ASSA ABLOY is the global leader in door opening solutions, dedicated to satisfying end-user needs for security, safety and convenience Q1 Report 2015 Johan Molin President and CEO
Financial highlights Q1 2015 Good start of the year Strong growth in Americas, Global Tech and ESD Good growth in EMEA Weak in APAC due to Chinese market and credit policy Sales 15,252 MSEK +24% 5% organic, 3% acquired growth, 16% currency EBIT 2,329 MSEK +25% Currency effect 249 MSEK EPS 4.36 SEK +28% Underlying tax rate 26% 2
Market highlights Record awards at ISC West Aperio R100, Aperio M100 & Ecopower power supply Electrified latch & GL1 Electrified Gate Lock HID Mobile Access & Active ID tap authentication Good development in consumer business Yale drives growth in EMEA, Americas and APAC Combination of digital and mechanical products Strong growth in Latin America (+43%) Regional warehouses and recent acquisitions Pedestrian Door Automatics New range of swing door operators Good growth in emerging markets 3
Group sales in local currencies Jan-Mar 2015 Emerging markets 23% (22) of sales 39 +9 40 +3 14 +12 2 +43 1 +5 4 +8 Share of Group sales 2015 YTD, % Year-to-date vs previous year, % 4
Sales growth, currency adjusted Sales MSEK 67 000 64 000 61 000 58 000 55 000 52 000 49 000 46 000 43 000 40 000 37 000 34 000 31 000 2015 Q1 +8% Organic +5% Acquired +3% Growth % 2008 2009 2010 2011 2012 2013 2014 2015 Orga nic G rowth Acquired Growth Sales in Fixed Currencies 27 24 21 18 15 12 9 6 3 0-3 -6-9 -12-15 5
Operating income (EBIT), MSEK Quarter 12-months 2 700 Run rate 9,728 MSEK (8,118) +20% 10 000 2 500 9 500 2 300 9 000 8 500 2 100 8 000 1 900 7 500 1 700 7 000 1 500 6 500 1 300 6 000 5 500 1 100 5 000 900 4 500 2008 2009 2010 2011 2012 2013 2014 2015 Quarter Rolling 12-months 6
Operating margin (EBIT), % EBIT Margin Run rate 2015 16.3% (16.3) 17,0 16,0 15,0 14,0 13,0 12,0 2008 2009 2010 2011 2012 2013 2014 2015 Quarter Rolling 12-months 2015 Dilution Q1-0.1% 2015-0.1% 7
Manufacturing footprint Status manufacturing footprint programs 2006-2013: 69 factories closed to date, 11 to go 84 factories converted to assembly, 5 to go 38 offices closed, 9 to go Personal reduction QTD 206p and total 9,620p 364p in further planned reductions 845 MSEK of the provision remains for all programs 8
Margin highlights Q1 2015 EBIT margin 15.3% (15.1) +0.2% + Volume increase 4%, price 1% + Margin increase +0.2% + Organic growth + Manufacturing footprint - Currency -0.3% - Acquisitions -0.1% Good leverage from growth 9
Acquisitions 2015 Fully active pipeline 4 acquisitions done in 2015 Annualized sales 750 MSEK Added sales 1.5% 10
Quantum Secure, USA Bookings of 400 MSEK with 175 employees Provider of advanced identity management systems Brings compliance in highlyregulated industries Management of identities across multiple sites Neutral to EPS 11
MSL, Switzerland Turnover of 180 MSEK with 106 employees Leading supplier of Swiss mortice locks Complets Swiss total door opening solutions Adds important market coverage Accretive to EPS 12
Teamware, Malaysia Turnover of 240 MSEK with 120 employees Creates firm market leadership in fast growing Malaysia Complimentary channels and products Allows specification Accretive to EPS 13
Division - EMEA Strong growth in Scandinavia, Finland, Eastern Europe and Africa Good growth in UK and Iberia Flat in Germany and Israel SALES share of Group total % 25% Negative in Benelux, France and Italy Strategic move in Switzerland EBIT % Operating margin (EBIT) + Organic 3% + Leverage from savings +0.5% - Dilution & Currency -0.7% 19 18 17 16 15 14 13 2010 2011 2012 2013 2014 2015 14
Division - Americas Strong growth in AHW, Doors, El-mech, Residential, Mexico and South America Stable trend in High security and Canada SALES share of Group total % 20 24% Important moves in South America Strong demand from Home Automation Operating margin (EBIT) + Organic 8% + Good leverage from efficiency - Currency & Dilution -0.5% EBIT % 23 22 21 20 19 18 2010 2011 2012 2013 2014 2015 16
Division - Asia Pacific Strong growth in Australia, South Asia and North Asia Good growth in New Zealand China Strong decline due to weak market and credit policy Government incentives for construction Many companies for sale SALES share of Group total % 14 11% Operating margin (EBIT) - Organic -3% + Personnel reduction in China -8% + Positive sales mix - Currency & Dilution -0.3% EBIT % 18 16 14 12 10 8 2010 2011 2012 2013 2014 2015 18
Division - Global Technologies HID Strong growth in Gov-Id, IDT (inlays) and Project sales Good growth in IAM (Identity and access management) Austin move completed SALES share of Group total % 13 14% Hospitality Strong growth Strong profit Operating margin (EBIT) + Organic 12% + Leverage from growth - Currency & Dilution -0.3% EBIT % 21 20 19 18 17 16 15 14 2010 2011 2012 2013 2014 2015 20
Division - Entrance Systems Strong growth in Door Automatics, High Speed Doors, Flexiforce, Amarr and 4Front Flat in Industrial EU and decline in Residential EU and Ditec SALES share of Group total % 28 26% Europe is tough but improving with growing service Operating margin (EBIT) + Organic 5% + Efficiency improvement - Negative mix (US growing) - Currency -0.4% EBIT % 18 17 16 15 14 13 12 11 2010 2011 2012 2013 2014 2015 22
ASSA ABLOY is the global leader in door opening solutions, dedicated to satisfying end-user needs for security, safety and convenience Q1 Report 2015 Carolina Dybeck Happe CFO
Financial highlights Q1 2015 1st Quarter Twelve months MSEK 2014 2015 Change 2013 2014 Change Sales 12,305 15,252 +24% 48,481 56,843 +17% Whereof Organic growth +5% +3% Acquired growth +3% +9% FX-differences +1,892 +16% +2,138 +5% Operating income (EBIT) 1,857 2,329 +25% 7,923 9,257 +17% EBIT-margin (%) ) 15.1 15.3 16.3 16.3 Operating cash flow 557 520-7% 6,803 8,238 +21% EPS (SEK) 3.41 4.36 +28% 14.84 17.38 +17% 25
Bridge Analysis Jan-Mar 2015 MSEK 2014 Jan-Mar Organic Currency Acq/Div 2015 Jan-Mar 5% 16% 3% 24% Revenues 12,305 680 1,892 376 15,252 EBIT 1,857 186 249 38 2,329 % 15.1% 27.3% 13.1% 10.1% 15.3% Dilution / Accretion 0.6% -0.3% -0.1% 26
P&L Components as % of sales Jan Mar 2015 2014 Q1 2015 YTD excluding acquisitions 2015 Q1 Direct material 34.6% 35.5% 35.6% Conversion costs 26.5% 25.4% 25.3% Gross Margin 38.9% 39.1% 39.1% S, G & A 23.8% 23.7% 23.8% EBIT 15.1% 15.4% 15.3% 27
Operating cash flow, MSEK Quarter 12-months 4 500 4 000 3 500 3 000 2 500 2 000 1 500 1 000 500 0 2008 2009 2010 2011 2012 2013 2014 2015 9 500 9 000 8 500 8 000 7 500 7 000 6 500 6 000 5 500 5 000 4 500 Quarter Cash Rolling 12-months EBT Rolling 12 months 28
Gearing % and net debt MSEK Net Debt 30 000 25 000 20 000 15 000 10 000 5 000 Debt/Equity 64 (72) Gearing 120 100 80 60 40 20 0 0 2008 2009 2010 2011 2012 2013 2014 2015 Net debt *) 2008-2011 Not restated for changed pension accounting principles. Gearing Net debt/ebitda 2.3 (2.3) 29
Earnings per share, SEK Quarter SEK 12-months 5,50 5,00 4,50 4,00 3,50 3,00 2,50 2,00 1,50 1,00 0,50 0,00 Dividend proposal 2015: 6.50 SEK (5.70) Stock split proposal 3:1 20,00 18,00 16,00 14,00 12,00 10,00 8,00 2008 2009 2010 2011 2012 2013 2014 2015 Quarter Excluding restructuring costs of 1,000 MSEK in Q4 and full year 2013. 2008-2011 Not restated for changed pension accounting principles. Rolling 12-months 30
ASSA ABLOY is the global leader in door opening solutions, dedicated to satisfying end-user needs for security, safety and convenience Q1 Report 2015 Johan Molin President and CEO
Conclusions Q1 2015 Strong growth by 24% with 5% organic Strong growth in Americas, Global Tech and ESD Good growth in EMEA Decline in APAC Good acquisition pipeline Emerging markets 23% (22) Strong EBIT improvement of 25% Strong EPS improvement by 28% 32
ASSA ABLOY is the global leader in door opening solutions, dedicated to satisfying end-user needs for security, safety and convenience Q&A