*Sales totaled SEK 10,502 M (9,356), representing an increase of 12 percent, made up of 5 percent organic growth, 20 percent acquired growth and currency effects of -13 percent.
*Strong growth in Asia and South America.
*Slow but stable development on the mature markets.
*Operating income (EBIT) increased by 7 percent and amounted to SEK 1,615 M (1,515).
*The operating margin amounted to 15.4 percent (16.2) including dilution from acquisitions and currency with 1.1 percent.
*Sale of Lorentzen & Wettre to ABB means that the Cardo transaction will be complete.
*Reduced tax rate to 22 percent (24).
*Net income amounted to SEK 1,156 M (1,031).
*Earnings per share rose by 12 percent to SEK 3.07 (2.74).
*Sales totaled SEK 10,502 M (9,356), representing an increase of 12 percent, made up of 5 percent organic growth, 20 percent acquired growth and currency effects of -13 percent.
*Strong growth in Asia and South America.
*Slow but stable development on the mature markets.
*Operating income (EBIT) increased by 7 percent and amounted to SEK 1,615 M (1,515).
*The operating margin amounted to 15.4 percent (16.2) including dilution from acquisitions and currency with 1.1 percent.
*Sale of Lorentzen & Wettre to ABB means that the Cardo transaction will be complete.
*Reduced tax rate to 22 percent (24).
*Net income amounted to SEK 1,156 M (1,031).
*Earnings per share rose by 12 percent to SEK 3.07 (2.74).
SALES AND INCOME
COMMENTS BY THE PRESIDENT AND CEO
"In the second quarter of the year sales grew by an exciting 25 percent in local currencies, made up of 5 percent organic growth and 20 percent acquired growth," says Johan Molin, President and CEO. Asia and South America showed strong growth, while development in the mature markets was slow but stable. It was pleasing that our electromechanical products did extremely well and continued to grow in all divisions and on all markets, with HID in particular reporting great successes and achieving 19 percent organic growth during the quarter.
"Operating income improved by 7 percent in spite of strong negative currency effects. The operating margin was affected positively by the volume growth and the efficiency and restructuring programs at the same time as it was diluted by acquisitions and currency.
"It is very pleasing that the Cardo deal is now concluding with the signing with ABB Ltd for the sale of Lorentzen & Wettre. This means that the parts of Cardo that do not fit ASSA ABLOY long term will get industrial owners that gives them better opportunities for continued development and growth. The integration of Crawford is progressing rapidly and is looking extremely promising.
"During the quarter Portafeu, France's leading manufacturer of fire doors, was acquired and its integration into EMEA division is in good progress. Portafeu broadens our offer in one of our most important European markets. I want to take this opportunity to welcome Portafeu's highly skilled staff into the Group.
"The business cycle on the mature markets is expected to be slow but stable due to cuts in public spending at the same time as the development on the emerging markets is expected to continue to be positive."
SECOND QUARTER
The Group's sales totaled SEK 10,502 M (9,356), an increase of 12 percent compared with 2010. Organic growth for comparable units was 5 percent (2). Acquired units contributed 20 percent (8). Currency effects had a negative impact of SEK 956 M on sales, that is -13 percent (-5). Operating income before depreciation, EBITDA, excluding restructuring costs, amounted to SEK 1,863 M (1,780). The corresponding EBITDA margin was 17.7 percent (19.0). The Group's operating income, EBIT, amounted to SEK 1,615 M (1,515), an increase of 7 percent. The operating margin was 15.4 percent (16.2).
Net financial items amounted to SEK -156 M (-152). The Group's income before tax amounted to SEK 1,460 M (1,363), an improvement of 7 percent compared with the previous year. Currency effects had a negative impact of SEK 153 M on the Group's income before tax. The profit margin was 13.9 percent (14.6). The estimated effective tax rate amounted to 22 percent, giving a tax charge of SEK 321 M (333). Earnings per share amounted to SEK 3.07 (2.74), an increase of 12 percent.
FIRST HALF-YEAR
Sales for the first half of 2011 totaled SEK 19,201 M (17,701), representing an increase of 8 percent. Organic growth was 5 percent (-1). Acquired units contributed 14 percent (6). Currency effects affected sales negatively by SEK 1,623 M, that is -11 percent (-5), compared with the first half of 2010. Operating income before depreciation, EBITDA, excluding restructuring costs, amounted to SEK 3,493 M (3,316) for the half-year. The corresponding margin was 18.2 percent (18.7). The Group's operating income, EBIT, excluding restructuring costs, amounted to SEK 2,992 M (2,810), an increase of 6 percent. The corresponding operating margin (EBIT) was 15.6 percent (15.9). Earnings per share for the first half-year rose to SEK 5.60 (5.10) an increase of 10 percent. Operating cash flow for the half-year amounted to SEK 1,758 M (2,310).
RESTRUCTURING MEASURES
Payments related to all restructuring programs amounted to SEK 67 M in the quarter.
The restructuring programs continued according to plan and have led to a reduction in personnel of 89 people during the quarter and 5,572 people since the projects began.
A further 816 people will leave by the end of 2012.
At the end of the quarter, a provision of SEK 809 M was set aside in the balance sheet for carrying out the remaining parts of the programs.