Q1 2012 ASSA ABLOY Investors presentation 24 april

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The ASSA ABLOY Group released its Interim report January-March 2012 on Tuesday 24 April 2012 at 12.00 noon (CET). A combined investors’ meeting and web conference was held at Operaterrassen in Stockholm at 13.00 (CET). The presentation is available as an on-demand webcast.Welcome to visit our Investor pages on http://www.assaabloy.com/investors/.

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Q1 2012 ASSA ABLOY Investors presentation 24 april

  1. 1. Q1 Report 2012 Johan Molin President & CEO 1
  2. 2. Financial highlights Q1 2012 Steady growth with strong profit improvement – Continued strong growth in Global tech – Good development in Europe and North America – Slower emerging markets and declining Australia – Footprint program gives good savings Sales 10,839 MSEK +25% +3% organic, +19% acquired growth, 3% currency EBIT 1,655 MSEK +20% Currency effect 19 MSEK EPS 3.10 SEK +23% Underlying tax rate 23% 2
  3. 3. Market highlights Branding – Group appearance on all trade shows – Demonstration fleet for architects – One company exposure on internet Investment in Emerging markets – Build up in India, ME, Africa and South America – Sales units created in Russia, Croatia, Indonesia, Ghana, Uganda, Mozambique, Liberia, Qatar Innovation pays off – More than 20% of all sales from products less than 3 years old 3
  4. 4. Emerging markets expansionExample; Africa Countries with high total GDP Nigeria Uganda and highly populated cities 13 new ASSA ABLOY Solution Ethiopia 6,2 centres 6,2 6,2 6,1 3 new legal entities Ivory coast 6,7 Kenya Ghana 6,5 6,4 Congo-Kinshasa 7,0 Tanzania 7,3 7,5 7,8 Angola Zambia Mozambique 3,7 South Africa Annual GDP growth, 2012-2016 (prognos), percent 4
  5. 5. ASSA ABLOY Code Handle DDLDoor Closers EMEA High impact Products EMEA new productsAperio CLIQ SMARTAIR 5
  6. 6. Group sales in local currencies Jan-Mar2012 51 +39 28 +7 13 +17 1 +5 2 +4 5 +4 Share of Group sales 2012 YTD, % Year-to-date vs previous year, % 6
  7. 7. Organic growth indexRecovery from recession Index 2009-2012 ASSA ABLOY, excl. Cardo 110 105 Group -2% Index 100 = 31/12 2008 100 95 90 85 Division Index 80 EMEA -7% 2009 2010 2011 2012 Americas -16% Asia Pacific +31% Global Tech +10% ESD *) +3%*) Entrance systems division including new acquired companies -12% 7
  8. 8. Sales growth, currency adjustedSales MSEK Growth, % 2012 Q1 +22% 46 000 Organic +3% 20 44 000 18 42 000 Acquired +19% 16 14 12 40 000 10 38 000 8 6 36 000 4 2 34 000 0 -2 32 000 -4 -6 30 000 -8 28 000 -10 -12 26 000 -14 -16 24 000 -18 2005 2006 2007 2008 2009 2010 2011 2012 Organic Growth Acquired Growth Sales in Fixed Currencies 8
  9. 9. Operating income (EBIT), MSEK Quarter 12-months 1 900 7 000 Run rate 6,902 MSEK (6,128), +13% 6 800 1 800 6 600 1 700 6 400 1 600 6 200 6 000 1 500 5 800 1 400 5 600 5 400 1 300 5 200 1 200 5 000 1 100 4 800 4 600 1 000 4 400 900 4 200 4 000 800 3 800 700 3 600 2005 2006 2007 2008 2009 2010 2011 2012 Quarter Rolling 12-months*) Excluding restructuring costs. 9
  10. 10. Operating margin (EBIT)*, % EBIT Margin 17,0 Long term target range (average) 16,0 15,0 Run rate 2012 15.7% (16.5) 14,0 13,0 12,0 2005 2006 2007 2008 2009 2010 2011 2012 Quarter Rolling 12-months Q2-Q4 2012 Dilution Group -0.2%*) Excluding restructuring costs. 10
  11. 11. Manufacturing footprint Status manufacturing footprint programs 2006-2011: – 45 factories closed to date, 23 to go – 50 factories converted to assembly, 25 to go – 25 offices closed, 4 to go Personnel reduction QTD 346p and total 6,243p 1,292 in further planned reductions 1,569 MSEK of the provision remains for all programs 11
  12. 12. Margin highlights Q1 2012EBIT margin 15.3% (15.8), -0.5%+ Volume increase 1.5%, price 1.5%+ Margin expansion 0.5% + Manufacturing footprint & efficiency improvements + Positive mix with growth in mature markets- Dilution from acquisitions by -1.0% 12
  13. 13. Acquisitions 2012 Fully active 6 acquisitions done so far in 2012 Annualized sales 2,200 MSEK, +5,3% Major acquisitions Jan-Apr 2012:  Albany, US  Dynaco, BE  Securistyle, UK  Traka, UK  Frameworks, USA 13
  14. 14. Traka plc Strong technology company Intelligent key cabinets Advanced locker systems Fleet managment solutions Sales of 140 MSEK, 40% export Accretive to EPS from start 14
  15. 15. Frameworks Manufacturing Inc Entrance to interior aluminum door, frame and window wall market Adds glaziers as additional distribution channel Complementary to our door business with good margins Total sales 110 MSEK Accretive to EPS from start 15
  16. 16. Division - EMEA SALES share of Market improved but hesitant Group total % Growth in Scandinavia, Finland, Benelux, UK, Israel and Africa 31 France, Germany and Eastern Europe are stable Southern Europe in continued decline Good leverage from volume increase EBIT % 19 Operating margin (EBIT) 18 17 + Volume 4% 16 = Material cost 15 14 + Footprint savings 13 2007 2008 2009 2010 2011 2012 - Dilution by 0.8% 16
  17. 17. Division - Americas SALES share of Stable sales development Group total % Good growth of high security, elmech and residential 21 Positive sales of mechanical locks and security doors Negative sales in Canada, Mexico and Brazil Improved margin from efficiency gains EBIT % Operating margin (EBIT) 22 21 + Volume 3% 20 = Material cost 19 + Efficiency improvement 18 2007 2008 2009 2010 2011 2012 18
  18. 18. Division - Asia Pacific SALES share of Strong growth in Korea and South East Asia Group total % including India 11 Weak growth in China Decline in Australia and New Zeeland Negative mix and Chinese cost pressure EBIT % 17 Operating margin (EBIT) 15 13 = Volume 3% 11 9 = Raw material 7 5 - Mix & cost pressure 2007 2008 2009 2010 2011 2012 20
  19. 19. Division - Global Technologies SALES  HID share of Group total % – Good growth of Access control and secure issuance – Strong sales of Identification Technology 14 – Large project orders dilutes  Hospitality – Good growth in all market regions – Several gains of important key accounts EBIT % Operating margin (EBIT) 19 18 + Volume 8% (13) 17 16 + Strong leverage from core business growth 15 14 - Dilution from large project orders 13 2007 2008 2009 2010 2011 2012 22
  20. 20. Division - Entrance Systems SALES share of Good growth of Besam, Crawford and FlexiForce Group total % Service sales in steady growth 23 Ditec declining due to southern Europe Albany and Dynaco consolidated in the quarter Sales +130% and EBIT +94% EBIT % Operating margin (EBIT) 19 18 + Volume 3% 17 16 - Dilution from acquisitions -2.7% 15 14 + Leverage from growth +0.3% 13 12 2007 2008 2009 2010 2011 2012 24
  21. 21. Q1 Report 2012Carolina Dybeck Happe CFO 26
  22. 22. Financial highlights Q1 2012 1st Quarter Twelve months MSEK 2011 2012 Change 2010 2011 Change Sales 8,699 10,839 +25% 36,823 41,786 +13% Whereof Organic growth +3% +4% Acquired growth +19% +17% FX-differences +149 +3% -2,309 -8% Operating income (EBIT) *) 1,377 1,655 +20% 6,046 6,624 +10% EBIT-margin (%) 15.8 15.3 16.4 15.9 Operating cash flow 448 483 +8% 6,285 6,080 -3% EPS (SEK) **) 2.52 3.10 +23% 10.89 12.30 +13% *) Excluding restructuring items of 1,420 MSEK for Q4 and full year 2011**) Excluding one-off items of 1,447 for Q4 and 1,016 MSEK for the full year 2011 27
  23. 23. Bridge Analysis – Jan-Mar 2012 MSEK 2011 Organic Currency Acq/Div 2012 Jan-Mar Jan-Mar 3% 3% 19% 25% Revenues 8,699 294 149 1,696 10,839 EBIT 1,377 92 19 167 1,655 % 15.8% 31.1% 12.9% 9.9% 15.3% Dilution / Accretion 0.5% 0.0% -1.0% 28
  24. 24. P&L – Components as % of sales 2011 2012 2012 Q1 Q1 excluding Q1 acquisitions Direct material 32.9% 33.2% 32.7% Conversion costs 26.2% 25.4% 27.6% Gross Margin 40.9% 41.4% 39.7% S, G & A 25.1% 25.1% 24.4% EBIT 15.8% 16.3% 15.3% 29
  25. 25. Operating cash flow, MSEKQuarter 12 months 3 000 Growth 7 500 7 000 2 500 Recession 6 500 2 000 6 000 5 500 1 500 Growth 5 000 1 000 4 500 4 000 500 3 500 0 3 000 2005 2006 2007 2008 2009 2010 2011 2012 Quarter Cash Rolling 12-months EBT Rolling 12 months 30
  26. 26. Gearing % and net debt MSEKNet Debt Gearing 30 000 120 Debt/Equity 64 (103) 25 000 100 20 000 80 15 000 60 10 000 40 5 000 20 0 0 2005 2006 2007 2008 2009 2010 2011 2012 Net debt Gearing Net debt/EBITDA 2.0 (3.0) 31
  27. 27. Q1 Report 2012 Johan Molin President & CEO 32
  28. 28. Conclusions Q1 2012 Strong total growth by 25% with 3% organic Good development in mature markets – Many new products and projects wins Slower emerging markets Good evolution in acquired companies Footprint program gives good savings Strong profit improvement 33
  29. 29. Q&A 34

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