ALLEGION REPORTS SECOND-QUARTER 2018 FINANCIAL RESULTS
Second-quarter 2018 net earnings per share (EPS) of $1.19, compared with 2017 EPS of $1.10; Adjusted 2018 EPS of $1.25, up 12.6 percent compared with 2017 adjusted EPS of $1.11
Second-quarter 2018 revenue of $704.7 million, up 12.4 percent compared to 2017, up 5.2 percent on an organic basis
Second-quarter 2018 operating margin of 20.3 percent, compared with 2017 operating margin of 21.5 percent; Adjusted operating margin of 21.3 percent, declined 50 basis points compared with 2017 adjusted operating margin of 21.8 percent due to dilution from acquisitions
Updating outlook for 2018 full-year revenue and full-year EPS; Full-year 2018 reported revenue growth of 12.5 to 13.5 percent and organic revenue growth of 4 to 5 percent; Full-year 2018 EPS outlook of $4.15 to $4.35 and $4.35 to $4.50 per share on an adjusted basis
DUBLIN (July 26, 2018) - Allegion plc (NYSE: ALLE), a leading global provider of security products and solutions, today reported second-quarter 2018 net revenues of $704.7 million and net earnings of $113.9 million, or $1.19 per share. Excluding charges related to restructuring and acquisitions, adjusted net earnings were $119.1 million, or $1.25 per share, up 12.6 percent when compared with second-quarter 2017 adjusted EPS of $1.11.
Second-quarter net revenues increased 12.4 percent, when compared to the prior year period (up 5.2 percent on an organic basis). Reported revenues reflect solid organic growth as well as benefits from acquisitions and foreign currency.
Second-quarter 2018 operating income was $143.4 million, an increase of $8.4 million or 6.2 percent compared to 2017. Adjusted operating income in second-quarter 2018 was $150.1 million, representing an increase of $13.2 million or 9.6 percent compared to 2017.
Second-quarter 2018 operating margin was 20.3 percent, compared with 21.5 percent in 2017. The adjusted operating margin in second-quarter 2018 was 21.3 percent, compared with 21.8 percent in 2017. The 50-basis-point decline in adjusted operating margin is attributable to the dilutive nature of the acquisitions.
“We are pleased to report another quarter of solid performance highlighted by growth in revenue, adjusted operating income and adjusted EPS,” said David D. Petratis, Allegion chairman, president and CEO. “We delivered double-digit top-line revenue growth, and saw organic growth rebound nicely back into the mid-single digits. The solid organic growth for the company was driven by strong Americas performance. End-market fundamentals remain positive, and we continue to be led by high-teens electronics growth in the Americas.
“I am also pleased with the nearly 13-percent increase in adjusted EPS during a high inflationary environment, highlighting our focus to drive increased shareholder returns. Inflationary pressures continued to challenge operating margins in the quarter. Excluding the acquisitions, the base business margins were flat year over year, as the global team drove price, productivity and other cost savings to combat the significant inflation headwinds,” Petratis added.
The Americas segment revenue increased 12.4 percent (up 6.6 percent on an organic basis). The revenue growth was driven by high-teens growth in electronics, solid volume in both the non-residential and residential businesses and favorable price. The recently acquired TGP and AD Systems businesses contributed 5.6 percent to the overall growth.
The EMEIA segment revenues were up 14.4 percent (up 1.4 percent on an organic basis), reflecting solid pricing, favorable foreign currency and contributions from the QMI acquisition. Second-quarter 2018 revenue for EMEIA had a tough comparable from the second quarter of last year, which drove the modest organic number.
The Asia-Pacific segment revenues increased 3.1 percent (up 0.7 percent on an organic basis). Favorable currency drove the revenue growth in the quarter.
Interest expense for second-quarter 2018 was $13.4 million, down from the $16.1 million for second-quarter 2017. The decrease is driven by the refinancing of the company’s debt completed in 2017.
The following information was filed by Allegion Plc (ALLE) on Thursday, July 26, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.