ASSA ABLOY reported a strong 2023 quarter two (Q2) performance despite low activity levels in residential new construction and slower sales in certain regions. Financial data released by the security solutions provider shows that Q2 net sales grew by 17%, organic growth increased by 3%, operating income increased by 25% and earnings per share rose by 18%.
However, lower residential construction levels have forced ASSA ABLOY to implement short-term cost measures to protect profitability. President and CEO Nico Delvaux says that despite a deceleration in residential construction, he is confident that the long-term growth drivers for access control remain.
“This includes the transition to electromechanical products, whose sales after currency adjustment grew by 16% in the quarter,” he adds. “We are therefore continuing to invest in research and development. It is the enabler for growth and creates new opportunities. Our dedication to innovation will continue to allow us to stay ahead and respond effectively to the evolving and growing overall market.”
Regionally, organic growth in the Americas rose by 4%, led by strong U.S. residential numbers, sales of access and high-security products, and overall sales in Canada. Organic growth was solid for architectural hardware and stable for security doors, electromechanical solutions, and sales in Latin America.
Q2 sales in ASSA ABLOY’s Global Technologies division increased by 20%. Organic sales growth was strong in physical access control, extended access, citizen identification and identity and access solutions. However, organic sales declined in secure issuance.
Organic growth in the company’s Entrance Systems division was flat. While sales were strong in industrial, sales declined in perimeters and declined significantly in residential.
ASSA ABLOY acquired five companies in Q2 2023. This includes the acquisition of Spectrum Brands’ Hardware and Home Improvement division. The total combined acquisition price for the businesses amounted to around $4 billion*. ASSA ABLOY also divested Emtek and the Smart Residential business in the U.S. and Canada to Fortune Brands.
Q2 2023 Sales by Product *
- Mechanical Locks, lock systems and fittings (Total: $739 million; 2022 Total: $621 million)
- Electromechanical and electric locks (Total: $984 million; 2022 Total: $795 million)
- Security doors and hardware (Total: $558 million: 2022 Total: $479 million)
- Entrance Automation (Total: $987 million: 2022 Total: $899 million)
*Converted from Swedish Krona to USD on July 28, 2023