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Johnson Controls (JCI) Q4 Earnings Miss, Revenues Rise Y/Y
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Johnson Controls International plc (JCI - Free Report) reported fourth-quarter fiscal 2023 (ended Sep 30, 2023) adjusted earnings of $1.05 per share, which missed the Zacks Consensus Estimate of earnings of $1.09 per share. However, the bottom line increased 6.1% year over year.
Total revenues of $7,092 million missed the consensus estimate of $6,906 million. The top line increased 2.7% year over year.
Segmental Results
Building Solutions North America: The segment’s revenues were $2,778 million, up 8.4% year over year. Organic sales jumped 8%, owing to growth in the Service and Install businesses due to strong performances in HVAC & Controls and Fire & Security. The segment’s EBITA increased 13% year over year to $427 million.
Building Solutions Europe, Middle East, Africa/Latin America: Revenues from this segment totaled $1,045 million, up 7.1% year over year. Our estimate for Building Solutions Europe, Middle East, Africa/Latin America revenues for the fiscal fourth quarter was $1,071.2 million. Organic sales climbed 3% due to growth in Service and HVAC & Controls and Fire & Security businesses. The segment’s EBITA was $82 million, down 11% from the year-ago period.
Building Solutions Asia Pacific: Revenues decreased 7.2% to $697 million in the reported quarter. Our estimate for Building Solutions Asia-Pacific revenues was $779.0 million. Sales declined 6% organically because the Install business has been negatively impacted by weakness in China. The segment’s EBITA was $94 million, down 11% year over year.
Global Products: Revenues in this segment declined 2% year over year to $2,386 million. Our estimate for Global Products revenues in the fiscal fourth quarter was $2,527.2 million. Organic sales were down 2% due to a decline in global Residential sales. The segment’s EBITA was $502 million, down 6% year over year.
Johnson Controls International plc Price, Consensus and EPS Surprise
Johnson Controls had cash and cash equivalents of $835 million as of Sep 30, 2023, compared with $2,031 million at the end of fiscal 2022. Long-term debt was $7,818 million compared with $7,426 million at the end of fiscal 2022.
The company reported a free cash flow of $1,819 million in fiscal 2023 compared with $1,398 million in the year-ago period.
The company repurchased 10.5 million shares for approximately $625 million in fiscal 2023.
Fiscal Q1 Guidance
For the first quarter of fiscal 2024, Johnson Controls anticipates organic revenue growth to be flat year over year. The segment EBITA margin is estimated to be approximately 13%. The company expects adjusted earnings to be 48-50 cents per share in the fiscal first quarter. The Zacks Consensus Estimate is pegged at 66 cents per share.
FY24 Guidance
Johnson Controls anticipates year-over-year organic revenue growth to be in the mid-single digits in fiscal 2024. The adjusted segment EBITA margin is expected to improve 25 bps year over year.
JCI expects adjusted earnings to be approximately $3.65-$3.80 per share in fiscal 2024. The Zacks Consensus Estimate is pegged at $3.94.
Zacks Rank & Stocks to Consider
Johnson Controls currently carries a Zacks Rank #4 (Sell).
Some better-ranked companies from the Industrial Products sector are discussed below:
FLS delivered a trailing four-quarter average earnings surprise of 27.3%. In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2023 earnings has increased 3.1%. The stock has risen 25.7% in the past year.
Applied Industrial Technologies, Inc. (AIT - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 13.9%.
The consensus estimate for AIT’s fiscal 2024 earnings has increased 3.3% in the past 60 days. Shares of Applied Industrial have rallied 29.1% in the past year.
A. O. Smith Corporation (AOS - Free Report) currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 14%.
In the past 60 days, the consensus estimate for A. O. Smith’s 2023 earnings has improved 5%. The stock has risen 31.5% in the past year.
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Johnson Controls (JCI) Q4 Earnings Miss, Revenues Rise Y/Y
Johnson Controls International plc (JCI - Free Report) reported fourth-quarter fiscal 2023 (ended Sep 30, 2023) adjusted earnings of $1.05 per share, which missed the Zacks Consensus Estimate of earnings of $1.09 per share. However, the bottom line increased 6.1% year over year.
Total revenues of $7,092 million missed the consensus estimate of $6,906 million. The top line increased 2.7% year over year.
Segmental Results
Building Solutions North America: The segment’s revenues were $2,778 million, up 8.4% year over year. Organic sales jumped 8%, owing to growth in the Service and Install businesses due to strong performances in HVAC & Controls and Fire & Security. The segment’s EBITA increased 13% year over year to $427 million.
Building Solutions Europe, Middle East, Africa/Latin America: Revenues from this segment totaled $1,045 million, up 7.1% year over year. Our estimate for Building Solutions Europe, Middle East, Africa/Latin America revenues for the fiscal fourth quarter was $1,071.2 million. Organic sales climbed 3% due to growth in Service and HVAC & Controls and Fire & Security businesses. The segment’s EBITA was $82 million, down 11% from the year-ago period.
Building Solutions Asia Pacific: Revenues decreased 7.2% to $697 million in the reported quarter. Our estimate for Building Solutions Asia-Pacific revenues was $779.0 million. Sales declined 6% organically because the Install business has been negatively impacted by weakness in China. The segment’s EBITA was $94 million, down 11% year over year.
Global Products: Revenues in this segment declined 2% year over year to $2,386 million. Our estimate for Global Products revenues in the fiscal fourth quarter was $2,527.2 million. Organic sales were down 2% due to a decline in global Residential sales. The segment’s EBITA was $502 million, down 6% year over year.
Johnson Controls International plc Price, Consensus and EPS Surprise
Johnson Controls International plc price-consensus-eps-surprise-chart | Johnson Controls International plc Quote
Financial Position
Johnson Controls had cash and cash equivalents of $835 million as of Sep 30, 2023, compared with $2,031 million at the end of fiscal 2022. Long-term debt was $7,818 million compared with $7,426 million at the end of fiscal 2022.
The company reported a free cash flow of $1,819 million in fiscal 2023 compared with $1,398 million in the year-ago period.
The company repurchased 10.5 million shares for approximately $625 million in fiscal 2023.
Fiscal Q1 Guidance
For the first quarter of fiscal 2024, Johnson Controls anticipates organic revenue growth to be flat year over year. The segment EBITA margin is estimated to be approximately 13%. The company expects adjusted earnings to be 48-50 cents per share in the fiscal first quarter. The Zacks Consensus Estimate is pegged at 66 cents per share.
FY24 Guidance
Johnson Controls anticipates year-over-year organic revenue growth to be in the mid-single digits in fiscal 2024. The adjusted segment EBITA margin is expected to improve 25 bps year over year.
JCI expects adjusted earnings to be approximately $3.65-$3.80 per share in fiscal 2024. The Zacks Consensus Estimate is pegged at $3.94.
Zacks Rank & Stocks to Consider
Johnson Controls currently carries a Zacks Rank #4 (Sell).
Some better-ranked companies from the Industrial Products sector are discussed below:
Flowserve Corporation (FLS - Free Report) presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
FLS delivered a trailing four-quarter average earnings surprise of 27.3%. In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2023 earnings has increased 3.1%. The stock has risen 25.7% in the past year.
Applied Industrial Technologies, Inc. (AIT - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 13.9%.
The consensus estimate for AIT’s fiscal 2024 earnings has increased 3.3% in the past 60 days. Shares of Applied Industrial have rallied 29.1% in the past year.
A. O. Smith Corporation (AOS - Free Report) currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 14%.
In the past 60 days, the consensus estimate for A. O. Smith’s 2023 earnings has improved 5%. The stock has risen 31.5% in the past year.