07.09.18
ASSA ABLOY reports one-off non-cash costs of SEK 6,000 million ($686 million) in the second quarter, related to its Chinese operations in the Asia Pacific Division. One-off costs of SEK 5,600 million are attributable to impairment of goodwill and other intangible assets, while SEK 400 million is related to write-downs of operating assets.
“The one-off costs reflect the continued challenging market conditions for new projects in China. In our updated China strategic review, we expect continued weak earnings in the short- and medium term in the Chinese market. The impairment of intangible assets in earlier Chinese acquisitions and write-downs of operating assets in some of our Chinese business units, reflect the continued challenging market conditions. However, we remain firmly committed to our Chinese operations, and believe in the long-term earnings potential of this market. We are currently launching new initiatives with a dedicated organization for our different market channels and different brands, focusing on new sales and replacement market,” said Nico Delvaux, president and CEO of ASSA ABLOY.
In the second quarter of 2018, ASSA ABLOY Group’s sales increased by 9% to SEK 21,140 million ($2.42 billion). Organic sales growth was 5%. Adjusted operating profit, EBIT, excluding the announced one-off costs, amounted to SEK 3,311 million ($379 million) corresponding to an adjusted operating margin of 15.7%. All numbers are preliminary and unaudited.
“The one-off costs reflect the continued challenging market conditions for new projects in China. In our updated China strategic review, we expect continued weak earnings in the short- and medium term in the Chinese market. The impairment of intangible assets in earlier Chinese acquisitions and write-downs of operating assets in some of our Chinese business units, reflect the continued challenging market conditions. However, we remain firmly committed to our Chinese operations, and believe in the long-term earnings potential of this market. We are currently launching new initiatives with a dedicated organization for our different market channels and different brands, focusing on new sales and replacement market,” said Nico Delvaux, president and CEO of ASSA ABLOY.
In the second quarter of 2018, ASSA ABLOY Group’s sales increased by 9% to SEK 21,140 million ($2.42 billion). Organic sales growth was 5%. Adjusted operating profit, EBIT, excluding the announced one-off costs, amounted to SEK 3,311 million ($379 million) corresponding to an adjusted operating margin of 15.7%. All numbers are preliminary and unaudited.