Assa Abloy Quarterly Report Q1 2024

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Apr 24, 2024, 02:26 ET

STOCKHOLM, April 24, 2024 /PRNewswire/ --

Strong execution in a challenging market

First quarter

Net sales increased by 9% to SEK 35,200 M (32,391), with organic growth of –2% (8) and acquired net growth of 11% (5). Exchange- rates affected sales by 0% (9).
Organic sales growth was stable in Entrance Systems, but declined in Americas, Asia Pacific, EMEIA and in Global Technologies.
Three acquisitions with combined annual sales of about SEK 2,000 M were completed in the quarter. The divestment of PACA in France was finalized.
Operating income¹ (EBIT) increased by 5% and amounted to SEK 5,427 M (5,186), with an operating margin of 15.4% (16.0).
The operating margin¹ (EBIT) excluding the acquisition of HHI and divestment of the Emtek/U.S. Smart Residential business was 16.3%.
Net income¹ amounted to SEK 3,462 M (3,692).
Earnings per share¹ amounted to SEK 3.12 (3.32).
Operating cash flow amounted to SEK 3,096 M (4,069).

Sales and income

	Full year			First quarter
	2022	2023	Δ	2023	2024	Δ
Sales, SEK M	120,793	140,716	16 %	32,391	35,200	9 %
Of which:
Organic growth	13,007	3,393	3 %	2,218	–762	–2%
Acquisitions and divestments	2,126	10,651	8 %	1,344	3,607	11 %
Exchange-rate effects	10,653	5,879	5 %	2,237	–35	0 %
Operating income (EBIT)¹, SEK M	18,532	22,185	20 %	5,186	5,427	5 %
Operating margin (EBITA)¹, %	15.9 %	16.5 %		16.6 %	16.3 %
Operating margin (EBIT)¹, %	15.3 %	15.8 %		16.0 %	15.4 %
Income before tax¹, SEK M	17,521	19,654	12 %	4,843	4,616	–5%
Net income¹, SEK M	13,296	15,049	13 %	3,692	3,462	–6%
Operating cash flow, SEK M	15,808	25,232	60 %	4,069	3,096	–24%
Earnings per share¹, SEK	11.97	13.54	13 %	3.32	3.12	–6%
¹ Excluding items affecting comparability. Please see the section "Items affecting comparability" in the report for further details about the financial effects in 2024. For information about items affecting comparability in 2023, please see the Year-end report 2023, available at assaabloy.com.

Comments by the President and CEO

Strong execution in a challenging market
The year took off with strong sales growth of 9%, driven by very strong net acquired growth of 11%, which was partly offset by an organic sales decline of –2%. The organic sales were affected by three fewer working days in March, the most important month of the quarter and a continued weak residential market. Entrance Systems' organic sales were stable with very strong growth in Perimeter and strong growth in the Pedestrian segment. Organic sales in Americas and EMEIA declined by –1% and –3% respectively. Asia Pacific's organic sales declined by –3% due to a weak Chinese market and negative intra-group sales growth. Global Technologies' organic sales declined by –9% against a high corresponding figure last year due to the significant reduction of the backlog a year ago.

The operating profit excluding items affecting comparability increased by 5% to SEK 5,427 M, and the operating margin was record-high for the quarter at 16.3%, excluding the HHI transaction. Strong operational execution through implementation of more cost actions, continued strong price realization and lower direct material costs contributed to the strong performance. The operating cash flow was seasonally lower at SEK 3,096 M with a cash conversion of 67%.

Security is a strong underlying driver for long-term growth
The demand for safe and secure access solutions is constantly increasing as a result of rising security threats, public safety concerns, regulatory requirements and a changing work environment. This also accelerates the demand for electromechanical products and solutions. They offer a high level of security thanks to advanced authentication methods, our unique encryption technologies, the enablement of remote monitoring & control as well as by providing audit trails and access logs. Electromechanical solutions also offer opportunities for efficiency gains and a higher level of convenience and flexibility for our customers. With prevailing penetration rates still low, the shift to more electromechanical solutions continues to be a long-term driver of profitable growth. During the quarter, our electromechanical organic sales growth was 6% in the regional divisions.

We acquired three companies in the first quarter, representing annualized sales of SEK 2 billion. The integration of HHI continues to proceed according to plan and we are gradually realizing more synergies. Given a robust target pipeline and a solid financial position with a strong balance sheet and cash flow, we are well positioned to continue our successful journey of acquiring companies.

We are committed to delivering value to our customers and shareholders and are confident that we will be able to adapt to and perform in any market condition.

Thank you for your continued support and trust in ASSA ABLOY.

Stockholm, April 24, 2024

Nico Delvaux
President and CEO

Further information can be obtained from:
Nico Delvaux,
President and CEO, tel. no: +46 8 506 485 82

Erik Pieder,
Executive Vice President and CFO, tel.no: +46 8 506 485 72

Björn Tibell,
Head of Investor Relations, tel. no: +46 70 275 67 68,
e-mail: [email protected]

ASSA ABLOY is holding a telephone and web conference at 09.30 on April 24, 2024 which can be followed online at assaabloy.com/investors.

It is possible to submit questions by telephone on: 08–505 100 31, +44 207 107 0613 or +1 631 570 5613

This information is information that ASSA ABLOY AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 08.00 CEST on April 24, 2024.

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The following files are available for download:

https://mb.cision.com/Main/7333/3966493/2753851.pdf	The full report (PDF)
https://news.cision.com/assa-abloy/i/assa-abloy-logo-door,c3292705	ASSA ABLOY logo door