Solid Q4 execution, record full-year
results
Quarterly Financial Highlights
(All comparisons against the fourth quarter of 2022, unless
otherwise noted)
- Net earnings per share (EPS) of $1.34, down 12.4% compared with
$1.53; Adjusted EPS of $1.68, down 0.6% compared with $1.69
- Revenues of $897.4 million, up 4.2% on a reported basis and up
2.6% on an organic basis
- Operating margin of 17.8%, compared with 18.5%; Adjusted
operating margin of 22.0%, up 130 basis points compared with
20.7%
Full-Year Financial Highlights
(All comparisons against the full year of 2022, unless otherwise
noted)
- EPS of $6.12, up 17.9% compared with $5.19; Adjusted EPS of
$6.96, up 16.2% compared with $5.99
- Revenues of $3,650.8 million, up 11.6% on a reported basis and
up 5.2% on an organic basis
- Operating margin of 19.4%, compared with 17.9%; Adjusted
operating margin of 22.1%, up 160 basis points compared with
20.5%
- Available cash flow, which is defined as net cash from
operating activities minus capital expenditures, was $516.4 million
for 2023, an increase of 30.6% versus the prior year
2024 Full-Year Outlook Highlights
- Full-year reported revenue growth is estimated to be 1.5% to
3.5%, with organic revenue growth estimated to be 1% to 3%
- Full-year adjusted EPS is estimated to be $7.00 to $7.15
- Available cash flow is estimated to be $540 to $570
million
Allegion plc (NYSE: ALLE), a leading global security products
and solutions provider, today reported financial results for its
fourth quarter (ended Dec. 31, 2023).
“Allegion’s fourth quarter reflected strong execution, margin
expansion and cash generation by our team,” said President and CEO
John H. Stone. “Celebrating our 10th anniversary as a standalone
company in December, we are proud to have closed the year with
record revenue, adjusted operating income and adjusted EPS.”
“As we look ahead to 2024, we are focused on consistent
execution of our strategy and balanced capital deployment, against
what we expect to be a stable market backdrop. Committed to our
vision of enabling seamless access and a safer world, we’ll deliver
yet another year of growth.”
Q4 2023 Company Results
(All comparisons against the fourth quarter of 2022, unless
otherwise noted)
Allegion reported fourth-quarter 2023 net revenues of $897.4
million and net earnings of $118.6 million, or $1.34 per share.
Adjusted net earnings were $148.5 million, or $1.68 per share, down
0.6%, excluding charges related to restructuring, acquisition and
integration costs and other non-cash impairment charges, as well as
amortization expense related to acquired intangible assets.
Fourth-quarter 2023 net revenues increased 4.2%. Net revenues
increased 2.6% on an organic basis, excluding impacts of
acquisitions, divestitures and foreign currency movements. Solid
growth in the company’s non-residential Americas business was
partially offset by declines in its residential and Allegion
International businesses. The reported revenue reflects a modest
positive impact from foreign currency and acquisitions.
Fourth-quarter 2023 operating income was $159.7 million, an
increase of $0.3 million or 0.2%. Adjusted operating income in
fourth-quarter 2023 was $197.2 million, an increase of $18.5
million or 10.4%.
Fourth-quarter 2023 operating margin was 17.8%, compared with
18.5%. The adjusted operating margin in fourth-quarter 2023 was
22.0%, compared with 20.7%. The 130-basis-point increase in
adjusted operating margin is attributable to positive price and
productivity net of inflation and investments. These increases were
partially offset by lower volumes.
Q4 2023 Segment Results
(All comparisons against the fourth quarter of 2022, unless
otherwise noted)
The Americas segment revenues were up 3.7% (up 3.7% on an
organic basis). Favorable price offset lower volumes. The segment
had mid-single digit organic growth in electronics in the fourth
quarter. The America’s non-residential business and the Access
Technologies business both grew mid-single digits. The residential
business continues to be soft and experienced a low-single digit
decline. The segment’s results are up against a tough prior-year
comparison, as the non-residential business had organic growth of
mid-twenties percent in the fourth quarter of last year.
The International segment revenues increased 5.9% (down 1.3% on
an organic basis). Positive price realization was more than offset
by the impact of soft end markets. The reported revenue reflects a
positive impact from foreign currency and acquisitions.
Full-Year 2023 Company Results
(All comparisons against the full year of 2022, unless otherwise
noted)
Allegion reported full-year 2023 net revenues of $3,650.8
million and net earnings of $540.4 million, or $6.12 per share.
Adjusted net earnings were $614.9 million, or $6.96 per share, up
16.2%, excluding charges related to restructuring, acquisition and
integration costs and other non-cash impairment charges, as well as
amortization expense related to acquired intangible assets.
Full-year 2023 net revenues increased 11.6%. Net revenues
increased 5.2% on an organic basis, excluding impacts of
acquisitions, divestitures and foreign currency movements.
Favorable price was more than offset by lower volumes experienced
in the mechanical portfolio. The company had approximately 20%
global organic growth in electronics and software solutions in the
year. The reported revenue reflects a positive impact from foreign
currency and acquisitions.
Full-year 2023 operating income was $708.4 million, an increase
of $122.0 million or 20.8%. Adjusted operating income for full-year
2023 was $805.6 million, an increase of $133.6 million or
19.9%.
Full-year 2023 operating margin was 19.4%, compared with 17.9%.
The adjusted operating margin for full-year 2023 was 22.1%,
compared with 20.5%. The 160-basis-point increase in adjusted
operating margin is attributable to positive price and productivity
net of inflation and investments. These increases were partially
offset by lower volumes.
Additional Items
(All comparisons against the fourth quarter of 2022, unless
otherwise noted)
Interest expense for fourth-quarter 2023 was $22.9 million, a
decrease of $0.8 million.
Other income, net for fourth-quarter 2023 was $0.1 million,
compared to other income, net of $4.5 million.
The company’s effective tax rate for fourth-quarter 2023 was
13.4%, compared with 3.4%. The company’s adjusted effective tax
rate for fourth-quarter 2023 was 16.4%, compared with 6.2%, driven
by timing of discrete items. The company’s adjusted effective tax
rate for full-year 2023 was 14.3%, compared with 12.7% in 2022.
Cash Flow and Liquidity
Year-to-date available cash flow for 2023 was $516.4 million, an
increase of $120.9 million versus the prior-year period. The
year-over-year increase in available cash flow is due to increased
year-to-date net earnings and lower cash used for net working
capital, partially offset by higher capital expenditures. The
company ended fourth-quarter 2023 with cash and cash equivalents of
$468.1 million, as well as total debt of $2,015.0 million.
Share Repurchase and Dividends
For the year, the company repurchased approximately 0.5 million
shares for approximately $60 million. As announced on Feb. 7, 2024,
Allegion’s board of directors declared a quarterly dividend of
$0.48 per ordinary share of the company, an increase of 7% over the
prior dividend. The dividend is payable March 29, 2024, to
shareholders of record on March 15, 2024.
2024 Full-Year Outlook
The company expects full-year 2024 revenues to increase 1.5% to
3.5% on a reported basis and increase 1% to 3% organically, when
compared to 2023, after excluding the expected impacts of
acquisitions, divestitures and foreign currency movements.
Full-year 2024 reported EPS is expected to be in the range of
$6.45 to $6.60, or $7.00 to $7.15 on an adjusted basis. The outlook
assumes a headwind of approximately $0.37 based on a full-year
adjusted effective tax rate of 18% to 19%, inclusive of the
estimated impacts of global minimum tax.
Adjustments to 2024 EPS include estimated impacts of
approximately $0.46 per share for acquisition-related amortization,
as well as $0.09 per share for restructuring and M&A.
The outlook assumes an average diluted share count for the full
year of approximately 88 million shares.
The company expects full-year available cash flow of
approximately $540 to $570 million.
Conference Call Information
On Tuesday, Feb. 20, 2024, President and CEO John H. Stone and
Senior Vice President and Chief Financial Officer Mike Wagnes will
conduct a conference call for analysts and investors, beginning at
8 a.m. ET, to review the company's results.
A real-time, listen-only webcast of the conference call will be
broadcast live online. Individuals wishing to listen may access the
call through the company's website at
https://investor.allegion.com.
About Allegion
Allegion (NYSE: ALLE) is a global pioneer in seamless access,
with leading brands like CISA®, Interflex®, LCN®, Schlage®,
SimonsVoss® and Von Duprin®. Focusing on security around the door
and adjacent areas, Allegion secures people and assets with a range
of solutions for homes, businesses, schools and institutions.
Allegion had $3.7 billion in revenue in 2023, and its security
products are sold around the world.
For more, visit www.allegion.com.
Non-GAAP Measures
This news release includes adjusted non-GAAP financial
information which should be considered supplemental to, not a
substitute for or superior to, the financial measure calculated in
accordance with GAAP. The company presents operating income,
operating margin, effective tax rate, net earnings and diluted
earnings per share (EPS) on both a U.S. GAAP basis and on an
adjusted (non-GAAP) basis, revenue growth on a U.S. GAAP basis and
organic revenue growth on a non-GAAP basis, EBITDA, adjusted EBITDA
and adjusted EBITDA margin (all non-GAAP measures) and Available
Cash Flow (“ACF,” a non-GAAP measure), including in certain cases,
on a segment basis. The company presents these non-GAAP measures
because management believes these non-GAAP measures provide
management and investors useful perspective of the company’s
underlying business results and trends and a more comparable
measure of period-over-period results. These measures are also used
to evaluate senior management and are a factor in determining
at-risk compensation. Investors should not consider non-GAAP
measures as alternatives to the related U.S. GAAP measures. Further
information about the adjusted non-GAAP financial tables is
attached to this news release. The 2024 Full Year Outlook contains
non-GAAP financial measures that exclude or otherwise have been
adjusted for non-GAAP adjustment items from our U.S. GAAP financial
statements. When we provide forward-looking outlooks for any of the
various non-GAAP metrics described above, we do not provide
reconciliations of the U.S. GAAP measures as we are unable to
predict with a reasonable degree of certainty the actual impact of
the non-GAAP adjustment items. By their very nature, non-GAAP
adjustment items are difficult to anticipate with precision because
they are generally associated with unexpected and unplanned events
that impact our company and its financial results. Therefore, we
are unable to provide a reconciliation of these measures without
unreasonable efforts.
Forward-Looking Statements
This press release contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995, Section 27A of the Securities Act of 1933, and Section 21E of
the Securities Exchange Act of 1934, including, but not limited to,
statements under the headings “2024 Full-Year Outlook Highlights,”
“2024 Full-Year Outlook” and statements regarding the company's
2024 and future financial performance, the company’s business plans
and strategy, the company’s growth strategy, the company’s capital
allocation strategy, the company’s ability to successfully complete
and integrate acquisitions and achieve anticipated strategic and
financial benefits and the performance of the markets in which the
company operates. These forward-looking statements generally are
identified by the words “believe,” “aim,” “project,” “expect,”
“anticipate,” “estimate,” “forecast,” “outlook,” “intend,”
“strategy,” “future,” “opportunity,” “plan,” “may,” “should,”
“will,” “would,” “will be,” “will continue,” “will likely result”
or the negative thereof or variations thereon or similar
expressions generally intended to identify forward-looking
statements. Forward-looking statements may relate to such matters
as projections of revenue, margins, expenses, tax rate and
provisions, earnings, cash flows, benefit obligations, dividends,
share purchases or other financial items; any statements of the
plans, strategies and objectives of management for future
operations, including those relating to any statements concerning
expected development, performance or market share relating to our
products and services; any statements regarding future economic
conditions or our performance; any statements regarding pending
investigations, claims or disputes; any statements of expectation
or belief; and any statements of assumptions underlying any of the
foregoing. Undue reliance should not be placed on any
forward-looking statements, as these statements are based on the
company's currently available information and our current
assumptions, expectations and projections about future events. They
are subject to future events, risks and uncertainties - many of
which are beyond the company’s control - as well as potentially
inaccurate assumptions, that could cause actual results to differ
materially from those in the forward-looking statements. Important
factors and other risks that may affect the company's business or
that could cause actual results to differ materially are included
in filings the company makes with the Securities and Exchange
Commission from time to time, including its Annual Report on Form
10-K and its Quarterly Reports on Form 10-Q and in its other SEC
filings. All forward-looking statements in this press release are
expressly qualified by such cautionary statements and by reference
to the underlying assumptions. The company undertakes no obligation
to update these forward-looking statements, whether as a result of
new information, future events or otherwise, except as required by
law.
ALLEGION PLC
Condensed and Consolidated Income
Statements
(In millions, except per share
data)
UNAUDITED
Three months ended December
31,
Year ended December
31,
2023
2022
2023
2022
Net revenues
$
897.4
$
861.5
$
3,650.8
$
3,271.9
Cost of goods sold
512.1
510.8
2,069.3
1,949.5
Gross profit
385.3
350.7
1,581.5
1,322.4
Selling and administrative expenses
218.1
191.3
865.6
736.0
Impairment of intangible assets
7.5
—
7.5
—
Operating income
159.7
159.4
708.4
586.4
Interest expense
22.9
23.7
93.1
75.9
Loss on divestitures
—
—
—
7.6
Other income, net
(0.1
)
(4.5
)
(1.9
)
(11.6
)
Earnings before income taxes
136.9
140.2
617.2
514.5
Provision for income taxes
18.3
4.8
76.6
56.2
Net earnings
118.6
135.4
540.6
458.3
Less: Net earnings attributable to
noncontrolling interests
—
0.1
0.2
0.3
Net earnings attributable to Allegion
plc
$
118.6
$
135.3
$
540.4
$
458.0
Basic earnings per ordinary
share
attributable to Allegion plc
shareholders:
$
1.35
$
1.54
$
6.15
$
5.20
Diluted earnings per ordinary
share
attributable to Allegion plc
shareholders:
$
1.34
$
1.53
$
6.12
$
5.19
Shares outstanding - basic
87.8
87.9
87.9
88.0
Shares outstanding - diluted
88.2
88.3
88.3
88.3
ALLEGION PLC
Condensed and Consolidated Balance
Sheets
(In millions)
UNAUDITED
December 31, 2023
December 31, 2022
ASSETS
Cash and cash equivalents
$
468.1
$
288.0
Accounts and notes receivables, net
412.8
395.6
Inventories
438.5
479.0
Other current assets
41.5
48.5
Assets held for sale
—
3.5
Total current assets
1,360.9
1,214.6
Property, plant and equipment, net
358.1
308.7
Goodwill
1,443.1
1,413.1
Intangible assets, net
572.8
608.9
Other noncurrent assets
576.6
445.9
Total assets
$
4,311.5
$
3,991.2
LIABILITIES AND EQUITY
Accounts payable
$
259.2
$
280.7
Accrued expenses and other current
liabilities
407.9
410.3
Short-term borrowings and current
maturities of long-term debt
412.6
12.6
Total current liabilities
1,079.7
703.6
Long-term debt
1,602.4
2,081.9
Other noncurrent liabilities
311.1
261.2
Equity
1,318.3
944.5
Total liabilities and equity
$
4,311.5
$
3,991.2
ALLEGION PLC
Condensed and Consolidated Statements
of Cash Flows
(In millions)
UNAUDITED
Year ended December
31,
2023
2022
Operating Activities
Net earnings
$
540.6
$
458.3
Depreciation and amortization
111.6
97.9
Changes in assets and liabilities and
other non-cash items
(51.6
)
(96.7
)
Net cash provided by operating
activities
600.6
459.5
Investing Activities
Capital expenditures
(84.2
)
(64.0
)
Acquisition of and equity investments in
businesses, net of cash acquired
(31.7
)
(923.1
)
Other investing activities, net
(13.2
)
(7.0
)
Net cash used in investing activities
(129.1
)
(994.1
)
Financing Activities
Net (repayments on) proceeds from debt
(81.6
)
656.4
Debt financing costs
—
(10.2
)
Dividends paid to ordinary
shareholders
(158.7
)
(143.9
)
Repurchase of ordinary shares
(59.9
)
(61.0
)
Other financing activities, net
1.5
(4.3
)
Net cash provided by (used in) financing
activities
(298.7
)
437.0
Effect of exchange rate changes on cash
and cash equivalents
7.3
(12.3
)
Net increase (decrease) in cash and cash
equivalents
180.1
(109.9
)
Cash and cash equivalents - beginning of
period
288.0
397.9
Cash and cash equivalents - end of
period
$
468.1
$
288.0
SUPPLEMENTAL
SCHEDULES
ALLEGION PLC
SCHEDULE 1
SELECTED OPERATING SEGMENT
INFORMATION
(In millions)
Three months ended December
31,
Year ended December
31,
2023
2022
2023
2022
Net revenues
Allegion Americas
$
704.6
$
679.5
$
2,913.6
$
2,530.7
Allegion International
192.8
182.0
737.2
741.2
Total net revenues
$
897.4
$
861.5
$
3,650.8
$
3,271.9
Operating income (expense)
Allegion Americas
$
175.0
$
156.8
$
757.2
$
611.2
Allegion International
17.9
23.0
58.1
70.4
Corporate unallocated
(33.2
)
(20.4
)
(106.9
)
(95.2
)
Total operating income
$
159.7
$
159.4
$
708.4
$
586.4
ALLEGION PLC
SCHEDULE 2
The Company presents operating income,
operating margin, net earnings and diluted earnings per share (EPS)
on both a U.S. GAAP basis and on an adjusted (non-GAAP) basis,
revenue growth on a U.S. GAAP basis and organic revenue growth on a
non-GAAP basis, and adjusted EBITDA and adjusted EBITDA margin
(both non-GAAP measures). The Company presents these non-GAAP
measures because management believes they provide useful
perspective of the Company’s underlying business results and trends
and a more comparable measure of period-over-period results. These
measures are also used to evaluate senior management and are a
factor in determining at-risk compensation. Investors should not
consider non-GAAP measures as alternatives to the related U.S. GAAP
measures.
The Company defines the presented non-GAAP
measures as follows:
- Adjustments to operating income, operating margin, net
earnings, EPS and EBITDA include items such as goodwill,
indefinite-lived trade name and other asset impairment charges,
restructuring charges, acquisition and integration costs,
amortization of acquired intangible assets, debt financing costs,
gains or losses related to the divestiture of businesses or equity
method investments and non-operating investment gains or
losses;
- Organic revenue growth is defined as U.S. GAAP revenue growth
excluding the impact of acquisitions, divestitures and currency
effects; and
- Available cash flow is defined as U.S. GAAP net cash from
operating activities less capital expenditures.
These non-GAAP measures may not be defined
and calculated the same as similar measures used by other
companies.
RECONCILIATION OF GAAP TO NON-GAAP NET
EARNINGS
(In millions, except per share
data)
Three Months Ended December
31, 2023
Three Months Ended December
31, 2022
Reported
Adjustments
Adjusted (non-GAAP)
Reported
Adjustments
Adjusted (non-GAAP)
Net revenues
$
897.4
$
—
$
897.4
$
861.5
$
—
$
861.5
Operating income
159.7
37.5
(1)
197.2
159.4
19.3
(1)
178.7
Operating margin
17.8
%
22.0
%
18.5
%
20.7
%
Earnings before income taxes
136.9
40.7
(2)
177.6
140.2
19.2
(2)
159.4
Provision for income taxes
18.3
10.8
(3)
29.1
4.8
5.1
(3)
9.9
Effective income tax rate
13.4
%
16.4
%
3.4
%
6.2
%
Net earnings
118.6
29.9
148.5
135.4
14.1
149.5
Noncontrolling interests
—
—
—
0.1
—
0.1
Net earnings attributable to Allegion
plc
$
118.6
$
29.9
$
148.5
$
135.3
$
14.1
$
149.4
Diluted earnings per ordinary share
attributable to
Allegion plc shareholders:
$
1.34
$
0.34
$
1.68
$
1.53
$
0.16
$
1.69
(1)
Adjustments to operating income for the
three months ended December 31, 2023, consist of $16.3 million of
restructuring charges and acquisition and integration expenses,
$13.7 million of amortization expense related to acquired
intangible assets, and $7.5 million of impairment expense related
to intangible assets. Adjustments to operating income for the three
months ended December 31, 2022, consist of $3.4 million of
restructuring charges and acquisition and integration expenses and
$15.9 million of amortization expense related to acquired
intangible assets and a fair value of inventory step-up.
(2)
Adjustments to earnings before income
taxes for the three months ended December 31, 2023, consist of the
adjustments to operating income discussed above, as well as a $3.2
million non-operating investment loss. Adjustments to earnings
before income taxes for the three months ended December 31, 2022,
consist of the adjustments to operating income discussed above as
well as a $0.1 million non-operating investment gain.
(3)
Adjustments to the provision for income
taxes for the three months ended December 31, 2023, and 2022,
consist of $10.8 million and $5.1 million of tax expense,
respectively, related to the excluded items discussed above.
Year ended December 31,
2023
Year ended December 31,
2022
Reported
Adjustments
Adjusted (non-GAAP)
Reported
Adjustments
Adjusted (non-GAAP)
Net revenues
$
3,650.8
$
—
$
3,650.8
$
3,271.9
$
—
$
3,271.9
Operating income
708.4
97.2
(1)
805.6
586.4
85.6
(1)
672.0
Operating margin
19.4
%
22.1
%
17.9
%
20.5
%
Earnings before income taxes
617.2
100.4
(2)
717.6
514.5
91.4
(2)
605.9
Provision for income taxes
76.6
25.9
(3)
102.5
56.2
20.8
(3)
77.0
Effective income tax rate
12.4
%
14.3
%
10.9
%
12.7
%
Net earnings
540.6
74.5
615.1
458.3
70.6
528.9
Noncontrolling interests
0.2
—
0.2
0.3
—
0.3
Net earnings attributable to Allegion
plc
$
540.4
$
74.5
$
614.9
$
458.0
$
70.6
$
528.6
Diluted earnings per ordinary share
attributable to
Allegion plc shareholders:
$
6.12
$
0.84
$
6.96
$
5.19
$
0.80
$
5.99
(1)
Adjustments to operating income for the
year ended December 31, 2023, consist of $33.8 million of
restructuring charges and acquisition and integration expenses,
$55.9 million of amortization expense related to acquired
intangible assets and $7.5 million of impairment expense related to
intangible assets. Adjustments to operating income for the year
ended December 31, 2022, consist of $35.4 million of restructuring
charges and acquisition and integration expenses and $50.2 million
of amortization expense related to acquired intangible assets and a
fair value of inventory step-up.
(2)
Adjustments to earnings before income
taxes for the year ended December 31, 2023, consist of the
adjustments to operating income discussed above, as well as a $3.2
million non-operating investment loss. Adjustments to earnings
before income taxes for the year ended December 31, 2022, as well
as a $7.6 million loss on divestiture of a business and $4.3
million of debt financing costs, partially offset by $6.1 million
in non-operating investment gains.
(3)
Adjustments to the provision for income
taxes for the year ended December 31, 2023, and 2022, consist of
$25.9 million and $20.8 million of tax expense, respectively,
related to the excluded items discussed above.
ALLEGION PLC
SCHEDULE 3
RECONCILIATION OF GAAP TO NON-GAAP
REVENUE AND OPERATING INCOME BY REGION
(In millions)
Three Months Ended December
31, 2023
Three Months Ended December
31, 2022
As Reported
Margin
As Reported
Margin
Allegion Americas
Net revenues (GAAP)
$
704.6
$
679.5
Operating income (GAAP)
$
175.0
24.8
%
$
156.8
23.1
%
Restructuring charges
2.9
0.4
%
—
—
%
Acquisition and integration costs
2.1
0.3
%
2.1
0.3
%
Amortization of acquired intangible
assets
8.4
1.2
%
10.7
1.5
%
Amortization of inventory step up
—
—
%
0.5
0.1
%
Adjusted operating income
188.4
26.7
%
170.1
25.0
%
Depreciation and amortization
8.9
1.3
%
8.1
1.1
%
Adjusted EBITDA
$
197.3
28.0
%
$
178.2
26.1
%
Allegion International
Net revenues (GAAP)
$
192.8
$
182.0
Operating income (loss) (GAAP)
$
17.9
9.3
%
$
23.0
12.6
%
Restructuring charges
1.2
0.6
%
0.2
0.1
%
Acquisition and integration costs
0.4
0.2
%
0.7
0.4
%
Amortization of acquired intangible
assets
5.3
2.8
%
4.7
2.6
%
Impairment of intangible assets
7.5
3.9
%
—
—
%
Adjusted operating income
32.3
16.8
%
28.6
15.7
%
Depreciation and amortization
4.3
2.2
%
4.2
2.3
%
Adjusted EBITDA
$
36.6
19.0
%
$
32.8
18.0
%
Corporate
Operating loss (GAAP)
$
(33.2
)
$
(20.4
)
Restructuring charges
1.0
—
Acquisition and integration costs
8.7
0.4
Adjusted operating loss
(23.5
)
(20.0
)
Depreciation and amortization
0.1
0.7
Adjusted EBITDA
$
(23.4
)
$
(19.3
)
Total
Net revenues
$
897.4
$
861.5
Adjusted operating income
$
197.2
22.0
%
$
178.7
20.7
%
Depreciation and amortization
13.3
1.5
%
13.0
1.6
%
Adjusted EBITDA
$
210.5
23.5
%
$
191.7
22.3
%
Year ended December 31,
2023
Year ended December 31,
2022
As Reported
Margin
As Reported
Margin
Allegion Americas
Net revenues (GAAP)
$
2,913.6
$
2,530.7
Operating income (GAAP)
$
757.2
26.0
%
$
611.2
24.2
%
Restructuring charges
3.7
0.1
%
—
—
%
Acquisition and integration costs
8.4
0.3
%
8.0
0.3
%
Amortization of acquired intangible
assets
33.7
1.1
%
24.6
1.0
%
Amortization of inventory step up
—
—
%
6.0
0.2
%
Adjusted operating income
803.0
27.5
%
649.8
25.7
%
Depreciation and amortization
33.8
1.2
%
30.7
1.2
%
Adjusted EBITDA
$
836.8
28.7
%
$
680.5
26.9
%
Allegion International
Net revenues (GAAP)
$
737.2
$
741.2
Operating income (loss) (GAAP)
58.1
7.9
%
70.4
9.5
%
Restructuring charges
8.0
1.1
%
4.9
0.7
%
Acquisition and integration costs
0.8
0.1
%
1.1
0.1
%
Amortization of acquired intangible
assets
22.2
3.0
%
19.6
2.7
%
Impairment of intangible assets
7.5
1.0
%
—
—
%
Adjusted operating income
96.6
13.1
%
96.0
13.0
%
Depreciation and amortization
17.8
2.4
%
17.0
2.3
%
Adjusted EBITDA
$
114.4
15.5
%
$
113.0
15.3
%
Corporate
Operating loss (GAAP)
$
(106.9
)
$
(95.2
)
Restructuring charges
1.0
—
Acquisition and integration costs
11.9
21.4
Adjusted operating loss
(94.0
)
(73.8
)
Depreciation and amortization
1.3
3.2
Adjusted EBITDA
$
(92.7
)
$
(70.6
)
Total
Net revenues
$
3,650.8
$
3,271.9
Adjusted operating income
$
805.6
22.1
%
$
672.0
20.5
%
Depreciation and amortization
52.9
1.4
%
50.9
1.6
%
Adjusted EBITDA
$
858.5
23.5
%
$
722.9
22.1
%
ALLEGION PLC
SCHEDULE 4
RECONCILIATION OF CASH PROVIDED BY
OPERATING ACTIVITIES TO AVAILABLE CASH FLOW AND NET EARNINGS TO
ADJUSTED EBITDA
(In millions)
Year ended December
31,
2023
2022
Net cash from operating activities
$
600.6
$
459.5
Capital expenditures
(84.2
)
(64.0
)
Available cash flow
$
516.4
$
395.5
Three months ended December
31,
Year ended December
31,
2023
2022
2023
2022
Net earnings (GAAP)
$
118.6
$
135.4
$
540.6
$
458.3
Provision for income taxes
18.3
4.8
76.6
56.2
Interest expense
22.9
23.7
93.1
75.9
Amortization of acquired intangible
assets
13.7
15.4
55.9
44.2
Amortization of inventory step-up
—
0.5
—
6.0
Depreciation and amortization of
nonacquired intangible assets
13.3
13.0
52.9
50.9
EBITDA
186.8
192.8
819.1
691.5
Other income, net
(0.1
)
(4.5
)
(1.9
)
(11.6
)
Impairment of intangible assets
7.5
—
7.5
—
Loss on divestitures
—
—
—
7.6
Acquisition and integration costs and
restructuring charges
16.3
3.4
33.8
35.4
Adjusted EBITDA
$
210.5
$
191.7
$
858.5
$
722.9
ALLEGION PLC
SCHEDULE 5
RECONCILIATION OF GAAP REVENUE GROWTH
TO NON-GAAP ORGANIC REVENUE GROWTH BY SEGMENT
Three months ended December
31,
Year ended December
31,
2023
2022
2023
2022
Allegion Americas
Revenue growth (GAAP)
3.7
%
37.5
%
15.1
%
23.5
%
Acquisitions and divestitures
—
%
(19.7
)%
(7.9
)%
(9.1
)%
Currency translation effects
—
%
0.5
%
0.2
%
0.2
%
Organic growth (non-GAAP)
3.7
%
18.3
%
7.4
%
14.6
%
Allegion International
Revenue growth (GAAP)
5.9
%
(15.3
)%
(0.5
)%
(9.3
)%
Acquisitions and divestitures
(2.8
)%
1.1
%
(0.7
)%
0.3
%
Currency translation effects
(4.4
)%
9.5
%
(1.3
)%
9.8
%
Organic growth (non-GAAP)
(1.3
)%
(4.7
)%
(2.5
)%
0.8
%
Total
Revenue growth (GAAP)
4.2
%
21.5
%
11.6
%
14.1
%
Acquisitions and divestitures
(0.6
)%
(13.4
)%
(6.2
)%
(6.4
)%
Currency translation effects
(1.0
)%
3.3
%
(0.2
)%
3.0
%
Organic growth (non-GAAP)
2.6
%
11.4
%
5.2
%
10.7
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240220977809/en/
Media Contact: Whitney Moorman – Director, Global
Communications 317-810-3241 Whitney.Moorman@allegion.com
Analyst Contacts: Jobi Coyle – Director, Investor
Relations 317-810-3107 Jobi.Coyle@allegion.com
Josh Pokrzywinski – Vice President, Investor Relations
463-210-8595 Joshua.Pokrzywinski@allegion.com
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