
|
(4,158
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other, including options exercised
|
47
|
|
|
—
|
|
|
47
|
|
|
29
|
|
|
—
|
|
|
29
|
|
||||||
Ending balance, December 31
|
$
|
19,577
|
|
|
$
|
819
|
|
|
$
|
20,396
|
|
|
$
|
10,506
|
|
|
$
|
931
|
|
|
$
|
11,437
|
|
|
Three Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Beginning balance, September 30
|
$
|
234
|
|
|
$
|
212
|
|
Net income
|
13
|
|
|
20
|
|
||
Foreign currency translation adjustments
|
(9
|
)
|
|
(8
|
)
|
||
Realized and unrealized losses on derivatives
|
—
|
|
|
(2
|
)
|
||
Dividends
|
(43
|
)
|
|
(6
|
)
|
||
Spin-off of Adient
|
(36
|
)
|
|
—
|
|
||
Ending balance, December 31
|
$
|
159
|
|
|
$
|
216
|
|
|
Three Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Foreign currency translation adjustments
|
|
|
|
||||
Balance at beginning of period
|
$
|
(1,152
|
)
|
|
$
|
(1,047
|
)
|
Aggregate adjustment for the period (net of tax effect of $5 and $(4))
|
(659
|
)
|
|
(160
|
)
|
||
Adient spin-off impact (net of tax effect of $0)
|
563
|
|
|
—
|
|
||
Balance at end of period
|
(1,248
|
)
|
|
(1,207
|
)
|
||
|
|
|
|
||||
Realized and unrealized gains (losses) on derivatives
|
|
|
|
||||
Balance at beginning of period
|
4
|
|
|
(7
|
)
|
||
Current period changes in fair value (net of tax effect of $4 and $0)
|
6
|
|
|
(4
|
)
|
||
Reclassification to income (net of tax effect of $(3) and $1) *
|
(6
|
)
|
|
3
|
|
||
Adient spin-off impact (net of tax effect of $6 and $0)
|
16
|
|
|
—
|
|
||
Balance at end of period
|
20
|
|
|
(8
|
)
|
||
|
|
|
|
||||
Realized and unrealized losses on marketable securities
|
|
|
|
||||
Balance at beginning of period
|
(1
|
)
|
|
—
|
|
||
Current period changes in fair value (net of tax effect of $0)
|
(2
|
)
|
|
—
|
|
||
Balance at end of period
|
(3
|
)
|
|
—
|
|
||
|
|
|
|
||||
Pension and postretirement plans
|
|
|
|
||||
Balance at beginning of period
|
(4
|
)
|
|
(3
|
)
|
||
Adient spin-off impact (net of tax effect of $0)
|
2
|
|
|
—
|
|
||
Balance at end of period
|
(2
|
)
|
|
(3
|
)
|
||
|
|
|
|
||||
Accumulated other comprehensive loss, end of period
|
$
|
(1,233
|
)
|
|
$
|
(1,218
|
)
|
16.
|
Derivative Instruments and Hedging Activities
|
|
|
|
|
Volume Outstanding as of
|
||||
Commodity
|
|
Units
|
|
December 31, 2016
|
|
September 30, 2016
|
||
|
|
|
|
|
|
|
||
Copper
|
|
Pounds
|
|
6,950,000
|
|
|
5,849,000
|
|
Lead
|
|
Metric Tons
|
|
2,980
|
|
|
5,185
|
|
Aluminum
|
|
Metric Tons
|
|
1,535
|
|
|
2,620
|
|
Tin
|
|
Metric Tons
|
|
175
|
|
|
185
|
|
|
Derivatives and Hedging Activities Designated
as Hedging Instruments under ASC 815
|
|
Derivatives and Hedging Activities Not
Designated as Hedging Instruments under ASC 815
|
||||||||||||
|
December 31,
|
|
September 30,
|
|
December 31,
|
|
September 30,
|
||||||||
|
2016
|
|
2016
|
|
2016
|
|
2016
|
||||||||
Other current assets
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
$
|
38
|
|
|
$
|
41
|
|
|
$
|
5
|
|
|
$
|
49
|
|
Commodity derivatives
|
3
|
|
|
4
|
|
|
—
|
|
|
—
|
|
||||
Other noncurrent assets
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
$
|
41
|
|
|
$
|
46
|
|
|
$
|
5
|
|
|
$
|
49
|
|
|
|
|
|
|
|
|
|
||||||||
Other current liabilities
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
$
|
12
|
|
|
$
|
48
|
|
|
$
|
18
|
|
|
$
|
18
|
|
Liabilities held for sale
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
||||
Current portion of long-term debt
|
|
|
|
|
|
|
|
||||||||
Fixed rate debt swapped to floating
|
—
|
|
|
551
|
|
|
—
|
|
|
—
|
|
||||
Long-term debt
|
|
|
|
|
|
|
|
||||||||
Foreign currency denominated debt
|
526
|
|
|
938
|
|
|
—
|
|
|
—
|
|
||||
Fixed rate debt swapped to floating
|
—
|
|
|
301
|
|
|
—
|
|
|
—
|
|
||||
Noncurrent liabilities held for sale
|
|
|
|
|
|
|
|
||||||||
Foreign currency denominated debt
|
—
|
|
|
1,119
|
|
|
—
|
|
|
—
|
|
||||
Total liabilities
|
$
|
538
|
|
|
$
|
2,957
|
|
|
$
|
18
|
|
|
$
|
23
|
|
|
Fair Value of Assets
|
|
Fair Value of Liabilities
|
||||||||||||
|
December 31,
|
|
September 30,
|
|
December 31,
|
|
September 30,
|
||||||||
|
2016
|
|
2016
|
|
2016
|
|
2016
|
||||||||
Gross amount recognized
|
$
|
46
|
|
|
$
|
95
|
|
|
$
|
556
|
|
|
$
|
2,980
|
|
Gross amount eligible for offsetting
|
(11
|
)
|
|
(21
|
)
|
|
(11
|
)
|
|
(21
|
)
|
||||
Net amount
|
$
|
35
|
|
|
$
|
74
|
|
|
$
|
545
|
|
|
$
|
2,959
|
|
Derivatives in ASC 815 Cash Flow Hedging Relationships
|
|
Three Months Ended December 31,
|
||||||
|
2016
|
|
2015
|
|||||
Foreign currency exchange derivatives
|
|
$
|
8
|
|
|
$
|
(2
|
)
|
Commodity derivatives
|
|
2
|
|
|
(2
|
)
|
||
Total
|
|
$
|
10
|
|
|
$
|
(4
|
)
|
Derivatives in ASC 815 Cash Flow
Hedging Relationships
|
|
Location of Gain (Loss) Reclassified
from AOCI into Income
|
|
Three Months Ended December 31,
|
||||||
|
2016
|
|
2015
|
|||||||
Foreign currency exchange derivatives
|
|
Cost of sales
|
|
$
|
8
|
|
|
$
|
5
|
|
Foreign currency exchange derivatives
|
|
Income (loss) from discontinued operations
|
|
—
|
|
|
(5
|
)
|
||
Commodity derivatives
|
|
Cost of sales
|
|
1
|
|
|
(4
|
)
|
||
Total
|
|
|
|
$
|
9
|
|
|
$
|
(4
|
)
|
Derivatives in ASC 815 Fair Value
Hedging Relationships
|
|
Location of Gain (Loss)
Recognized in Income on Derivative
|
|
Three Months Ended December 31,
|
||||||
|
2016
|
|
2015
|
|||||||
Interest rate swap
|
|
Net financing charges
|
|
$
|
(1
|
)
|
|
$
|
(5
|
)
|
Fixed rate debt swapped to floating
|
|
Net financing charges
|
|
2
|
|
|
5
|
|
||
Total
|
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
|
|
|
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 December 31,
|
||||||
|
2016
|
|
2015
|
|||||||
Foreign currency exchange derivatives
|
|
Cost of sales
|
|
$
|
1
|
|
|
$
|
2
|
|
Foreign currency exchange derivatives
|
|
Net financing charges
|
|
4
|
|
|
—
|
|
||
Foreign currency exchange derivatives
|
|
Income tax provision
|
|
(3
|
)
|
|
—
|
|
||
Foreign currency exchange derivatives
|
|
Income (loss) from discontinued operations
|
|
5
|
|
|
(3
|
)
|
||
Equity swap
|
|
Selling, general and administrative
|
|
—
|
|
|
(6
|
)
|
||
Total
|
|
|
|
$
|
7
|
|
|
$
|
(7
|
)
|
17.
|
Fair Value Measurements
|
|
Fair Value Measurements Using:
|
||||||||||||||
|
Total as of
December 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
|
$
|
43
|
|
|
$
|
—
|
|
|
$
|
43
|
|
|
$
|
—
|
|
Commodity derivatives
|
3
|
|
|
—
|
|
|
3
|
|
|
—
|
|
||||
Other noncurrent assets
|
|
|
|
|
|
|
|
||||||||
Investments in marketable common stock
|
4
|
|
|
4
|
|
|
—
|
|
|
—
|
|
||||
Deferred compensation plan assets
|
83
|
|
|
83
|
|
|
—
|
|
|
—
|
|
||||
Exchange traded funds (fixed income)
1
|
163
|
|
|
163
|
|
|
—
|
|
|
—
|
|
||||
Exchange traded funds (equity)
1
|
89
|
|
|
89
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
$
|
385
|
|
|
$
|
339
|
|
|
$
|
46
|
|
|
$
|
—
|
|
Other current liabilities
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
$
|
30
|
|
|
$
|
—
|
|
|
$
|
30
|
|
|
$
|
—
|
|
Long-term debt
|
|
|
|
|
|
|
|
||||||||
Foreign currency denominated debt
|
526
|
|
|
526
|
|
|
—
|
|
|
—
|
|
||||
Total liabilities
|
$
|
556
|
|
|
$
|
526
|
|
|
$
|
30
|
|
|
$
|
—
|
|
|
Fair Value Measurements Using:
|
||||||||||||||
|
Total as of
September 30, 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
|
$
|
90
|
|
|
$
|
—
|
|
|
$
|
90
|
|
|
$
|
—
|
|
Commodity derivatives
|
4
|
|
|
—
|
|
|
4
|
|
|
—
|
|
||||
Exchange traded funds (fixed income)
1
|
15
|
|
|
15
|
|
|
—
|
|
|
—
|
|
||||
Other noncurrent assets
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Investments in marketable common stock
|
3
|
|
|
3
|
|
|
—
|
|
|
—
|
|
||||
Deferred compensation plan assets
|
81
|
|
|
81
|
|
|
—
|
|
|
—
|
|
||||
Exchange traded funds (fixed income)
1
|
163
|
|
|
163
|
|
|
—
|
|
|
—
|
|
||||
Exchange traded funds (equity)
1
|
86
|
|
|
86
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
$
|
443
|
|
|
$
|
348
|
|
|
$
|
95
|
|
|
$
|
—
|
|
Other current liabilities
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
$
|
66
|
|
|
$
|
—
|
|
|
$
|
66
|
|
|
$
|
—
|
|
Liabilities held for sale
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
5
|
|
|
—
|
|
|
5
|
|
|
—
|
|
||||
Current portion of long-term debt
|
|
|
|
|
|
|
|
||||||||
Fixed rate debt swapped to floating
|
551
|
|
|
—
|
|
|
551
|
|
|
—
|
|
||||
Long-term debt
|
|
|
|
|
|
|
|
||||||||
Foreign currency denominated debt
|
938
|
|
|
938
|
|
|
—
|
|
|
—
|
|
||||
Fixed rate debt swapped to floating
|
301
|
|
|
—
|
|
|
301
|
|
|
—
|
|
||||
Noncurrent liabilities held for sale
|
|
|
|
|
|
|
|
||||||||
Foreign currency denominated debt
|
1,119
|
|
|
1,119
|
|
|
—
|
|
|
—
|
|
||||
Total liabilities
|
$
|
2,980
|
|
|
$
|
2,057
|
|
|
$
|
923
|
|
|
$
|
—
|
|
18.
|
Impairment of Long-Lived Assets
|
19.
|
Segment Information
|
•
|
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.
|
|
Net Sales
|
||||||
|
Three Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
Building Technologies & Solutions
|
|
|
|
||||
Building Efficiency
|
|
|
|
||||
Systems and Service North America
|
$
|
928
|
|
|
$
|
984
|
|
Products North America
|
543
|
|
|
557
|
|
||
Asia
|
1,042
|
|
|
992
|
|
||
Rest of World
|
398
|
|
|
423
|
|
||
|
2,911
|
|
|
2,956
|
|
||
Tyco
|
2,275
|
|
|
—
|
|
||
|
5,186
|
|
|
2,956
|
|
||
Power Solutions
|
1,900
|
|
|
1,740
|
|
||
Total net sales
|
$
|
7,086
|
|
|
$
|
4,696
|
|
|
Segment EBITA
|
||||||
|
Three Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
Building Technologies & Solutions
|
|
|
|
||||
Building Efficiency
|
|
|
|
||||
Systems and Service North America
|
$
|
75
|
|
|
$
|
99
|
|
Products North America
|
37
|
|
|
33
|
|
||
Asia
|
119
|
|
|
70
|
|
||
Rest of World
|
(10
|
)
|
|
(3
|
)
|
||
|
221
|
|
|
199
|
|
||
Tyco
|
214
|
|
|
—
|
|
||
|
435
|
|
|
199
|
|
||
Power Solutions
|
389
|
|
|
360
|
|
||
Segment EBITA
|
$
|
824
|
|
|
$
|
559
|
|
|
|
|
|
||||
Corporate expenses
|
$
|
(193
|
)
|
|
$
|
(87
|
)
|
Amortization of intangible assets
|
(149
|
)
|
|
(20
|
)
|
||
Restructuring and impairment costs
|
(78
|
)
|
|
—
|
|
||
Net mark-to-market adjustments on pension plans
|
117
|
|
|
—
|
|
||
Net financing charges
|
(136
|
)
|
|
(66
|
)
|
||
Income from continuing operations before income taxes
|
$
|
385
|
|
|
$
|
386
|
|
20.
|
Guarantees
|
|
Three Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Balance at beginning of period
|
$
|
374
|
|
|
$
|
288
|
|
Accruals for warranties issued during the period
|
82
|
|
|
93
|
|
||
Accruals from acquisition and divestitures
|
(1
|
)
|
|
35
|
|
||
Accruals related to pre-existing warranties
|
(6
|
)
|
|
—
|
|
||
Settlements made (in cash or in kind) during the period
|
(73
|
)
|
|
(77
|
)
|
||
Currency translation
|
(6
|
)
|
|
(1
|
)
|
||
Balance at end of period
|
$
|
370
|
|
|
$
|
338
|
|
21.
|
Tyco International Finance S.A.
|
(in millions)
|
Johnson Controls
International plc
|
|
Tyco Fire & Security Finance SCA
|
|
Tyco International Finance S.A.
|
|
Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net sales
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,086
|
|
|
$
|
—
|
|
|
$
|
7,086
|
|
Cost of sales
|
—
|
|
|
—
|
|
|
—
|
|
|
4,972
|
|
|
—
|
|
|
4,972
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gross profit
|
—
|
|
|
—
|
|
|
—
|
|
|
2,114
|
|
|
—
|
|
|
2,114
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Selling, general and administrative
expenses
|
(2
|
)
|
|
—
|
|
|
1
|
|
|
(1,569
|
)
|
|
—
|
|
|
(1,570
|
)
|
||||||
Restructuring and impairment costs
|
—
|
|
|
—
|
|
|
—
|
|
|
(78
|
)
|
|
—
|
|
|
(78
|
)
|
||||||
Net financing charges
|
(19
|
)
|
|
—
|
|
|
(19
|
)
|
|
(98
|
)
|
|
—
|
|
|
(136
|
)
|
||||||
Equity income (loss)
|
318
|
|
|
(299
|
)
|
|
(96
|
)
|
|
55
|
|
|
77
|
|
|
55
|
|
||||||
Intercompany interest and fees
|
32
|
|
|
—
|
|
|
17
|
|
|
(49
|
)
|
|
—
|
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Income (loss) from continuing
operations before income taxes
|
329
|
|
|
(299
|
)
|
|
(97
|
)
|
|
375
|
|
|
77
|
|
|
385
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Income tax benefit
|
—
|
|
|
—
|
|
|
—
|
|
|
(27
|
)
|
|
—
|
|
|
(27
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Income (loss) from continuing
operations
|
329
|
|
|
(299
|
)
|
|
(97
|
)
|
|
402
|
|
|
77
|
|
|
412
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Income (loss) from sale of
intercompany investment, net of
tax
|
—
|
|
|
—
|
|
|
(935
|
)
|
|
—
|
|
|
935
|
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loss from discontinued
operations, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
(34
|
)
|
|
—
|
|
|
(34
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income (loss)
|
329
|
|
|
(299
|
)
|
|
(1,032
|
)
|
|
368
|
|
|
1,012
|
|
|
378
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Income from continuing operations
attributable to noncontrolling
interests
|
—
|
|
|
—
|
|
|
—
|
|
|
40
|
|
|
—
|
|
|
40
|
|
||||||
Income from discontinued
operations attributable to
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
9
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income (loss) attributable to
Johnson Controls
|
$
|
329
|
|
|
$
|
(299
|
)
|
|
$
|
(1,032
|
)
|
|
$
|
319
|
|
|
$
|
1,012
|
|
|
$
|
329
|
|
(in millions)
|
Johnson Controls
International
plc
|
|
Tyco Fire & Security Finance SCA
|
|
Tyco International Finance S.A.
|
|
Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net Income (loss)
|
$
|
329
|
|
|
$
|
(299
|
)
|
|
$
|
(1,032
|
)
|
|
$
|
368
|
|
|
$
|
1,012
|
|
|
$
|
378
|
|
Other comprehensive income (loss),
net of tax
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency translation
adjustments
|
(659
|
)
|
|
—
|
|
|
27
|
|
|
(730
|
)
|
|
659
|
|
|
(703
|
)
|
||||||
Realized and unrealized gains
on derivatives
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
||||||
Realized and unrealized gains
(losses) on marketable securities
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
2
|
|
|
(2
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive income (loss)
|
(661
|
)
|
|
—
|
|
|
27
|
|
|
(728
|
)
|
|
661
|
|
|
(701
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total comprehensive income (loss)
|
(332
|
)
|
|
(299
|
)
|
|
(1,005
|
)
|
|
(360
|
)
|
|
1,673
|
|
|
(323
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income attributable
to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
9
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income (loss)
attributable to Johnson Controls
|
$
|
(332
|
)
|
|
$
|
(299
|
)
|
|
$
|
(1,005
|
)
|
|
$
|
(369
|
)
|
|
$
|
1,673
|
|
|
$
|
(332
|
)
|
(in millions)
|
Johnson Controls
International
plc
|
|
Tyco Fire & Security Finance SCA
|
|
Tyco International Finance S.A.
|
|
Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents
|
$
|
350
|
|
|
$
|
—
|
|
|
$
|
280
|
|
|
$
|
—
|
|
|
$
|
(253
|
)
|
|
$
|
377
|
|
Accounts receivable - net
|
—
|
|
|
—
|
|
|
—
|
|
|
6,057
|
|
|
—
|
|
|
6,057
|
|
||||||
Inventories
|
—
|
|
|
—
|
|
|
—
|
|
|
2,943
|
|
|
—
|
|
|
2,943
|
|
||||||
Intercompany receivables
|
3,129
|
|
|
—
|
|
|
372
|
|
|
2,737
|
|
|
(6,238
|
)
|
|
—
|
|
||||||
Assets held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
173
|
|
|
—
|
|
|
173
|
|
||||||
Other current assets
|
5
|
|
|
—
|
|
|
1
|
|
|
1,410
|
|
|
—
|
|
|
1,416
|
|
||||||
Current assets
|
$
|
3,484
|
|
|
$
|
—
|
|
|
$
|
653
|
|
|
$
|
13,320
|
|
|
$
|
(6,491
|
)
|
|
$
|
10,966
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property, plant and equipment - net
|
—
|
|
|
—
|
|
|
—
|
|
|
5,556
|
|
|
—
|
|
|
5,556
|
|
||||||
Goodwill
|
239
|
|
|
—
|
|
|
30
|
|
|
20,503
|
|
|
—
|
|
|
20,772
|
|
||||||
Other intangible assets - net
|
—
|
|
|
—
|
|
|
—
|
|
|
7,290
|
|
|
—
|
|
|
7,290
|
|
||||||
Investments in partially-owned
affiliates
|
—
|
|
|
—
|
|
|
—
|
|
|
1,030
|
|
|
—
|
|
|
1,030
|
|
||||||
Investments in affiliates
|
14,933
|
|
|
26,907
|
|
|
22,489
|
|
|
—
|
|
|
(64,329
|
)
|
|
—
|
|
||||||
Intercompany loans receivable
|
16,281
|
|
|
—
|
|
|
2,836
|
|
|
9,855
|
|
|
(28,972
|
)
|
|
—
|
|
||||||
Other noncurrent assets
|
—
|
|
|
—
|
|
|
—
|
|
|
3,174
|
|
|
—
|
|
|
3,174
|
|
||||||
Total assets
|
$
|
34,937
|
|
|
$
|
26,907
|
|
|
$
|
26,008
|
|
|
$
|
60,728
|
|
|
$
|
(99,792
|
)
|
|
$
|
48,788
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities and Equity
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Short-term debt
|
$
|
105
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,527
|
|
|
$
|
(253
|
)
|
|
$
|
2,379
|
|
Current portion of long-term debt
|
441
|
|
|
—
|
|
|
—
|
|
|
79
|
|
|
—
|
|
|
520
|
|
||||||
Accounts payable
|
—
|
|
|
—
|
|
|
—
|
|
|
3,453
|
|
|
—
|
|
|
3,453
|
|
||||||
Accrued compensation and benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
1,164
|
|
|
—
|
|
|
1,164
|
|
||||||
Liabilities held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
31
|
|
|
—
|
|
|
31
|
|
||||||
Intercompany payables
|
780
|
|
|
500
|
|
|
4,319
|
|
|
639
|
|
|
(6,238
|
)
|
|
—
|
|
||||||
Other current liabilities
|
293
|
|
|
2
|
|
|
25
|
|
|
3,592
|
|
|
—
|
|
|
3,912
|
|
||||||
Current liabilities
|
1,619
|
|
|
502
|
|
|
4,344
|
|
|
11,485
|
|
|
(6,491
|
)
|
|
11,459
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Long-term debt
|
5,849
|
|
|
—
|
|
|
183
|
|
|
4,319
|
|
|
—
|
|
|
10,351
|
|
||||||
Pension and postretirement benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
1,094
|
|
|
—
|
|
|
1,094
|
|
||||||
Intercompany loans payable
|
7,892
|
|
|
12,599
|
|
|
1,963
|
|
|
6,518
|
|
|
(28,972
|
)
|
|
—
|
|
||||||
Other noncurrent liabilities
|
—
|
|
|
—
|
|
|
24
|
|
|
5,305
|
|
|
—
|
|
|
5,329
|
|
||||||
Long-term liabilities
|
13,741
|
|
|
12,599
|
|
|
2,170
|
|
|
17,236
|
|
|
(28,972
|
)
|
|
16,774
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Redeemable noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
159
|
|
|
—
|
|
|
159
|
|
||||||
Ordinary shares
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
||||||
Ordinary shares held in treasury
|
(45
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(45
|
)
|
||||||
Other shareholders' equity
|
19,613
|
|
|
13,806
|
|
|
19,494
|
|
|
31,029
|
|
|
(64,329
|
)
|
|
19,613
|
|
||||||
Shareholders’ equity attributable to Johnson Controls
|
19,577
|
|
|
13,806
|
|
|
19,494
|
|
|
31,029
|
|
|
(64,329
|
)
|
|
19,577
|
|
||||||
Nonredeemable noncontrolling
interest
|
—
|
|
|
—
|
|
|
—
|
|
|
819
|
|
|
—
|
|
|
819
|
|
||||||
Total equity
|
19,577
|
|
|
13,806
|
|
|
19,494
|
|
|
31,848
|
|
|
(64,329
|
)
|
|
20,396
|
|
||||||
Total liabilities, redeemable
noncontrolling interest and
equity
|
$
|
34,937
|
|
|
$
|
26,907
|
|
|
$
|
26,008
|
|
|
$
|
60,728
|
|
|
$
|
(99,792
|
)
|
|
$
|
48,788
|
|
(in millions)
|
Johnson Controls
International plc
|
|
Tyco Fire & Security Finance SCA
|
|
Tyco International Finance S.A.
|
|
Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net cash provided (used) by operating
activities
|
$
|
223
|
|
|
$
|
—
|
|
|
$
|
32
|
|
|
$
|
(2,155
|
)
|
|
$
|
—
|
|
|
$
|
(1,900
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investing Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital expenditures
|
—
|
|
|
—
|
|
|
—
|
|
|
(371
|
)
|
|
—
|
|
|
(371
|
)
|
||||||
Sale of property, plant and equipment
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
||||||
Acquisition of businesses, net of cash
acquired
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
3
|
|
|
—
|
|
|
(3
|
)
|
||||||
Business divestitures
|
—
|
|
|
—
|
|
|
—
|
|
|
47
|
|
|
—
|
|
|
47
|
|
||||||
Changes in long-term investments
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
(6
|
)
|
||||||
Net change in intercompany loans
|
—
|
|
|
—
|
|
|
10
|
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
||||||
Net cash provided (used) by
investing activities
|
—
|
|
|
—
|
|
|
4
|
|
|
(325
|
)
|
|
(10
|
)
|
|
(331
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Financing Activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Increase in short-term debt - net
|
105
|
|
|
—
|
|
|
—
|
|
|
1,460
|
|
|
(253
|
)
|
|
1,312
|
|
||||||
Increase in long-term debt
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
||||||
Repayment of long-term debt
|
—
|
|
|
—
|
|
|
—
|
|
|
(763
|
)
|
|
—
|
|
|
(763
|
)
|
||||||
Debt financing costs
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
||||||
Proceeds from the exercise of stock
options
|
29
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
29
|
|
||||||
Net intercompany loan borrowings
(repayments) |
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
10
|
|
|
—
|
|
||||||
Dividends paid to noncontrolling
interests
|
—
|
|
|
—
|
|
|
—
|
|
|
(31
|
)
|
|
—
|
|
|
(31
|
)
|
||||||
Dividend from Adient spin-off
|
—
|
|
|
—
|
|
|
—
|
|
|
2,050
|
|
|
—
|
|
|
2,050
|
|
||||||
Cash transferred to Adient related to
spin-off
|
—
|
|
|
—
|
|
|
—
|
|
|
(564
|
)
|
|
—
|
|
|
(564
|
)
|
||||||
Cash paid related to prior acquisitions
|
—
|
|
|
—
|
|
|
—
|
|
|
(45
|
)
|
|
—
|
|
|
(45
|
)
|
||||||
Other
|
(12
|
)
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
(10
|
)
|
||||||
Net cash provided (used) by
financing activities
|
116
|
|
|
—
|
|
|
—
|
|
|
2,106
|
|
|
(243
|
)
|
|
1,979
|
|
||||||
Effect of exchange rate changes on
cash and cash equivalents
|
—
|
|
|
—
|
|
|
—
|
|
|
(55
|
)
|
|
—
|
|
|
(55
|
)
|
||||||
Changes in cash held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
105
|
|
|
—
|
|
|
105
|
|
||||||
Increase (decrease) in cash and
cash equivalents
|
339
|
|
|
—
|
|
|
36
|
|
|
(324
|
)
|
|
(253
|
)
|
|
(202
|
)
|
||||||
Cash and cash equivalents at
beginning of period
|
11
|
|
|
—
|
|
|
244
|
|
|
324
|
|
|
—
|
|
|
579
|
|
||||||
Cash and cash equivalents at
end of period
|
$
|
350
|
|
|
$
|
—
|
|
|
$
|
280
|
|
|
$
|
—
|
|
|
$
|
(253
|
)
|
|
$
|
377
|
|
(in millions)
|
Johnson Controls
International
plc
|
|
Tyco Fire & Security Finance SCA
|
|
Tyco International Finance S.A.
|
|
Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
244
|
|
|
$
|
324
|
|
|
$
|
—
|
|
|
$
|
579
|
|
Accounts receivable - net
|
—
|
|
|
—
|
|
|
—
|
|
|
6,394
|
|
|
—
|
|
|
6,394
|
|
||||||
Inventories
|
—
|
|
|
—
|
|
|
—
|
|
|
2,888
|
|
|
—
|
|
|
2,888
|
|
||||||
Intercompany receivables
|
16
|
|
|
—
|
|
|
2
|
|
|
6,188
|
|
|
(6,206
|
)
|
|
—
|
|
||||||
Assets held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
5,812
|
|
|
—
|
|
|
5,812
|
|
||||||
Other current assets
|
6
|
|
|
—
|
|
|
1
|
|
|
1,429
|
|
|
—
|
|
|
1,436
|
|
||||||
Current assets
|
$
|
33
|
|
|
$
|
—
|
|
|
$
|
247
|
|
|
$
|
23,035
|
|
|
$
|
(6,206
|
)
|
|
$
|
17,109
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property, plant and equipment - net
|
—
|
|
|
—
|
|
|
—
|
|
|
5,632
|
|
|
—
|
|
|
5,632
|
|
||||||
Goodwill
|
—
|
|
|
—
|
|
|
274
|
|
|
20,750
|
|
|
—
|
|
|
21,024
|
|
||||||
Other intangible assets - net
|
—
|
|
|
—
|
|
|
—
|
|
|
7,540
|
|
|
—
|
|
|
7,540
|
|
||||||
Investments in partially-owned affiliates
|
—
|
|
|
—
|
|
|
—
|
|
|
990
|
|
|
—
|
|
|
990
|
|
||||||
Investments in affiliates
|
12,460
|
|
|
31,405
|
|
|
27,906
|
|
|
—
|
|
|
(71,771
|
)
|
|
—
|
|
||||||
Intercompany loans receivable
|
18,680
|
|
|
—
|
|
|
13,336
|
|
|
15,631
|
|
|
(47,647
|
)
|
|
—
|
|
||||||
Noncurrent assets held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
7,374
|
|
|
—
|
|
|
7,374
|
|
||||||
Other noncurrent assets
|
—
|
|
|
—
|
|
|
—
|
|
|
3,510
|
|
|
—
|
|
|
3,510
|
|
||||||
Total assets
|
$
|
31,173
|
|
|
$
|
31,405
|
|
|
$
|
41,763
|
|
|
$
|
84,462
|
|
|
$
|
(125,624
|
)
|
|
$
|
63,179
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities and Equity
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Short-term debt
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,078
|
|
|
$
|
—
|
|
|
$
|
1,078
|
|
Current portion of long-term debt
|
—
|
|
|
—
|
|
|
—
|
|
|
628
|
|
|
—
|
|
|
628
|
|
||||||
Accounts payable
|
1
|
|
|
—
|
|
|
—
|
|
|
3,999
|
|
|
—
|
|
|
4,000
|
|
||||||
Accrued compensation and benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
1,333
|
|
|
—
|
|
|
1,333
|
|
||||||
Liabilities held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
4,276
|
|
|
—
|
|
|
4,276
|
|
||||||
Intercompany payables
|
3,873
|
|
|
—
|
|
|
2,315
|
|
|
18
|
|
|
(6,206
|
)
|
|
—
|
|
||||||
Other current liabilities
|
3
|
|
|
2
|
|
|
32
|
|
|
4,979
|
|
|
—
|
|
|
5,016
|
|
||||||
Current liabilities
|
3,877
|
|
|
2
|
|
|
2,347
|
|
|
16,311
|
|
|
(6,206
|
)
|
|
16,331
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Long-term debt
|
—
|
|
|
—
|
|
|
2,413
|
|
|
8,640
|
|
|
—
|
|
|
11,053
|
|
||||||
Pension and postretirement benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
1,550
|
|
|
—
|
|
|
1,550
|
|
||||||
Intercompany loans payable
|
3,178
|
|
|
18,680
|
|
|
12,453
|
|
|
13,336
|
|
|
(47,647
|
)
|
|
—
|
|
||||||
Noncurrent liabilities held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
3,888
|
|
|
—
|
|
|
3,888
|
|
||||||
Other noncurrent liabilities
|
—
|
|
|
—
|
|
|
22
|
|
|
5,011
|
|
|
—
|
|
|
5,033
|
|
||||||
Long-term liabilities
|
3,178
|
|
|
18,680
|
|
|
14,888
|
|
|
32,425
|
|
|
(47,647
|
)
|
|
21,524
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Redeemable noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
234
|
|
|
—
|
|
|
234
|
|
||||||
Ordinary shares
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
||||||
Ordinary shares held in treasury
|
(20
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20
|
)
|
||||||
Other shareholders' equity
|
24,129
|
|
|
12,723
|
|
|
24,528
|
|
|
34,520
|
|
|
(71,771
|
)
|
|
24,129
|
|
||||||
Shareholders’ equity attributable to
Johnson Controls
|
24,118
|
|
|
12,723
|
|
|
24,528
|
|
|
34,520
|
|
|
(71,771
|
)
|
|
24,118
|
|
||||||
Nonredeemable noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
972
|
|
|
—
|
|
|
972
|
|
||||||
Total equity
|
24,118
|
|
|
12,723
|
|
|
24,528
|
|
|
35,492
|
|
|
(71,771
|
)
|
|
25,090
|
|
||||||
Total liabilities, redeemable
noncontrolling interest and
equity
|
$
|
31,173
|
|
|
$
|
31,405
|
|
|
$
|
41,763
|
|
|
$
|
84,462
|
|
|
$
|
(125,624
|
)
|
|
$
|
63,179
|
|
22.
|
Commitments and Contingencies
|
23.
|
Related Party Transactions
|
|
|
December 31, 2016
|
|
September 30, 2016
|
|
|||
|
|
|
|
|
||||
Receivable from related parties
|
|
$
|
50
|
|
|
$
|
66
|
|
Payable to related parties
|
|
29
|
|
|
11
|
|
24.
|
Subsequent Event
|
|
Three Months Ended
December 31, |
|
|
|||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|||||
|
|
|
|
|
|
|||||
Net sales
|
$
|
7,086
|
|
|
$
|
4,696
|
|
|
51
|
%
|
|
Three Months Ended
December 31, |
|
|
|||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|||||
|
|
|
|
|
|
|||||
Cost of sales
|
$
|
4,972
|
|
|
$
|
3,439
|
|
|
45
|
%
|
Gross profit
|
2,114
|
|
|
1,257
|
|
|
68
|
%
|
||
% of sales
|
29.8
|
%
|
|
26.8
|
%
|
|
|
|
Three Months Ended
December 31, |
|
|
|||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|||||
|
|
|
|
|
|
|||||
Selling, general and administrative expenses
|
$
|
1,570
|
|
|
$
|
847
|
|
|
85
|
%
|
% of sales
|
22.2
|
%
|
|
18.0
|
%
|
|
|
|
Three Months Ended
December 31, |
|
|
||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
||||
|
|
|
|
|
|
||||
Restructuring and impairment costs
|
$
|
78
|
|
|
$
|
—
|
|
|
*
|
|
Three Months Ended
December 31, |
|
|
||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
||||
|
|
|
|
|
|
||||
Net financing charges
|
$
|
136
|
|
|
$
|
66
|
|
|
*
|
|
Three Months Ended
December 31, |
|
|
|||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|||||
|
|
|
|
|
|
|||||
Equity income
|
$
|
55
|
|
|
$
|
42
|
|
|
31
|
%
|
|
Three Months Ended
December 31, |
|
|
||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
||||
|
|
|
|
|
|
||||
Income tax provision (benefit)
|
$
|
(27
|
)
|
|
$
|
83
|
|
|
*
|
Effective tax rate
|
-7
|
%
|
|
22
|
%
|
|
|
|
Three Months Ended
December 31, |
|
|
||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
||||
|
|
|
|
|
|
||||
Income (loss) from discontinued operations, net of tax
|
$
|
(34
|
)
|
|
$
|
187
|
|
|
*
|
|
Three Months Ended
December 31, |
|
|
|||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|||||
|
|
|
|
|
|
|||||
Income from continuing operations attributable to noncontrolling interests
|
$
|
40
|
|
|
$
|
23
|
|
|
74
|
%
|
Income from discontinued operations attributable to noncontrolling interests
|
9
|
|
|
17
|
|
|
-47
|
%
|
|
Three Months Ended
December 31, |
|
|
||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
||||
|
|
|
|
|
|
||||
Net income attributable to Johnson Controls
|
$
|
329
|
|
|
$
|
450
|
|
|
*
|
|
Three Months Ended
December 31, |
|
|
||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
||||
|
|
|
|
|
|
||||
Comprehensive income (loss) attributable to Johnson
Controls
|
$
|
(332
|
)
|
|
$
|
289
|
|
|
*
|
|
Net Sales
Three Months Ended
December 31,
|
|
|
|
Segment EBITA
Three Months Ended
December 31,
|
|
|
||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Building Efficiency
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Systems and Service North America
|
$
|
928
|
|
|
$
|
984
|
|
|
-6
|
%
|
|
$
|
75
|
|
|
$
|
99
|
|
|
-24
|
%
|
Products North America
|
543
|
|
|
557
|
|
|
-3
|
%
|
|
37
|
|
|
33
|
|
|
12
|
%
|
||||
Asia
|
1,042
|
|
|
992
|
|
|
5
|
%
|
|
119
|
|
|
70
|
|
|
70
|
%
|
||||
Rest of World
|
398
|
|
|
423
|
|
|
-6
|
%
|
|
(10
|
)
|
|
(3
|
)
|
|
*
|
|
||||
|
2,911
|
|
|
2,956
|
|
|
-2
|
%
|
|
221
|
|
|
199
|
|
|
11
|
%
|
||||
Tyco
|
2,275
|
|
|
—
|
|
|
*
|
|
|
214
|
|
|
—
|
|
|
*
|
|
||||
|
$
|
5,186
|
|
|
$
|
2,956
|
|
|
75
|
%
|
|
$
|
435
|
|
|
$
|
199
|
|
|
*
|
|
•
|
The decrease in Systems and Service North America was due to lower volumes of controls systems and service ($42 million), and a prior year business divestiture ($14 million). The decrease in volumes was primarily attributable to lower performance contracting activity.
|
•
|
The decrease in Products North America was due to lower volumes ($10 million), a prior year business divestiture ($3 million) and the unfavorable impact of foreign currency translation ($1 million).
|
•
|
The increase in Asia was due to the favorable impact of foreign currency translation ($29 million), higher volumes of equipment and control systems ($17 million), and higher service volumes ($11 million), partially offset by lower volumes related to a business deconsolidation ($7 million). The increase in volumes was primarily due to favorable local market conditions.
|
•
|
The decrease in Rest of World was due to lower volumes in the Middle East ($20 million), a prior year business divestiture ($7 million) and the unfavorable impact of foreign currency translation ($7 million), partially offset by higher volumes in Latin America ($7 million) and Europe ($2 million).
|
•
|
The increase in Tyco was due to incremental sales related to the Tyco Merger ($2,275 million).
|
•
|
The decrease in Systems and Service North America was due to lower volumes ($12 million), higher operating costs ($7 million), current year integration costs ($3 million), unfavorable pricing and mix ($3 million), current year transaction costs ($2 million) and a prior year business divestiture ($1 million), partially offset by lower selling, general and administrative expenses ($4 million).
|
•
|
The increase in Products North America was due to lower operating costs ($9 million), and lower selling, general and administrative expenses ($4 million), partially offset by lower volumes ($4 million), current year transaction costs ($1 million), current year integration costs ($1 million), unfavorable pricing and mix ($1 million), lower equity income ($1 million) and the unfavorable impact of foreign currency translation ($1 million).
|
•
|
The increase in Asia was due to lower operating costs due to cost reduction initiatives ($14 million), higher equity income ($13 million), prior year transaction costs ($9 million), higher volumes ($7 million), lower selling, general and administrative expenses ($7 million), and prior year integration costs ($3 million), partially offset by unfavorable pricing and mix ($2 million), and the unfavorable impact of foreign currency translation ($2 million).
|
•
|
The decrease in Rest of World was due to lower equity income ($6 million), lower volumes ($5 million), higher operating costs ($1 million), current year integration costs ($1 million) and the unfavorable impact of foreign currency translation ($1 million), partially offset by lower selling, general and administrative expenses ($7 million).
|
•
|
The increase in Tyco was due to incremental operating income related to the Tyco Merger ($349 million), partially offset by the impact of nonrecurring purchasing accounting adjustments ($112 million), current year transaction costs ($14 million) and current year integration costs ($9 million).
|
|
Three Months Ended
December 31, |
|
|
|||||||
(in millions)
|
2016
|
|
2015
|
|
Change
|
|||||
|
|
|
|
|
|
|||||
Net sales
|
$
|
1,900
|
|
|
$
|
1,740
|
|
|
9
|
%
|
Segment EBITA
|
389
|
|
|
360
|
|
|
8
|
%
|
•
|
Net sales increased due to higher volumes ($96 million), the impact of higher lead costs on pricing ($47 million), and favorable pricing and product mix ($28 million), partially offset by the unfavorable impact of foreign currency translation ($11 million). The increase in volumes was driven by start-stop battery volumes and growth in China. Additionally, higher start-stop volumes contributed to favorable product mix.
|
•
|
Segment EBITA increased due to higher volumes ($27 million), favorable pricing and product mix ($21 million), and higher equity income ($4 million), partially offset by higher operating costs primarily driven by efforts to satisfy growing customer demand ($19 million), the unfavorable impact of foreign currency translation ($2 million), higher selling, general and administrative expenses ($1 million), and transaction costs ($1 million).
|
|
December 31,
|
|
September 30,
|
|
|
|||||
(in millions)
|
2016
|
|
2016
|
|
Change
|
|||||
|
|
|
|
|
|
|||||
Current assets
|
$
|
10,966
|
|
|
$
|
17,109
|
|
|
|
|
Current liabilities
|
(11,459
|
)
|
|
(16,331
|
)
|
|
|
|||
|
(493
|
)
|
|
778
|
|
|
*
|
|
||
|
|
|
|
|
|
|||||
Less: Cash
|
(377
|
)
|
|
(579
|
)
|
|
|
|||
Add: Short-term debt
|
2,379
|
|
|
1,078
|
|
|
|
|||
Add: Current portion of long-term debt
|
520
|
|
|
628
|
|
|
|
|||
Less: Assets held for sale
|
(173
|
)
|
|
(5,812
|
)
|
|
|
|||
Add: Liabilities held for sale
|
31
|
|
|
4,276
|
|
|
|
|||
Working capital (as defined)
|
$
|
1,887
|
|
|
$
|
369
|
|
|
*
|
|
|
|
|
|
|
|
|||||
Accounts receivable
|
$
|
6,057
|
|
|
$
|
6,394
|
|
|
-5
|
%
|
Inventories
|
2,943
|
|
|
2,888
|
|
|
2
|
%
|
||
Accounts payable
|
3,453
|
|
|
4,000
|
|
|
-14
|
%
|
||
|
|
|
|
|
|
|||||
* 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 underlying operating performance.
|
•
|
The increase in working capital at
December 31, 2016
as compared to
September 30, 2016
was primarily due to income tax payments related to the Adient spin-off and a decrease in accounts payable due to timing of supplier payments.
|
•
|
The Company’s days sales in accounts receivable at
December 31, 2016
were 66, higher than 61 days at
September 30, 2016
. 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
December 31, 2016
were lower than the comparable period ended
September 30, 2016
, primarily due to changes in inventory production levels.
|
•
|
Days in accounts payable at
December 31, 2016
were 65 days, lower than 69 days at the comparable period ended
September 30, 2016
.
|
|
Three Months Ended
December 31, |
||||||
(in millions)
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Cash used by operating activities
|
$
|
(1,900
|
)
|
|
$
|
(13
|
)
|
Cash used by investing activities
|
(331
|
)
|
|
(384
|
)
|
||
Cash provided by financing activities
|
1,979
|
|
|
214
|
|
||
Capital expenditures
|
(371
|
)
|
|
(282
|
)
|
•
|
The increase in cash used by operating activities for the three months ended
December 31, 2016
was primarily due to higher income tax payments related to the Adient spin-off ($1.2 billion in the first quarter of fiscal 2017), and unfavorable changes in accounts payable and accrued liabilities and accounts receivable.
|
•
|
The decrease in cash used by investing activities for the three months ended
December 31, 2016
was primarily due to cash paid for the Hitachi investment in the prior year, partially offset by an increase in capital expenditures.
|
•
|
The increase in cash provided by financing activities for the three months ended
December 31, 2016
was primarily due to the dividend from the Adient spin-off, an increase in short-term debt, a decrease in dividends paid due to timing and a decrease in dividends paid to noncontrolling interest in the current year, partially offset by repayment of long-term debt and cash transferred to Adient related to the spin-off.
|
•
|
The increase in capital expenditures for the three months ended
December 31, 2016
primarily relates to Tyco capital investments in the current year and higher capital investments in the Building Efficiency business.
|
|
December 31,
|
|
September 30,
|
|
|
|||||
(in millions)
|
2016
|
|
2016
|
|
Change
|
|||||
|
|
|
|
|
|
|||||
Short-term debt
|
$
|
2,379
|
|
|
$
|
1,078
|
|
|
|
|
Current portion of long-term debt
|
520
|
|
|
628
|
|
|
|
|||
Long-term debt
|
10,351
|
|
|
11,053
|
|
|
|
|||
Total debt
|
13,250
|
|
|
12,759
|
|
|
4
|
%
|
||
|
|
|
|
|
|
|||||
Shareholders’ equity attributable to Johnson Controls
ordinary shareholders
|
19,577
|
|
|
24,118
|
|
|
-19
|
%
|
||
|
|
|
|
|
|
|||||
Total capitalization
|
$
|
32,827
|
|
|
$
|
36,877
|
|
|
-11
|
%
|
|
|
|
|
|
|
|||||
Total debt as a % of total capitalization
|
40
|
%
|
|
35
|
%
|
|
|
•
|
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.
|
•
|
In connection with the Tyco Merger, on December 28, 2016, the Company completed its offers to exchange all validly tendered and accepted notes of certain series (the "existing notes") issued by JCI Inc. or Tyco International Finance S.A. ("TIFSA"), as applicable, each of which is a wholly owned subsidiary of the Company, for the new notes to be issued by the Company and the related solicitation of consents to amend the indentures governing the existing notes (the offers to exchange and the related consent solicitation together the "exchange offers"). Pursuant to the exchange offers, the Company exchanged approximately $5.6 billion of $6.0 billion in aggregate principal amount of dollar denominated notes and approximately 423 million euro of 500 million euro in aggregate principal amount of euro denominated notes. All were validly tendered and accepted and notes have been canceled. Following such cancellation, $380,948,000 aggregate principal amount of existing notes (not including the TIFSA Euro Notes) will remain outstanding across seventeen series of dollar-denominated existing notes and 77,394,000 euro aggregate principal amount of TIFSA Euro Notes remain outstanding across one series. In connection with the settlement of the exchange offers, the new notes ("the New Notes") issued by the Company have been registered under the Securities Act of 1933. The terms of the New Notes are described in the Company’s Prospectus dated December 19, 2016, as filed with the SEC under Rule 424(b)(3) of the Act on that date. The issuance of the New Notes occurred on December 28, 2016. The New Notes are unsecured and unsubordinated obligations of the Company and will rank equally with all other unsecured and unsubordinated indebtedness of the Company issued from time to time.
|
•
|
In December 2016, the Company entered into a 364-day 100 million euro floating rate term loan scheduled to mature in December 2017. Proceeds from the term loan were used for general corporate purposes.
|
•
|
In December 2016, a $100 million committed revolving credit facility expired. There were no draws on the facility.
|
•
|
In November 2016, the Company fully repaid its 37 billion yen syndicated floating rate term loan, plus accrued interest, scheduled to mature in June 2020.
|
•
|
In November 2016, a $35 million committed revolving credit facility expired. There were no draws on the facility.
|
•
|
In October 2016, the Company repaid two ten-month, floating rate term loans totaling $325 million, plus accrued interest, scheduled to mature in October 2016.
|
•
|
In October 2016, the Company repaid a nine-month $100 million floating rate term loan, plus accrued interest, scheduled to mature in November 2016.
|
•
|
In October 2016, the Company repaid a nine-month 100 million euro floating rate term loan, plus accrued interest, scheduled to mature in October 2016.
|
•
|
The Company also selectively makes use of short-term credit lines other than its revolving credit facilities at the Company and TSarl. The Company estimates that, as of
December 31, 2016
, it could borrow up to $1.2 billion based on average borrowing levels during the quarter on committed credit lines.
|
•
|
The Company believes its capital resources and liquidity position at
December 31, 2016
are adequate to meet projected needs. The Company believes requirements for working capital, capital expenditures, dividends, stock repurchases, minimum pension contributions, debt maturities and any potential acquisitions in the remainder of fiscal 2017 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 and TSarl are unable to issue commercial paper, they would have the ability to draw on their $2.0 billion and $1.0 billion revolving credit facilities, respectively. Both facilities mature in August 2020. There were no draws on the revolving credit facility as of
December 31, 2016
and
September 30, 2016
. As such, the Company believes it has sufficient financial resources to fund operations and meet its obligations for the foreseeable future.
|
•
|
The Company earns a significant amount of its operating income outside of the parent company. Outside basis differences in these subsidiaries are deemed to be permanently reinvested. The Company currently does not intend nor foresee a need to repatriate undistributed earnings included in the outside basis differences other than in tax efficient manners. However, in fiscal 2016, the Company did provide income tax expense related to a change in the Company's assertion over a portion of the permanently reinvested earnings as a result of the planned spin-off of the Automotive Experience business. Except as noted, the Company’s intent is to reduce basis differences only when it would be tax efficient. The Company expects existing U.S. cash and liquidity to continue to be sufficient to fund the Company’s U.S. 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 non-U.S. cash, cash equivalents, short-term investments and cash flows from operations to continue to be sufficient to fund the Company’s non-U.S. 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 in the U.S., the Company could elect to raise capital in the U.S. through debt or equity issuances. In addition, should the Company require more capital at the Luxembourg and Ireland holding and financing entities, other than amounts that can be provided in tax efficient methods, the Company could also elect to raise capital 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 in the U.S. and continues to have the ability to borrow funds in the U.S. at reasonable interest rates.
|
•
|
The Company’s debt financial covenants in its revolving credit facility require a minimum consolidated shareholders’ equity attributable to Johnson Controls 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 for liens and pledges. For purposes of calculating the covenants, consolidated shareholders’ equity attributable to Johnson Controls is calculated without giving effect to (i) the application of Accounting Standards Codification (ASC) 715-60, "Defined Benefit Plans - Other Postretirement," or (ii) the cumulative foreign currency translation adjustment. TSarl's, revolving credit facility contains customary terms and conditions, and financial covenants that limit the ratio of TSarl's debt to earnings before interest, taxes, depreciation, and amortization and excluding special items to 3.5x and that limit its ability to incur subsidiary debt or grant liens on its property. As of December 31, 2016, the Company and TSarl were in compliance with all covenants and other requirements set forth in their credit agreements and indentures and expect to remain in compliance for the foreseeable future. None of the Company’s or TSarl's debt agreements limit access to stated borrowing levels or require accelerated repayment in the event of a decrease in the respective borrower'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
|
||||||
10/1/16 - 10/31/16
|
|
|
|
|
|
|
|
||||||
Purchases by Company
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
538,072,815
|
|
11/1/16 - 11/30/16
|
|
|
|
|
|
|
|
||||||
Purchases by Company
|
—
|
|
|
—
|
|
|
—
|
|
|
538,072,815
|
|
||
12/1/16 - 12/31/16
|
|
|
|
|
|
|
|
||||||
Purchases by Company
|
—
|
|
|
—
|
|
|
—
|
|
|
538,072,815
|
|
||
10/1/16 - 10/31/16
|
|
|
|
|
|
|
|
||||||
Purchases by Citibank
|
—
|
|
|
—
|
|
|
—
|
|
|
NA
|
|
||
11/1/16 - 11/30/16
|
|
|
|
|
|
|
|
||||||
Purchases by Citibank
|
—
|
|
|
—
|
|
|
—
|
|
|
NA
|
|
||
12/1/16 - 12/31/16
|
|
|
|
|
|
|
|
||||||
Purchases by Citibank
|
—
|
|
|
—
|
|
|
—
|
|
|
NA
|
|
|
|
JOHNSON CONTROLS INTERNATIONAL PLC
|
|
|
|
||
Date: February 8, 2017
|
|
By:
|
/s/ Brian J. Stief
|
|
|
|
Brian J. Stief
|
|
|
Executive Vice President and
Chief Financial Officer
|
Exhibit No.
|
Description
|
|
|
4.1
|
Indenture, dated December 28, 2016, between Johnson Controls International plc and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 to the registrant’s Current Report on Form 8-K filed on December 28, 2016).
|
|
|
4.2
|
First Supplemental Indenture, dated December 28, 2016, between Johnson Controls International plc, and U.S. Bank National Association, as trustee, and Elavon Financial Services DAC, UK Branch, as paying agent for the New Euro Notes (incorporated by reference to Exhibit 4.2 to the registrant’s Current Report on Form 8-K filed on December 28, 2016).
|
|
|
4.3
|
Supplemental Indenture No. 1, dated December 9, 2016, between Johnson Controls, Inc. (the “Company”) and U.S. Bank National Association, as trustee (the “Trustee”), supplementing that certain Indenture, dated as of February 22, 1995 between the Company and the Trustee (incorporated by reference to Exhibit 4.1 to the registrant’s Current Report on Form 8-K filed on December 12, 2016).
|
|
|
4.4
|
Supplemental Indenture No. 1, dated December 9, 2016, between Johnson Controls, Inc. (the “Company”) and U.S. Bank National Association, as trustee (the “Trustee”), supplementing that certain Indenture, dated as of January 17, 2006 between the Company and the Trustee (incorporated by reference to Exhibit 4.2 to the registrant’s Current Report on Form 8-K filed on December 12, 2016).
|
|
|
4.5
|
Supplemental Indenture No. 3, dated December 9, 2016, between Johnson Controls, Inc. (the “Company”) and U.S. Bank National Association, as trustee (the “Trustee”), supplementing that certain Indenture, dated as of March 16, 2009 between the Company and the Trustee (incorporated by reference to Exhibit 4.3 to the registrant’s Current Report on Form 8-K filed on December 12, 2016).
|
|
|
4.6
|
Sixth Supplemental Indenture, dated December 9, 2016, among Tyco International Finance S.A. (the “Company”), Johnson Controls International plc, Inc. (formerly Tyco International plc), Tyco Fire & Security Finance S.A. and Deutsche Bank Trust Company Americas, as trustee (the “Trustee”), supplementing that certain Indenture, dated as of January 9, 2009, between the Company and the Trustee (incorporated by reference to Exhibit 4.4 to the registrant’s Current Report on Form 8-K filed on December 12, 2016).
|
|
|
4.7
|
Fourth Supplemental Indenture, dated December 9, 2016, among Tyco International Finance S.A. (the “Company”), Johnson Controls International plc (formerly named Tyco International plc), Tyco Fire & Security Finance S.C.A. and Deutsche Bank Trust Company Americas, as trustee (the “Trustee”), supplementing that certain Indenture, dated as of February 15, 2015, between the Company and the Trustee (incorporated by reference to Exhibit 4.5 to the registrant’s Current Report on Form 8-K filed on December 12, 2016).
|
|
|
10.1
|
Form of terms and conditions for Option / SAR Awards, and Restricted Stock / Unit Awards, under the Johnson Controls International plc 2012 Share and Incentive Plan for periods commencing on September 2, 2016 applicable to Messrs. Molinaroli, Oliver and Stief (filed herewith) *
|
|
|
15.1
|
Letter of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm, dated February 8, 2017, relating to Financial Information.
|
|
|
Exhibit No.
|
Description
|
|
|
31.1
|
Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
31.2
|
Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.1
|
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.
|
|
|
101
|
The following materials from Johnson Controls, Inc.’s Quarterly Report on Form 10-Q for the quarter ended December 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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(a)
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“Award” means this grant of Restricted Shares and/or Restricted Share Units.
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(b)
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“Award Notice” means the Award notification delivered to the Participant.
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(c)
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“Cause” means (i) if the Participant is subject to an employment agreement with the Company or a Subsidiary that contains a definition of “cause”, such definition, or (ii) otherwise, any of the following as determined by the Committee: (A) violation of the provisions of any employment agreement, non-competition agreement, confidentiality agreement, or similar agreement with the Company or a Subsidiary, or the Company’s or a Subsidiary’s code of ethics, as then in effect, (B) conduct rising to the level of gross negligence or willful misconduct in the course of employment with the Company or a Subsidiary, (C) commission of an act of dishonesty or disloyalty involving the Company or a Subsidiary, (D) violation of any federal, state or local law in connection with the Participant’s employment or service, or (E) breach of any fiduciary duty to the Company or a Subsidiary.
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(d)
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“Company” means Johnson Controls International plc, an Irish public limited company, or any successor thereto.
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(e)
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“Fair Market Value” means, per Share on a particular date, the closing sales price on such date on the New York Stock Exchange, or if no sales of Shares occur on the date in question, on the next preceding date on which there was a sale on such market.
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(f)
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“Inimical Conduct” means any act or omission that is inimical to the best interests of the Company or any Affiliate as determined by the Administrator in its sole discretion, including but not limited to: (i) violation of any employment, noncompete, confidentiality or other agreement in effect with the Company or any Affiliate, (ii) taking any steps or doing anything which would damage or negatively reflect on the reputation of the Company or an Affiliate, or (iii) failure to comply with applicable laws relating to trade secrets, confidential information or unfair competition.
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(g)
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“Plan” means the Johnson Controls International plc 2012 Share and Incentive Plan (as amended and restated as of September 2, 2016) and as may be further amended from time to time.
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(h)
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“Restriction Period” means the length of time indicated in the Award Notice during which the Award is subject to vesting. During the Restriction Period, the Participant cannot sell, transfer, pledge, assign or otherwise encumber the Restricted Shares or Restricted Share Units (or a portion thereof) subject to this Award.
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(i)
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“Restricted Share” means a Share that is subject to a risk of forfeiture and the Restriction Period.
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(j)
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“Restricted Share Unit” means the right to receive a payment, in cash or Shares, equal to the Fair Market Value of one Share, that is subject to a risk of forfeiture and the Restriction Period.
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(k)
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“Retirement” means termination of employment from the Company and its Subsidiaries (for other than Cause) on or after attainment of age fifty-five (55) and completion of five (5) years of continuous service with the Company and its Subsidiaries (including, for Participants who are Legacy Johnson Controls Employees, service with Johnson Controls, Inc. and its affiliates prior to the Merger).
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(l)
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“Share” means an ordinary share in the capital of the Company.
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1.
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Grant of Award
. Subject to the terms and conditions of the Plan, a copy of which has been delivered to the Participant and made a part of this Award, and to the terms and conditions of this Award Agreement, the Company grants to the Participant an award of Restricted Shares or Restricted Share Units, as specified in the Award Notice, on the date and with respect to the number of Shares specified in the Award Notice.
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2.
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Restricted Shares
. If the Award is in the form of Restricted Shares, the Shares are subject to the following terms:
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a.
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Restriction Period
.
The Company will hold the Shares in escrow for the Restriction Period. During this period, the Shares shall be subject to forfeiture as provided in Section 4.
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b.
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Removal of Restrictions
. Subject to any applicable deferral election under the Johnson Controls International plc Executive Deferred Compensation Plan (or any successor or similar deferred compensation plan for which the Participant is eligible) and to Section 4 below, Shares that have not been forfeited shall become available to the Participant after the last day of the Restriction Period upon payment in full of all taxes due with respect to such Shares.
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c.
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Voting Rights
. During the Restriction Period, the Participant may exercise full voting rights with respect to the Shares.
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d.
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Dividends and Other Distributions
. Any cash dividends or other distributions paid or delivered with respect to Restricted Shares for which the record date occurs on or before the last day of the Restriction Period will be credited to a bookkeeping account for the benefit of the Participant. For U.S. domestic Participants, the account will be converted into and settled in additional Shares issued under the Plan at the end of the applicable Restriction Period; for all other Participants, the account will be paid to the Participant in cash at the end of the applicable Restriction Period. Prior to the end of the Restriction Period, such account will be subject to the same terms and conditions (including risk of forfeiture) as the Restricted Shares to which the dividends or other distributions relate.
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3.
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Restricted Share Units.
If the Award is in the form of Restricted Share Units
,
the Restricted Share Units are subject to the following terms:
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a.
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Restriction Period
. During the Restriction Period, the Restricted Share Units shall be subject to forfeiture as provided in Section 4.
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b.
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Settlement of Restricted Share Units
. Subject to any applicable deferral election under the Johnson Controls International plc Executive Deferred Compensation Plan (or any successor or similar deferred compensation plan for which the Participant is eligible) and to Section 4 below, the Restricted Share Units shall be settled by, for U.S. domestic Participants, payment of one Share per Restricted Share Unit or, for all other Participants, payment of cash equal to the Fair Market Value of one Share (on the last day of the Restriction Period) per Restricted Share Unit or, at the discretion of the Company, one Share per Restricted Share Unit, in each case within forty-five (45) days after the last day of the Restriction Period and upon payment in full of all taxes due with respect to such Restricted Share Units (subject to a six-month delay to the extent required to comply with Code Section 409A).
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c.
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Dividend Equivalent Units
. Any cash dividends or other distributions paid or delivered with respect to the Shares for which the record date occurs on or before the last day of the Restriction Period will result in a credit to a bookkeeping account for the benefit of the Participant. The credit will be equal to the dividends or other distributions that would have been paid with respect to the Shares subject
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4.
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Termination of Employment - Risk of Forfeiture.
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a.
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Retirement
. If the Participant terminates employment from the Company and its Affiliates due to Retirement on or after the first anniversary of the date on which this Award is granted, and at a time when the Participant could not have been terminated for Cause, then any remaining Restriction Period shall continue as if the Participant continued in active employment. If the Participant engages in Inimical Conduct after his Retirement, as determined by the Committee, any Restricted Stock and/or Restricted Stock Units still subject to a Restriction Period shall automatically be forfeited as of the date of the Committee’s determination.
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b.
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Death
. If the Participant’s employment with the Company and its Affiliates terminates because of death at a time when the Participant could not have been terminated for Cause, then, effective as of the date the Company determines the Participant’s employment terminated due to death (provided such determination is made no later than the end of the calendar year following the calendar year in which death occurs), the Participant shall become fully vested in all of the Restricted Shares or Restricted Share Units subject to this Award and any remaining Restriction Period shall automatically lapse.
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c.
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Disability
. If the Participant’s employment with the Company and its Affiliates terminates because of Disability at a time when the Participant could not have been terminated for Cause, then the Participant shall become fully vested in all of the Restricted Shares or Restricted Share Units subject to this Award and any remaining Restriction Period shall automatically lapse as of the date of such termination of employment.
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d.
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Divestiture or Outsourcing
. If the Participant’s employment with the Company and its Affiliates terminates as a result of a Disposition of Assets, Disposition of a Subsidiary or Outsourcing Agreement (each as defined below), at a time when the Participant could not have been terminated for Cause, then the Participant shall become vested in a pro rata portion of the total number of Restricted Shares or Restricted Share Units subject to this Award based on the number of full months of the Participant’s employment during the Restriction Period prior to such Disposition of Assets, Disposition of a Subsidiary or Outsourcing Agreement compared to the total number of full months in the original Restriction Period (with an offset for any Restricted Shares or Restricted Share Units that have previously vested); provided that, if such termination of employment does not constitute a “separation from service” within the meaning of Code Section 409A, then any remaining Restriction Period shall continue with respect to the vested Shares or Restricted Share Units as if the Participant continued in active employment to the extent required for compliance with Code Section 409A. Any Restricted Shares or Restricted Share Units subject to this Award that do not become vested under this paragraph as a result of such Disposition of Assets, Disposition of a Subsidiary or Outsourcing Agreement shall automatically be forfeited and returned to the Company as of the date of the Disposition of Assets, Disposition of a Subsidiary or Outsourcing Agreement, as applicable. Notwithstanding the foregoing, the Participant shall not be eligible for such pro rata vesting if (i) the Participant’s termination of employment occurs on or prior to the closing date of such Disposition of Assets or Disposition of a Subsidiary, as applicable, or on such later date as is specifically provided in the applicable transaction agreement or related agreements, or on the effective date of such Outsourcing Agreement applicable to the Participant (the “Applicable Employment Date”), and (ii) the Participant is offered Comparable Employment (as defined below) with the buyer, successor company or outsourcing agent, as applicable, but does not commence such employment on the Applicable Employment Date.
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e.
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Other Termination.
If the Participant’s employment terminates for any reason not described above (including for Cause), then any Restricted Shares or any Restricted Share Units (and all deferred dividends paid or credited thereon) still subject to the Restriction Period as of the date of such termination shall automatically be forfeited and returned to the Company. In the event of the Participant’s involuntary termination of employment by the Company or an Affiliate for other than Cause, the Committee may waive the automatic forfeiture of any or all such Restricted Shares or Restricted Share Units (and all deferred dividends or other distribution paid or credited thereon) and may add such new restrictions to such Restricted Shares or Restricted Share Units as it deems appropriate. The Company may suspend payment or delivery of Shares (without liability for interest thereon) pending the Committee’s determination of whether the Participant was or should have been terminated for Cause.
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5.
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Withholding
. The Participant agrees to remit to the Company any foreign, Federal, state and/or local taxes (including the Participant’s FICA tax obligation) required by law to be withheld with respect to the issuance of Shares under this Award, the vesting of this Award or the payment of cash under this Award. Notwithstanding anything to the contrary in this Award, if the Company or any Affiliate of the Company is required to withhold any Federal, state or local taxes or other amounts in connection with the Award, then the Company may require the Participant to pay to the Company, in cash, promptly on demand, amounts sufficient to satisfy such tax obligations or make other arrangements satisfactory to the Company regarding the payment to the Company of the aggregate amount of any such taxes and other amounts. Alternatively, the Company can withhold Shares no longer restricted, or can withhold from cash or property, including cash or Shares under this Award, payable or issuable to the Participant, in the amount needed to satisfy any withholding obligations; provided that, to the extent Shares are withheld to satisfy taxes, the amount to be withheld may not exceed the total minimum statutory tax withholding obligations associated with the transaction to the extent needed for the Company and its Subsidiaries to avoid an accounting charge until Accounting Standards Update 2016-09 applies to the Company, after which time the amount to be withheld may not exceed the total maximum statutory tax rates associated with the transaction.
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6.
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No Claim for Forfeiture
. Neither the Award nor any benefit accruing to the Participant from the Award will be considered to be part of the Participant’s normal or expected compensation or salary for any purposes, including, but not limited to, calculating any severance, resignation, termination, redundancy, dismissal, end-of-service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments. In no event may the Award or any benefit accruing to the Participant from the Award be considered as compensation for, or relating in any way to, past services for the Company or any Affiliate. In consideration of the Award, no claim or entitlement to compensation or damages shall arise from forfeiture of the Award resulting from termination of the Participant’s employment by the Company or any Affiliate (for any reason whatsoever and whether or not in breach of local labor laws) and the Participant irrevocably releases the Company and its Affiliates from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by acknowledging the grant, the Participant shall have been deemed irrevocably to have waived any entitlement to pursue such claim.
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7.
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Electronic Delivery
. The Company or its Affiliates may, in its or their sole discretion, decide to deliver any documents related to current or future participation in the Plan or related to this Award by electronic means. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate
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8.
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Securities Compliance.
The Company may place a legend or legends upon the certificates for Shares issued under the Plan and may issue “stop transfer” instructions to its transfer agent in respect of such Shares as it determines to be necessary or appropriate to (a) prevent a violation of, or to obtain an exemption from, the registration requirements of the Securities Act of 1933, as amended, applicable state securities laws or other legal requirements, or (b) implement the provisions of the Plan, this Award or any other agreement between the Company and the Participant with respect to such Shares.
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9.
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Successors
. All obligations of the Company under this Award shall be binding on any successor to the Company. The terms of this Award and the Plan shall be binding upon and inure to the benefit of the Participant, and his or her heirs, executors, administrators or legal representatives.
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10.
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Legal Compliance
. The granting of this Award and the issuance of Shares under this Award shall be subject to all applicable laws, rules, and regulations and to such approvals by any governmental agencies or national securities exchanges as may be required.
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11.
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Governing Law; Arbitration
. This Award, and the interpretation of this Award Agreement, shall be governed by (a) the internal laws of Ireland (without reference to conflict of law principles thereof that would direct the application of the laws of another jurisdiction) with respect to the validity and authorization of any Shares issued under this Award, and (b) the internal laws of the State of Wisconsin (without reference to conflict of law principles thereof that would direct the application of the laws of another jurisdiction) with respect to all other matters. Arbitration will be conducted per the provisions in the Plan.
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12.
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Data Privacy and Sharing
. As a condition of the granting of the Award, the Participant acknowledges and agrees that it is necessary for some of the Participant’s personal identifiable information to be provided to certain employees of the Company, the third party data processor that administers the Plan and the Company’s designated third party broker in the United States. These transfers will be made pursuant to a contract that requires the processor to provide adequate levels of protection for data privacy and security interests in accordance with the EU Data Privacy Directive 95/46 EC and the implementing legislation of the Participant’s home country (or any successor or superseding regulation). By acknowledging the Award, the Participant acknowledges having been informed of the processing of the Participant’s personal identifiable information described in the preceding paragraph and consents to the Company collecting and transferring to the Company's Shareholder Services Department, and its independent benefit plan administrator and third party broker, the Participant’s personal data that are necessary to administer the Award and the Plan. The Participant understands that his or her personal information may be transferred, processed and stored outside of the Participant’s home country in a country that may not have the same data protection laws as his or her home country, for the purposes mentioned in this Award.
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13.
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Non-Competition; Non-Solicitation
.
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a.
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Except as prohibited by law, the Participant agrees that during his or her employment with the Company or its Affiliates, and for the one year period following the Participant’s termination of employment for any reason, the Participant will not directly or indirectly, own, manage, operate, control (including indirectly through a debt, equity investment, or otherwise), provide services to, or be employed by, any person or entity engaged in any business that is (i) located in a region with respect to which the Participant had substantial responsibilities while employed by the Company or its Affiliates, and (ii) competitive, with (A) the line of business or businesses of the Company or its Subsidiaries that the Participant was employed with during the Participant’s employment (including any prospective business to be developed or acquired that was proposed at the date of termination), or (B) any other business of the Company or its Subsidiaries with respect to which the Participant had substantial exposure during such employment.
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b.
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Except as prohibited by law, the Participant further agrees that during his or her employment with the Company or its Affiliates, and for the two-year period thereafter, the Participant will not, directly or indirectly, on his or her own behalf or on behalf of another (i) solicit, recruit, aid or induce any employee of the Company or any of its Affiliates to leave their employment with the Company or its Affiliates in
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c.
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Irreparable injury will result to the Company, and to its business, in the event of a breach by the Participant of any of the Participant’s covenants and commitments under this Award, including the covenants of non-competition and non-solicitation. Therefore, in the event of a breach of such covenants and commitments, in the sole discretion of the Company, any of the Participant’s unvested Restricted Shares or Restricted Share Units shall be immediately rescinded and the Participant will forfeit any rights he or she has with respect thereto. Furthermore, by acknowledging this Award, and not declining the Award, in the event of such a breach, upon demand by the Company, the Participant hereby agrees and promises immediately to deliver to the Company the number of Shares (or, in the discretion of the Company, the cash value of said Shares) the Participant received for Restricted Share Units that vested or were delivered during the period beginning six months prior to the Participant’s termination of employment and ending on the six-month anniversary of such termination of employment. In addition, the Company reserves all rights to seek any and all remedies and damages permitted under law, including, but not limited to, injunctive relief, equitable relief and compensatory damages. The Participant further acknowledges and confirms that the terms of this section, including but not limited to the time and geographic restrictions, are reasonable, fair, just and enforceable by a court.
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(m)
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“Award” means this grant of Options and/or an SAR.
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(n)
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“Award Notice” means the Award notification delivered to the Participant.
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(o)
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“Cause” means (i) if the Participant is subject to an employment agreement with the Company or a Subsidiary that contains a definition of “cause”, such definition, or (ii) otherwise, any of the following as determined by the Committee: (A) violation of the provisions of any employment agreement, non-competition agreement, confidentiality agreement, or similar agreement with the Company or a Subsidiary, or the Company’s or a Subsidiary’s code of ethics, as then in effect, (B) conduct rising to the level of gross negligence or willful misconduct in the course of employment with the Company or a Subsidiary, (C) commission of an act of dishonesty or disloyalty involving the Company or a Subsidiary, (D) violation of any federal, state or local law in connection with the Participant’s employment or service, or (E) breach of any fiduciary duty to the Company or a Subsidiary.
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(p)
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“Company” means Johnson Controls International plc, an Irish public limited company, or any successor thereto.
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(q)
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“Fair Market Value” means, per Share on a particular date, the closing sales price on such date on the New York Stock Exchange, or if no sales of Shares occur on the date in question, on the next preceding date on which there was a sale on such market.
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(r)
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“Grant Date” is the date the Award was made to the Participant, as specified in the Award Notice.
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(s)
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“Inimical Conduct” means any act or omission that is inimical to the best interests of the Company or any Affiliate as determined by the Committee in its sole discretion, including but not limited to: (i) violation of any employment, noncompete, confidentiality or other agreement in effect with the Company or any Affiliate, (ii) taking any steps or doing anything which would damage or negatively reflect on the reputation of the Company or an Affiliate, or (iii) failure to comply with applicable laws relating to trade secrets, confidential information or unfair competition.
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(t)
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“Option” means this nonqualified share option representing the right to purchase Shares at a stated price for a specified period of time.
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(u)
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“Plan” means the Johnson Controls International plc 2012 Share and Incentive Plan (as amended and restated as of September 2, 2016) and as may be further amended from time to time.
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(v)
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“Retirement” means termination of employment from the Company and its Subsidiaries (for other than Cause) on or after attainment of age fifty-five (55) and completion of five (5) years of continuous service with the Company and its Subsidiaries (including, for Participants who are Legacy Johnson Controls Employees, service with Johnson Controls, Inc. and its affiliates prior to the Merger).
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(w)
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“SAR” is an Award of Share Appreciation Rights which will be settled in cash. The Participant will receive the economic equivalent of the excess of the Fair Market Value on the exercise date over the Exercise Price.
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(x)
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“Share” means an ordinary share in the capital of the Company.
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(a)
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Fifty Percent (50%) of the Award shall vest on the second anniversary of the Grant Date.
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(b)
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Fifty Percent (50%) of the Award shall vest on the third anniversary of the Grant Date.
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1.
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I have reviewed this quarterly report on Form 10-Q of Johnson Controls International plc;
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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 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 International plc;
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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
December 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 International plc.
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/s/ Alex A. Molinaroli
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Alex A. Molinaroli
Chairman 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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