Allegion Q4 Earnings Meet Estimates, Revenues Miss

Allegion plc’s (ALLE - Free Report) fourth-quarter 2019 adjusted earnings came in line with estimates, while revenues missed the same.

Earnings/Revenues

Quarterly adjusted earnings came in at $1.28 per share, meeting the Zacks Consensus Estimate. Notably, the bottom line was 4.9% higher than the year-ago figure of $1.22. The upside can be primarily attributed to solid sales growth and improved operating income.

In full-year 2019, Allegion’s adjusted earnings came in at $4.89 per share, up 8.7% on a year-over-year basis.

Revenues totaled $719.5 million, up 2.4% year over year. However, the top line missed the consensus estimate of $740 million. Revenues jumped 3.5% on an organic basis. The rise was backed by strength in businesses in the Americas region and strong pricing benefits, partially offset by adverse impact of unfavorable foreign exchange movements.

In 2019, Allegion generated revenues of $2,854 million, up 4.5% on a year-over-year basis.

Allegion plc Price, Consensus and EPS Surprise

Allegion PLC Price, Consensus and EPS Surprise

 

Allegion plc price-consensus-eps-surprise-chart | Allegion plc Quote

Segmental Breakup

Revenues in the Americas rose 6.8% year over year to $526.3 million, driven by strength in non-residential and residential businesses. EMEIA (Europe, Middle East, India and Africa) revenues declined 5% to $149.6 million, on account of adverse impacts of divestitures and unfavorable foreign exchange movements. Revenues in Asia-Pacific fell 16.6% to $43.6 million in the quarter, reflecting weak residential end markets in Australia and market softness in China.

Costs/Margins

In the fourth quarter, Allegion’s cost of sales decreased 0.4% year over year to $400.3 million. Gross profit grew 6.2% to $319.2 million while gross margin improved 160 basis points (bps) to 44.4%.

Selling and administrative expenses increased 10.6% year over year to $175.9 million.

Adjusted operating margin expanded 30 bps to 21%.

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