Allegion Q4 Results Top Estimates; Sees FY23 Earnings Above Market

Allegion plc, a provider of security products and solutions, reported Wednesday higher profit and revenues in its fourth quarter, above market estimates. Further, the company projects fiscal 2023 earnings higher than last year, and above the Street view.

John Stone, Allegion president and CEO, said, “… our supply chain actions are achieving positive results and lead times for our mechanical products are normalizing. While strong global demand for our electronic products is still outpacing supply, component availability has improved, and we expect this progress to continue… Our focus on operational excellence and investing for growth – paired with healthy demand in electronics and non-residential markets – gives Allegion strong momentum as we enter 2023.”

For fiscal 2023, the company projects earnings in the range of $5.70 to $5.90 per share, and adjusted earnings in the range of $6.30 to $6.50 per share, up 5 to 9 percent from last year’s adjusted earnings per share of $5.99.

On average, 14 analysts polled by Thomson Reuters expect earnings of $6.06 per share for the year. Analysts’ estimates typically exclude special items.

Allegion expects full-year revenues to increase 9 to 10.5 percent on a reported basis and 2.5 to 4.5 percent organically.

In fiscal 2022, earnings per share were $5.19, and adjusted earnings per share were $5.69, on revenues of $3.27 billion.

In the fourth quarter, net earnings attributable grew to $135.3 million from last year’s $112.7 million. Earnings per share were $1.53, compared to $1.26 a year ago.

Adjusted net earnings were $141 million or $1.60 per share, compared to prior year’s $99.7 million or $1.11 per share. Analysts expected earnings of $1.38 per share for the quarter.

The company’s revenues were $861.5 million, up 21.5 percent from last year’s $709.2 million, benefited mainly by the acquisition of Access Technologies in July. Analysts projected revenues of $848.69 million for the quarter.

Revenues went up 11.4 percent on an organic basis.

The results were driven by strong price realization across the portfolio to address ongoing inflationary pressure along with strong volume in the Allegion Americas non-residential business. This was partly offset by weakness experienced in Americas residential and Allegion International businesses.

The Americas segment revenues increased 36.9 percent, while International segment revenues declined 15.3 percent.

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