Johnson Controls 2013 Annual Report Download - page 50

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liability. However, while neither the timing nor the amount of ultimate costs associated with known environmental remediation
matters can be determined at this time, the Company does not expect that these matters will have a material adverse effect on its
financial position, results of operations or cash flows. In addition, the Company has identified asset retirement obligations for
environmental matters that are expected to be addressed at the retirement, disposal, removal or abandonment of existing owned
facilities, primarily in the Power Solutions business. At September 30, 2013 and 2012, the Company recorded conditional asset
retirement obligations of $56 million and $76 million, respectively.
Additionally, the Company is involved in a number of product liability and various other casualty lawsuits incident to the operation
of its businesses. The Company maintains insurance coverages and records estimated costs for claims and suits of this nature. It
is management’s opinion that none of these will have a materially adverse effect on the Company’s financial position, results of
operations or cash flows (see Note 21, “Commitments and Contingencies,” of the notes to consolidated financial statements). Costs
related to such matters were not material to the periods presented.
QUARTERLY FINANCIAL DATA
Previously reported quarterly amounts have been revised to reflect the retrospective application of the Company’s change in
inventory costing method for certain inventory in its Power Solutions business to the first-in first-out (FIFO) method from the last-
in first-out (LIFO). Refer to Note 1, “Summary of Significant Accounting Policies,” of the notes to consolidated financial statements
for further details surrounding this accounting policy change.
(in millions, except per share data)
(unaudited) First
Quarter Second Quarter Third Quarter Fourth Quarter Full Year
2013 (1)
Net sales $ 10,422 $ 10,430 $ 10,831 $ 11,047 $ 42,730
Gross profit 1,516 1,515 1,645 2,102 6,778
Net income (3) 389 194 573 141 1,297
Net income attributable to Johnson
Controls, Inc. 359 164 550 105 1,178
Earnings per share (5)
Basic 0.53 0.24 0.80 0.15 1.72
Diluted 0.52 0.24 0.80 0.15 1.71
2012 (2)
Net sales $ 10,417 $ 10,565 $ 10,581 $ 10,392 $ 41,955
Gross profit 1,491 1,552 1,518 1,587 6,148
Net income (4) 431 417 442 21 1,311
Net income (loss) attributable to Johnson
Controls, Inc. 396 379 417 (8) 1,184
Earnings (loss) per share (5)
Basic 0.58 0.56 0.61 (0.01) 1.74
Diluted 0.58 0.55 0.61 (0.01) 1.72
(1) For the first, second, third and fourth quarters of fiscal 2013, the retrospective application of the Company’s change in
inventory costing method resulted in an increase (decrease) to gross profit of $8 million, $27 million, $(35) million and
$11 million, respectively, and an increase (decrease) to net income attributable to Johnson Controls, Inc. of $5 million (less
than $0.01 per diluted share), $16 million ($0.03 per diluted share), $(21) million ($0.03 per diluted share) and $7 million
($0.01 per diluted share), respectively.
(2) For the first, second, third and fourth quarters of fiscal 2012, the retrospective application of the Company’s change in
inventory costing method resulted in a decrease to gross profit of $45 million, $1 million, $23 million and $1 million,
respectively. For the first and third quarters of fiscal 2012, the change resulted in a decrease to net income attributable to
Johnson Controls, Inc. of $28 million ($0.04 per diluted share) and $14 million ($0.02 per diluted share), respectively, and
there was no significant impact for the second and fourth quarters of fiscal 2012.
(3) The fiscal 2013 second quarter net income includes $84 million of significant restructuring and impairment costs and an
$82 million gain on acquisition of a partially-owned affiliate in India in the Automotive Experience Seating segment. The