Assa Abloy Profit Beats Estimates on Growth Beyond Europd

Assa Abloy AB (ASSAB), the world’s largest lockmaker, posted third-quarter profit that beat analysts’ estimates as growth in the U.S. and Asia helped offset weak sales in Europe.

Net income rose to 1.47 billion kronor ($232.6 million) from 1.31 billion kronor a year earlier, the Stockholm-based company said in a statement today. Analysts on average predicted profit of 1.42 billion kronor, according to 13 estimates compiled by Bloomberg. Revenue increased 5.1 percent to 12.1 billion kronor.

“Americas, Asia-Pacific and Global Technologies all had strong organic growth,” Chief Executive Johan Molin said in the statement. “The group’s earnings reached a record level, largely due to good growth arising from new products.”

Assa Abloy is countering weakening European demand by expanding in emerging markets, and has a target of doubling the proportion of sales coming from developing economies to about 50 percent of the total by 2025. The company agreed to buy the fire-door business of Gdansk, Poland-based Mercor SA in September, and to acquire Chinese fire- and security-door producers Harbin Xinmao Burglarproof Door Manufacturing Co. and Yantai Huasheng Industrial Co Ltd. this month.

The Swedish company said today that it will close about 30 production units and offices over three years as part of a 1 billion-krona reorganization starting this quarter. Savings generated from the measures will help earnings in about three years, Assa Abloy said.

To contact the reporter on this story: Natasha Doff in London at ndoff@bloomberg.net

To contact the editor responsible for this story: David Risser at drisser@bloomberg.net

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.