Johnson Controls Inc.'s (JCI) fiscal fourth-quarter profit
surged from a year-ago quarter that included a restructuring
charge, as core results edged analysts' expectations despite
continuing weak demand.
It was the second straight profitable quarter for the auto-parts
and heating-systems maker, which also reaffirmed its forecast for
the new fiscal year. Chief Executive Stephen A. Roell said two
weeks ago he expected the company's earnings to continue to
strengthen through the new fiscal year "and beyond."
Two weeks ago, Johnson Controls forecast a recovery in U.S.
construction in the second half of next year but remained cautious
about the auto sector. The segments account for a half and a third
of its revenue, respectively. The company has cut 15,000 jobs, most
of them from the auto business.
Profit rose to $300 million, or 47 cents a share, from $16
million, or 3 cents, a year earlier. Johnson Controls' estimate two
weeks ago was for earnings of 40 cents to 42 cents, above analysts
estimates at the time. Excluding items, among them a $495 million
year-ago restructuring charge, earnings fell to 52 cents from 73
cents.
Sales dropped 16% to $7.87 billion.
Analysts surveyed by Thomson Reuters were expecting earnings,
excluding items, of 51 cents on revenue of $7.83 billion.
Gross margin fell to 14.5% from 15.3% amid the sales
decline.
The automotive unit, which builds seats and interiors, swung to
a profit, helped by cost cutting, while sales dropped 14% on lower
North American and European auto production. The unit's results
also were helped by a $299 milion government-stimulus grant to
build a manufacturing facility for hybrid- and electric-vehicle
batteries.
The building segment, which makes heating, ventilating and
air-conditioning products, saw its earnings drop 57% as sales fell
16%.
Shares closed Monday at $26.28 and didn't trade premarket.
-By Mike Barris, Dow Jones Newswires; 212-416-2330;
mike.barris@dowjones.com