UPDATE: Johnson Controls Shutting Down 10 Plants

By Steve Gelsi

NEW YORK (Dow Jones) -- Johnson Controls will shut down 10 plants and take a second-quarter charge of up to $215 million, the automotive supplier said Friday.

However, Milwaukee-based Johnson Controls (JCI) didn't specify either the plants to be closed or the number of job cuts envisioned as part of this restructuring.

The company also said it expects to realize a return to profitability in the third and fourth quarters of fiscal 2009, with the run rate for its unit specializing in automotive interiors projected to break even by the end of the fiscal year ending Sept. 30.

In addition, Johnson Controls said it doesn't expect having to resort to further restructuring activities for the foreseeable future -- it had announced a $495 million restructuring program during the fourth quarter of fiscal 2008 -- even while revising lower its forecast for vehicle production.

"While we don't expect near-term recoveries in our markets, we believe we can manage through this environment from a position of strength and enhance our ability to gain further market share while improving our margins," said Stephen Roell, chairman and chief executive.

Management pointed out that it completed a debt offering "that significantly improves our liquidity and gives us the flexibility to take advantage of opportunities that may arise as a result of the economic environment." The company pegged net proceeds from the sale of convertible senior notes and equity units earlier this month at more than $828 million.

As revised, Johnson Controls now expects vehicle production during its fiscal 2009 to be 8.8 million units in North America and 14.3 million units in Europe, lower than its forecast in December.

On an annualized basis, North American production in the March quarter stood at a 27-year low, the company said.

Shares of Johnson Controls rose 26 cents to $12.90 on Thursday but fell about 3% ahead of Friday's opening bell.