Allegion rides favorable Americas, ‘active pipeline’ into 2025

DUBLIN — Allegion’s fourth quarter results exceeded expectations thanks to a favorable bump in revenue for the Americas and strategic partnerships and acquisitions bolstering its non-residential business.  

Allegion’s revenues in the Americas saw a 6.4% increase in Q4 (4.6% organic). 

“Allegion delivered a record year in 2024 – a year marked by consistent, strong execution, solid margin expansion and balanced capital deployment,” said President and CEO John H. Stone during a recent webcast to review Q4 and full-year 2024 financial results. 

Residential business grew by high-single digits and non-residential by mid-single digits. Stone said he was particularly “encouraged” by the latter, where growth was driven by several product launches, including the Schlage XE360 Series commercial wireless locks, and partnerships. 

“Schlage's new smart lock integration with Airbnb was yet another industry first for our company,” he said. “And Schlage Indication Solutions (is) a best-in-class lock portfolio that allows users to more easily see the locked or unlocked status of a door specifically designed with K through 12 school security in mind.” 

Allegion also made a number of bolt-on acquisitions in 2024, including Dorcas earlier in the year. In the Americas, the company’s activity included Krieger, a custom doors and windows company, and Unicel Architectural, a privacy shading and structural products provider that Stone said increased the amount of highly profitable specialty offerings for its non-residential portfolio. In early February, Allegion continued the pace, picking up U.S.-based Next Door. 

“We continue to see opportunity to grow inorganically in 2025 and have entered the year with a very active pipeline,” he said. 

Company officials also noted during the Q&A portion of the webcast that that since Allegion’s non-residential business is largely sourced and produced in the U.S., they don’t anticipate a large financial impact stemming from tariffs on aluminum and steel. 

Results at a glance: 

• Allegion reported fourth quarter 2024 net revenues of $945.6 million and net earnings of $144.1 million, or $1.65 per share. Adjusted net earnings were $161.8 million, or $1.86 per share, up 10.7%, excluding items primarily related to restructuring, acquisition and integration expenses, as well as amortization expense related to acquired intangible assets.  

• Fourth quarter 2024 net revenues increased 5.4%. On an organic basis, which excludes impacts of acquisitions, divestitures and foreign currency movements, net revenues increased 3.5%, led by the Americas region. The organic revenue increase was driven by price realization and volume growth. Reported revenue reflects a 2.0% positive impact from acquisitions and a slight headwind from foreign currency. 

• Fourth quarter 2024 operating income was $184.6 million, an increase of $24.9 million or 15.6%. Adjusted operating income in fourth quarter 2024 was $209.1 million, an increase of $11.9 million or 6.0%. 

• Fourth quarter 2024 operating margin was 19.5%, compared with 17.8%. The adjusted operating margin in fourth-quarter 2024 was 22.1%, compared with 22.0%. The 10-basis-point increase in adjusted operating margin is attributable to favorable volume leverage and regional mix.