ASSA ABLOY AB (publ)

Good morning, everyone, and welcome to the presentation of Azab Loy's first interim report in 2026. My name is Björn Tobel. I'm heading Investor Relations. And joining me here in the studio are Azab Loy's CEO, Nico Delvaux, and our CFO, Erik Tider. We'll start this conference now with a short summary of the report, and then we will open up for your questions, as usual. And we have set aside about one hour for these events. So with that, I'd like to hand over to you, Nico.

Thanks, Bjorn. Also good morning from my side. We can report a good start of the year with a continued strong execution in the quarter. Very good organic sales development of plus 2%. Good sales growth in Americas, Global Technologies and EMEA. Very stable sales in Antron Systems and APAC. Then organic sales complemented with growth through acquisitions of net 2%. And then a strong execution with a strong EBIT margin improvement, 40 base points better than last year, and EBIT at 15.3%, with an excellent operating leverage of 51%. And then again, cash flow also highlights this quarter, a very strong cash flow, 30% up compared to last year. Electromechanical organic sales continues to outgrow the rest of the business. We had a 6% organic growth for electromechanical products in the regional divisions. And then we complemented three acquisitions, or we completed three acquisitions in the quarter. So if we look in numbers, sales of almost 36 billion SEC, 2% organic growth, 2% net acquired growth, but then hit in an important way by FX, minus 10%, so top line minus six in total. I'm very happy with the EBITDA margin evolution, 50 base points better than last year at a strong 16.4%. Then we have the EBIT margin, like I mentioned, at 15.3, 40 base points better than last year. And EBIT in absolute value of close to 5.5 billion SEC. If we look a little bit in the market conditions, And perhaps I start to comment for the opening solutions geographical divisions in the three main markets, where I would say there is no difference compared to previous quarters. As well in North America, as in Europe, as in Oceania, we continue to see very good, strong momentum on the non-residential side, on the commercial side. And we continue to see a more challenging situation on the residential market. If I comment for those three markets, for the other divisions for global tech, mobility is important and we still continue to see very good mobility in all three regions, so it's good market conditions for global tech. The deviation is perhaps in entrance systems, where we see in North America, Europe and Oceania, good momentum for everything that is retail related. We see good momentum for our perimeter security business in North America. But we see more challenging market conditions for the residential garage doors. They are linked to residential market conditions. And then we have seen also a slower recovery of the logistics vertical in North America than anticipated. And we don't see that recovery yet in Europe. As a matter of fact, we see the logistic vertical further going down in Europe. We see in Europe also a bit slowness, I would say, on let's call it industrial CAPEX-related decisions for project business. Main environmental systems also did in HID. So that gives us then the plus 5% organic growth for North America, the flat development in Europe, and the plus 3% in Oceania. Very good market dynamics in Latam, where we have seen a very good growth in all our markets, a plus 2% organic growth. Africa is a very small part of our total business, minus 8. That's mainly related to a difficult comparison with projects that we took last year for HID and Global Solutions. And then a plus 2 in Asia, a very mixed picture between Greater China, where the market continues to be double digit down, And then the rest of Asia where we see good momentum and where we also ourselves see a very good high single and double digit organic growth. We then go to some highlights for the quarter. Some project wins. HID was able to secure a solution offering mobile first access via Apple and Google Wallet with kind of hybrid support for physical credentials. for Bureau Properties, a big, important customer for us in Latam. Kwikset continues to launch new products on the digital side. The Kwikset Aura Reach smart door lock, a connected Deadpool, enabling hands-free intelligent home access with Bluetooth and Matter connectivity. So another, I would say, product launch in that field. Very happy with that. And then on DoorBud introducing the world's first IP video intercom system with integrated 5G, enabling flexible and cable-free access to residential and commercial buildings. Very excited about that new product launch as well. Going to look a little bit at the sales growth, 2% organic, 2% acquisition, a bit lower than the previous four quarters. You see that our 12 month growth trend continues. Operating margin at a good level but hit because of the currency on the top line. And then, sorry, operating margin, sorry, at a good 16.3% and then operating income on a good level but hit by the currency on the top line. Nevertheless, 73% up compared to 2021. We continue to be very active on the acquisition side with three acquisitions completed in the quarter. They represent an annualized sales of around 550 million SEK. And now in beginning of April we announced another acquisition that's our 400th acquisition since we were born 32 years ago. Very happy also about that acquisition. It's a residential garage door company. in Portugal serving south of Europe, so complementing also our residential offering in Europe. If we zoom in on one of the acquisitions of Q1, Senco is a US provider of asset protection technology and solutions for retail security, so really complementing our in-view offering in that vertical, very nice complement to an exciting vertical. They had a sales of around 330 million SEC last year. If we then go into the different divisions, starting with EMEA, a very good start of the year for EMEA with an organic sales growth of 3%, strong sales growth in Central Europe, the Nordics and the Middle East, India, Africa region, but then a sales decline in UK, Ireland and in South Europe. Also very good improvement of the margin, 14.8% and the base points better than last year. You see that organic volume growth continues to boost the bottom line. Strong operating leverage of 40 base points and then also helped by FX, the only division actually that is bottom line helped by FX 80 base points, M&A dilutive 20 base points. Also Americas, very good start for the year. We have an organic sales of plus 4%, with strong sales growth in North America, non-residential segment, and in Latin America, and then a sales decline in North America residential segment. Also here, very good EBIT margin, an EBIT margin improvement at 17.9%, 80 base points, better than last year. We've also here excellent operating leverage and hits by currency and acquisition, 2 times 30 base points. APAC, a flat organic sales development, with good sales growth in Pacific, North East Asia, and a sales decline in Greater China and South East Asia, where we see really a big difference between Greater China, double digit down, and South East Asia, double digit up. Nevertheless, despite a flat organic sales development also here, nice EBIT margin improvement, 100 base points better than last year at 5.1%, also here excellent operating leverage, and then hit by currency 30 base points. Global technologies and organic sales of growth of plus 4% with strong sales growth in global solutions and a good sales growth in HID and a strong EBIT margin for Q1 at 15.3% with also here excellent operating leverage hit in a very important way by FX and base points dilution and helped by M&A 40 basepoints that mainly the divestment of citizen ID business last year. And the last but not least, entrance systems, a flat organic sales development with strong sales growth in parameter security and in pedestrian, but a sales decline in doors and automation and in the industrial segment, and a good sales growth in service. Despite a flat top line development and therefore negative volume, we managed to still post a very good EBIT margin at 15.1% with a stable operating leverage. And then ABEX and M&A dilute if respectively 40 base points and 20 base points. And with that, I give the word to Erik for some more details on the financial numbers.

Thank you, Nico, and also a very good morning from my side. You've heard a lot of the numbers before, but sales were in total down with minus 6, with plus 2 in both organic as well as acquired net growth, but were hit in an important way by the currency, minus 10%. Of course, I mean, as you probably are aware of, there is quite a lot of movements in the currency, so if you look into Q2, Right now, we sort of foresee that it's going to be a minus 2% impact for the second quarter. EBIT was in value, was 3% down. If you look on EBITDA, up with 50 base points. EBIT was up with 40 base points. And then we were a little bit helped by the interest rates, so both income before tax, net income, as well as EPS. is at a similar level as what we had a year ago. Cash flow, as mentioned before, was very strong at 3.1 billion, 30% up versus the same period last year. We also saw an improvement in return on capital employed, up with 20 base points. And then, as we introduced in the last quarter, operational value added, which is EBIT minus the interest cost that we have for our capital employed, there we also were able to improve that with one percent in absolute value if you look on the bridge and dissect the organic part uh on price was a strong two which means that volumes were for flat you see an excellent flow through uh 52 percent where you can see that okay there is a bit of positive mix but also we have positive tailwind that comes from price cost MFP savings of about 120 million SEC, as well as other operational efficiencies. The currency hits us both on top line as well as on bottom line, 10% on top line, and then dilution of 30 base points on the bottom line, and then there is a small dilution this quarter of 10 base points that comes from acquisitions and divestments. Cost breakdown, direct material. positive with 90 base points, out of which about 40 base points comes from mix, which is predominantly mix within the divisions. So, let's say the true impact is 50 base points from price versus cost. We see, of course, now that raw material are increasing, but we're mitigating that with price actions. Conversion costs due to the lack of volume was down with 40 base points. SG&A was flat despite that we continued to do investment in R&D as well as in sales, but we were able to offset that with efficiencies within our administrative expenses. Operating cash flow, as mentioned before, 30% better than the same period last year. Cash conversion was about 60%. And if you look on the last 12 months, our cash conversion is at a very high 110%, and we have had an operating cash flow positive of about 23 billion SEK. And that, of course, has an impact on our gearing and on net debt. If you look on net debt to equity, it's going down, so now it's about 60% net debt to EBTA. is at 2.1, and if you look on the lower bar there, we have reduced our net debt with more than 6 billion SEC, where if you remember in Q4, it was a lot related to currency. Now the currency has a much smaller impact, and you can see that our cash flow is really paying off in reducing our debt, so we continue to have a very strong banner sheet so we can continue the acquisitions that we want to do in line with our strategy. Last but not least, from my side, EPS, as mentioned before, was at the same level as previous years. If you look on dividend, we have since 2021 paid out 27 billion SEC. And if now the AGM approves this afternoon, we're going to pay out another 7 billion SEC. With that, I hand the word back to Nico for some concluding remarks.