ASSA ABLOY Reports Strong Start to 2017

ASSA ABLOY reported its first quarter 2017 financial results. Sales increased by 14% to SEK 18,142 million (15,891), with organic growth of 6%. Acquisitions contributed 3%. Strong growth was shown by Global Technologies, Entrance Systems, Americas and EMEA, and good growth by Asia Pacific.
 
Contracts have been signed for the acquisition of seven companies with expected combined annual sales of about SEK 700 million ($80 million).
 
Operating income (EBIT) increased by 16% and totaled SEK 2,787 million ($318 million), which represents an operating margin of 15.4%. Net income amounted to SEK 1,918 million ($219 million). Operating cash flow amounted to SEK 824 million ($94 million), an improvement of 65%.
 
Johan Molin, ASSA ABLOY’s president and CEO, said that 2017 started well for ASSA ABLOY with a strong organic growth of 6% and with growth in all divisions.
 
“The mature markets continued to achieve a good performance, with strong growth in many of our key markets such as the USA, Scandinavia, Britain and Germany,” Molin noted. “In China, where the trend has been very negative, we saw a stabilization of demand. In the Middle East and Brazil, sales fell, however. It should be noted that the quarter had two extra days as a result of the late Easter, which contributed to the strong sales.
 
“We saw the strongest performance in Global Technologies with a full 9% organic growth,” he reported. “Sales growth for electromechanical lock solutions continues to be very good in all divisions and on nearly all markets, which is very much due to our technological leadership. The applications of virtual keys are continuing to develop rapidly – both on the private residential market through so-called Connected Home solutions using mobile apps and on the commercial market in hotel locks, access control, virtual identities and trusted transactions, for example.
 
“My judgment is that the global economic trend has improved to some degree,” Molin concluded. “On most markets in North and South America and in parts of Europe, there is a positive trend, but on some markets, chiefly in Asia and the Middle East, the trend is weak. However, our strategy of expanding our market presence, even on the emerging markets, remains unchanged. We are also continuing our investments in new products, especially in the growth area of electromechanics.”