Analysis of Geographic Areas
Johnson Controls International plc operates in 4 regions: United States; Europe; Asia Pacific; and Other Non-U.S..
Area Asset Turnover
Johnson Controls International plc, asset turnover by geographic area
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | |
|---|---|---|---|---|---|---|
| United States | 8.78 | 8.18 | 7.07 | 6.64 | 6.56 | 4.55 |
| Europe | 9.50 | 10.16 | 9.33 | 12.67 | 14.16 | 7.73 |
| Asia Pacific | 8.90 | 8.83 | 7.91 | 7.92 | 6.80 | 4.17 |
| Other Non-U.S. | 5.81 | 6.13 | 5.33 | 5.33 | 6.07 | 5.55 |
Based on: 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30).
- United States
- The asset turnover ratio in the United States demonstrated a consistent upward trend over the six-year period. Beginning at 4.55 in 2018, the ratio steadily increased each year without any decline, reaching 8.78 by 2023. This represents a near doubling of turnover efficiency, indicating improved utilization of assets in this geographic area.
- Europe
- The European asset turnover ratio exhibited significant volatility during the period. It started at 7.73 in 2018 and surged sharply to a peak of 14.16 in 2019. However, this was followed by a decline over the next two years, dropping to 9.33 in 2021. Subsequently, the ratio experienced minor fluctuations, rising modestly to 10.16 in 2022 before decreasing again to 9.5 in 2023. Despite the volatility, the ratio remained higher than the initial 2018 value, suggesting variable but generally strong efficiency in asset use.
- Asia Pacific
- The Asian Pacific region displayed steady growth in the asset turnover ratio from 2018 through 2023. Starting at 4.17, the ratio increased to 6.80 in 2019, followed by continuous incremental improvements to 7.92 in 2020 and stability around 7.90 in 2021. Further growth led to 8.83 in 2022 and 8.90 in 2023. This steady rise indicates consistent enhancement in asset utilization over the period.
- Other Non-U.S.
- The asset turnover ratio for the Other Non-U.S. category was relatively stable but without a clear upward or downward trend. The ratio began at 5.55 in 2018, reached a slight high of 6.07 in 2019, then declined to 5.33 in both 2020 and 2021. A modest rebound to 6.13 occurred in 2022, followed by a small decline to 5.81 in 2023. Overall, the fluctuations were limited and the ratio remained within a narrow range indicating steady performance with minor variations.
Area Asset Turnover: United States
Johnson Controls International plc; United States; area asset turnover calculation
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | 13,989) | 12,864) | 11,577) | 11,371) | 11,973) | 14,625) |
| Long-lived assets | 1,594) | 1,573) | 1,638) | 1,713) | 1,824) | 3,216) |
| Area Activity Ratio | ||||||
| Area asset turnover1 | 8.78 | 8.18 | 7.07 | 6.64 | 6.56 | 4.55 |
Based on: 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30).
1 2023 Calculation
Area asset turnover = Net sales ÷ Long-lived assets
= 13,989 ÷ 1,594 = 8.78
- Net Sales
- Net sales demonstrated a downward trend from 2018 through 2020, declining from 14,625 million USD to 11,371 million USD. This decrease was followed by a recovery phase starting in 2021, with sales increasing steadily to reach 13,989 million USD by 2023. The pattern indicates an initial contraction in the business segment, potentially influenced by external factors, and a subsequent resurgence.
- Long-lived Assets
- Long-lived assets consistently decreased over the analyzed period, dropping from 3,216 million USD in 2018 to 1,594 million USD in 2023. This represents a significant reduction of approximately 50%. The decline suggests either a divestiture of fixed assets, asset impairments, or a strategic shift towards less capital-intensive operations in the geographical area.
- Area Asset Turnover
- The area asset turnover ratio showed a sustained upward trend, rising from 4.55 in 2018 to 8.78 in 2023. This increase reflects improved efficiency in utilizing assets to generate sales. Despite the decline in long-lived assets, the company managed to enhance asset productivity considerably. This improvement aligns with the recovery and growth in net sales after 2020.
- Overall Analysis
- The data indicates a strategic adjustment during the period, characterized by a reduction in long-term assets alongside increased operational efficiency. The initial decline in net sales and asset base may have resulted from external pressures or restructuring efforts. Subsequently, the company’s ability to increase asset turnover and recover sales suggests successful adaptation to market conditions and better management of resources in the United States geographic area.
Area Asset Turnover: Europe
Johnson Controls International plc; Europe; area asset turnover calculation
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | 4,882) | 4,186) | 4,069) | 3,523) | 3,697) | 6,105) |
| Long-lived assets | 514) | 412) | 436) | 278) | 261) | 790) |
| Area Activity Ratio | ||||||
| Area asset turnover1 | 9.50 | 10.16 | 9.33 | 12.67 | 14.16 | 7.73 |
Based on: 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30).
1 2023 Calculation
Area asset turnover = Net sales ÷ Long-lived assets
= 4,882 ÷ 514 = 9.50
- Net Sales
- Net sales in Europe exhibited a notable decline from 6,105 million USD in 2018 to 3,697 million USD in 2019. This downward trend continued marginally into 2020, reaching 3,523 million USD. From 2021 onward, net sales showed a consistent recovery, rising to 4,069 million USD in 2021, 4,186 million USD in 2022, and 4,882 million USD in 2023. Overall, despite a sharp drop between 2018 and 2019, net sales demonstrated a positive rebound trend in subsequent years.
- Long-lived Assets
- Long-lived assets in the European region experienced significant volatility during the period. The asset base decreased substantially from 790 million USD in 2018 to 261 million USD in 2019, followed by a slight increase to 278 million USD in 2020. There was then a marked rise to 436 million USD in 2021. In 2022, long-lived assets slightly contracted to 412 million USD, before increasing again to 514 million USD in 2023. These fluctuations suggest adjustments in capital investments or asset disposals over the years.
- Area Asset Turnover
- The area asset turnover ratio, which measures the efficiency of asset use in generating sales, showed a sharp increase from 7.73 in 2018 to 14.16 in 2019, reflecting improved efficiency. This ratio then decreased steadily to 12.67 in 2020 and continued declining to 9.33 in 2021. A slight improvement occurred in 2022 with the ratio rising to 10.16, but the figure dropped again to 9.5 in 2023. The trend suggests initial gains in asset utilization efficiency followed by reduced efficiency in later years, possibly due to changes in sales performance or asset base composition.
Area Asset Turnover: Asia Pacific
Johnson Controls International plc; Asia Pacific; area asset turnover calculation
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | 5,610) | 5,791) | 5,748) | 5,285) | 5,888) | 4,069) |
| Long-lived assets | 630) | 656) | 727) | 667) | 866) | 975) |
| Area Activity Ratio | ||||||
| Area asset turnover1 | 8.90 | 8.83 | 7.91 | 7.92 | 6.80 | 4.17 |
Based on: 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30).
1 2023 Calculation
Area asset turnover = Net sales ÷ Long-lived assets
= 5,610 ÷ 630 = 8.90
- Net Sales
- The net sales exhibited a general upward trend from 2018 to 2023 with some fluctuations. Starting at 4,069 million USD in 2018, net sales rose significantly to 5,888 million USD in 2019. However, there was a decline in 2020 to 5,285 million USD, followed by a recovery to 5,748 million USD in 2021. Net sales remained relatively stable through 2022 at 5,791 million USD but experienced a slight decrease in 2023 to 5,610 million USD. Overall, the data indicates a resilient sales performance despite some variability.
- Long-lived Assets
- Long-lived assets show a consistent declining trend over the period. From 975 million USD in 2018, the value decreased steadily each year to 630 million USD in 2023. The reduction appears to be gradual, suggesting ongoing asset disposals or amortization without significant reinvestments or asset acquisitions to offset the decline.
- Area Asset Turnover
- The area asset turnover ratio has improved markedly over the six-year period. Beginning at 4.17 in 2018, the ratio increased consistently, reaching 8.9 in 2023. This indicates enhanced efficiency in using long-lived assets to generate sales, nearly doubling the turnover rate in the period. The upward trend occurred despite fluctuations in net sales and the steady decline in asset values, reflecting improvements in operational productivity or asset utilization.
- Overall Analysis
- The data suggests a scenario of increased operational efficiency, as seen in the rising asset turnover ratio, which more than doubled between 2018 and 2023. Simultaneously, net sales showed resilience with growth and recovery after a dip in 2020. The consistent decrease in long-lived assets indicates a reduction in the asset base, potentially due to strategic asset management or shifts in capital allocation. Together, these trends highlight an improved utilization of assets to support sales, though the slight decrease in sales in the most recent year may warrant monitoring.
Area Asset Turnover: Other Non-U.S.
Johnson Controls International plc; Other Non-U.S.; area asset turnover calculation
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | 2,312) | 2,458) | 2,274) | 2,138) | 2,410) | 6,601) |
| Long-lived assets | 398) | 401) | 427) | 401) | 397) | 1,190) |
| Area Activity Ratio | ||||||
| Area asset turnover1 | 5.81 | 6.13 | 5.33 | 5.33 | 6.07 | 5.55 |
Based on: 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30).
1 2023 Calculation
Area asset turnover = Net sales ÷ Long-lived assets
= 2,312 ÷ 398 = 5.81
- Net Sales
- The net sales figures display a significant drop from 6,601 million USD in 2018 to 2,410 million USD in 2019, followed by a continued decline reaching the lowest point of 2,138 million USD in 2020. From 2020 onwards, net sales exhibit a moderate recovery trend, increasing to 2,274 million USD in 2021 and 2,458 million USD in 2022, before slightly declining to 2,312 million USD in 2023. This pattern suggests a sharp contraction possibly caused by external factors, with gradual stabilization but no return to pre-2019 levels during the observed period.
- Long-Lived Assets
- The value of long-lived assets displays a sharp decrease from 1,190 million USD in 2018 to 397 million USD in 2019. Subsequent years show stability with minor fluctuations: remaining around 400 million USD from 2019 to 2023. This decline between 2018 and 2019 indicates a significant asset revaluation, disposal, or restructuring event, after which the asset base remains relatively constant without notable growth or reduction.
- Area Asset Turnover
- The asset turnover ratio exhibits moderate volatility across the periods. It increased from 5.55 in 2018 to 6.07 in 2019, then decreased to 5.33 in 2020 and remained stable in 2021. A peak of 6.13 is observed in 2022, followed by a slight decline to 5.81 in 2023. This ratio's fluctuations indicate varying efficiency in using the long-lived asset base to generate sales, with overall improved utilization after the initial drop in 2020, reaching its highest efficiency in 2022 before a minor pullback.
- Overall Insights
- The data reveal a substantial structural change around 2019, marked by a sharp decline in both net sales and long-lived assets. Despite these reductions, the company managed to maintain and even improve asset utilization efficiency in certain years. The net sales recovery after 2020 suggests adaptation to new conditions, though the business area has not reverted to 2018 scale. The stable long-lived asset base subsequent to the initial drop further supports a period of operational stabilization rather than expansion or contraction in fixed assets.
Net sales
Johnson Controls International plc, net sales by geographic area
US$ in millions
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | |
|---|---|---|---|---|---|---|
| United States | 13,989) | 12,864) | 11,577) | 11,371) | 11,973) | 14,625) |
| Europe | 4,882) | 4,186) | 4,069) | 3,523) | 3,697) | 6,105) |
| Asia Pacific | 5,610) | 5,791) | 5,748) | 5,285) | 5,888) | 4,069) |
| Other Non-U.S. | 2,312) | 2,458) | 2,274) | 2,138) | 2,410) | 6,601) |
| Total | 26,793) | 25,299) | 23,668) | 22,317) | 23,968) | 31,400) |
Based on: 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30).
The net sales data over the six-year period reveals distinct trends across the geographic regions.
- United States
- Net sales in the United States show an initial decline from 14,625 million US dollars in 2018 to 11,371 million in 2020. This is followed by a recovery trend, with sales increasing steadily to 13,989 million by 2023. Despite the dip, the later years demonstrate a clear upward trajectory, indicating a rebound and growth in this market.
- Europe
- European net sales experienced a substantial drop from 6,105 million in 2018 to 3,697 million in 2019 and remained relatively stable around 3,500 million in 2020. However, starting in 2021 there is a significant increase reaching 4,882 million by 2023. This suggests that while the region faced challenges early on, it has shown resilience and growth from 2021 onwards.
- Asia Pacific
- Sales in the Asia Pacific region display some volatility, rising sharply from 4,069 million in 2018 to 5,888 million in 2019, then declining to 5,285 million in 2020. After partially recovering to 5,748 million in 2021, sales have remained relatively stable around 5,600 million through 2023, indicating a plateau without strong growth in the latter years.
- Other Non-U.S.
- This region shows a marked decline from 6,601 million in 2018 to 2,138 million in 2020, followed by a slight recovery to 2,458 million in 2022 and then a small decrease to 2,312 million in 2023. Overall, the sales remain significantly lower compared to 2018 levels, reflecting ongoing challenges in this segment.
- Total Net Sales
- Total sales decreased from 31,400 million in 2018 to a low of 22,317 million in 2020. Since then, total sales have rebounded steadily, reaching 26,793 million in 2023, although they have not yet returned to the 2018 peak. The overall recovery is primarily driven by improvements in the United States and Europe.
Long-lived assets
Johnson Controls International plc, long-lived assets by geographic area
US$ in millions
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | |
|---|---|---|---|---|---|---|
| United States | 1,594) | 1,573) | 1,638) | 1,713) | 1,824) | 3,216) |
| Europe | 514) | 412) | 436) | 278) | 261) | 790) |
| Asia Pacific | 630) | 656) | 727) | 667) | 866) | 975) |
| Other Non-U.S. | 398) | 401) | 427) | 401) | 397) | 1,190) |
| Total | 3,136) | 3,042) | 3,228) | 3,059) | 3,348) | 6,171) |
Based on: 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30).
The analysis of the annual geographic area long-lived assets data reveals several notable trends and changes over the six-year period.
- United States
- The long-lived assets in the United States exhibit a clear and consistent downward trend starting from 3,216 million US dollars in 2018, decreasing sharply to 1,824 million in 2019. This decline continues more gradually over the subsequent years, reaching 1,573 million in 2022 before experiencing a slight increase to 1,594 million in 2023. Overall, the US assets have reduced by roughly 50% from 2018 to 2023, indicating a significant contraction in this region.
- Europe
- The European long-lived assets display a fluctuating pattern with an initial steep decrease from 790 million in 2018 to 261 million in 2019. However, from 2019 onwards, the assets recover notably, climbing to 514 million by 2023. This resurgence suggests either re-investment or asset acquisition in the European region after an initial withdrawal.
- Asia Pacific
- Assets in the Asia Pacific region show a declining trend overall, beginning at 975 million in 2018 and ending at 630 million in 2023. The reduction is not steady; a notable drop occurs between 2019 and 2020, followed by a slight recovery in 2021 before decreasing again in the latest periods. This inconsistency may reflect regional market dynamics or strategic adjustments in that geographic area.
- Other Non-U.S.
- The category covering Other Non-U.S. regions shows a significant decline from 1,190 million in 2018 to around 400 million in the following years, remaining relatively stable between 397 and 427 million from 2019 through 2023. This suggests a major reduction occurred after 2018, with the assets stabilizing at a lower level during the subsequent years.
- Total Assets
- The total long-lived assets across all geographic areas collectively declined from 6,171 million in 2018 to a low of 3,059 million in 2020. Following this, a slight recovery is evident with total assets rising to 3,228 million in 2021 before decreasing again to approximately 3,136 million by 2023. The data indicate an overall reduction exceeding 40% over the six-year period, with some minor fluctuations suggesting partial stabilization in recent years.
In summary, the data indicates a marked decrease in long-lived assets in the United States and Other Non-U.S. regions after 2018, accompanied by a recovery trend in Europe after 2019. The Asia Pacific region experienced a general decline with intermittent recovery periods. These shifts collectively contributed to a substantial reduction in total long-lived assets over the examined period, with signs of stabilization emerging in the last two years.