Johnson Controls 2014 Annual Report Download - page 69

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69
In connection with the divestitures, the Company recorded a gain, net of transaction costs, of $40 million and reduced goodwill
by $34 million in the Building Efficiency business.
3. DISCONTINUED OPERATIONS
In the fourth quarter of fiscal 2013, the Company completed its divestiture of its Automotive Experience Electronics' HomeLink®
product line to Gentex Corporation. In the second quarter of fiscal 2014, the Company announced that it had reached a definitive
agreement to sell the remainder of the Automotive Experience Electronics business to Visteon Corporation, subject to regulatory
and other approvals. The sale closed on July 1, 2014. At March 31, 2014, the Company determined that the Automotive Experience
Electronics segment met the criteria to be classified as a discontinued operation, which required retrospective application to financial
information for all periods presented. The Company did not allocate any general corporate overhead to discontinued operations.
The assets and liabilities of the Automotive Experience Electronics segment were reflected as held for sale in the consolidated
statement of financial position at September 30, 2013.
The following table summarizes the results of the Automotive Experience Electronics business, which includes the HomeLink®
product line in fiscal 2013 and 2012 results, reclassified as discontinued operations for fiscal years ended September 30, 2014,
2013 and 2012 (in millions):
Year Ended September 30,
2014 2013 2012
Net sales $ 1,027 $ 1,320 $ 1,351
Income (loss) from discontinued operations before income taxes (8) 578 134
Provision for income taxes on discontinued operations 202 472 48
Income from discontinued operations attributable to
noncontrolling interests, net of tax 851
Income (loss) from discontinued operations, net of tax $(218) $ 101 $ 85
For the year ended September 30, 2014, the discontinued operations before income taxes included divestiture-related losses of
$80 million comprised of asset and investment impairment charges of $43 million, transaction costs of $27 million and severance
obligations of $10 million. For the year ended September 30, 2013, the discontinued operations before income taxes included a
$476 million gain on divestiture of the HomeLink® product line net of transaction costs and $28 million of restructuring costs.
The effective tax rate is different than the U.S. statutory rate for fiscal 2014 primarily due to second quarter discrete non-cash tax
charge of $180 million related to the repatriation of foreign cash associated with the divestiture of the Electronics business and
unbenefited foreign losses. The effective rate is different than the U.S. statutory rate for fiscal 2013 primarily due to the tax
consequences of the sale of the HomeLink® product line, the change in our assertion over reinvestment of foreign undistributed
earnings and unbenefited foreign losses. The effective rate is different than the U.S. statutory rate for fiscal 2012 primarily due
to unbenefited foreign losses.
Assets and Liabilities Held for Sale
The Company has determined that certain of its businesses met the criteria to be classified as held for sale. The Automotive
Experience Electronics segment and the headliner and sun visor product lines were classified as held for sale beginning
September 30, 2013. The headliner and sun visor product lines and the Automotive Experience Electronics segment were sold
during the third and fourth quarters of fiscal 2014, respectively; refer to Note 2, "Acquisitions and Divestitures," of the notes to
consolidated financial statements for additional information.