Q1 Report 2015 Johan Molin President and CEO Financial highlights - PowerPoint PPT Presentation

ASSA ABLOY is the global leader in door opening solutions, dedicated to satisfying end-user needs for security, safety and convenience Q1 Report 2015 Johan Molin President and CEO

Financial highlights Q1 2015  Good start of the year – Strong growth in Americas, Global Tech and ESD – Good growth in EMEA – Weak in APAC due to Chinese market and credit policy  Sales 1 5 ,2 5 2 MSEK + 2 4 % 5 % organic, 3% acquired growth, 16% currency  EBI T 2 ,3 2 9 MSEK + 2 5 % Currency effect 249 MSEK  EPS 4 .3 6 SEK + 2 8 % Underlying tax rate 26% 2

Market highlights  Record awards at ISC West – Aperio R100, Aperio M100 & Ecopower power supply – Electrified latch & GL1 Electrified Gate Lock – HID Mobile Access & Active ID tap authentication  Good development in consumer business – Yale drives growth in EMEA, Americas and APAC – Combination of digital and mechanical products  Strong growth in Latin America (+ 43% ) – Regional warehouses and recent acquisitions  Pedestrian Door Automatics – New range of swing door operators – Good growth in emerging markets 3

Group sales in local currencies Jan-Mar 2015 Em erging m arkets 2 3 % ( 2 2 ) of sales 4 0 + 3 3 9 + 9 1 4 + 1 2 1 + 5 2 + 4 3 4 + 8 Share of Group sales 2 0 1 5 YTD, % Year-to-date vs previous year, % 4

Sales growth, currency adjusted Sales MSEK Growth % 2 0 1 5 Q1 + 8 % 67 000 Organic + 5 % 27 64 000 24 Acquired + 3 % 61 000 21 58 000 18 15 55 000 12 52 000 9 49 000 6 46 000 3 43 000 0 -3 40 000 -6 37 000 -9 34 000 -12 31 000 -15 2008 2009 2010 2011 2012 2013 2014 2015 Orga nic Gr owth Acqu ir ed Gr owth Sales in Fixed Cu rr encies 5

Operating income (EBIT), MSEK Quarter 12-m onths 2 700 Run rate 9 ,7 2 8 MSEK ( 8 ,1 1 8 ) + 2 0 % 10 000 9 500 2 500 9 000 2 300 8 500 2 100 8 000 1 900 7 500 7 000 1 700 6 500 1 500 6 000 1 300 5 500 1 100 5 000 900 4 500 2008 2009 2010 2011 2012 2013 2014 2015 Quarter Rolling 12-mont hs 6

Operating margin (EBIT), % EBI T Margin Run rate 2 0 1 5 1 6 .3 % ( 1 6 .3 ) 17,0 16,0 15,0 14,0 13,0 12,0 2008 2009 2010 2011 2012 2013 2014 2015 Quarter Rolling 12- m onths 2 0 1 5 Dilution Q1 -0 .1 % 2 0 1 5 -0 .1 % 7

Manufacturing footprint  Status manufacturing footprint programs 2006-2013: – 69 factories closed to date, 11 to go – 84 factories converted to assembly, 5 to go – 38 offices closed, 9 to go  Personal reduction QTD 206p and total 9,620p  364p in further planned reductions  845 MSEK of the provision remains for all programs 8

Margin highlights Q1 2015 EBI T m argin 1 5 .3 % ( 1 5 .1 ) + 0 .2 % + Volume increase 4% , price 1% + Margin increase + 0.2% + Organic growth + Manufacturing footprint - Currency -0.3% - Acquisitions -0.1% Good leverage from grow th 9

Acquisitions 2015  Fully active pipeline  4 acquisitions done in 2015  Annualized sales 750 MSEK  Added sales 1.5% 1 0

Quantum Secure, USA  Bookings of 400 MSEK with 175 employees  Provider of advanced identity management systems  Brings compliance in highly- regulated industries  Management of identities across multiple sites  Neutral to EPS 1 1

MSL, Switzerland  Turnover of 180 MSEK with 106 employees  Leading supplier of Swiss mortice locks  Complets Swiss total door opening solutions  Adds important market coverage  Accretive to EPS 1 2

Teamware, Malaysia  Turnover of 240 MSEK with 120 employees  Creates firm market leadership in fast growing Malaysia  Complimentary channels and products  Allows specification  Accretive to EPS 1 3

Division - EMEA SALES  Strong growth in Scandinavia, Finland, Eastern Europe share of Group total % and Africa  Good growth in UK and Iberia 25%  Flat in Germany and Israel  Negative in Benelux, France and Italy  Strategic move in Switzerland EBI T % 19  Operating margin (EBIT) 18 17 + Organic 3% 16 15 + Leverage from savings + 0.5% 14 13 - Dilution & Currency -0.7% 2010 2011 2012 2013 2014 2015 1 4

Division - Americas SALES share of  Strong growth in AHW, Doors, El-mech, Residential, Group total % Mexico and South America 20  24% Stable trend in High security and Canada  Important moves in South America  Strong demand from Home Automation EBI T %  Operating margin (EBIT) 23 22 + Organic 8% 21 20 + Good leverage from efficiency 19 - Currency & Dilution -0.5% 18 2010 2011 2012 2013 2014 2015 1 6

Division - Asia Pacific SALES  share of Strong growth in Australia, South Asia and North Asia Group total %  Good growth in New Zealand 14 11%  China – Strong decline due to weak market and credit policy – Government incentives for construction – Many companies for sale EBI T %  Operating margin (EBIT) 18 16 - Organic -3% 14 + Personnel reduction in China -8% 12 10 + Positive sales mix 8 2010 2011 2012 2013 2014 2015 - Currency & Dilution -0.3% 1 8

Division - Global Technologies SALES  HID share of Group total % – Strong growth in Gov-Id, IDT (inlays) and Project sales – Good growth in IAM (Identity and access management) 13 14% – Austin move completed  Hospitality – Strong growth – Strong profit EBI T % 21  Operating margin (EBIT) 20 19 + Organic 12% 18 17 16 + Leverage from growth 15 14 - Currency & Dilution -0.3% 2010 2011 2012 2013 2014 2015 2 0

Division - Entrance Systems SALES  Strong growth in Door Automatics, High Speed Doors, share of Group total % Flexiforce, Amarr and 4Front  Flat in Industrial EU and decline in Residential EU and 28 26% Ditec  Europe is tough but improving with growing service EBI T %  Operating margin (EBIT) 18 17 + Organic 5% 16 15 + Efficiency improvement 14 13 12 - Negative mix (US growing) 11 2010 2011 2012 2013 2014 2015 - Currency -0.4% 2 2

ASSA ABLOY is the global leader in door opening ASSA ABLOY is the global leader in door opening solutions, dedicated to satisfying end-user needs solutions, dedicated to satisfying end-user needs for security, safety and convenience for security, safety and convenience Q1 Report 2015 Carolina Dybeck Happe CFO

Financial highlights Q1 2015 1st Quarter Twelve months MSEK 2014 2015 Change 2013 2014 Change Sales 12,305 15,252 +24% 48,481 56,843 +17% Whereof Organic growth +5% +3% Acquired growth +3% +9% FX-differences +1,892 +16% +2,138 +5% Operating income (EBIT) 1,857 2,329 +25% 7,923 9,257 +17% EBIT-margin (%) ) 15.1 15.3 16.3 16.3 Operating cash flow 557 520 -7% 6,803 8,238 +21% EPS (SEK) 3.41 4.36 +28% 14.84 17.38 +17% 2 5

Bridge Analysis – Jan-Mar 2015 2014 Organic Currency Acq/ Div 2015 MSEK Jan-Mar Jan-Mar 5% 16% 3% 24% Revenues 12,305 680 1,892 376 15,252 EBIT 1,857 186 249 38 2,329 % 15.1% 27.3% 13.1% 10.1% 15.3% Dilution / Accretion 0.6% -0.3% -0.1% 2 6

P&L Components as % of sales Jan – Mar 2015 2 0 1 4 2 0 1 5 2 0 1 5 Q1 YTD excluding Q1 acquisitions Direct material 34.6% 35.5% 35.6% Conversion costs 26.5% 25.4% 25.3% Gross Margin 38.9% 39.1% 39.1% S, G & A 23.8% 23.7% 23.8% EBIT 15.1% 15.4% 15.3% 2 7

Operating cash flow, MSEK 1 2 -m onths Quarter 4 500 9 500 9 000 4 000 8 500 3 500 8 000 3 000 7 500 2 500 7 000 2 000 6 500 1 500 6 000 1 000 5 500 500 5 000 0 4 500 2008 2009 2010 2011 2012 2013 2014 2015 Quarter Cash Rolling 12-months EBT Rolling 12 months 2 8

Gearing % and net debt MSEK Net Debt Gearing 30 000 120 Debt/ Equity 6 4 ( 7 2 ) 25 000 100 20 000 80 15 000 60 10 000 40 5 000 20 0 0 2008 2009 2010 2011 2012 2013 2014 2015 Net debt Gearing Net debt/ EBI TDA 2 .3 ( 2 .3 ) * ) 2008-2011 Not restated for changed pension accounting principles. 29

Earnings per share, SEK Quarter SEK 1 2 -m onths 5,50 20,00 Dividend proposal 2 0 1 5 : 6 .5 0 SEK ( 5 .7 0 ) 5,00 Stock split proposal 3 :1 18,00 4,50 4,00 16,00 3,50 3,00 14,00 2,50 2,00 12,00 1,50 1,00 10,00 0,50 0,00 8,00 2008 2009 2010 2011 2012 2013 2014 2015 Quarter Rolling 12- m onths Excluding restructuring costs of 1,000 MSEK in Q4 and full year 2013. 2008-2011 Not restated for changed pension accounting principles. 3 0

ASSA ABLOY is the global leader in door opening solutions, dedicated to satisfying end-user needs for security, safety and convenience Q1 Report 2015 Johan Molin President and CEO

Conclusions Q1 2015  Strong growth by 24% with 5% organic – Strong growth in Americas, Global Tech and ESD – Good growth in EMEA – Decline in APAC  Good acquisition pipeline  Emerging markets 23% (22)  Strong EBIT improvement of 25%  Strong EPS improvement by 28% 3 2

ASSA ABLOY is the global leader in door opening solutions, dedicated to satisfying end-user needs for security, safety and convenience Q&A