“The third quarter of the year showed satisfactory growth for Assa Abloy generally, with the exception of Asia Pacific,” says Johan Molin, President and CEO.
Third quarter
- Sales totaled SEK 18,025 M (17,465), with 2% (3) organic growth and 2% (4) acquired growth
- Strong growth for Global Technologies and Americas
- Good growth for Entrance Systems and growth for EMEA
- Negative growth for Asia Pacific due to weak demand in China
- Trojan in the UK was acquired, with expected annual sales of SEK 220 M
- Operating income (EBIT) was SEK 3,020 M (2,970). The operating margin was 16.8% (17.0)
- Net income amounted to SEK 2,122 M (2,069)
- Earnings per share amounted to SEK 1.91 (1.86)
- Operating cash flow increased by 1% to SEK 2,830 M (2,816)
Comments by the President and CEO
“The third quarter of the year showed satisfactory growth for
Assa Abloy generally, with the exception of Asia Pacific,” says Johan Molin, President and CEO. “In general the mature markets made good progress while the growth markets continued to show subdued demand, apart from Latin America and India.
“In Global Technologies and Americas there was strong growth during the quarter, driven by successful marketing efforts and the launch of innovative new products. Entrance Systems showed good growth. EMEA showed growth despite some impact from a negative calendar effect. Growth in Asia Pacific remained negative because of the weak demand in China.
“The organic growth was rather weaker this quarter and amounted to 2%. Operating income remained strong and the operating margin was 16.8% (17.0).
“A number of major exhibitions have taken place during the quarter, with gratifying results. The Group’s innovations have once again been honored by the award of several prestigious prizes. The launches of The Security Continuum (a platform-independent series of commercial electronic locks) and Accentra (a cloud-based electronic system for multi-family buildings) were especially acclaimed. Another interesting new series of products that was launched was HID Global’s virtual authentication and identification solutions, by which, for example, future driver’s licenses can be securely stored on an ordinary smartphone.
“The English company Trojan was acquired during the quarter. The company is a typical example of a complementary acquisition providing high synergies, by which the company’s specialized door and window products allow us to offer the British market complete lock and fittings solutions with good profitability.
“Operating income for the quarter amounted to SEK 3,020 M, with an operating margin of 16.8%, mainly due to positive organic growth, lower raw-material costs and other significant savings. Operating cash flow remained strong.
“My judgment is that the global economic trend remains weak, but with a positive trend in America and parts of Europe. Elsewhere, many of the emerging markets are stagnating. However, our strategy of expanding on the emerging markets remains unchanged, since in the long term they are expected to achieve very good economic growth. We are also continuing our investments in new products, especially in the growth area of electromechanics.”