JCI says divesting unprofitable interiors unit is an option

Andrew Thurlow
AUTOMOTIVE NEWS

Published: October 29, 2013 3:43 pm ET
Updated: October 29, 2013 4:32 pm ET

Related to this story

Topics Mergers & Acquisitions, Automotive, Injection Molding
Companies & Associations Johnson Controls Inc.

Johnson Controls Inc. said it would explore various options for its unprofitable automotive interiors unit, including a divestiture.

The plan is part of the Glendale, Wis.-based supplier's strategy under new CEO Alex Molinaroli, who replaced Steve Roell on Oct. 1. Molinaroli said JCI would make moves to become a more multi-industry company, focusing more efforts on its automotive battery and building efficiency units.

JCI's automotive interiors unit, which makes various components such as headliners and instrument panels, generated revenue of $4.2 billion and lost $13 million in the most recent fiscal year, the company said in a statement today. The company's seating operations are not included in the strategic review.

In late September, the company reported the sale of a portion of its electronics operations, HomeLink, to Gentex Corp. for $700 million. Gentex, which makes dimming rearview mirrors and other driver-assist systems, said in July that the deal would boost its yearly profits by $25 million to $150 million.

An announcement regarding the sale of the remaining electronics business, which totals to about $1 billion a year in sales, is expected to be made by the end of the calendar year, JCI said in a statement.

Also today, JCI posted a quarterly profit — excluding onetime items — of $657 million, up from $526 million in the fourth fiscal quarter a year ago. After onetime costs, the company said it posted net income of $105 million in the quarter vs. a loss of $8 million during the same period last year.

Its quarterly revenue also rose to $11.05 billion, compared to $10.39 billion in 2012.

The company's new CEO, Alex Molinaroli, said today that JCI expects earnings to rise 30 percent in the next quarter.

"While the macroeconomic environment continues to be challenging, each of our businesses generated top line growth in the fourth quarter. Even more importantly, they all had significant improvements in profitability," Molinaroli said.

Former CEO Steve Roell remains chairman of the board of directors until Dec. 31.


Comments

JCI says divesting unprofitable interiors unit is an option

Andrew Thurlow
AUTOMOTIVE NEWS

Published: October 29, 2013 3:43 pm ET
Updated: October 29, 2013 4:32 pm ET

Post Your Comments


Back to story


More stories

Image

Cambro investing $30.4 million in new N.C. injection molding plant

April 18, 2014 2:36 pm ET

Foodservice products manufacturer Cambro Manufacturing Co. Inc. plans to set up a satellite production and distribution operation in Mebane, N.C., to ...    More

Image

Increased orders prompt Georg Utz to add capacity, equipment in Indiana

April 18, 2014 12:20 pm ET

Plastic totes and tray orders have picked up to the point where manufacturer Georg Utz Inc. has added machines, silos and material feed systems to...    More

Image

Ascend targets nylon for auto applications, opening propylene monomer unit in Texas

April 18, 2014 10:57 am ET

Materials firm Ascend Performance Materials Inc. is in full operation at its new nylon 6/6 compounding line in Florida and will break ground by the...    More

PolyQuest spins off FiberQuest unit

April 18, 2014 10:14 am ET

PolyQuest Inc. has spun off its FiberQuest unit — which distributes polyester staple fibers and cotton — as a separate company.    More

Spain's Cristian Lay Group buys two materials units of bankrupt LSB

April 17, 2014 11:11 am ET

Spanish industrial conglomerate Cristian Lay Group has purchased two of the bankrupt Spanish PET packaging group La Seda de Barcelona.    More

Market Reports

Thermoformed Packaging 2014 Market Review & Outlook North America

This in-depth report provides analysis and discussions of economic and political conditions, market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as strategies being implemented by thermoformed packaging companies. In addition, there are reviews of 25 leading thermoformers in the packaging segment, assessing their growth initiatives and performance metrics over 10 years.

Learn more

Automotive Market Review and Outlook 2014 The Americas

This 75-page report features in-depth analysis of the automotive industry for the Americas. It includes discussions of market trends, legislative/regulatory activity impacting production and threats as well as design strategies being implemented by the major automakers. Detailed charts and data tables outline North American automotive production over the last five years.

Learn more

Plastics Building & Construction Market Review and Outlook 2014 with MS Excel chart data

This report provides in-depth analysis of the plastic building and construction market for North America, including discussions of trends, opportunities, threats and the latest developments in construction trends that impact plastics processors.

Learn more

Upcoming Plastics News Events

May 6, 2014 - May 8, 2014Plastics in Medical Devices 2014

May 12, 2014 - May 12, 2014Plastics News Brazil Pharma Summit

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

February 3, 2015 - February 7, 2015Plastics News Executive Forum 2015

More Events