Johnson Controls shows profit
Johnson Controls reported a profit of $0.26 per diluted share for the third quarter of 2009. Net sales in the quarter were $7 billion, with segment income of $282 million and net income of $163 million. These results compare with net sales of $9.9 billion, segment income of $645 million and net income of $439 million, or $0.73 per diluted share for the third quarter of 2008.
"In most of our global markets this quarter, economic conditions remain very challenging,” Steve Roell, chairman and CEO, said in a news release. “I am pleased to report that despite this environment, we returned to solid profitability. The cost improvement initiatives we undertook earlier this year are providing the expected benefits. We believe the company is well positioned to further increase our profitability in our fourth quarter and into 2010.”
“Automotive Experience” sales in the quarter declined 38 percent to $3 billion versus $4.8 billion last year due to significantly lower production volumes globally. Automotive industry production in North America was down 48 percent versus a year ago as a result of prolonged production shutdowns in the quarter as well as overall lower consumer demand. European production declined 27 percent. There were some positive volume comparisons in certain European countries where governments are providing incentives to consumers who scrap old cars and purchase new vehicles. The company said that most of these new vehicle sales were in the "A" and "B" (lower cost) segments.
“Building Efficiency” sales in the 2009 third quarter were $3.2 billion, down 14 percent from $3.7 billion last year. Excluding the effect of currency, sales were down 7 percent. In North America and Western Europe, systems and service revenues were lower, reflecting the overall slowdown in construction spending, lower HVAC equipment volumes and the continued deferral of discretionary maintenance and retrofit projects. In Eastern Europe, the Middle East and Latin America, revenue declines ranged from 10 to 15 percent excluding the impact of foreign exchange.
“Power Solutions” sales in the third quarter were $856 million, down 39 percent from $1.4 billion in the year ago period. Lower lead prices and currency translation negatively impacted revenues; overall unit volumes were 12 percent lower. Original equipment automotive battery volume was lower in both North America and Europe due to the decline in auto production levels.
Johnson Controls said that in the third quarter it started shipping the industry's first lithium-ion hybrid battery systems, for the Mercedes S-Class, which arrives in showrooms this summer.