DUBLIN - Allegion plc (NYSE: NYSE:ALLE), a global leader in security products and solutions, reported mixed results for the fourth quarter ended December 31, 2023, with adjusted earnings per share (EPS) slightly surpassing analyst expectations while revenue fell short of estimates.
The company's Q4 adjusted EPS came in at $1.68, $0.09 higher than the analyst estimate of $1.59. However, quarterly revenue was reported at $897.4 million, missing the consensus estimate of $904.54 million.
Despite the revenue shortfall, shares of Allegion saw a modest increase of 0.6% following the announcement, signaling a cautiously optimistic investor response to the company's performance and future outlook.
Allegion's fourth-quarter performance demonstrated resilience with a 4.2% increase in revenue compared to the same quarter last year, and a slight 0.6% decrease in adjusted EPS year-over-year (YoY). The company highlighted solid growth in its non-residential Americas business, which was partially offset by declines in residential and Allegion International businesses.
The adjusted operating margin improved by 130 basis points to 22.0%, attributed to positive price and productivity, net of inflation and investments.
For the full year of 2023, Allegion reported a revenue increase of 11.6% to $3,650.8 million and a 16.2% rise in adjusted EPS to $6.96. The company's operating margin for the year improved to 22.1%, up from 20.5% the previous year.
Looking ahead to the full year of 2024, Allegion expects reported revenue growth between 1.5% and 3.5%, with organic growth estimated at 1% to 3%. The company's full-year adjusted EPS guidance is set at $7.00 to $7.15, aligning closely with the analyst consensus of $7.06.
President and CEO John H. Stone expressed confidence in the company's future, stating, "Allegion’s fourth quarter reflected strong execution, margin expansion and cash generation by our team. 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."
Allegion's outlook for 2024 is based on expectations of a stable market backdrop and the company's commitment to executing its strategy and balanced capital deployment. The company anticipates another year of growth, in line with its vision of enabling seamless access and a safer world.
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