Assa Abloy 3Q Net Profit Fell on Year But Still Topped Forecasts

By Dominic Chopping

STOCKHOLM--Assa Abloy on Wednesday posted a slight drop in third-quarter net profit that still came in just above forecasts.

The Swedish lock maker said net profit in the period fell to 3.39 billion Swedish kronor ($304.8 million) from SEK3.55 billion a year earlier as sales rose 16% to SEK36.88 billion.

A FactSet consensus had forecast quarterly profit of SEK3.33 billion on sales of SEK36.91 billion.

The adjusted operating margin rose to 15.7% from 15.6%.

The company said residential construction markets are weak, particularly in Europe, while demand in China remains soft.

There was good organic sales growth in its global technologies and Americas business and stable organic sales in the entrance systems unit, while organic sales declined in Asia Pacific and Europe, Middle East, India and Africa, Assa Abloy said.

In June, Assa Abloy said it had completed the $4.3 billion acquisition of Spectrum Brands' hardware and home improvement division known as HHI.

"HHI was consolidated for the first full quarter and is performing in line with our expectations," Chief Executive Nico Delvaux said.

"We have already started to realize the first synergies which contributed to an improvement in HHI's underlying margin versus the first half of 2023."

A new manufacturing footprint program was launched in the first quarter of 2023 and restructuring cost year-to-date totaled SEK1.25 billion.

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

(END) Dow Jones Newswires

October 25, 2023 03:11 ET (07:11 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.