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FOR IMMEDIATE RELEASE                                     

                    
CONTACT:
Investors:
Antonella Franzen
(609) 720-4665

Ryan Edelman
(609) 720-4545

Media:
Fraser Engerman
(414) 524-2733
Exhibit 99.1



Johnson Controls reports solid fiscal Q2 earnings with stronger orders and free cash flow
________________________________________________________________________________
GAAP earnings of $0.47 per share including special items
Adjusted EPS from continuing operations of $0.53, up 6% versus prior year
Sales of $7.5 billion, up 3%, reflecting organic growth of 1% versus prior year
Buildings organic sales growth in service and products up 3% and 6%, respectively
Buildings field orders up 7% organically with continued strong quoting activity
Adjusted free cash flow of $0.6 billion in Q2; $0.3 billion year-to-date
Re-affirm full year fiscal 2018 guidance for adjusted EPS from continuing operations in the range of $2.75 to $2.85
________________________________________________________________________________

CORK, Ireland, May 1, 2018 -- Johnson Controls International plc (NYSE: JCI) today reported fiscal second quarter 2018 GAAP earnings per share (“EPS”) from continuing operations, including special items, of $0.47. Excluding these items, adjusted EPS from continuing operations was $0.53, up 6% versus the prior year period (see attached footnotes for non-GAAP reconciliation).
Sales of $7.5 billion increased 3% compared to the prior year. Excluding the impacts of M&A, foreign currency and lead prices, total sales grew 1% organically.
GAAP earnings before interest and taxes (“EBIT”) was $676 million and EBIT margin was 9.0%. Adjusted EBIT was $740 million and adjusted EBIT margin was 9.9%, up 10 basis points over the prior year. Excluding the impact of the Scott Safety divestiture, foreign currency, and lead prices, the underlying adjusted EBIT margin increased 30 basis points.



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“Second quarter results represent an important step in the continued transformation of Johnson Controls,” said George Oliver, Johnson Controls chairman & chief executive officer. “We reported another quarter of solid operational performance and momentum continues to build. I am encouraged by the continued strength in orders across the Buildings platform driven by the significant efforts we have made to increase capacity and drive improved sales execution. In addition, we are monetizing investments in sales and product and channel investments with 3% organic service growth and 6% organic product growth,” Oliver continued.
“In Power Solutions, we are encouraged by our new business wins in both Original Equipment and Aftermarket, driven by improved service levels and shifts to new technologies. We expect to see this momentum positively impact our top line growth as we move into the second half of the fiscal year. In addition, we are making good progress on our Power Solutions strategic review.”

Income and EPS amounts attributable to Johnson Controls ordinary shareholders
($ millions, except per-share amounts)
The financial highlights presented in the tables below are in accordance with GAAP, unless otherwise indicated. All comparisons are to the second quarter of 2017.
 
 
GAAP
 
GAAP
 
Adjusted
 
Adjusted
 
 
 
 
Q2 2017
 
Q2 2018
 
Q2 2017
 
Q2 2018
 
Change
 
 
 
 
 
 
 
 
 
 
 
Sales
 
$7,267
 
$7,475
 
$7,237
 
$7,475
 
+3%
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA
 
956
 
929
 
931
 
944
 
+1%
 
 
 
 
 
 
 
 
 
 
 
EBIT
 
509
 
676
 
711
 
740
 
+4%
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) from continuing operations
 
(148)
 
438
 
473
 
493
 
+4%
 
 
 
 
 
 
 
 
 
 
 
Diluted EPS from continuing operations
 
$(0.16)
 
$0.47
 
$0.50
 
$0.53
 
+6%
Organic sales growth, adjusted segment EBITA, adjusted EBIT, adjusted EPS from continuing operations and adjusted free cash flow are non-GAAP financial measures. For a reconciliation of these non-GAAP measures and detail of the special items, refer to the attached footnotes. A slide presentation reviewing second quarter results can be found in the Investor Relations section of Johnson Controls’ website at http://investors.johnsoncontrols.com.










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BUSINESS RESULTS
Building Solutions North America
 
 
GAAP
 
GAAP
 
Adjusted
 
Adjusted
 
 
 
 
Q2 2017
 
Q2 2018
 
Q2 2017
 
Q2 2018
 
Change
 
 
 
 
 
 
 
 
 
 
 
Sales
 
$2,097
 
$2,097
 
$2,074
 
$2,097
 
+1%
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA
 
$255
 
$239
 
$229
 
$244
 
+7%
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA margin %
 
12.2%
 
11.4%
 
11.0%
 
11.6%
 
+60bps
Sales in the second quarter of 2018 were $2.1 billion, an increase of 1% versus the prior year quarter. Excluding M&A and foreign currency, organic sales also increased 1% versus the prior year, driven primarily by solid growth in HVAC & Controls.
Orders in the quarter, excluding M&A and adjusted for foreign currency, increased 4% year-over-year. Backlog at the end of the quarter of $5.3 billion increased 5% year-over-year, excluding M&A and adjusted for foreign currency.
Adjusted segment EBITA was $244 million, up 7% versus the prior year. Adjusted segment EBITA margin of 11.6% increased 60 basis points driven by cost synergies and productivity savings as well as favorable volume/mix, partially offset by expected low margin backlog conversion and salesforce additions.

Building Solutions EMEA/LA (Europe, Middle East, Africa/Latin America)
 
 
GAAP
 
GAAP
 
Adjusted
 
Adjusted
 
 
 
 
Q2 2017
 
Q2 2018
 
Q2 2017
 
Q2 2018
 
Change
 
 
 
 
 
 
 
 
 
 
 
Sales
 
$898
 
$907
 
$891
 
$907
 
+2%
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA
 
$89
 
$77
 
$79
 
$78
 
(1%)
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA margin %
 
9.9%
 
8.5%
 
8.9%
 
8.6%
 
(30bps)
Sales in the second quarter of 2018 were $907 million, an increase of 2% versus the prior year quarter. Excluding M&A and foreign currency, organic sales declined 3% versus the prior year driven by lower volumes across Europe and the Middle East, partially offset by continued strength in Latin America.
Orders in the quarter, excluding M&A and adjusted for foreign currency, increased 10% year-over-year. Backlog at the end of the quarter of $1.7 billion increased modestly year-over-year, excluding M&A and adjusted for foreign currency.






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Adjusted segment EBITA was $78 million, down 1% versus the prior year quarter. Adjusted segment EBITA margin of 8.6% declined 30 basis points over the prior year, as the benefit from cost synergies and productivity savings was more than offset by lower volume de-leverage.

Building Solutions Asia Pacific
 
 
GAAP
 
GAAP
 
Adjusted
 
Adjusted
 
 
 
 
Q2 2017
 
Q2 2018
 
Q2 2017
 
Q2 2018
 
Change
 
 
 
 
 
 
 
 
 
 
 
Sales
 
$562
 
$586
 
$562
 
$586
 
+4%
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA
 
$67
 
$71
 
$67
 
$71
 
+6%
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA margin %
 
11.9%
 
12.1%
 
11.9%
 
12.1%
 
+20bps
Sales in the second quarter of 2018 were $586 million, an increase of 4% versus the prior year quarter. Excluding M&A and foreign currency, organic sales declined 2% versus the prior year, as strong growth in service was more than offset by declines in project installations related to the timing of large project flow-through.
Orders in the quarter, excluding M&A and adjusted for foreign currency, increased 10% year-over-year. Backlog at the end of the quarter of $1.5 billion was 15% higher year-over-year, excluding M&A and adjusted for foreign currency.
Adjusted segment EBITA was $71 million, up 6% versus the prior year. Adjusted segment EBITA margin of 12.1% expanded 20 basis points over the prior year, including a 40 basis point headwind related to foreign currency. Adjusting for foreign currency, the underlying margin improved 60 basis points driven by favorable mix as well as the benefit of cost synergies and productivity savings, partially offset by salesforce additions.

Global Products
 
 
GAAP
 
GAAP
 
Adjusted
 
Adjusted
 
 
 
 
Q2 2017
 
Q2 2018
 
Q2 2017
 
Q2 2018
 
Change
 
 
 
 
 
 
 
 
 
 
 
Sales
 
$2,014
 
$2,040
 
$2,014
 
$2,040
 
+1%
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA
 
$242
 
$228
 
$253
 
$237
 
(6%)
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA margin %
 
12.0%
 
11.2%
 
12.6%
 
11.6%
 
 (100bps)







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Sales in the second quarter of 2018 were $2.0 billion, an increase of 1% versus the prior year quarter. Excluding M&A and foreign currency, organic sales increased 6% versus the prior year driven by mid-single digit growth in Building Management and HVAC & Refrigeration Equipment, and low-teens growth in Specialty Products.
Adjusted segment EBITA was $237 million, down 6% versus the prior year, primarily attributable to the impact of the Scott Safety divestiture. Adjusted segment EBITA margin of 11.6% declined 100 basis points over the prior year including a 120 basis point headwind related to the divestiture of the Scott Safety business. The underlying margin expanded 20 basis points as the benefit of cost synergies and productivity savings as well as favorable volume leverage was partially offset by planned product and channel investments and expected price/cost pressure.

Power Solutions
 
 
GAAP
 
GAAP
 
Adjusted
 
Adjusted
 
 
 
 
Q2 2017
 
Q2 2018
 
Q2 2017
 
Q2 2018
 
Change
 
 
 
 
 
 
 
 
 
 
 
Sales
 
$1,696
 
$1,845
 
$1,696
 
$1,845
 
 +9%
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA
 
$303
 
$314
 
$303
 
$314
 
+4%
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA margin %
 
17.9%
 
17.0%
 
17.9%
 
17.0%
 
 (90bps)
Sales in the second quarter of 2018 were $1.8 billion, an increase of 9% versus the prior year quarter. Excluding the impact of higher lead pass-through and foreign currency, organic sales declined 2% as favorable price and technology mix was more than offset by lower unit volumes. Global original equipment battery shipments declined 2% in-line with overall market demand and aftermarket shipments declined 6% driven primarily by weather impacts in the U.S. and Europe. Start-stop battery shipments increased 14% year-over-year, led by growth in China and the Americas.
Power Solutions adjusted segment EBITA was $314 million, a 4% increase compared to the prior year. Adjusted segment EBITA margin of 17.0% decreased 90 basis points compared with the prior year, including a 60 basis point headwind related to the impact of foreign currency and lead prices. Power Solution’s underlying margin declined 30 basis points as favorable mix and productivity savings were more than offset by higher transportation costs and planned incremental investments.










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Corporate
 
 
GAAP
 
GAAP
 
Adjusted
 
Adjusted
 
 
 
 
Q2 2017
 
Q2 2018
 
Q2 2017
 
Q2 2018
 
Change
 
 
 
 
 
 
 
 
 
 
 
Corporate expense
 
$(240)
 
$(159)
 
$(128)
 
$(110)
 
(14%)
Adjusted Corporate expense was $110 million in the second quarter, a decrease of 14% compared to the prior year quarter driven primarily by cost synergies and productivity initiatives.

OTHER ITEMS

Cash from operating activities less capex was $0.4 billion for the quarter and nil year-to-date. Adjusted free cash flow was $0.6 billion for the quarter and $0.3 billion year-to-date. Adjusted free cash flow excludes net cash outflows of $0.2 billion in the quarter and $0.3 billion year-to-date primarily related to restructuring and integration costs.
 
During the quarter, the Company repurchased 1.3 million shares for approximately $50 million; year-to-date share repurchases totaled 4.9 million shares for approximately $200 million.

In March, the Company announced the decision to review strategic alternatives for its Power Solutions business and the review is ongoing.


###
About Johnson Controls
Johnson Controls is a global diversified technology and multi industrial leader serving a wide range of customers in more than 150 countries. Our 120,000 employees create intelligent buildings, efficient energy solutions, integrated infrastructure and next generation transportation systems that work seamlessly together to deliver on the promise of smart cities and communities. Our commitment to sustainability dates back to our roots in 1885, with the invention of the first electric room thermostat. We are committed to helping our customers win and creating greater value for all of our stakeholders through strategic focus on our buildings and energy growth platforms. For additional information, please visit http://www.johnsoncontrols.com or follow us @johnsoncontrols on Twitter.
###

Johnson Controls International plc Cautionary Statement Regarding Forward-Looking Statements
Johnson Controls International plc has made statements in this communication that are forward-looking and therefore are subject to risks and uncertainties. All statements in this document other than statements of historical fact are, or could be, “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. In this communication, statements regarding Johnson Controls’ future financial position, sales, costs, earnings, cash flows, other measures of results of operations, synergies and integration

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opportunities, capital expenditures and debt levels are forward-looking statements. Words such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “should,” “forecast,” “project” or “plan” and terms of similar meaning are also generally intended to identify forward-looking statements. However, the absence of these words does not mean that a statement is not forward-looking. Johnson Controls cautions that these statements are subject to numerous important risks, uncertainties, assumptions and other factors, some of which are beyond Johnson Controls’ control, that could cause Johnson Controls’ actual results to differ materially from those expressed or implied by such forward-looking statements, including, among others, risks related to: any delay or inability of Johnson Controls to realize the expected benefits and synergies of recent portfolio transactions such as the merger with Tyco and the spin-off of Adient, changes in tax laws (including but not limited to the recently enacted Tax Cuts and Jobs Act), regulations, rates, policies or interpretations, the loss of key senior management, the tax treatment of recent portfolio transactions, significant transaction costs and/or unknown liabilities associated with such transactions, the outcome of actual or potential litigation relating to such transactions, the risk that disruptions from recent transactions will harm Johnson Controls’ business, the strength of the U.S. or other economies, automotive vehicle production levels, mix and schedules, energy and commodity prices, the availability of raw materials and component products, currency rates, cancellation of or changes to commercial arrangements, and with respect to the recently announced review of strategic alternatives for the Power Solutions business, uncertainties as to the structure and timing of any transaction and whether it will be completed, the possibility that closing conditions for a transaction may not be satisfied or waived, the impact of the strategic review and any transaction on Johnson Controls and the Power Solutions business on a standalone basis if a transaction is completed, and whether the strategic benefits of any transaction can be achieved. A detailed discussion of risks related to Johnson Controls’ business is included in the section entitled “Risk Factors” in Johnson Controls’ Annual Report on Form 10-K for the 2017 fiscal year filed with the SEC on November 21, 2017, and its Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2017 filed with the SEC on February 2, 2018, both of which are and available at www.sec.gov and www.johnsoncontrols.com under the “Investors” tab. Shareholders, potential investors and others should consider these factors in evaluating the forward-looking statements and should not place undue reliance on such statements. The forward-looking statements included in this communication are made only as of the date of this document, unless otherwise specified, and, except as required by law, Johnson Controls assumes no obligation, and disclaims any obligation, to update such statements to reflect events or circumstances occurring after the date of this communication.

###
Non GAAP Financial Information
The Company's press release contains financial information regarding adjusted earnings per share, which is a non-GAAP performance measure. The adjusting items include mark-to-market for pension and postretirement plans, transaction/integration/separation costs, restructuring and impairment costs, nonrecurring purchase accounting impacts related to the Tyco merger, Scott Safety gain on sale and discrete tax items. Financial information regarding adjusted sales, organic sales, adjusted segment EBITA, adjusted segment EBITA margin and adjusted free cash flow are also presented, which are non-GAAP performance measures. Adjusted segment EBITA excludes special items such as transaction/integration/separation costs and nonrecurring purchase accounting impacts because these costs are not considered to be directly related to the underlying operating performance of its business units. Management believes that, when considered together with unadjusted amounts, these non-GAAP measures are useful to investors in understanding period-over-period operating results and business trends of the Company. Management may also use these metrics as guides in forecasting, budgeting and long-term planning processes and for compensation purposes. These metrics should be considered in addition to, and not as replacements for, the most comparable GAAP measure.
###

Page 7 of 17







JOHNSON CONTROLS INTERNATIONAL PLC
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in millions, except per share data; unaudited)
 
 
Three Months Ended March 31,
 
 
2018
 
 
2017
 
 
 
 
 
 
Net sales
$
7,475

 
 
$
7,267

Cost of sales
5,255

 
 
4,986

 
Gross profit
2,220

 
 
2,281

 
 
 
 
 
 
Selling, general and administrative expenses
(1,588
)
 
 
(1,726
)
Restructuring and impairment costs

 
 
(99
)
Net financing charges
(115
)
 
 
(116
)
Equity income
44

 
 
53

 
 
 
 
 
 
Income from continuing operations before income taxes
561

 
 
393

 
 
 
 
 
 
Income tax provision
78

 
 
508

 
 
 
 
 
 
Income (loss) from continuing operations
483

 
 
(115
)
 
 
 
 
 
 
Loss from discontinued operations, net of tax

 
 

 
 
 
 
 
 
Net income (loss)
483

 
 
(115
)
 
 
 
 
 
 
Less: Income from continuing operations
     attributable to noncontrolling interests
45

 
 
33

Less: Income from discontinued operations
     attributable to noncontrolling interests

 
 

 
 
 
 
 
 
Net income (loss) attributable to JCI
$
438

 
 
$
(148
)
 
 
 
 
 
 
Income (loss) from continuing operations
$
438

 
 
$
(148
)
Loss from discontinued operations

 
 

 
 
 
 
 
Net income (loss) attributable to JCI
$
438

 
 
$
(148
)
 
 
 
 
 
 
Diluted earnings (loss) per share from continuing operations
$
0.47

 
 
$
(0.16
)
Diluted loss per share from discontinued operations

 
 

Diluted earnings (loss) per share
$
0.47

 
 
$
(0.16
)
 
 
 
 
 
 
Diluted weighted average shares
932.5

 
 
939.2

Shares outstanding at period end
926.2

 
 
938.1








Page 8 of 17







JOHNSON CONTROLS INTERNATIONAL PLC
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in millions, except per share data; unaudited)
 
 
Six Months Ended March 31,
 
 
2018
 
 
2017
 
 
 
 
 
 
Net sales
$
14,910

 
 
$
14,353

Cost of sales
10,521

 
 
9,958

 
Gross profit
4,389

 
 
4,395

 
 
 
 
 
 
Selling, general and administrative expenses
(3,005
)
 
 
(3,296
)
Restructuring and impairment costs
(158
)
 
 
(177
)
Net financing charges
(231
)
 
 
(252
)
Equity income
104

 
 
108

 
 
 
 
 
 
Income from continuing operations before income taxes
1,099

 
 
778

 
 
 
 
 
 
Income tax provision
345

 
 
481

 
 
 
 
 
 
Income from continuing operations
754

 
 
297

 
 
 
 
 
 
Loss from discontinued operations, net of tax

 
 
(34
)
 
 
 
 
 
 
Net income
754

 
 
263

 
 
 
 
 
 
Less: Income from continuing operations
     attributable to noncontrolling interests
86

 
 
73

Less: Income from discontinued operations
     attributable to noncontrolling interests

 
 
9

 
 
 
 
 
 
Net income attributable to JCI
$
668

 
 
$
181

 
 
 
 
 
 
Income from continuing operations
$
668

 
 
$
224

Loss from discontinued operations

 
 
(43
)
 
 
 
 
 
Net income attributable to JCI
$
668

 
 
$
181

 
 
 
 
 
 
Diluted earnings per share from continuing operations
$
0.72

 
 
$
0.24

Diluted loss per share from discontinued operations

 
 
(0.05
)
Diluted earnings per share
$
0.72

 
 
$
0.19

 
 
 
 
 
 
Diluted weighted average shares
932.9

 
 
948.0

Shares outstanding at period end
926.2

 
 
938.1






Page 9 of 17







JOHNSON CONTROLS INTERNATIONAL PLC
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(in millions; unaudited)
 
 
March 31,
2018
 
September 30,
2017
ASSETS
 
 
 
Cash and cash equivalents
$
268

 
$
321

Accounts receivable - net
6,679

 
6,666

Inventories
3,565

 
3,209

Assets held for sale
22

 
189

Other current assets
1,737

 
1,907

 
Current assets
12,271

 
12,292

 
 
 
 
 
Property, plant and equipment - net
6,235

 
6,121

Goodwill
19,806

 
19,688

Other intangible assets - net
6,625

 
6,741

Investments in partially-owned affiliates
1,294

 
1,191

Noncurrent assets held for sale

 
1,920

Other noncurrent assets
3,721

 
3,931

 
Total assets
$
49,952

 
$
51,884

 
 
 
 
 
LIABILITIES AND EQUITY
 
 
 
Short-term debt and current portion of long-term debt
$
1,136

 
$
1,608

Accounts payable and accrued expenses
5,116

 
5,342

Liabilities held for sale

 
72

Other current liabilities
4,740

 
4,832

 
Current liabilities
10,992

 
11,854

 
 
 
 
 
Long-term debt
10,962

 
11,964

Other noncurrent liabilities
5,883

 
6,315

Noncurrent liabilities held for sale

 
173

Redeemable noncontrolling interests
235

 
211

Shareholders' equity attributable to JCI
20,874

 
20,447

Noncontrolling interests
1,006

 
920

 
Total liabilities and equity
$
49,952

 
$
51,884











Page 10 of 17







JOHNSON CONTROLS INTERNATIONAL PLC
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions; unaudited)
 
 
 
 
 
 
Three Months Ended March 31,
 
 
 
 
 
 
2018
 
 
2017
Operating Activities
 
 
 
 
Net income (loss) attributable to JCI
$
438

 
 
$
(148
)
Income from continuing operations attributable to noncontrolling interests
45

 
 
33

Income from discontinued operations attributable to noncontrolling interests

 
 

 
 
 
 
 
 
 
 
 
 
Net income (loss)
483

 
 
(115
)
 
 
 
 
 
 
 
 
 
 
Adjustments to reconcile net income (loss) to cash provided by operating activities:
 
 
 
 
 
 
Depreciation and amortization
280

 
 
292

 
 
Pension and postretirement benefit income
(36
)
 
 
(47
)
 
 
Pension and postretirement contributions
(13
)
 
 
(11
)
 
 
Equity in earnings of partially-owned affiliates, net of dividends received
(43
)
 
 
(52
)
 
 
Deferred income taxes
2

 
 
479

 
 
Non-cash restructuring and impairment costs

 
 
23

 
 
Other - net
15

 
 
45

 
 
Changes in assets and liabilities, excluding acquisitions and divestitures:
 
 
 
 
 
 
 
 
Accounts receivable
138

 
 
(58
)
 
 
 
 
Inventories
(67
)
 
 
(228
)
 
 
 
 
Other assets
(49
)
 
 
(63
)
 
 
 
 
Restructuring reserves
(105
)
 
 
27

 
 
 
 
Accounts payable and accrued liabilities
102

 
 
197

 
 
 
 
Accrued income taxes
(45
)
 
 
(123
)
 
 
 
 
 
Cash provided by operating activities
662

 
 
366

 
 
 
 
 
 
 
 
 
 
Investing Activities
 
 
 
 
Capital expenditures
(267
)
 
 
(263
)
Sale of property, plant and equipment
5

 
 
16

Acquisition of businesses, net of cash acquired
(15
)
 
 
(3
)
Business divestitures, net of cash divested
103

 
 
133

Other - net
(2
)
 
 
(24
)
 
 
 
 
 
Cash used by investing activities
(176
)
 
 
(141
)
 
 
 
 
 
 
 
 
 
 
Financing Activities
 
 
 
 
Increase (decrease) in short and long-term debt - net
(497
)
 
 
220

Debt financing costs

 
 
(11
)
Stock repurchases
(49
)
 
 
(119
)
Payment of cash dividends
(241
)
 
 
(235
)
Proceeds from the exercise of stock options
20

 
 
59

Dividends paid to noncontrolling interests
(46
)
 
 
(47
)
Cash transferred to Adient related to spin-off

 
 
(101
)
Cash paid related to prior acquisitions

 
 
8

Other - net
(1
)
 
 
6

 
 
 
 
 
Cash used by financing activities
(814
)
 
 
(220
)
Effect of exchange rate changes on cash and cash equivalents
44

 
 
30

Increase (decrease) in cash and cash equivalents
$
(284
)
 
 
$
35


Page 11 of 17







JOHNSON CONTROLS INTERNATIONAL PLC
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions; unaudited)
 
 
 
 
 
 
Six Months Ended March 31,
 
 
 
 
 
 
2018
 
 
2017
Operating Activities
 
 
 
 
Net income attributable to JCI
$
668

 
 
$
181

Income from continuing operations attributable to noncontrolling interests
86

 
 
73

Income from discontinued operations attributable to noncontrolling interests

 
 
9

 
 
 
 
 
 
 
 
 
 
Net income
754

 
 
263

 
 
 
 
 
 
 
 
 
 
Adjustments to reconcile net income to cash provided (used) by operating activities:
 
 
 
 
 
 
Depreciation and amortization
552

 
 
638

 
 
Pension and postretirement benefit income
(72
)
 
 
(202
)
 
 
Pension and postretirement contributions
(37
)
 
 
(258
)
 
 
Equity in earnings of partially-owned affiliates, net of dividends received
(79
)
 
 
(116
)
 
 
Deferred income taxes
(77
)
 
 
1,059

 
 
Non-cash restructuring and impairment costs
30

 
 
39

 
 
Gain on Scott Safety business divestiture
(114
)
 
 

 
 
Other - net
32

 
 
82

 
 
Changes in assets and liabilities, excluding acquisitions and divestitures:
 
 
 
 
 
 
 
 
Accounts receivable
108

 
 
(21
)
 
 
 
 
Inventories
(300
)
 
 
(370
)
 
 
 
 
Other assets
15

 
 
(150
)
 
 
 
 
Restructuring reserves
(12
)
 
 
47

 
 
 
 
Accounts payable and accrued liabilities
(521
)
 
 
(599
)
 
 
 
 
Accrued income taxes
254

 
 
(1,931
)
 
 
 
 
 
Cash provided (used) by operating activities
533

 
 
(1,519
)
 
 
 
 
 
 
 
 
 
 
Investing Activities
 
 
 
 
Capital expenditures
(497
)
 
 
(634
)
Sale of property, plant and equipment
10

 
 
18

Acquisition of businesses, net of cash acquired
(15
)
 
 
(6
)
Business divestitures, net of cash divested
2,114

 
 
180

Other - net
(14
)
 
 
(30
)
 
 
 
 
 
Cash provided (used) by investing activities
1,598

 
 
(472
)
 
 
 
 
 
 
 
 
 
 
Financing Activities
 
 
 
 
Increase (decrease) in short and long-term debt - net
(1,542
)
 
 
776

Debt financing costs
(4
)
 
 
(17
)
Stock repurchases
(199
)
 
 
(119
)
Payment of cash dividends
(473
)
 
 
(235
)
Proceeds from the exercise of stock options
36

 
 
88

Dividends paid to noncontrolling interests
(46
)
 
 
(78
)
Dividend from Adient spin-off

 
 
2,050

Cash transferred to Adient related to spin-off

 
 
(665
)
Cash paid related to prior acquisitions

 
 
(37
)
Other - net
(26
)
 
 
(19
)
 
 
 
 
 
Cash provided (used) by financing activities
(2,254
)
 
 
1,744

Effect of exchange rate changes on cash and cash equivalents
61

 
 
(25
)
Change in cash held for sale
9

 
 
105

Decrease in cash and cash equivalents
$
(53
)
 
 
$
(167
)

Page 12 of 17







FOOTNOTES
1. Financial Summary

The Company evaluates the performance of its business units primarily on segment earnings before interest, taxes and amortization (EBITA), which represents income from continuing operations before income taxes and noncontrolling interests, excluding general corporate expenses, intangible asset amortization, net financing charges, significant restructuring and impairment costs, and the net mark-to-market adjustments related to pension and postretirement plans.
 
Three Months Ended March 31,
(in millions; unaudited)
2018
 
2017
 
Actual
 
Adjusted Non-GAAP
 
Actual
 
Adjusted Non-GAAP
 
 
 
 
 
 
 
 
Net sales (1)
 
 
 
 
 
 
 
Building Solutions North America
$
2,097

 
$
2,097

 
$
2,097

 
$
2,074

Building Solutions EMEA/LA
907

 
907

 
898

 
891

Building Solutions Asia Pacific
586

 
586

 
562

 
562

Global Products
2,040

 
2,040

 
2,014

 
2,014

Total Building Technologies & Solutions
5,630

 
5,630

 
5,571

 
5,541

Power Solutions
1,845

 
1,845

 
1,696

 
1,696

               Net sales
$
7,475

 
$
7,475

 
$
7,267

 
$
7,237

 
 
 
 
 
 
 
 
Segment EBITA (1)
 
 
 
 
 
 
 
Building Solutions North America
$
239

 
$
244

 
$
255

 
$
229

Building Solutions EMEA/LA
77

 
78

 
89

 
79

Building Solutions Asia Pacific
71

 
71

 
67

 
67

Global Products
228

 
237

 
242

 
253

Total Building Technologies & Solutions
615

 
630

 
653

 
628

Power Solutions
314

 
314

 
303

 
303

               Segment EBITA
929

 
944

 
956

 
931

 
 
 
 
 
 
 
 
Corporate expenses (2)
(159
)
 
(110
)
 
(240
)
 
(128
)
Amortization of intangible assets (3)
(94
)
 
(94
)
 
(126
)
 
(92
)
Mark-to-market gain for pension plans (4)

 

 
18

 

Restructuring and impairment costs (5)

 

 
(99
)
 

               EBIT (6)
676

 
740

 
509

 
711

               EBIT margin
9.0
%
 
9.9
%
 
7.0
%
 
9.8
%
 
 
 
 
 
 
 
 
Net financing charges (7)
(115
)
 
(115
)
 
(116
)
 
(116
)
Income from continuing operations before income taxes
561

 
625

 
393

 
595

Income tax provision (8)
(78
)
 
(87
)
 
(508
)
 
(89
)
Income (loss) from continuing operations
483

 
538

 
(115
)
 
506

Income from continuing operations attributable to
     noncontrolling interests
(45
)
 
(45
)
 
(33
)
 
(33
)
Net income (loss) from continuing operations attributable
     to JCI
$
438

 
$
493

 
$
(148
)
 
$
473


 
Six Months Ended March 31,
(in millions; unaudited)
2018
 
2017
 
Actual
 
Adjusted Non-GAAP
 
Actual
 
Adjusted Non-GAAP
 
 
 
 
 
 
 
 
Net sales (1)
 
 
 
 
 
 
 
Building Solutions North America
$
4,109

 
$
4,109

 
$
4,039

 
$
4,016

Building Solutions EMEA/LA
1,822

 
1,822

 
1,773

 
1,769

Building Solutions Asia Pacific
1,183

 
1,183

 
1,137

 
1,138

Global Products
3,821

 
3,821

 
3,808

 
3,814

Total Building Technologies & Solutions
10,935

 
10,935

 
10,757

 
10,737

Power Solutions
3,975

 
3,975

 
3,596

 
3,596

               Net sales
$
14,910

 
$
14,910

 
$
14,353

 
$
14,333

 
 
 
 
 
 
 
 
Segment EBITA (1)
 
 
 
 
 
 
 
Building Solutions North America
$
466

 
$
480

 
$
451

 
$
465

Building Solutions EMEA/LA
146

 
149

 
138

 
144

Building Solutions Asia Pacific
145

 
145

 
130

 
139

Global Products
514

 
415

 
369

 
458

Total Building Technologies & Solutions
1,271

 
1,189

 
1,088

 
1,206

Power Solutions
698

 
698

 
692

 
693

               Segment EBITA
1,969

 
1,887

 
1,780

 
1,899

 
 
 
 
 
 
 
 
Corporate expenses (2)
(293
)
 
(211
)
 
(433
)
 
(236
)
Amortization of intangible assets (3)
(188
)
 
(188
)
 
(275
)
 
(195
)
Mark-to-market gain for pension plans (4)

 

 
135

 

Restructuring and impairment costs (5)
(158
)
 

 
(177
)
 

               EBIT (6)
1,330

 
1,488

 
1,030

 
1,468

               EBIT margin
8.9
%
 
10.0
%
 
7.2
%
 
10.2
%
 
 
 
 
 
 
 
 
Net financing charges (7)
(231
)
 
(231
)
 
(252
)
 
(235
)
Income from continuing operations before income taxes
1,099

 
1,257

 
778

 
1,233

Income tax provision (8)
(345
)
 
(176
)
 
(481
)
 
(185
)
Income from continuing operations
754

 
1,081

 
297

 
1,048

Income from continuing operations attributable to
     noncontrolling interests
(86
)
 
(86
)
 
(73
)
 
(73
)
Net income from continuing operations attributable to JCI
$
668

 
$
995

 
$
224

 
$
975


Building Technologies & Solutions - Provides facility systems and services including comfort, energy and security management for the non-residential buildings market, and provides heating, ventilating, and air conditioning products and services, security products and services, and fire detection and suppression products and services.

Power Solutions - Services both automotive original equipment manufacturers and the battery aftermarket by providing advanced battery technology, coupled with systems engineering, marketing and service expertise.


Page 13 of 17



(1) The Company's press release contains financial information regarding adjusted net sales, adjusted segment EBITA and adjusted segment EBITA margins, which are non-GAAP performance measures. The Company's definition of adjusted segment EBITA excludes special items because these costs are not considered to be directly related to the underlying operating performance of its business units. Management believes these non-GAAP measures are useful to investors in understanding the ongoing operations and business trends of the Company.

The following is the three months ended March 31, 2018 and 2017 reconciliation of net sales, segment EBITA and segment EBITA margin as reported to adjusted net sales, adjusted segment EBITA and adjusted segment EBITA margin (unaudited):
(in millions)
Building Solutions
North America
 
Building Solutions EMEA/LA
 
Building Solutions
Asia Pacific
 
Global Products
 
Total Building Technologies & Solutions
 
2018
 
2017
 
2018
 
2017
 
2018
 
2017
 
2018
 
2017
 
2018
 
2017
Net sales as reported
$
2,097

 
$
2,097

 
$
907

 
$
898

 
$
586

 
$
562

 
$
2,040

 
$
2,014

 
$
5,630

 
$
5,571

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusting items:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Nonrecurring purchase accounting impacts

 
(23
)
 

 
(7
)
 

 

 

 

 

 
(30
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted net sales
$
2,097

 
$
2,074

 
$
907

 
$
891

 
$
586

 
$
562

 
$
2,040

 
$
2,014

 
$
5,630

 
$
5,541

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA as reported
$
239

 
$
255

 
$
77

 
$
89

 
$
71

 
$
67

 
$
228

 
$
242

 
$
615

 
$
653

Segment EBITA margin as reported
11.4
%
 
12.2
%
 
8.5
%
 
9.9
%
 
12.1
%
 
11.9
%
 
11.2
%
 
12.0
%
 
10.9
%
 
11.7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusting items:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Transaction costs

 
1

 

 
3

 

 

 

 
6

 

 
10

  Integration costs
5

 
7

 
1

 
2

 

 
2

 
9

 
5

 
15

 
16

  Nonrecurring purchase accounting impacts

 
(34
)
 

 
(15
)
 

 
(2
)
 

 

 

 
(51
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted segment EBITA
$
244

 
$
229

 
$
78

 
$
79

 
$
71

 
$
67

 
$
237

 
$
253

 
$
630

 
$
628

Adjusted segment EBITA margin
11.6
%
 
11.0
%
 
8.6
%
 
8.9
%
 
12.1
%
 
11.9
%
 
11.6
%
 
12.6
%
 
11.2
%
 
11.3
%


(in millions)
Total Building Technologies & Solutions
 
Power Solutions
 
Consolidated JCI plc
 
2018
 
2017
 
2018
 
2017
 
2018
 
2017
Net sales as reported
$
5,630

 
$
5,571

 
$
1,845

 
$
1,696

 
$
7,475

 
$
7,267

 
 
 
 
 
 
 
 
 
 
 
 
Adjusting items:
 
 
 
 
 
 
 
 
 
 
 
  Nonrecurring purchase accounting impacts

 
(30
)
 

 

 

 
(30
)
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted net sales
$
5,630

 
$
5,541

 
$
1,845

 
$
1,696

 
$
7,475

 
$
7,237

 
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA as reported
$
615

 
$
653

 
$
314

 
$
303

 
$
929

 
$
956

Segment EBITA margin as reported
10.9
%
 
11.7
%
 
17.0
%
 
17.9
%
 
12.4
%
 
13.2
%
 
 
 
 
 
 
 
 
 
 
 
 
Adjusting items:
 
 
 
 
 
 
 
 
 
 
 
  Transaction costs

 
10

 

 

 

 
10

  Integration costs
15

 
16

 

 

 
15

 
16

  Nonrecurring purchase accounting impacts

 
(51
)
 

 

 

 
(51
)
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted segment EBITA
$
630

 
$
628

 
$
314

 
$
303

 
$
944

 
$
931

Adjusted segment EBITA margin
11.2
%
 
11.3
%
 
17.0
%
 
17.9
%
 
12.6
%
 
12.9
%


The following is the six months ended March 31, 2018 and 2017 reconciliation of net sales, segment EBITA and segment EBITA margin as reported to adjusted net sales, adjusted segment EBITA and adjusted segment EBITA margin (unaudited):

(in millions)
Building Solutions
North America
 
Building Solutions EMEA/LA
 
Building Solutions Asia Pacific
 
Global Products
 
Total Building Technologies & Solutions
 
2018
 
2017
 
2018
 
2017
 
2018
 
2017
 
2018
 
2017
 
2018
 
2017
Net sales as reported
$
4,109

 
$
4,039

 
$
1,822

 
$
1,773

 
$
1,183

 
$
1,137

 
$
3,821

 
$
3,808

 
$
10,935

 
$
10,757

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusting items:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Nonrecurring purchase accounting impacts

 
(23
)
 

 
(4
)
 

 
1

 

 
6

 

 
(20
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted net sales
$
4,109

 
$
4,016

 
$
1,822

 
$
1,769

 
$
1,183

 
$
1,138

 
$
3,821

 
$
3,814

 
$
10,935

 
$
10,737

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Segment EBITA as reported
$
466

 
$
451

 
$
146

 
$
138

 
$
145

 
$
130

 
$
514

 
$
369

 
$
1,271

 
$
1,088

Segment EBITA margin as reported
11.3
%
 
11.2
%
 
8.0
%
 
7.8
%
 
12.3
%
 
11.4
%
 
13.5
%
 
9.7
%
 
11.6
%
 
10.1
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusting items:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Transaction costs

 
11

 

 
5

 

 
2

 

 
9

 

 
27

  Integration costs
14

 
14

 
3

 
4

 

 
3

 
15

 
9

 
32

 
30

  Scott Safety gain on sale

 

 

 

 

 

 
(114
)
 

 
(114
)
 

  Nonrecurring purchase accounting impacts

 
(11
)
 

 
(3
)
 

 
4

 

 
71

 

 
61

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted segment EBITA
$
480

 
$
465

 
$
149

 
$
144

 
$
145

 
$
139

 
$
415

 
$
458

 
$
1,189

 
$
1,206

Adjusted segment EBITA margin
11.7
%
 
11.6