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$JCI's BoD appointed John Young to serve as a director. Young is currently group president of $PFE Essential Health. Effective Jan. 1, 2018, he will become group president of Pfizer Innovative Health, which comprises six business groups focused on improving health through innovative products covering every stage of life.
$JCI, which completed the sale of Scott Safety business to $MMM in Oct. 2017, reported 4Q17 net income of $875MM compared to a loss of $1.17Bil a year ago. GAAP EPS was $0.93 versus a loss of $1.61 per share. Sales of $8.1Bil increased 4% on a combined basis. On an adjusted basis, Johnson Controls earned $0.87 per share.
$JCI has named John Donofrio as EVP and General Counsel effective Nov. 15, 2017. Donofrio, who will also serve as a Corporate Officer, succeeds Judy Reinsdorf, who served in the General Counsel role since Sept. 2016, following the merger of Johnson Controls and Tyco.
$JCI's board of directors appointed Lynn Minella as vice president, chief human resources officer effective June 14. Minella succeeds Simon Davis who is leaving the company to pursue other opportunities. Minella most recently served as group human resources director at BAE Systems Plc based out of London.
$JCI has driven good productivity in its Power Solutions business and has benefited from the higher mix of AGM in 2Q17. This enabled the company to offset the 220BP of headwind on lead and deliver margin rate improvement of over 10BP. For 2017, $JCI expects to see an increase in AGM shipments but margins will face pressure from lead prices.
$JCI is seeing growth in the fire & security product business which is expected to accelerate in 3Q17 and 4Q17. The company believes there will be a pick-up in its service revenues seasonally in 3Q and 4Q along with leverage on volume. Overall, $JCI is positioned to deliver about 90BP improvement in margin rate for 3Q17 and 4Q17.
$JCI expects 3Q17 adjusted EPS from continuing operations to be in the range of $0.70 to $0.73, an increase of 15-20% YoY. Additionally, the company tightened its 2017 adjusted EPS from continuing operations guidance to the range of $2.60 to $2.68, a 13-16% increase YoY.
Automotive parts manufacturer $JCI posted a narrowed loss for 2Q17, driven by higher net sales along with non-cash tax charge and other special items. Net loss narrowed to $115MM or $0.16 loss per share from $469MM or $0.81 loss per share a year ago. Net sales increased 53.53% to $7.26Bil.
$JCI signed a definitive agreement to sell its Scott Safety business to $MMM for about $2Bil in cash. Net proceeds of $1.8-1.9Bil from the deal will be used to repay a portion of Tyco International Holding Sarl's $4.0Bil merger-related debt. The transaction is expected to close in the second half of 2017.
$MMM agreed to buy Scott Safety from $JCI. On GAAP basis, $MMM expects the acquisition to be $0.10 dilutive to earnings in the first 12 months following completion of the transaction. Excluding items, $MMM expects the acquisition to be $0.10 accretive to earnings over the same period. The deal will close in 2H17.
$MMM agreed to buy Scott Safety from $JCI for a total enterprise value of $2Bil. Scott Safety is a premier manufacturer of innovative products, including self-contained breathing apparatus (SCBA) systems, gas and flame detection instruments, and other safety devices that complement $MMM's personal safety portfolio.
$JCI said looking at the total Buildings business, about 70% of the business is driven by field orders and looking at the backlog and types of projects that are in the backlog, the company feels positive about how these projects are going to convert.
$JCI said in the Fire & Security business, it has been building orders consistently about 3-4% over the last year and this has been building the backlog. The company is beginning to see conversion of this backlog within the Fire & Security space. Both North America and Rest of World are up around 2-3% which reflects progress in orders and backlog.