Johnson Controls Second-Quarter Eps Up 14% Outlook For Year Updated

BURSCHEID, Germany 16. 4. 2002 (ots/PROTEXT) - JohnsonControls, Inc. (JCI) today reported that diluted earnings pershare reached a record $1.21 for the second quarter of fiscal2002, up 14% from $1.06 for the prior year. Sales for the threemonths ended March 31, 2002, were $4.8 billion, 5% higher thanthe $4.6 billion for the prior year. Operating income for thecurrent quarter increased 5% to $218.7 million compared with theprior year's $208.5 million. Net income, aided by a lowereffective income tax rate, increased 16% to $114.8 million from$99.0 million for the second quarter of fiscal 2001. Incomecomparisons are with last year's results that have been adjustedto exclude the effects of goodwill amortization expense. Totaldebt to total capitalization decreased to 41% from 43% atDecember 31, 2001 as a result of strong free cash flow in thequarter.

Automotive Systems Group (dollars in millions)

Three Months Ended March 31,

2002

2001

% Sales $3,570.5

$ 3,372.5

6 Operating Income

$ 158.0

$ 152.7

3

Automotive Systems Group sales increased 6% over the sameperiod of 2001. North American sales of seating, interiorsystems and batteries were 7% higher than the prior year.Johnson Controls said that new interiors and battery businesscaused its revenues to exceed the 4% increase in domesticindustry light vehicle production.

Automotive sales in Europe were 6% higher reflecting theinclusion of an electronics business and a battery businesswhich were acquired in October 2001. Excluding the electronicsacquisition and the negative effect of currency, Europeanseating and interiors systems sales were approximately level withthe prior year, which compares favorably with an estimated 9%decline in European industry vehicle production.

Johnson Controls sales in Asia, Japan and South America,which represent less than 10% of its automotive revenuesworldwide, were substantially lower due to negative currencyeffects and reduced vehicle production levels. Operating income for the Automotive Systems Group increasedfrom the prior year amount due to the higher domestic sales andworldwide operational efficiencies. These improvements werepartially offset by lower results in Europe where it incurredhigher startup and engineering costs.

Controls Group (dollars in millions) Three Months EndedMarch 31

2002

2001

% Sales $1,240.0

$1,229.1

1 Operating Income

$ 60.7

$ 55.8

9

Controls Group sales to the nonresidential buildings marketincreased slightly over the 2001 period. North American saleswere 4% higher reflecting increased service and integratedfacility management volume. While revenues associated withcontrol system installation contracts were comparable with theprior year, increases are anticipated during the balance of theyear.

Sales outside North America decreased 4%, reflecting thedeconsolidation of a joint venture in Japan and the negativeeffect of currency. These factors more than offset the inclusionof a European systems and services company acquired in the thirdquarter of fiscal 2001.

Controls Group operating income increased 9% over the 2001period, with higher results due to the volume increases andproductivity improvements.

First-Half Results and Full-Year Outlook

Year-to-date, Johnson Controls sales were $9.6 billion or 6%above the same period of 2001. Net income for the first sixmonths of fiscal 2002 increased 8% to $235 million ($2.48 perdiluted share,) up from $217 million ($2.33 per diluted share.) According to Chairman and Chief Executive Officer James H.Keyes, higher than expected domestic demand for cars and lighttrucks has enabled the company to improve the outlook for itsAutomotive Systems Group. Its full-year automotive sales areanticipated to exceed the prior year by approximately 6% comparedwith the company's October 2001 forecast for 5% growth. Theimprovement from last fall's estimate is based on the followingassumptions for industry light vehicle production: NorthAmerica increases to 15.7 million units from 15.1 millionpreviously forecast; Europe declines to 15.3 million from 15.6million; and South America and Japan production declines versusthe previous forecast for relatively stable levels.

The company also said that it now anticipates the automotiveoperating margin to be approximately level with the prior yearwhereas lower margins were expected six months ago. Theimprovement in margin is primarily due to the stronger thananticipated North American production environment and effectivequality and cost initiatives.

Johnson Controls said that, based on the year-to-date salesincrease of 5%, it anticipates that for the full year of fiscal2002, the Controls Group will achieve sales growth of 6-10%,slightly lower than the 8-12% anticipated earlier. Mr. Keyesemphasized that demand remains strong with the backlog ofuncompleted systems installation contracts 18% above the prioryear level. He added that the Controls Group continues to expectmodest margin improvement for the year.

Mr. Keyes said, "In summary, even before adding the benefitof the lower tax rate, we anticipate that Johnson Controls willbe able to achieve another record year."

Following is a summary of supplementary full-year financialestimates for 2002:

(dollars in millions)

FY2001

FY2002

Actual

EstimatesCapital expenditures

$621

$575-600Depreciation

$434

$490-510Amortization of intangibles

$13*

$20 Totaldebt to total capitalization

38%

ą 38%Interest expense, net of interest income

$110

$115-120Effective income tax rate

36.6%*

34.8%Minority interests in net earnings of subsidiaries

$53

$60-70 *Adjusted to exclude the effects of goodwill amortization

The company has made forward-looking statements in thisdocument that are subject to risks and uncertainties. Forward-looking statements include information concerning possible orassumed future risks and may include words such as "believes,""expects," "anticipates" or similar expressions. For thosestatements, the company cautions that numerous important factors,including industry vehicle production levels, US dollar exchangerates and those discussed in the company's Form 8-K (datedNovember 9, 2001), could affect the company's actual results andcould cause its actual consolidated results to differ materiallyfrom those expressed in any forward-looking statement made by, oron behalf of, the company.

Further information is available from: Johnson Controls GmbHClaudia Steinhoff Industriestr. 20-30 D-51399 Burscheid Phone: +49 21 74/65-32 43 Fax: + 49 21 74/65-32 19

Johnson Controls, Inc. is a global market leader inautomotive systems and facility management and control. In theautomotive market, it is a leading supplier of seating andinterior systems and batteries. For non-residential facilities,Johnson Controls provides building control components and systemsand facility management services. Johnson Controls (New YorkStock Exchange: JCI), founded in 1885, has headquarters inMilwaukee, Wisconsin. The European head-quarters is inBurscheid, Germany. Its sales for 2001 totaled 18.4 billion US-Dollars, the Automotive Systems Group alone accounting for 13.6billion US-Dollars of this figure. In the current "IndustryWeek" business magazine rankings, Johnson Controls has beenlisted as one of the top 100 best run companies in the world forthe fifth time in succession.

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