Assa Abloy Ab Class B · OMXSTO:ASSA_B

Assa Abloy Ab Class B — Q4 2023 Earnings Presentation

33 slides from Assa Abloy Ab Class B's earnings presentation, Feb 7, 2024

  1. Slide 1: ASSA ABLOY Q4 interim report 2023

    ASSA ABLOY Q4 interim report 2023

  2. Slide 2: Strong result in a challenging market

    Strong result in a challenging market  Positive organic sales development – Strong sales growth in Americas – Good sales growth in Entrance Systems – Sales decline in APAC, EMEIA and Global Technologies  Strong underlying margin – Strong operating leverage  Record strong operating cash flow  Con

  3. Slide 3: Q4 2023 figures in summary

    Q4 2023 figures in summary Sales EBIT*^ +12% +12%  Sales MSEK 36,970 +12% – +0% organic 38,000 6,500 – +11% acquired and divested 36,000 5,759 6,000 – +1% currency 34,000 5,500  EBITA-margin*^ 17.5% (16.2%) 32,000 30,000 5,000 5,152  EBIT-margin*^ 16.8% (15.7%) 28,000 4,500 26,000 4,000  EBIT*^

  4. Slide 4: Sales by region Oct-Dec 2023

    Sales by region ASSA ABLOY 100 11 0 Emerging markets 14 16 10 Oct-Dec 2023 33 4 0 51 15 -2 8 8 5 1 29 28 3 36 17 4 5 3 Change in local currencies Organic change Share of sales, % QTD 2023 vs. QTD 2022, % QTD 2023 vs. QTD 2022, % Emerging markets follows IMF’s definition as per 2018-12-31 4

  5. Slide 5: Q4 2023 Market highlights

    Q4 2023 Market highlights Project wins  Modernization and replacement of master key systems for a German energy company with ~100,000 cylinders  Docking solutions and high-speed doors delivered to two large electrical vehicle battery plants in the US  HID has been awarded a contract to provide Fi

  6. Slide 6: FX adjusted sales growth

    FX adjusted sales growth 12 consecutive quarters with positive OG % MSEK 30 140,000 25 130,000 20 15 120,000 10 110,000 5 100,000 0 90,000 -5 80,000 -10 -15 70,000 -20 60,000 2018 2019 2020 2021 2022 2023 Organic growth, % Acquired growth, % Sales in fixed currencies, MSEK 6

  7. Slide 7: Operating margin

    Operating margin 16.8% EBIT-margin run % Run rate: EBIT-margin 15.8% (15.3%) rate ex. HHI/div 19 18 17 Long term target range (average) 16 15 14 13 12 11 10 2018 2019 2020 2021 2022 2023 Quarter EBIT* Rolling 12-months EBIT* ex HHI/div last 12 months EBITA* Rolling 12-months *) Operating margin befo

  8. Slide 8: Operating profit

    Operating profit +67% +20% in 5 years run in 2023 rate MSEK MSEK 6,000 22,500 20,000 5,000 17,500 4,000 15,000 12,500 3,000 10,000 2,000 7,500 5,000 1,000 2,500 0 0 2018 2019 2020 2021 2022 2023 Quarter Rolling 12-months Excluding items affecting comparability 8

  9. Slide 9: Acquisitions

    Acquisitions  Active pipeline – 6 acquisitions signed in Q4 – 24 acquisitions signed as of December 2023 – Representing annualized sales of SEK 20 bn Hardware & Home Improvement 9

  10. Slide 10: Leone Fence, Canada

    Leone Fence, Canada  Manufacturer of fencing products for commercial and residential applications  Reinforcing our current offering within perimeter security in the Canadian market  Sales of MSEK 300 in 2022  Accretive to EPS from the start 10

  11. Slide 11: Ghost Controls, USA

    Ghost Controls, USA  Supplier of automated residential gate openers  Sales of MSEK 300 in 2022  Accretive to EPS from the start 11

  12. Slide 12: Opening Solutions EMEIA

    Opening Solutions 17% EMEIA of Group sales  Organic sales -2% – Strong growth in Middle East/India/Africa 6,500 21% – Good growth in South Europe 6,000 19% – Stable in Central Europe 5,500 – Sales decline in UK/Ireland and the Nordics 17% 5,000 4,500 15%  Operating margin 14.4% (15.0%) 4,000 13% –

  13. Slide 13: Opening Solutions Americas

    Opening Solutions 28% of Americas 23.8% Group sales Q4 operating margin excl.  Organic sales +5% HHI/div – Good growth in North America Non-Residential and in 12,000 25% Latin America – Sales decline in US Residential 11,000 24% 10,000 23%  Operating margin 17.6%* (21.3%) 9,000 22% – Very strong o

  14. Slide 14: Opening Solutions Asia Pacific

    Opening Solutions 6% Asia Pacific of Group sales  Organic sales -1% – Very strong sales growth in South-East Asia 3,000 15% – Stable sales growth in China – Sales decline in South Korea and Pacific 10% 2,500  Operating margin 4.3% (-4.7%) 5% – Very strong operating leverage due to pricing, lower 2

  15. Slide 15: Global Technologies

    Global Technologies 16% of Group sales  Organic sales -7% – Very strong sales growth in Citizen ID 6,000 24% – Good sales growth in Identity & Access Solutions and Extended Access 5,500 22% – Sales decline in Secure Issuance, Identification 5,000 20% Technology and significant sales decline in Phys

  16. Slide 16: Entrance Systems

    Entrance Systems 33% of Group sales  Organic sales +3% – Very strong sales growth in Perimeter Security 13,000 18% – Strong sales growth in Industrial and Pedestrian – Sales decline in Residential 12,000 17% 11,000 16% – Strong growth in service 10,000 15% 9,000  Operating margin 17.4% (16.5%) 14%

  17. Slide 17: Financial summary

    FX & acquisition ‘run-rate’ effects in Q1 2024 Financial summary (31 December 2023): SALES FX: -3% M&A: 11% October-December* January-December* SEK M 2022 2023 Change 2022 2023 Change Sales 32,915 36,970 12% 120,793 140,716 16% - Organic growth 2,656 133 0% 13,007 3,393 3% - Acquired net growth 1,33

  18. Slide 18: Bridge analysis – Q4 2023

    Bridge analysis – Q4 2023 Q4 2023 ex MSEK Q4 2022 Organic Currency Acq/div HHI/div Q4 2023 HHI/div Growth 28% 0% 1% 3% 4% 8% 12% Sales 32,915 133 349 920 34,318 2,651 36,970 Operating profit* 5,152 450 29 127 5,759 -37 5,722 Operating margin, %* 15.7% 337% 8.4% 13.8% 16.8% -1.4% 15.5% Dilution/accre

  19. Slide 19: HHI: Positive margin trend

    HHI: Positive margin trend  HHI financial performance 600 100 – Sales –1% vs Q4 last year EBIT- – EBITDA-margin 14.9% vs 12.4% in Q4 last year 500 margin 8.9% – Adjusted EBIT-margin at 8.9%, up 130bps versus Q3, 75 excluding closing and integration costs in Q4 of MSEK 180 400 – PPA at MUSD 60 per a

  20. Slide 20: Cost breakdown as % of sales – Q4 2023

    Cost breakdown as % of sales – Q4 2023 QTD 2023 % QTD 2022 excl. acq/div Δ QTD 2023 Direct material -37.0% -34.6% +2.4 pts -35.5% Conversion cost -22.9% -23.9% -1.0 pts -23.9% Gross margin 40.1% 41.5% +1.4 pts 40.6% S, G & A -24.4% -24.6% -0.2 pts -25.1% EBIT* 15.7% 16.9% +1.2 pts 15.5% *Excluding i

  21. Slide 21: Operating cash flow, MSEK

    Operating cash flow, MSEK Quarter 12 months cash flow / EBT = 128% 12 months 8,000 26,000 23,500 7,000 21,000 6,000 18,500 5,000 16,000 13,500 4,000 11,000 3,000 8,500 6,000 2,000 3,500 1,000 1,000 0 -1,500 2018 2019 2020 2021 2022 2023 Quarter, MSEK Cash rolling 12 months, MSEK EBT rolling 12 month

  22. Slide 22: Gearing % and net debt, MSEK

    Gearing % and net debt, MSEK Net debt/EBITDA** 2.3 (1.4) Net debt Net debt/Equity 70% (37%) Gearing % 80,000 80 70,000 70 60,000 60 50,000 50 40,000 40 30,000 30 20,000 20 10,000 10 0 0 2018 2019* 2020 2021 2022 2023 Net debt, MSEK Gearing, % *) IFRS 16 effect on net debt SEK 3.7 bn. **) Excluding i

  23. Slide 23: Earnings per share, SEK

    Earnings per share, SEK Quarter 12 months 4.00 16 3.50 14 3.00 12 2.50 10 2.00 8 1.50 6 1.00 4 0.50 2 2018 2019 2020 2021 2022 2023 Quarter, SEK Rolling 12 months, SEK Excluding items affecting comparability 23

  24. Slide 24: Conclusions

    Conclusions  Positive organic sales development – Positive organic sales – Net acquired growth of 11%  Strong margin and cash flow  Uncertain economic climate – Take advantage of opportunities – Agility and efficiency  The Board proposes a dividend of SEK 5.40 (4.80) per share, split between two

  25. Slide 25: Experience a safer and more open world

    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

  26. Slide 26: Appendix

    Appendix

  27. Slide 27: Cost breakdown as % of sales

    Cost breakdown as % of sales QTD 2023 YTD 2023 excl. excl. % QTD 2022 acquisitions Δ QTD 2023 YTD 2022 acquisitions Δ YTD 2023 Direct material -37.0% -34.6% +2.4 pts -35.5% -37.1% -34.7% +2.4 pts -35.5% Conversion cost -22.9% -23.9% -1.0 pts -23.9% -23.2% -23.6% -0.4 pts -23.4% Gross margin 40.1% 41

  28. Slide 28: Opening Solutions EMEIA’s bridge

    Opening Solutions EMEIA’s bridge MSEK Q4 2022 Organic Currency Acq/Div Q4 2023 Growth 20% -2% 2% 2% 2% Sales 6,231 -153 158 103 6,339 Operating income* 933 -56 20 18 915 Operating margin, %* 15.0% 36.3% 12.5% 17.6% 14.4% Dilution/accretion -0.5% -0.2% 0.1% 12 months figures Sales 22,858 24,831 EBIT*

  29. Slide 29: Opening Solutions Americas’ bridge

    Opening Solutions Americas’ bridge MSEK Q4 2022 Organic Currency Acq/Div Q4 2023 Growth 35% 5% -2% 38% 41% Sales 7,427 290 3 2,788 10,508 Operating income* 1,583 183 5 82 1,854 Operating margin, %* 21.3% 63.1% 182.2% 2.9% 17.6% Dilution/accretion 1.3% 0.3% -5.3% 12 months figures Sales 28,344 38,009

  30. Slide 30: Opening Solutions Asia Pacific’s bridge

    Opening Solutions Asia Pacific’s bridge MSEK Q4 2022 Organic Currency Acq/Div Q4 2023 Growth 9% -1% 0% -6% -7% Sales 2,648 -29 -4 -148 2,468 Operating income* -125 256 -9 -16 107 Operating margin, %* -4.7% -884.8% 231.9% 10.6% 4.3% Dilution/accretion 10.3% -0.9% -0.4% 12 months figures Sales 9,824 1

  31. Slide 31: Global Technologies’ bridge

    Global Technologies’ bridge MSEK Q4 2022 Organic Currency Acq/Div Q4 2023 Growth 45% -7% 1% 9% 3% Sales 5,734 -420 65 506 5,885 Operating income* 982 -93 5 16 910 Operating margin, %* 17.1% 22.1% 7.9% 3.1% 15.5% Dilution/accretion -0.4% 0.0% -1.2% 12 months figures Sales 19,344 23,099 EBIT* 3,065 3,

  32. Slide 32: Entrance Systems’ bridge

    Entrance Systems’ bridge MSEK Q4 2022 Organic Currency Acq/Div Q4 2023 Growth 26% 3% 2% 1% 6% Sales 11,535 390 129 133 12,189 Operating income* 1,906 223 7 -10 2,126 Operating margin, %* 16.5% 57.1% 5.8% -7.5% 17.4% Dilution/accretion 1.3% -0.1% -0.3% 12 months figures Sales 42,928 46,665 EBIT* 6,84

  33. Slide 33: Thank you

    Thank you assaabloy.com

ASSA ABLOY — Q4 2023 Earnings Presentation on 6ix