Johnson Controls Inc. (JCI) raised the prices of its batteries in the U.S. and Canada on the back of rising commodity costs. This is the second time the company has increased battery prices since 2008.
Johnson Controls has increased battery prices in the range of 5%–9% for orders placed from April 1 onwards. The move will offset rising raw material prices and delivery costs, including costs related to packaging and transportation.
At the beginning of last month, Johnson Controls announced that it will acquire California-based EnergyConnect Group Inc. that provides demand-response services to the electricity grid.
EnergyConnect’s technologies provide real-time pricing information that is used by commercial, institutional and industrial customers to manage their electricity consumption more efficiently. Its demand-response programs offer incentives for curtailing consumption during periods of peak demand.
The blending of demand-response services with Johnson Controls’ building efficiency technologies will undoubtedly place the company among the market leaders. The deal is expected to be completed by July this year.
Wisconsin-based Johnson Controls is a supplier of automotive interiors, batteries, and other control equipment. The company functions through three segments: Automotive Experience, Building Efficiency and Power Solutions.
The Zacks #3 Rank (Hold) company posted a profit of $375 million or 55 cents per share in the first quarter of its fiscal 2011, exceeding the Zacks Consensus Estimate by a penny. The profit increased 30% from $288 million or 43 cents per share in the comparable quarter a year ago.
The higher profit was mainly driven by increase in earnings in the company’s Automotive Experience segment on the back of an overall recovery in the global automotive markets. Net sales in the quarter rose 13% to $9.5 billion, higher than the Zacks Consensus Estimate of $8.72 billion.
Revenues in the Building Efficiency segment escalated 13% to $3.4 billion led by a 31% sales increase in Asia and 21% in Global Workplace Solutions product. The segment recorded a 34% rise in income to $139 million due to higher volumes.
Johnson Controls anticipates sales to increase 12% to $38.5 billion, up from the prior forecast of a 9% increase to $37 billion for the full fiscal 2011, based on European automotive acquisitions, higher automotive production in North America and Europe and higher volumes in the Power Solutions aftermarket battery business.
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