Assa Abloy Earnings Boosted by Lower Costs, Price Hikes in Challenging Market

By Dominic Chopping

STOCKHOLM--Assa Abloy reported higher earnings after cost cutting, price hikes, lower material costs and the contribution from a major acquisition helped offset challenging market conditions.

The Swedish lock maker said net profit in the second quarter rose to 3.92 billion Swedish kronor ($369.7 million) from SEK3.57 billion a year earlier, just shy of expectations, while sales rose 10% to SEK37.97 billion.

A FactSet consensus had forecast quarterly profit of SEK4.0 billion on sales of SEK38.44 billion.

Organic sales declined 1% on the year as good growth in Americas and Europe, Middle East, India and Africa and stable growth in its entrance systems unit was offset by declines in Asia Pacific and the global technologies business, it said.

Last year Assa Abloy completed the $4.3 billion acquisition of Spectrum Brands' hardware and home improvement division known as HHI. It said Wednesday that integration of the business continues according to plan and it is even more confident than a year ago that it will be able to realize $100 million in synergies.

"It is also encouraging that HHI, on a standalone basis in the quarter, delivered a high-single digit sales growth with a sequentially improved operating margin," Chief Executive Nico Delvaux said. "We are confident that this positive trend will continue."

Write to Dominic Chopping at dominic.chopping@wsj.com

(END) Dow Jones Newswires

July 17, 2024 02:59 ET (06:59 GMT)

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