Johnson Controls 2013 Annual Report Download - page 85

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85
A summary of the status of the Company’s nonvested PSUs at September 30, 2013, and changes for the fiscal year then ended, is
presented below:
Weighted
Average
Price
Shares/Units
Subject to
PSU
Nonvested, September 30, 2012 $ — —
Granted 30.73 547,800
Forfeited 30.73 (6,100)
Nonvested, September 30, 2013 $ 30.73 541,700
At September 30, 2013, the Company had approximately $19 million of total unrecognized compensation cost related to
nonvested PSUs granted. That cost is expected to be recognized over a weighted-average period of 2.0 years.
13. EARNINGS PER SHARE
The Company presents both basic and diluted earnings per share (EPS) amounts. Basic EPS is calculated by dividing net income
attributable to Johnson Controls, Inc. by the weighted average number of common shares outstanding during the reporting period.
Diluted EPS is calculated by dividing net income attributable to Johnson Controls, Inc. by the weighted average number of common
shares and common equivalent shares outstanding during the reporting period that are calculated using the treasury stock method
for stock options and unvested restricted stock. The treasury stock method assumes that the Company uses the proceeds from the
exercise of awards to repurchase common stock at the average market price during the period. The assumed proceeds under the
treasury stock method include the purchase price that the grantee will pay in the future, compensation cost for future service that
the Company has not yet recognized and any windfall tax benefits that would be credited to capital in excess of par value when
the award generates a tax deduction. If there would be a shortfall resulting in a charge to capital in excess of par value, such an
amount would be a reduction of the proceeds. For unvested restricted stock, assumed proceeds under the treasury stock method
would include unamortized compensation cost and windfall tax benefits or shortfalls.
The Company’s outstanding Equity Units due 2042 are reflected in diluted earnings per share using the “if-converted” method.
Under this method, if dilutive, the common stock is assumed issued as of the beginning of the reporting period and included in
calculating diluted earnings per share. In addition, if dilutive, interest expense, net of tax, related to the outstanding Equity Units
is added back to the numerator in calculating diluted earnings per share.
The following table reconciles the numerators and denominators used to calculate basic and diluted earnings per share (in millions):
Year Ended September 30,
2013 2012 2011
Income Available to Common Shareholders
Basic income available to common shareholders $ 1,178 $ 1,184 $ 1,415
Interest expense, net of tax — 1 3
Diluted income available to common shareholders $ 1,178 $ 1,185 $ 1,418
Weighted Average Shares Outstanding
Basic weighted average shares outstanding 683.7 681.5 677.7
Effect of dilutive securities:
Stock options and unvested restricted stock 5.5 5.2 8.1
Equity units — 1.9 4.1
Diluted weighted average shares outstanding 689.2 688.6 689.9
Antidilutive Securities
Options to purchase common shares 0.8 1.4 0.3
During the three months ended September 30, 2013 and 2012, the Company declared a dividend of $0.19 and $0.18, respectively,
per common share. During the twelve months ended September 30, 2013 and 2012, the Company declared four quarterly dividends
totaling $0.76 and $0.72, respectively, per common share. With the exception of the quarterly dividend declared and paid in the
three months ended December 31, 2012, the Company paid all dividends in the month subsequent to the end of each fiscal quarter.