Q4 Report 2012 Johan Molin President & CEO 1 Financial - - PowerPoint PPT Presentation

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Q4 Report 2012

Johan Molin President & CEO

Financial highlights Q4 2012

• Good perform ance in a tough m arket

– Good growth in Americas and improvement in the Pacific – Stable situation in EMEA, APAC and Global Tech – ESD suffering from weak Europe – Record profit and cash flow

• Sales

1 2 ,2 3 9 MSEK + 4 % 0% organic, + 7% acquired growth, -3% currency

• EBI T

2 ,0 3 0 MSEK + 8 % Currency effect -41 MSEK

• EPS

3 .7 4 SEK + 9 % Underlying tax rate 24%

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Financial highlights Jan-Dec 2012

• A good year in a challenging m arket
• Sales

4 6 ,6 1 9 MSEK + 1 2 % + 2% organic, + 9% acquired growth, + 1% currency

• EBI T

7 ,5 0 1 MSEK + 1 3 % Currency effect 37 MSEK

• EPS

1 3 .8 4 SEK + 1 3 % Underlying tax rate 24%

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Market highlights

• Strong demand for SE readers

with SIO in Physical access

• Digital door locks sees strong

growth in the Americas

• New industrial door range for

distribution in ESD

• New modular lock range for

Europe

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Modular lock range

• Platform based mechanical &

elmech locks for commercial applications

• Sustainability ECO Design,

“Sustainable Design” and EPD

• 20 new patents
• Branded ASSA ABLOY

, like the success of ASSA ABLOY door closers

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Group sales in local currencies Jan-Dec 2012

2 + 9 2 9 + 1 2 1 6 + 9 5 + 1 1 + 1 6

Share of Group sales 2 0 1 2 YTD, % Year-to-date vs previous year, %

4 7 + 1 1

Emerging markets 25% of sales despite acquisitions in Europe

Organic growth index

Recovery from recession

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Group + 0 %

Division I ndex EMEA

• 7%

Am ericas

• 13%

Asia Pacific + 33% Global Tech + 14% ESD + 0%

• 18
• 15
• 12
• 9
• 6
• 3

3 6 9 12 15 18 21 24 24 000 26 000 28 000 30 000 32 000 34 000 36 000 38 000 40 000 42 000 44 000 46 000 48 000 2005 2006 2007 2008 2009 2010 2011 2012

Organic Growth Acquired Growth Sales in Fixed Currencies

Sales growth, currency adjusted

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2 0 1 2 Q4 + 7 % Organic + 0 % Acquired + 7 %

Sales MSEK Growth, %

Operating income (EBIT), MSEK

3 500 4 000 4 500 5 000 5 500 6 000 6 500 7 000 7 500 8 000 700 800 900 1 000 1 100 1 200 1 300 1 400 1 500 1 600 1 700 1 800 1 900 2 000 2 100 2005 2006 2007 2008 2009 2010 2011 2012 Quarter Rolling 12-months

Quarter 12-months

Run rate 7 ,5 0 1 MSEK ( 6 ,6 2 4 ) + 1 3 %

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* ) Excluding restructuring costs.

12,0 13,0 14,0 15,0 16,0 17,0 2005 2006 2007 2008 2009 2010 2011 2012 Quarter Rolling 12-months

Q4 2 0 1 2 Dilution QTD + 0 .1 % YTD

• 0 .2 %

Operating margin (EBIT)* , %

Run rate 2 0 1 2 1 6 .1 % ( 1 5 .9 )

Long term target range ( average)

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EBIT Margin * ) Excluding restructuring costs.

Q1 2 0 1 3 effect Easter -2 days

Manufacturing footprint

• Status manufacturing footprint programs 2006-2011:

– 53 factories closed to date, 15 to go – 56 factories converted to assembly, 19 to go – 28 offices closed, 1 to go

• Personnel reduction QTD 301p and total 6,765p
• 770p in further planned reductions

 1,068 MSEK of the provision remains for all programs

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Margin highlights Q4 2012

EBI T m argin 1 6 .6 % ( 1 6 .0 ) + 0 .6 % + Volume increase -1% , price + 1% + Margin expansion from organic growth 0.5%

• Organic growth 0%

+ Manufacturing footprint + Capacity adjustments + Raw material + Contribution from acquisitions + 0.1%

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Acquisitions 2012

• Fully active pipeline
• 1 3 acquisitions done in 2 0 1 2
• Annualized sales 4 ,5 0 0 MSEK + 1 0 .8 %
• Major acquisitions Jan-Dec 2 0 1 2 :

 Albany, US  Dynaco, BE  Securistyle, UK  Sanhe Metal, China  Helton, Canada  Guoqiang, China  4Front, USA

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4Front, USA

• US Market leader in docking

equipment with sales of 1,100 MSEK

• Adds strong distribution network

across North America

• Leading well known brands and

products with 125 active patents

• Offers a manufacturing base for

production in North America

• Single digit EBIT but accretive to EPS

in 2013

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Division - EMEA

• Weak December due to few working days
• Growth in UK, France, Israel, Middle east and

Eastern Europe

• Slight decline in Scandinavia, Finland, Germany and

Spain

• Negative sales in Italy and Benelux
• Good profit and cash flow
• Operating margin (EBIT)
• Organic -1%

= Material cost + Footprint savings

SALES share of Group total %

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15 13 14 15 16 17 18 19 2007 2008 2009 2010 2011 2012 EBI T %

Division - Americas

• Strong growth in Residential, Electromechanical and

South America

• Growth in AHW, Doors, High security and Mexico
• Decline in Canada
• Improved margin from volume and efficiency gains
• Operating margin (EBIT)

+ Organic + 5% + Material cost + Efficiency improvement

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SALES share of Group total %

17 18 19 20 21 22 2007 2008 2009 2010 2011 2012

EBI T%

Division - Asia Pacific

• Return of growth in the Pacific and strong growth of

Korea

• Low growth in China and slowing South East Asia
• Workforce in China reduced by 1,400p to mitigate the

high salary inflation

• Operating margin (EBIT)
• Organic + 2%
• Mix & cost pressure

+ Efficiency in China + Material cost

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SALES share of Group total %

5 8 11 14 17 2007 2008 2009 2010 2011 2012

EBI T %

Division - Global Technologies

• HID

– Strong growth of Logical access and IDT – Good growth of Access control and Secure Issuance – Flat in Government ID and decline in project sales – Strong profit improvement

• Hospitality

– Continued good growth from the renovation market – Strong profit improvement

• Operating margin (EBIT)

+ Organic + 2% + Leverage from core business growth + Less project sales

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SALES share of Group total %

10 12 14 16 18 20 2007 2008 2009 2010 2011 2012 EBI T%

Division - Entrance Systems

• Decline in Southern Europe
• Good growth of Albany, Dynaco
• Slightly neg growth for industrial and pedestrian doors
• Continued decline of Ditec and Residential doors
• Integration work develops very well
• Sales + 14% and EBIT + 15%
• Operating margin (EBIT)
• Organic -5%

+ Raw material + Efficiency gains from integration works

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SALES share of Group total %

10 12 14 16 18 20 2007 2008 2009 2010 2011 2012 EBI T%

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Q4 Report 2012

Carolina Dybeck Happe CFO

Financial highlights Q4 2012

MSEK 2011 2012 Change 2011 2012 Change

Sales 11,744 12,239 +4% 41,786 46,619 +12% Whereof Organic growth 0% +2% Acquired growth +7% +9% FX-differences

• 212
• 3%

290 1% Operating income (EBIT) 1,881 2,030 +8% 6,624 7,501 +13% EBIT-margin (%) 16.0 16.6 15.9 16.1 Operating cash flow 2,794 3,160 +13% 6,080 7,044 +16% EPS (SEK)* 3.43 3.74 +9% 12.30 13.84 +13%

4th Quarter Twelve months

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* excluding non comparable items

Bridge Analysis – Oct-Dec 2012

MSEK

2011 Oct-Dec Organic Currency Acq/ Div 2012 Oct-Dec

0%

• 3%

7% 4%

Revenues

11,744

• 28
• 212

736 12,239

EBIT

1,881 51

• 41

138 2,030

%

16.0%

• 19.2%

18.8% 16.6%

Dilution / Accretion

0.5% 0.0% 0.1%

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P&L – Components as % of sales

• Direct material

35.1% 34.7% 34.6%

• Conversion costs

25.9% 25.4% 25.9%

• Gross Margin

39.0% 39.9% 39.5%

• S, G & A

23.1% 23.6% 23.4%

• EBIT

15.9% 16.3% 16.1% 2 0 1 2

FY excluding acquisitions

2 0 1 1

FY

2 0 1 2

FY

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Operating cash flow, MSEK

3 000 3 500 4 000 4 500 5 000 5 500 6 000 6 500 7 000 7 500 8 000 500 1 000 1 500 2 000 2 500 3 000 3 500 2005 2006 2007 2008 2009 2010 2011 2012

Quarter Cash Rolling 12-months EBT Rolling 12 months

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Quarter 12 months

Gearing % and net debt MSEK

20 40 60 80 100 120 5 000 10 000 15 000 20 000 25 000 30 000 2005 2006 2007 2008 2009 2010 2011 2012 Net debt Gearing

Debt/ Equity 5 5 ( 6 0 ) Net debt/ EBI TDA 1 .7 ( 1 .9 )

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Net Debt Gearing

13,84

0,00 2,00 4,00 6,00 8,00 10,00 12,00 14,00 16,00 2005 2006 2007 2008 2009 2010 2011 2012

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Earnings per share

Since 2 0 0 5 EPS + 1 2 0 % Dividend 2 0 1 3 : 5 .1 0 SEK ( 4 .5 0 )

* ) Excluding restructuring costs.

SEK

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Q4 Report 2012

Johan Molin President & CEO

Conclusions Q4 2012

• Total growth by 4% with 0% organic
• Good growth in Americas
• Stable situation in EMEA, APAC and Global Tech
• Strong efficiency improvements and raw material

supports profit

• Record EBIT of 2,030 MSEK, improved by 8%
• Record cash flow at 3,160 MSEK

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Q&A