Assa Abloy Ab Class B · OMXSTO:ASSA_B
Assa Abloy Ab Class B — Q3 2020 Earnings Presentation
33 slides from Assa Abloy Ab Class B's earnings presentation, 2020
Slide 1: Q3 interim report 2020
ASSA ABLOY Q3 interim report 2020 Public
Slide 2: Strong recovery in the quarter
Strong recovery in the quarter Organic sales development – Sales growth in Entrance Systems – Stable sales in EMEA – Sales declined in Americas and APAC – Sales declined significantly in Global Technologies Strong EBIT-margin recovery – Significant savings and cost measures implemented – Operati
Slide 3: Q3 2020 figures in summary
Q3 2020 figures in summary Sales MSEK 22,225 -8% 25 000 Sales EBIT 5 500 – - 5% organic -8% -8% – +4% acquired 24 000 5 000 – - 7% currency 23 000 4 500 EBITA-margin 16.8%* (16.7%) 22 000 4 000 3 894 21 000 3 500 EBIT-margin 16.2%* (16.2%) 3 593 20 000 3 000 EBIT MSEK 3,593 -8% 19 000 2 500
Slide 4: Sales by region Jul-Sep 2020
Sales by region ASSA ABLOY 100 -1 -5 Emerging markets 16 -5 -8 Jul-Sep 2020 36 +3 -3 44 -3 -5 12 -9 -10 1 +4 -5 2 -5 -7 5 +19 -3 Change in local currencies Organic change Share of sales, % QTD 2020 vs. QTD 2019, % QTD 2020 vs. QTD 2019, % Emerging markets comprise follows IMF’s definition as per 201
Slide 5: Market highlights
Market highlights Project wins Key Management and doors for Qatar World Cup stadiums Docking solution for big box retail in the US Selected to supply smart locks to a Chinese real estate association Product launches HID OMNIKEY launch (smallest embedded reader module) IOT solutions for
Slide 6: Sales growth
Sales growth % MSEK 20 100 000 15 95 000 10 90 000 5 85 000 0 80 000 -5 75 000 -10 70 000 -15 65 000 -20 60 000 2015 2016 2017 2018 2019 2020 Organic growth, % Acquired growth, % Sales in fixed currencies, MSEK 6 Public
Slide 7: Operating margin
Operating margin Run rate: EBIT-margin 14.0% (15.8%) % % 18 18 17 17 Long term target range (average) 16 16 15 15 14 14 13 13 12 12 11 11 10 10 9 9 8 8 2015 2016 2017 2018 2019 2020 Quarter EBIT Rolling 12-months EBITA* Rolling 12-months Excluding China write-downs, restructuring items *) Operating
Slide 8: Operating profit
Operating profit MSEK -8% MSEK, 12 months 4 500 vs 16 000 Q3 LY 4 000 14 000 3 500 12 000 3 000 10 000 2 500 8 000 2 000 6 000 1 500 4 000 1 000 500 2 000 0 0 2015 2016 2017 2018 2019 2020 Quarter Rolling 12-months *) Excluding China write-downs, restructuring items and a positive revaluation of agt
Slide 9: Acquisitions
Acquisitions Fully active pipeline – 4 acquisitions completed in Q3 agta record consolidated from August 31 – 9 acquisitions completed in 2020 Including Olimpia in October – Acquired annualized sales of MSEK 5,700 Divestments – agta record and ASSA ABLOY Entrance businesses – CEDES, transact
Slide 10: Olimpia, Latin America
Olimpia, Latin America Complementary to Latin America business Sales of MSEK 125 in 2019 A leading glass hardware and accessories brand in Latin America and the Caribbean Accretive to EPS from start 10 Public
Slide 11: Opening Solutions EMEA
Opening Solutions 21% EMEA of Group sales Organic sales declined –2% 6 000 20% – Good sales growth in the UK 5 500 18% – Stable sales in Germany and Scandinavia – Sales declined in Benelux, Eastern Europe, France, 5 000 16% Middle East/Africa and South Europe 4 500 14% – Strong growth for Elmech p
Slide 12: Opening Solutions Americas
Opening Solutions 22% of Americas Group sales Organic sales declined -5% 6 500 24% – Very strong sales growth in US Smart Residential and Latin America 6 000 23% – Strong sales growth in US Residential 5 500 22% – Sales declined in Architectural Hardware, Electromechanical Solutions and Security D
Slide 13: Opening Solutions Asia Pacific
Opening Solutions 10% Asia Pacific of Group sales Organic sales declined -8% 3 000 20% – Sales declined in Pacific and China – Significant sales decline in all other regions 15% 2 500 10% 5% 2 000 Operating margin 7.4% (9.5%) 0% – Negative leverage (-190 bps) due to Covid-19 Negative mix -5% 1
Slide 14: Global Technologies
Global Technologies 15% of Group sales Organic sales declined –17% 4 500 24% – Sales growth in Secure Issuance 4 000 22% – Sales declined in Identity & Access Mgmt Solutions and Physical Access Control 3 500 20% – Significant sales decline in all other business areas 3 000 18% – Significant sales
Slide 15: Entrance Systems
Entrance Systems 32% of Group sales Organic sales growth of 1% 7 500 18% – Good sales growth in Perimeter Security – Sales growth in Residential and Industrial 7 000 17% – Sales declined in Pedestrian 6 500 16% – Sales growth in service 6 000 15% 5 500 14% Operating margin 17.8% (13.6%) – Strong
Slide 16: Financial summary, Q3 2020
Financial summary, Q3 2020 FX & acquisition ‘run-rate’ effects in Q4 2020 (30 September 2020): SALES FX: -4% Acq: +5% July-September January-September SEK M 2019 2020* Change 2018 2020* Change Sales 24,034 22,225 -8% 69,082 64,351 -7% - Organic growth 807 -1,043 - 5% 2,505 -6,001 -9% - Acquired net
Slide 17: Cost efficiency in everything we do
Cost efficiency in everything we do Progress in Q3 Close to 10% of workforce impacted by Reduced SG&A and conversion net costs by temporary short time schedule in Q3 Headcount reduction 5% Jan-Sep ~SEK 0.6 bn in Q3 Operational efficiency Travel costs reduced by 85% ASSA ABLOY’s new factory i
Slide 18: Bridge analysis – Q3 2020
Bridge analysis – Q3 2020 MSEK Q3 2019 Organic Currency Acq/Div Q3 2020 Growth -5% -7% 4% -8% Sales 24,034 -1,043 -1,581 816 22,225 Operating profit 3,894 -271 -264 233 3,593 Operating margin, % 16.2% 26.0% 16.7% 28.6% 16.2% Dilution/accretion -0.4 pts -0.1 pts 0.5 pts Sales decreased MSEK -1,809
Slide 19: Cost breakdown as % of sales July-September
Cost breakdown as % of sales July-September QTD 2020 % QTD 2019 excl. acquisitions Δ QTD 2020 Direct material -36.5% -35.6% +0.9 pts -35.5% Conversion cost -23.5% -23.3% +0.2 pts -23.9% Gross margin 40.0% 41.1% +1.1 pts 40.6% S, G & A -23.8% -25.4% -1.6 pts -24.4% EBIT 16.2% 15.7% -0.5 pts 16.2% • D
Slide 20: Operating cash flow, MSEK
Operating cash flow, MSEK Working capital down SEK 0.8 Bn Quarter 12 months 6 000 20 000 12 months cash flow / EBT = 123% 18 000 5 000 16 000 14 000 4 000 12 000 3 000 10 000 8 000 2 000 6 000 4 000 1 000 2 000 0 0 2015 2016 2017 2018 2019 2020 Quarter, MSEK Cash rolling 12 months, MSEK EBT rolling
Slide 21: Gearing % and net debt, MSEK
Gearing % and net debt, MSEK Net debt/EBITDA 2.2 (2.1) Net debt Gearing 40 000 75 Debt/Equity 56% (64%) 35 000 60 30 000 25 000 45 20 000 30 15 000 10 000 15 5 000 0 0 2015 2016 2017 2018 2019* 2020 Net debt, MSEK Gearing, % *) IFRS 16 effect on net debt SEK 3.7 bn. 21 Public
Slide 22: Earnings per share, SEK
Earnings per share, SEK Quarter 12 months Q3 EPS -6% 2,50 10,00 Dividend proposal: SEK 1.85 2,25 9,00 2,00 8,00 1,75 7,00 1,50 6,00 1,25 5,00 1,00 4,00 0,75 3,00 0,50 2,00 2015 2016 2017 2018 2019 2020 Quarter, SEK Rolling 12 months, SEK Excluding restructuring items, impairment of intangible assets
Slide 23: Committing to science-based targets
Committing to science-based targets ASSA ABLOY commits to science-based targets – Halving greenhouse gas emissions by 2030 Limiting global temperature rise to 1.5°C – Reaching net-zero by 2050. Change 2015-2019 Increased sustainability focus provides incentives for sound economic and industria
Slide 24: Conclusions
Conclusions Strong recovery in a difficult quarter – Sales declined by 8% – Strong margin recovery – Very strong cash flow of SEK 4.4 bn Short term view – Covid-19 continues to have negative effects – Strong cost focus – Investments in growth initiatives Long term view – Attractive fundamental
Slide 25: Q&A
=N Experience a safer and more open world The ASSA ABLOY Group is the global leader in.access solutions. Every day we help people feel safe, secure and experience amore open world. ASSA ABLOY
Slide 26: Appendix
Appendix Public
Slide 27: Cost breakdown as % of sales
Cost breakdown as % of sales QTD 2020 YTD 2020 excl. excl. % QTD 2019 acquisitions Δ QTD 2020 YTD 2019 acquisitions Δ YTD 2020 Direct material -36.5% -35.6% +0.9 pts -35.5% -36.0% -34.9% +1.1 pts -35.0% Conversion cost -23.5% -23.3% +0.2 pts -23.9% -23.9% -24.9% -1.0 pts -25.1% Gross margin 40.0% 41
Slide 28: Opening Solutions EMEA's bridge
Opening Solutions EMEA’s bridge MSEK Q3 2019 Organic Currency Acq/Div Q3 2020 Growth -2% -4% 0% -6% Sales 5,120 -78 -206 -13 4,824 Operating income 822 -22 -32 -3 765 Operating margin, % 16.1% 27.7% 15.5% 28.0% 15.9% Dilution/accretion -0.2 pts 0.0 pts 0.0 pts 12 months figures Sales 21,105 19,264 E
Slide 29: Opening Solutions Americas' bridge
Opening Solutions Americas’ bridge MSEK Q3 2020 Organic Currency Acq/Div Q3 2020 Growth -5% -8% -9% -22% Sales 6,099 -230 -578 -513 4,779 Operating income 1,249 -39 -121 -122 966 Operating margin, % 20.5% 17.1% 21.0% 23.9% 20.2% Dilution/accretion 0.1 pts 0.0 pts -0.4 pts 12 months figures Sales 22,
Slide 30: Opening Solutions Asia Pacific's bridge
Opening Solutions Asia Pacific’s bridge MSEK Q3 2019 Organic Currency Acq/Div Q3 2020 Growth -8% -6% 0% -14% Sales 2,874 -219 -186 10 2,479 Operating income 274 -68 -16 -7 183 Operating margin, % 9.5% 31.2% 8.5% -69.9% 7.4% Dilution/accretion -1.9 pts 0.1 pts -0.3 pts 12 months figures Sales 10,768
Slide 31: Global Technologies' bridge
Global Technologies’ bridge MSEK Q3 2019 Organic Currency Acq/Div Q3 2020 Growth -17% -6% 9% -14% Sales 3,991 -629 -265 331 3,428 Operating income 810 -184 -60 -15 550 Operating margin, % 20.3% 29.3% 22.6% -4.6% 16.0% Dilution/accretion -2.1 pts 0.0 pts -2.2 pts 12 months figures Sales 14,648 14,991
Slide 32: Entrance Systems' bridge
Entrance Systems’ bridge MSEK Q3 2019 Organic Currency Acq/Div Q3 2020 Growth 1% -7% 17% 11% Sales 6,427 67 -377 999 7,116 Operating income 873 50 -38 381 1,266 Operating margin, % 13.6% 74.4% 10.1% 38.1% 17.8% Dilution/accretion 0.5 pts 0.4 pts 3.3 pts 12 months figures Sales 25,276 27,288 EBIT 3,5
Slide 33: Thank you
Thank you assaabloy.com Public