Allegion Plc · NYSE:ALLE
Allegion — Q2 2024 Earnings Presentation
20 slides from Allegion's earnings presentation, Jul 24, 2024
Slide 1: Q2-2024 Earnings Call
Q2-2024 Earnings Call July 24, 2024
Slide 2: Cautionary Statements
Cautionary Statements Forward-Looking Statements This presentation contains "forward-looking statements," which are statements that are not historical facts, including, but not limited to, statements related to Key Business Drivers, FY-2024 Outlook and statements regarding market trends, electronics
Slide 3: Stable Markets, Strong Execution
Stable Markets, Strong Execution MSD revenue growth; Solid margin expansion Accelerating capital deployment Raising full-year 2024 outlook 3 Q2-2024 Financial Results
Slide 4: Capital Allocation
Capital Allocation Invest for Dividend Acquisitions Share Repurchase Organic Growth $42M $40M Schlage’s new suite of $0.48 per ordinary share Growth rate & EPS accretive In Q2 2024 Indication Trims of the company 4 Q2-2024 Financial Results
Slide 5: Q2-2024 Financial Summary
Q2-2024 Financial Summary Revenue Adjusted OI Adjusted EBITDA Adjusted ACF YTD $Millions Margin Margin EPS $Millions 5.8% +150 bps +170 bps +11.4% -7.4% $965.6 $190.1 25.3% $1.96 $176.0 $912.5 $1.76 23.7% 23.6% 22.2% Q2 23 Q2 24 Q2 23 Q2 24 Q2 23 Q2 24 Q2 23 Q2 24 Q2 23 Q2 24 ▪ Organic growth of 5.2
Slide 6: Q2-2024 Revenue Results
Q2-2024 Revenue Results $Millions 1,000.0 $966 950.0 $923 $913 $918 $897 $894 900.0 850.0 800.0 750.0 700.0 650.0 600.0 15.0% 5.6% -0.6% 2.6% -3.6% 5.2% 550.0 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Current Quarter Revenue Prior Quarter Revenue Organic Growth % noted Price Volume Organic Acq
Slide 7: Allegion Americas Results
Q2-2024 Allegion Americas Results Revenue Adjusted OI% Adjusted EBITDA% $Millions +6.0% +110 bps +130 bps 30.7% $770.7 29.4% 29.4% $727.2 28.3% Q2 23 Q2 24 Q2 23 Q2 24 Q2 23 Q2 24 Q2 Revenue Performance Q2 Adjusted Margin Performance ▪ Organic revenue growth of 5.7% ▪ Strong operational execution an
Slide 8: Allegion International Results
Q2-2024 Allegion International Results Revenue Adjusted OI% Adjusted EBITDA% $Millions +5.2% +80 bps +80 bps $185.3 $194.9 13.7% 14.5% 11.3% 12.1% Q2 23 Q2 24 Q2 23 Q2 24 Q2 23 Q2 24 Q2 Revenue Performance Q2 Adjusted Margin Performance ▪ Organic revenue growth of 3.1% driven by electronics ▪ Volume
Slide 9: Balance Sheet & Cash Flow
Balance Sheet & Cash Flow Available Cash Flow Working Capital Leverage $Millions -7.4% $190.1 $176.0 Working Capital % of Revenue 9.1% 2.5x 2.7x 8.3% 2.1x 1.9x Q2 YTD Q2 YTD Q2 2023 Q2 2024 Q2 2023 Q2 2024 2023 2024 Gross Debt/Adj EBITDA Net Debt /Adj EBITDA Capex $40.0M $48.1M ▪ Higher earnings mor
Slide 10: FY-2024 Outlook
FY-2024 Outlook Raising reported revenue and adjusted EPS outlook; Affirming ACF Prior Outlook Current Outlook Americas: 1.5% to 3.5% Americas: 2.5% to 3.5% Reported Revenue International: 1.5% to 3.5% International: 3% to 4% Total: 1.5% to 3.5% Total: 2.5% to 3.5% Americas: 1.5% to 3.5% Americas: 2
Slide 11: Resilient Business Model
Resilient Business Model Stable across cycles, boosted by secular electronics growth and capital deployment Powerful Strong Broad End Balanced Spec Engine Execution Market Capital Coverage Deployment ▪ Generates demand, ▪ Industry-leading ▪ ~45% institutional in ▪ ~$280M deployed YTD pulls product t
Slide 12: Pioneering Safety
Pioneering Safety TM Stable markets, strong execution Resilient business model Accelerating capital deployment Raising full-year 2024 outlook 12 Q2-2024 Financial Results
Slide 13: Q&A
Q&A
Slide 14: Appendix
Appendix
Slide 15: Allegion EPS Performance
Q2-2024 Allegion EPS Performance M&A: ($0.04) M&A: $0.02 Amortization: ($0.14) Restructuring: $0.01 Impairment: ($0.01) Amortization: $0.12 15 Q2-2024 Financial Results See appendix for definitions and press release for non-GAAP reconciliations
Slide 16: FY-2024 EPS Outlook Details
FY-2024 EPS Outlook Details Share Count: ~87.7M Interest/Other: ~$82M Tax Rate at Midpoint of 18.0% - 19.0% M&A, Restructuring & Other: ($0.13) Restructuring: $0.11 Amortization: ($0.52) M&A: $0.18 Amortization: $0.46 Impairment: $0.06 Investment loss: $0.03 16 Q2-2024 Financial Results See appendix
Slide 17: FY-2024 EPS Outlook Details
FY-2024 EPS Outlook Details Outlook at Feb '24 Earnings Call Current Outlook 2023 Reported EPS $6.12 $6.12 Notes: Acquired Intangible Asset Amortization1 $0.46 $0.46 Adjustments 2 $0.38 $0.38 ▪ Capital deployment and operational performance 2023 Adjusted EPS As Recasted $6.96 $6.96 driving higher ou
Slide 18: Proforma Cash & Debt for 2024 Bond Maturity
Q2-2024 Proforma Cash & Debt for 2024 Bond Maturity ▪ Cash and debt balances include proceeds of $400M $Millions from the May 2024 issuance of new 2034 senior notes, $2,405 which will be used to repay the $400M senior note maturity in the second half of 2024 $400 ▪ Net debt unaffected $2,005 $748 $1
Slide 19: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures The company presents operating income, operating margin, effective tax rate, 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 o
Slide 20: About Allegion
About Allegion™ Allegion (NYSE: ALLE) is a global pioneer in seamless access, with leading brands like CISA®, Interflex®, LCN®, Schlage®, SimonsVoss® and Von Duprin®. Focusing on security around the door and adjacent areas, Allegion secures people and assets with a range of solutions for homes, busi