Company Reports

Assa Abloy reported second-quarter organic sales growth of 4%, up from 2% in the first quarter, with an EBIT margin of 17.0%. Approximately SEK 220 million of nonrecurring items inflated the margin, resulting in an underlying 16.5% EBIT margin.

Assa Abloy delivered 2% organic growth and a 52% operating leverage ratio in the first quarter of 2026—nearly double management's guidance—despite flat volumes, as a 10% foreign-currency drag masked strong underlying execution.

Assa Abloy is the global leader in access solutions, supplying mechanical and electromechanical locks, doors, and entrance automation systems to residential, commercial, and institutional markets. The group’s strategy centers on profitable growth through innovation and disciplined capital allocation, underpinned by a resilient aftermarket that represents roughly two-thirds of sales. Its products are mission-critical to customers, ensuring safety and security, and its trusted brands command premium positioning across key regions.

Assa Abloy closed 2025 with a strong fourth quarter, delivering record margins and solid organic growth despite severe currency headwinds. Organic sales grew 4% while adjusted EBITA margin reached a record 17.9%, supported by strong pricing, mix, and cost discipline.

Assa Abloy is the global leader in access solutions, supplying mechanical and electromechanical locks, doors, and entrance automation systems to residential, commercial, and institutional markets. The group’s strategy centers on profitable growth through innovation and disciplined capital allocation, underpinned by a resilient aftermarket that represents roughly two-thirds of sales. Its products are mission-critical to customers, ensuring safety and security, and its trusted brands command premium positioning across key regions.

We take a fresh look at Assa Abloy as we transfer coverage. Assa Abloy is the global leader in access solutions, supplying mechanical and electromechanical locks, doors, and entrance automation systems across residential, commercial, and institutional markets.

Assa Abloy reported good third-quarter results, with organic and inorganic revenue growth of 3% and 5%, respectively, partially offset by 6% currency headwinds. Operating margins expanded slightly, supporting earnings growth.

Assa Abloy is the clear global leader in locking and physical access system markets, accounting for about 13% of the supply of the global addressable market—estimated to be worth around USD 100 billion. Assa Abloy’s installed-based business model confers the benefit of significant aftermarket sales—contributing about two-thirds of annual revenue at high profit margins. Importantly, we think Assa Abloy’s strategic focus areas—customer relevance, product leadership, and cost-efficiency—work to protect, grow, and optimally monetise the global industry-leading installed base of locking and access systems it has amassed over many decades.

Assa Abloy delivered solid second-quarter results with organic sales up 3% and operating income up 1%, despite challenging global conditions. Margins improved despite acquisition-related costs; organic drivers like price realization and operational efficiency contributed positively.

Assa Abloy delivered solid first-quarter 2025 results with net sales and operating income up 8% and 4% respectively, despite challenging global conditions. Margins declined due to acquisition-related costs, but organic drivers like price realization and operational efficiency contributed positively.

Fourth-quarter organic sales growth remained flat for wide-moat Assa Abloy, according with our expectations and subdued by still soft construction activity in late 2024. Consequently, full-year top-line growth of 7% also matched our estimates, with all top-line growth in 2024 being delivered by acquisitions, including the first full-year sales contribution from the HHI acquisition, which was completed in mid-2023. Notwithstanding, full-year EBIT came in approximately 2% ahead of our expectations with fourth-quarter margin progression eclipsing our expectations. Indeed, the strong fourth-quarter EBIT margin of 16.5%—up 100 basis points year on year—was the result of strong price versus cost tailwinds and good operational execution, which outstripped the otherwise dilutive impact of acquisitions on the group EBIT margin. We expect to nudge our operating margin and earnings estimates upward for 2025 given the strong fourth-quarter margin performance. Still, we don’t expect this to have a material impact on our SEK 320 fair value estimate.

Soft construction activity continued to weigh on wide-moat Assa Abloy during the third quarter of 2024. Still, conditions in residential markets—excluding Asia—are beginning to stabilize, contributing to flat year-on-year organic sales during the third quarter, representing modest sequential improvement. Demand in the Americas segment was a bright spot, rising 4% organically in the quarter. The global technologies segment also returned to growth in the third quarter, with revenue rising 2% organically as the comparative eased for the division. Still, top-line growth remains held back in particular by weakness in demand in the Asia-Pacific region, an unsurprising outcome given the ongoing challenges in China’s property market. Demand in the group’s global entrance systems division also weakened, with third-quarter organic sales easing 2%, year on year. Our estimates and SEK 320 fair value estimate remain unchanged, with Assa Abloy shares screening as approximately fairly valued.

Demand for wide-moat Assa Abloy’s locking and physical access systems remained subdued during the second quarter of 2024 amid globally weak new construction conditions. Still, second-quarter organic sales of negative 1% showed modest sequential improvement, up from negative 2% in the prior quarter. The performance of the Americas and EMEIA Opening Solutions segments were bright spots, with organic sales growth—of 1% and 3%, respectively—improving on their first-quarter showing and tracking ahead of our prior expectations that factored further organic top-line pressure amid still-tight financial conditions. Organic sales growth for Entrance Systems—the group’s largest segment accounting for about 35% of group EBIT—was flat, unchanged quarter on quarter. However, still-weak demand for the Global Technologies and Asia Pacific Opening Solutions segments weighed on the group’s second-quarter top-line performance.

Assa Abloy is the clear global leader in locking and physical access system markets, accounting for about 13% of supply of the global addressable market—estimated to be worth around USD 100 billion. Assa Abloy’s installed-based business model confers the benefit of significant aftermarket sales—contributing about two thirds of annual revenue at high profit margins. Importantly, we think Assa Abloy’s strategic focus areas—customer relevance, product leadership, and cost-efficiency—work to protect, grow, and optimally monetise the global industry-leading installed base of locking and access systems it has amassed over many decades.

We make no change to our thesis or financial estimates for wide-moat Assa Abloy, which reaffirmed its long-term strategy and financial targets at its 2024 capital markets day. Assa Abloy’s strategy remains focused on driving growth via innovation that perpetuates product leadership and increases its relevance with its broad and diverse customer base while also achieving cost efficiency across its global operations. Assa Abloy shares screen as approximately fairly valued, trading at a slim 3% discount to our unchanged SEK 320 fair value estimate.

Wide-moat Assa Abloy is off to a slow start in 2024 with demand for its locking and physical access systems weakening in the first quarter. First-quarter organic revenue growth for the group softened by 2% year on year, tracking broadly in line with our full-year estimates that factor in headwinds from subdued construction activity in 2024. Organic sales for each of the group’s Americas, European, and Asia-Pacific opening solutions segments—which together account for roughly 50% of group earnings—declined in the range of 1% to 3%. Sales fell more significantly for Assa Abloy’s global technologies segment, down 9% organically in the first quarter.

Assa Abloy is the clear global leader in locking and physical access system markets, accounting for about 13% of supplies for the global addressable market—estimated to be worth around USD 100 billion. Assa Abloy’s installed-based business model confers the benefit of significant aftermarket sales—contributing about two thirds of annual revenue at high profit margins. Importantly, we think Assa Abloy’s strategic focus areas—customer relevance, product leadership, and cost-efficiency—work to protect, grow, and optimally monetise the global industry-leading installed base of locking and access systems it has amassed over many decades.

Wide-moat Assa Abloy delivered a fourth-quarter 2023 result that tracked a touch short of our expectations but nonetheless aligned with consensus forecasts. Full-year 2023 EBIT of SEK 22.2 billion fell 3% short of our forecast as operating margin progression proved less favorable than we’d previously credited—largely the result of organic growth that stalled in the fourth quarter. In particular, fourth-quarter sales for Assa Abloy’s global technologies segment weakened appreciably, falling by 7% year on year. Organic growth for the EMEIA and Asia-Pacific opening solutions segments also faltered, declining by 2% and 1% year on year, respectively. A softer-than-anticipated profit margin recovery for the Asia-Pacific opening solutions segment—following COVID-19 lockdowns that led to cost inefficiencies in 2022—also contributed to the weaker-than-anticipated operating profit outcome.

Soft residential construction markets are holding wide-moat Assa Abloy back in late 2023, with a meager 1% of organic growth delivered in the third quarter. The impact of weakened residential construction activity was most pronounced for the Europe, Middle East, India, and Africa, or EMEIA, and Asia-Pacific opening solutions segments, posting third-quarter organic growth of negative 3% and negative 7%, respectively. The performance of the global entrance systems segment was also hampered by weak residential sales, with organic growth flat in the quarter. Elsewhere, the global technologies and the Americas opening solutions segments delivered more appealing third-quarter organic growth of 4% and 3%, respectively. Strong nonresidential volumes were the major driver of the outperformance of the Americas segment relative to the Europe and Asia opening solutions segments, where residential sales were also subdued.

Assa Abloy shares screen attractively relative to our SEK 320 fair value estimate, which remains unchanged following a transfer of analyst. Our long-term thesis for the global leader in locking and physical access systems remains intact. Specifically, Assa Abloy is best positioned, in our view, to capitalise on the substantive growth opportunity from the increasing acceptance and uptake of electromechanical locking systems currently underway. We think investors presently underappreciate the full extent of the secular growth opportunity in front of Assa Abloy—the clear global locking and physical access industry leader—with shares trading at an appealing 22% discount to our valuation.