Allegion Q2 results show continued momentum

DUBLIN – Allegion held its 2023 second quarter earnings call on July 26, and the results are a year of positive gain and increased expectations.

These results mirror a surprisingly well-padded first quarter that could not be dampened by the soft residential market. Now several months later Allegion is reporting revenues of $912.5 million, up 18% on a reported basis and up 5.6% on an organic basis in the second quarter of 2023.

“In Q2, strength across both residential and nonresidential business in our Americas segment totaled nearly 40% electronics growth over the prior period,” said President and CEO John Stone during the earnings call. “We also saw a strong electronics and software solutions performance in our international segment. As we work to shape the transformation taking place in our industry, we continue to see electronics as key to our overall growth.”

Looking to the future, Stone said the company’s vision and strategy lay in enabling seamless access in a safer world. “What does that mean?” he asked investors during the meeting. “It means if you have the right credentials, whether that's a metal key, an encrypted proximity card, or a digital identity in a mobile wallet, we will provide you the most convenient and secure experience possible.”

As a result of all the good financial outcomes this quarter the company adjusted its full-year outlook:

• Raising full-year 2023 EPS outlook to a range of $6.10 to $6.20 and adjusted EPS outlook to a range of $6.70 to $6.80 (+11.9% to +13.5%)
• Raising full-year 2023 available cash flow to a range of $500 to $520 million
• Tightening full-year 2023 reported revenue growth outlook to 11.5% to 12.5% and full-year 2023 organic revenue growth outlook to 5.5% to 6.5%

July 5th also marked the one-year milestone of Allegion's purchase of Stanley Access Security Technologies. Stone notes that the teams have integrated well and do a good job taking care of customers. As far as Stone is concerned, they’ve returned to a high operating level.

“And I feel we're well on track to deliver all of that for 2023,” said Stone. “Our end markets are stable, demand is steady, electronics will continue to fuel our overall revenue growth as we stay focused on our vision of enabling seamless access in a safer world. I'm confident in our outlook and very proud of what our team and our distribution partners delivered this quarter and in my first year with Allegion.”

Find the full version of the earnings report online at investor.allegion.com.