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

Coveris makes another flexible packaging buy

August 22, 2014 9:34 am ET

Coveris Holdings is continuing its rapid acquisition pace, this time picking up flexible print specialist Learoyd Packaging (Holdings) Ltd. to boost...    More

Image

Making the most of complexity

August 22, 2014 1:02 pm ET

In the global market for injection molded parts, custom molders have tried a million different ways to differentiate themselves from the pack. Make...    More

Image

German injection molders Metz-Werke and Inotech to collaborate

August 21, 2014 11:47 am ET

German injection molding companies Metz-Werke GmbH & Co. KG and Inotech Kunststofftechnik GmbH have announced that they have joined forces to bring...    More

Image

Inteplast expands in corrugated sheet with Coroplast deal

August 21, 2014 5:28 pm ET

Packaging major Inteplast Group has acquired its main competitor in corrugated plastic sheet, Coroplast Inc. Inteplast gets corrugated sheet plants...    More

Image

NanoHolding, Applied Nanotech merge to form PEN Inc.

August 21, 2014 4:44 pm ET

Nanotechnology firms NanoHolding Inc. and Applied Nanotech Holdings Inc. are merging to create PEN Inc., a publicly held firm whose product mix will i...    More

Market Reports

Thermoformed Packaging 2014 Market Review & Outlook North America

This in-depth report analyzes economic and market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as growth strategies being implemented by thermoformed packaging companies.

Learn more

Pipe, Profile & Tubing Extrusion in North America 2014

U.S. demand for extruded plastics is expected to grow by 3 percent in 2014, with PVC remaining the largest segment.

Plastic pipe will post the strongest gains through 2018, continuing to take market share from competing materials in a range of markets.

Our latest market report provides in-depth analysis of current trends and their financial impact on the pipe, profile and tubing extrusion industry in North America.

Learn more

2014 Injection Molding Industry Report

GROWTH, OPPORTUNITY IN SIGHT FOR INJECTION MOLDERS IN 2014

In the wake of the economic turbulence earlier in this decade, molders today find themselves in much better shape. Molders are gaining a competitive advantage by investing in people, equipment and seeking inroads into new markets on a global scale.

Growth in the injection molding industry is going to be driven by low financing costs and a continued move to reshore some business.

Learn more

Upcoming Plastics News Events

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

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events