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Can you just provide a little bit more detail around the impact from the cyber attack? I mean, I think you said $0.04 in the fourth quarter, but it was kind of late in the fourth quarter. And then in particular, which businesses it impacted just kind of the mechanics of the thing? And then just clarify what you're saying in the first quarter, I think you said $200 million in cash, but then $0.02 of earnings, I might have missed. I'm not sure I can reconcile like all those numbers.
So maybe just a little more mechanical detail on the impact of the cyber attack.
Olivier Leonetti
Yes. let me give you some of the numbers. In Q4, we believe that the impact on the top line was about 1%. And it will be the same in Q1. What you have going on, Steve, I would go to the EPS impact in a second is what you lose in Q4, you recover some of it in Q1, right? That's why you have those numbers going on.
So 1% in revenue in Q4 and in Q1. The EPS impact in Q4 is about $0.04 and the impact in Q1 about $0.02. What is mainly impacted is everything which is short cycle, if you need to satisfy demand for something that you need to have in inventory, if you don't have it, you lose it, that's where the impact will be. My $200 million impact in cash is lower collection in the first quarter because we're not able to build immediately as we could not be immediately then that has delayed collection. That's the $200 million, Steve.
cyber impact
Transcript
2023 Q4
13 Dec 23
Global Products saw continued strength in Commercial HVAC, which grew high single digits after growing mid-teens in the comparable period 1 year ago. Demand remained strong and our leading position in Commercial HVAC was further extended in fiscal 2023. Client security declined low single digits as inventory further rebalanced as lead times improved materially year-over-year. Industrial Refrigeration had another strong quarter, growing over 45% driven by EMEALA. Global residential declined high-teens, driven by a greater than 30% decline in North America and a high single-digit decline in rest of world. North America faced challenging year-over-year comparisons as we were still working out of a backlog from last fiscal year. In Europe, the heat pump market overall experienced lower growth than anticipated.
comm hvac offsetting weak resi and fire & security(inventory rebalance)
Transcript
2023 Q4
13 Dec 23
Global Products
global prpducrts--- seems to be the issue with cyber
Transcript
2023 Q4
13 Dec 23
e're initiating guidance for fiscal 2024 for approximately mid-single-digit sales and adjusted EPS growth, respectively, and for free cash flow conversion of approximately 85%. Olivier will provide additional color on the guidance later in the call, but fiscal 2024 will show improvement following a seasonally slower first quarter.
2024 guide
Transcript
2023 Q4
13 Dec 23
n the Global Product business, we see the margin being slightly flat. What is happening in the global business, you have that in Q3, it's happening in Q4.
So it's some absorption as we are ramping applied volumes to drive market share and lead time.
gp margin flat in q4
Transcript
2023 Q3
10 Aug 23
Our Global Products third party backlog increased 8% from the prior year to $2.5 billion
gp third party backog up 8%
Transcript
2023 Q3
10 Aug 23
We expect Building Solutions momentum to continue, while Global Products faces a tough year-over-year comparison driven by inventory reduction in residential HVAC and certain Fire and Security and direct channels as lead time have materially improved.
Q4 colour by segment
Transcript
2023 Q3
10 Aug 23
Now, referencing the orders in Q4, in revenue in Q4, when you look at our residential and Fire & Security businesses, we have been experiencing some short-term pressure in our shorter cycle book-to-bill business and it's in those two areas. The inventories in the channel are resetting as we've been able to improve lead times and so therefore there are some short-term adjustments in the book-to-bill revenues.
inventories correcting due to lead times normailzing
Transcript
2023 Q3
10 Aug 23
we have a broader exposure to Institutional, Industrial, Data Centers and Government sectors.
inst, ind, data centers and gov
Transcript
2023 Q2
30 May 23
Moving on to Slide 5, there has been a lot of focus in the past couple of months around commercial construction, particularly with regards to the commercial office sector.
While Johnson Controls does have exposure to this sector, it represents a small portion of our overall business.
commercial office sector
Transcript
2023 Q2
30 May 23
So as we put in George’s preparing remarks, we have a low exposure to the office business.
Your number is in the ballpark, Nigel.
Our customers also have many funding sources.
So we don’t see today an exposure to what is happening in the U.S. in the banking industry.
Another data point, as George indicated, the backlog is strong and very resilient, which is another indicator about the strength of the financing sources
low expisure to office busunessa
Transcript
2023 Q2
30 May 23
And so our Parts business is up well over 20% year-on-year as a result of the work we’re doing.
parts business up 20%
Transcript
2023 Q2
13 May 23
And as we’ve been transforming the company with digital, going back and making sure that all of our installed base is connected, we ultimately then use the data to not only enhance the traditional services that we perform, but then add on additional value propositions with energy and space utilization. There is a lot of things that we can do with now the capabilities of OpenBlue. And then ultimately, with that, we get better value propositions and better delivery.
Our attrition comes down. And then ultimately, we believe we can sustain double-digit growth with that model.
When you look at the quarter, we were up 11% revenue growth, like we said, 14% orders. But the underlying to your question, when you look at connected chillers, we’re up 100% year-on-
servi ce irder growth not just driven by mechanicxal break, but by digital upgrades too
Transcript
2023 Q2
13 May 23
ow single-digit exposure to commercial office new build.
lsd exposure to commercial office new build
Transcript
2023 Q2
13 May 23
Now when you look at the commercial sector, we typically are 50% new build and 50% retrofit.
comm sectoe-- typucsally 50% new build/50% retrofit
Transcript
2023 Q2
13 May 23
In addition, when you look at our base business, what you see happening is all the work that we did through the course of last year, building a very strong backlog with very strong margins.
As you see, as we begin to turn that, we’re seeing a nice pickup in the margin rate, which is exactly what we expected.
well priceds backlog helping margins now
Transcript
2023 Q2
13 May 23
uilding Solutions performance. Orders increased 8% organically as China rebounded from COVID-related impacts during the first quarter. We saw healthy growth in install orders of 5%, and we’re especially pleased with service orders growing 14%.
Our focus and investment around increasing our service offering continues to gain momentum. Total sales grew 11%, with organic sales increasing 13%, made up 10% price and 3% volume growth. Service revenue grew 11% and installed revenue increased 15%. Adjusted segment EBITA increased 16%, with margins expanding 50 basis points, led by positive price costs and improved productivity. Building Solutions backlog remain at record levels, growing 9% to $11.7 billion. Service backlog grew 15%, while installed backlog increased 8%.
BS-- orders increased with China reboundig
Transcript
2023 Q2
13 May 23
organic sales in our shorter cycle Global Products business increased 12% in the quarter, benefiting from strong price realization of 9% and 3% volume growth. We saw strong growth across most of the portfolio, led by greater than 20% growth in commercial HVAC. This growth occurred in both applied and light commercial, where demand remained strong.
GP -- price 9%, 3% volume growth
Transcript
2023 Q2
13 May 23
As we have stated in the past, nearly 40% of global energy emissions come from buildings
40% etc
Transcript
2023 Q2
10 May 23
On the install side, it’s mainly a couple of factors here that impacted us here in the quarter. It was – the China – the COVID lockdowns, we have incredible pipeline, but because of the disruption and ultimately the delay in getting those closed impacted us in the quarter, and that’s 1% to 2%. And then in our project-based business as we now drive our vectors of growth around sustainability and healthy building. There’s larger projects and a lot of these, it’s hard to predict that timing conversion and so that amounted to another roughly 1% to 2%
fied orders
Transcript
2023 Q1
3 Feb 23