MILWAUKEE – Economic problems in Europe and some one-time charges pulled Johnson Controls Inc.'s second-quarter earnings down by 61 percent.
The Milwaukee company said Tuesday that it made $148 million, or 21 cents per share, for the three months ended March 31. That compared with $379 million, or 55 cents per share, a year earlier.
Revenue was $10.4 billion, down 1 percent from a year ago.
But the company, which makes heating and ventilation systems for buildings, as well as automotive batteries and other parts, is restructuring overseas because of the weak economy. It reaffirmed previous earnings guidance for fiscal 2013 and said it anticipates stronger profits in the second half of the year.
Excluding $195 million in one-time restructuring and tax valuation costs, JCI said it earned 42 cents per share, matching Wall Street's expectations. Analysts polled by data provider FactSet, on average, expected 42 cents per share on revenue of $10.5 billion.
Sales in the company's Building Efficiency unit were down 3 percent to $3.5 billion, due to soft global demand. Higher sales in North America were offset by lower revenue in Europe, Asia and in the North American service business. The company's backlog of orders dropped 6 percent during the quarter on weakness in the Middle East and Europe.
JCI's Automotive Experience sales also fell 3 percent, to $5.4 billion, again with higher revenue in North America more than offset by lower sales in Europe.
"The profitability of all three automotive segments was impacted by the low level of European production," JCI said in a statement.
The European automakers' association said last week that new car registrations slid 10 percent in the first quarter of 2013, with all but three European Union countries posting declines. Europe's debt crisis sapped consumer spending and March marked the 18th straight month of declining auto sales, as unemployment and gas prices remain high.
Sales at JCI's Power Solutions business, which makes batteries for hybrid and traditional vehicles, were up 10 percent to $1.6 billion, as strength in Asia and North America was partially offset by lower European volumes.
Despite the second-quarter slowdown, JCI reaffirmed its previous full-year profit guidance of $2.60 to $2.70 per share, as it expects the benefits of restructuring to kick in. Also, seasonal profits for the Building Efficiency unit are coming, and improved auto production is expected in North America and Europe.
JCI also said it's comfortable with analysts' consensus of 75 cents per share for third-quarter earnings.
"Despite a challenging global market, we anticipate stronger profitability in the second half of fiscal 2013 consistent with market expectations," CEO Stephen Roell said in the statement.
Shares of Johnson Controls closed Monday at $33.15, up about 8 percent since the start of the year.