Allegion Plc · NYSE:ALLE
Allegion — Investor Day (May 2025)
65 slides from Allegion's investor day presentation, May 6, 2025
Slide 1: Creating a Safer & More Accessible World
Creating a Safer & More Accessible World Investor & Analyst Day May 6, 2025
Slide 2: Cautionary Statements
Cautionary Statements Forward-Looking Statements This presentation contains "forward-looking statements," which are statements that are not historical facts. These forward-looking statements generally are identified by the words “believe,” “aim,” “project,” “expect,” “anticipate,” “estimate,” “forec
Slide 3: Be Safe, Be Healthy
Be Safe, Be Healthy An Allegion Core Value ▪ NYSE has safety staff assigned to our floor ▪ In emergency, use closest exit (Fire Tower Stair A) ▪ In severe weather, shelter in place here (Freedom Hall) ▪ No smoking; NYSE is tobacco free ▪ Mid-presentation break will be provided 3 2025 Allegion Invest
Slide 4: Agenda
Agenda 1 Company & Strategy Overview John H. Stone 2 The Allegion Model Dave Ilardi 3 Optimizing Performance & Tim Eckersley Growth Opportunities 4 Driving Outgrowth Through John H. Stone, Electronics Vince Wenos 5 Financials & Mike Wagnes Capital Deployment 4 2025 Allegion Investor & Analyst Day
Slide 5: Company & Strategy Overview
Company & Strategy Overview John H. Stone, President & CEO
Slide 6: What You’ll Hear Today
What You’ll Hear Today Allegion is uniquely advantaged, executing at a high level, and we’re primed to grow faster. 6 2025 Allegion Investor & Analyst Day
Slide 7: Our Vision
Our Vision Creating a safer and more accessible world 7 2025 Allegion Investor & Analyst Day
Slide 8: Our Team of Experts
Our Team of Experts We Are Many. We Are One. We Are Allegion. Two-Time Winner | 2024-2025 12,000+ 30+ 25+ 1,000+ full-time trusted countries global global employees brands where we work active patents 8 2025 Allegion Investor & Analyst Day
Slide 9: Global Business Profile
Global Business Profile $3.8 Billion in 2024 Revenue | 24.4% Adjusted EBITDA Margin ▪ Pure-play provider of security and access with iconic brands ▪ Proven ability to expand margins over the cycle and deploy capital consistently ▪ Primed for accelerated growth Software & Services 7% International 20
Slide 10: Our Markets
Our Markets U.S. Non-Residential U.S. Residential International ▪ Lead in school safety ▪ Lead in electronics and ▪ Grow electronics hardware ▪ Grow and leverage our large industry-first technologies and software installed base, specification ▪ Leverage innovation and ▪ Expand specification writing
Slide 11: Leveraging Our Advantages
Leveraging Our Advantages Unique Diverse, Front-End Locally-Driven Markets Creating Value Critical Through Solutions, Capital Configured Deployment to Order Technology Fuels Growth 11 2025 Allegion Investor & Analyst Day
Slide 12: Creating Long-Term Shareholder Value
Creating Long-Term Shareholder Value % Accelerate Improve Drive High Cash Deploy Capital Organic Growth Operating Margin Flow Conversion Effectively Double-Digit Adjusted EPS Growth Over the Cycle 12 2025 Allegion Investor & Analyst Day See appendix for definitions of GAAP to non-GAAP financial meas
Slide 13: Primed to Grow Faster Over the Cycle
Primed to Grow Faster Over the Cycle Revenue Growth, Excluding FX 7.4% 6.1% 7%+ Avg. M&A 2.0% 2.6% 3%+ Contribution 1.5% Avg. Organic Growth 4.5% (Price + Volume) MSD 3.9% -1.0% 2014-2019 2020-2024 Over the Cycle ▪ Strong growth in Americas Non-Residential ▪ Limited market volume growth ▪ MSD-HSD gr
Slide 14: Driving Growth & Value Through Capital Deployment
Driving Growth & Value Through Capital Deployment M&A ▪ Deploy ~100% of available cash flow, 45% M&A ~$2B over next 3 years 50% ▪ Historically balanced ▪ Additional balance sheet capacity available for M&A Share Additional Strategic ▪ M&A more episodic Deployment ▪ Target bolt-ons at 3+ points of an
Slide 15: Focused Approach to M&A
Focused Approach to M&A Top Key Criteria Priorities Technology & ▪ Leverages Allegion’s strengths Electronics ▪ Clear synergy opportunities ▪ Enhances financial profile ▪ ROIC to exceed WACC Mechanical Complementary ▪ Accelerates organic growth Portfolio Software & Expansion Services 15 2025 Allegio
Slide 16: Primed to Grow Faster: M&A in the Core
Primed to Grow Faster: M&A in the Core Americas Total Addressable Market (TAM): ~$20B, Including ~$3B Residential Electronics Exits, Closers & Readers, panels, e-locks, touchless actuators Automatic Doors Panic bar devices, door control hardware, auto doors and services Less Consolidated $5B TAM Con
Slide 17: Recent Mechanical M&A
Recent Mechanical M&A ▪ High margin ▪ Specifiable ▪ Rapidly integrated ▪ Expands presence in fast-growing specialty applications 17 2025 Allegion Investor & Analyst Day
Slide 18: M&A Strategy: Electronics & Software
M&A Strategy: Electronics & Software Technology Complementary & Electronics Software & Services Fill electronic hardware gaps in core markets; Accelerate electronics adoption; Leverage specification leadership Leverage expertise in complex environments 18 2025 Allegion Investor & Analyst Day
Slide 19: The Allegion Model
The Allegion Model Dave Ilardi, SVP & President, Allegion Americas
Slide 20: Accelerating Growth with Our Differentiated Model
Accelerating Growth with Our Differentiated Model Unique Front-End Technology Fuels Growth ▪ Highly skilled consultants and ▪ Connectivity and electronic solutions specification team generate non- drive growth residential demand and pull product ▪ Allegion drives standards and scale through the chan
Slide 21: Demand Generation Through Building Lifecycle
Demand Generation Through Building Lifecycle Building Strong Relationships Design Construct Own ▪ Project Architects ▪ General Contractors ▪ Facilities Managers ▪ Architectural Designers ▪ Integrators ▪ Information Technology ▪ Security Consultants ▪ Software Providers (PACS) ▪ Tenants ▪ Project Man
Slide 22: The Partner of Choice for New Construction
The Partner of Choice for New Construction Architectural Consulting Design Construct Own ▪ Local expertise in building codes and standards ▪ Support design integrity, compliance and security ▪ Tailor our solutions to meet diverse project needs ▪ Maximize building functionality and efficiency 22 2025
Slide 23: Tailored Support for Contractors, Distributors & Integrators
Tailored Support for Contractors, Distributors & Integrators Channel Excellence Design Construct Own ▪ General Contractors ▪ Pre-construction planning and training ▪ Installation readiness / post-install walk-throughs ▪ Distribution Channel ▪ Robust distribution channel and product availability ▪ Ex
Slide 24: Optimizing Building Portfolios
Optimizing Building Portfolios End-User Consultation Design Construct Own ▪ Establish ongoing owner standards for facilities and construction teams ▪ Provide product training for maintenance technicians and service providers ▪ Consult across departments to ensure long-term performance of our solutio
Slide 25: Leveraging Our Advantage: Vertical Markets
Leveraging Our Advantage: Vertical Markets Complex, Dense Content Mix ▪ Institutional Americas Non-Residential ▪ High content, leverage our Estimated $/SF leadership in a stable, premium market ▪ Multifamily ▪ Increase content through technology ▪ Commercial ▪ Focus on core markets and growth opport
Slide 26: Accelerating Growth with Our Differentiated Model
Accelerating Growth with Our Differentiated Model Unique Front-End Technology Fuels Growth ▪ Highly skilled consultants and ▪ Connectivity and electronic solutions specification team generate non- drive growth residential demand and pull product ▪ Allegion drives standards and scale through the chan
Slide 27: Optimizing Performance & Growth Opportunities
Optimizing Performance & Growth Opportunities Tim Eckersley, SVP & President, Allegion International
Slide 28: Leveraging Our Advantages, Driving Profitable Growth
Leveraging Our Advantages, Driving Profitable Growth Allegion Has a High Operating Leverage Business Model Diverse, Locally Driven Markets Critical Solutions, Configured to Order ▪ Share best practices and technology ▪ Increase safety, quality and efficiency globally, optimize locally through automa
Slide 29: Global Best Practices, Local Optimization
Global Best Practices, Local Optimization Hardware / Devices ▪ Core component platforming ▪ Customized to meet country-specific standards and local market needs Electronics / Software ▪ Digital platforming ▪ Long-term local integrations ▪ SaaS revenue opportunities Processes / Strategy ▪ Channel rel
Slide 30: Investing in Automation
Investing in Automation Long-Term Improvements in Innovation, Safety, Quality and Productivity Americas International Greenfield, IN, USA Osterfeld, Germany Pin drops on map represent a sampling Princeton, IL, USA Auckland, New Zealand of 2023-2025 automation investments Asia Pacific 30 2025 Allegio
Slide 31: Driving Profitability Through Differentiated Growth
Driving Profitability Through Differentiated Growth Cloud-based infrastructure | Flexible platforming Global long-term growth trend in electronics Annual recurring revenue Solutions approach and interoperability 31 2025 Allegion Investor & Analyst Day
Slide 32: Enhanced Business Quality
Enhanced Business Quality Primed for Additional Profitable Growth Opportunities Business Transformation Strategic Acquisitions Portfolio Management ▪ Disciplined approach to ▪ Opportunities to ▪ Focusing on profitable simplification and accelerate growth growth opportunities efficiencies ▪ Leveragin
Slide 33: Leveraging Our Advantages
Leveraging Our Advantages +280 bps Enterprise Adj. EBITDA Diverse, Locally Margins 2021-2024 Our Business is Primed for Growth Driven Markets ▪ High operating leverage business model ▪ High-quality business portfolio We’re Accelerating Momentum and Increasing Profitability ▪ Automation driving safet
Slide 34: Driving Outgrowth Through Electronics
Driving Outgrowth Through Electronics John H. Stone, President & CEO Vince Wenos, SVP & Chief Technology Officer
Slide 35: Innovating with Electronics & Software
Innovating with Electronics & Software ~30% HSD ~1+ pt ~2-2.5x of 2024 electronics growth over average annual revenue ASP vs. mechanical products revenue the cycle outgrowth since spin at similar margin rate Guiding Standards, Creating Open Ecosystems 35 2025 Allegion Investor & Analyst Day All bran
Slide 36: Driving Adoption in Key Verticals
Driving Adoption in Key Verticals K-12 Higher Ed Multifamily Enterprise ▪ Increasing safety from ▪ Modernizing student ▪ Creating competitive ▪ Leveraging core spec- the perimeter through to experiences edge with improved writing strength the classroom ▪ Increasing security and tenant experiences ▪
Slide 37: Electronics Growth Driven by Significant ROI and Improved Tenant Experiences
Electronics Growth Driven by Significant ROI and Improved Tenant Experiences ▪ Flexible, easy to deploy, mobile credentials ▪ Significant savings and potential revenue source U.S. Multifamily Market ~25 Million Units Higher ~25% Class A Electronics Adoption ~75% Class B & C Lower 37 2025 Allegion In
Slide 38: A Value Proposition Tailored to Meet Multifamily Market Needs
Increase Revenue A Value Proposition Tailored to Meet Multifamily Market Needs Manage Costs Attract Tenants Reduced Time-to-Turn, Maintenance and Higher Rent Vendor Access Potential Leasing Office Expense Cost Savings Improved Tenant Reduction Experience 38 2025 Allegion Investor & Analyst Day
Slide 39: Productivity Through Platforming
Productivity Through Platforming Prior to Platforming With Platforming ▪ Unique, independent product designs ▪ Reuse of common platforms – requiring significant time, investment electronics, software and hardware and resources ▪ Improved efficiency – lower risk, ▪ Ever-increasing resources to mainta
Slide 40: Allegion’s Platforming in Action
Allegion’s Platforming in Action Cumulative Assets Deployed Efficiency gains ▪ Over 45% reduction in development time Resource optimization ▪ Reduced development effort by ~225 person months Pre-2025 2025 2026 2027+ ▪ Initial focus on embedded software and Global impact electrical hardware ▪ Shared
Slide 41: Ongoing History of Innovation in Electronics
Ongoing History of Innovation in Electronics SimonsVoss Schlage LE Schlage Encode Schlage NDE-B, Acquisition with Engage – 1st Battery LE-B, Control-B Schlage XE360 Powered Schlage Sense Integrated Wi-Fi 2014 2015 2016 2017 2018 2019 2020 2021 2022 2024 2025 Schlage NDE Schlage Sense Von Duprin Exit
Slide 42: Financials & Capital Deployment
Financials & Capital Deployment Mike Wagnes, SVP & Chief Financial Officer
Slide 43: Creating Long-Term Shareholder Value
Creating Long-Term Shareholder Value % Accelerate Improve Drive High Cash Deploy Capital Organic Growth Operating Margin Flow Conversion Effectively Double-Digit Adjusted EPS Growth Over the Cycle 43 2025 Allegion Investor & Analyst Day See appendix for definitions of GAAP to non-GAAP financial meas
Slide 44: Strong Organic Growth, Industry-Leading Margins
Strong Organic Growth, Industry-Leading Margins $600 $4,000.0 $8.00 26.00% $583M $3,772M $7.53 $7.00 $3,500.0 $500 24.00% $919M $6.00 $443M $3,000.0 22.00% $400 24.4% $5.00 $2,500.0 $2,867M 20.00% $618M $5.43 $300 18.00% 21.6% $4.00 $2,000.0 $3.00 $200 16.00% $1,500.0 $2.00 14.00% $100 $1,000.0 $1.0
Slide 45: Resilient Margins Through Cycles
Resilient Margins Through Cycles 45 2025 Allegion Investor & Analyst Day See appendix for definitions and reconciliations of GAAP to non-GAAP financial measures.
Slide 46: Bending the Curve on Growth Investments
Bending the Curve on Growth Investments R&D CapEx ~1.5x Spend (2021-2024) ~2x Spend (2021-2024) From 2.6% of Sales (2021) From 1.6% of Sales (2021) to 3.0% of Sales (2024) to 2.4% of Sales (2024) $600.00 26.00% $500.00 $583M 24.00% 22.00% $919M $443M $400.00 24.4% 20.00% $618M Adjusted Available 21.
Slide 47: Driving Profitable Growth
Driving Profitable Growth Investor Day +150-300 bps ~35% Adj. EBITDA margins in 2025 Core Incremental Margins 2022 2023 2024 Over the Cycle 22.1% 24.4% Adj. EBITDA Margin +230 bps; on track for top half of 2025 range Adj. EBITDA Margin 47 2025 Allegion Investor & Analyst Day See appendix for definit
Slide 48: Driving Growth & Value Through Capital Deployment
Driving Growth & Value Through Capital Deployment M&A ▪ Deploy ~100% of available cash flow, 45% M&A ~$2B over next 3 years 50% ▪ Historically balanced ▪ Additional balance sheet capacity available for M&A Share Additional Strategic ▪ M&A more episodic Deployment ▪ Target bolt-ons at 3+ points of an
Slide 49: Proven Track Record of Leverage Management
Proven Track Record of Leverage Management Supporting Growth While Maintaining Investment Grade Rating 49 2025 Allegion Investor & Analyst Day See appendix for definitions and reconciliations of GAAP to non-GAAP financial measures.
Slide 50: Long-Term Value Framework
Long-Term Value Framework LDD ~10% ~3% HSD 35% Incremental Adj. EPS Additional Adj. EPS MSD Margins Growth B/S CAGR Electronics +1% Before Capacity Core Adj. Borrowing EPS Growth Market Organic Adj. OI Growth Capital Revenue Deployment Growth Price: 1.5-2% 50 2025 Allegion Investor & Analyst Day See
Slide 51: Closing & Q&A
Closing & Q&A John H. Stone, President & CEO
Slide 52: What You Heard Today
What You Heard Today Allegion is uniquely advantaged, executing at a high level, and we’re primed to grow faster. 52 2025 Allegion Investor & Analyst Day
Slide 53: Appendix
Appendix
Slide 54: Allegion Americas
Allegion Americas Residential: ~20% Institutional: ~50-60% Brand strength led K-12, Higher Ed, Healthcare, etc. by technology innovation Non-Res Revenue by Market Vertical Commercial: ~30-35% Markets Office, Industrial, Data Centers, etc. Non-Residential: ~80% Demand generation Multifamily: ~10-15%
Slide 55: Allegion International
Allegion International Mechanical: ~60% High-quality portfolio of market-leading brands Revenue by Product Category Electronics & Software: ~40% Growing portfolio of connected hardware and cloud-based software capabilities 55 2025 Allegion Investor & Analyst Day Estimated as of fiscal year 2024.
Slide 56: Resilient EBITDA Margins Through Cycles
Resilient EBITDA Margins Through Cycles 1 2 (1) EBITDA defined as operating income plus depreciation and amortization. (2) EBITDA Margin for 2008-2013 calculated using revenue adjusted for Asia joint venture order flow change 2000-2007 represents the Security & Safety or Security Technologies segmen
Slide 57: 2025 Allegion Investor & Analyst Day
57 2025 Allegion Investor & Analyst Day STANLEY ACCESS TECHNOLOGIES is used with permission. STANLEY is the property of Stanley Logistics L.L.C.
Slide 58: Our Leadership
Our Leadership Board of Directors Jeff Braun Tim Eckersley Jen Hawes Senior Vice President, Senior Vice President, Senior Vice President, Kirk S. Hachigian General Counsel, Allegion International Chief Human Former Chairman of JELD-WEN Holding, Inc. Corporate Secretary Resources Officer Susan L. Mai
Slide 59: Values-Led Culture
Values-Led Culture Our Core Values Date Back to Our Founding Serve others, not yourself Be curious beyond the obvious Enjoy what you do and Be empowered and accountable celebrate who we are Do the right thing This is your business, run with it Be safe, be healthy Have a passion for excellence 59 202
Slide 60: Global Reach & Manufacturing Footprint
Global Reach & Manufacturing Footprint 12,000+ Employees | 15,000+ Channel Partners | 120 Countries Where Products Sold Allegion Allegion Allegion Americas International Corporate Corporate headquarters Dublin, Ireland Global technology center Bangalore, India 60 2025 Allegion Investor & Analyst Day
Slide 61: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures The company presents operating income, operating margin, net debt, net earnings and diluted earnings per share (EPS) on both a U.S. GAAP basis and on an adjusted (non-GAAP) basis, revenue growth on a U.S. GAAP basis and organic revenue growth on a non-GAAP basis,
Slide 62: Consolidated Operating Income & EBITDA Reconciliation
Consolidated Operating Income & EBITDA Reconciliation 62 2025 Allegion Investor & Analyst Day
Slide 63: Consolidated Net Income & EPS Reconciliation
Consolidated Net Income & EPS Reconciliation 63 2025 Allegion Investor & Analyst Day
Slide 64: Consolidated Reconciliation of Available Cash Flow
Consolidated Reconciliation of Available Cash Flow 64 2025 Allegion Investor & Analyst Day
Slide 65: About Allegion
About Allegion At Allegion (NYSE: ALLE), we design and manufacture innovative security and access solutions that help keep people safe where they live, learn, work and connect. We’re pioneering safety with our strong legacy of leading brands like CISA®, Interflex®, LCN®, Schlage®, SimonsVoss® and Vo