Allegion's Q1 Earnings & Revenues Surpass Estimates, Increase Y/Y

Core Viewpoint - Allegion plc reported strong first-quarter 2025 results, with adjusted earnings per share of $1.86, exceeding estimates and showing a 20% year-over-year increase [1] Revenue Details - Total revenues reached$ 941.9 million, a 5.4% increase year over year, surpassing the Zacks Consensus Estimate of $932 million [1][2] - Organic revenues grew by 4%, primarily driven by robust performance in the non-residential business in the Americas [1] - Acquired assets contributed 1.8% to revenue growth, while foreign exchange negatively impacted revenues by 3% [2] Segment Performance - Allegion Americas revenues increased by 6.8% year over year to$ 757.8 million, accounting for 80.5% of total revenues, exceeding estimates [2] - Organic revenues in this segment rose by 4.9%, supported by high-single-digit growth in non-residential businesses [2] - Allegion International revenues slightly declined by 0.3% year over year to $184.1 million, but organic revenues grew by 0.9% due to pricing [3] Margin Profile - Cost of revenues increased by 3.4% year over year to$ 519.4 million, while gross profit rose by 8% to $422.5 million, leading to a gross margin increase of 110 basis points to 44.9% [4] - Adjusted EBITDA grew by 12.2% year over year to$ 228.0 million, with a margin increase of 140 basis points to 24.2% [4] - Adjusted operating income increased by 14.1% year over year to $196.4 million, with an adjusted margin of 22.7%, up 150 basis points [5] Balance Sheet and Cash Flow - At the end of Q1 2025, Allegion had cash and cash equivalents of$ 494.5 million, down from $503.8 million at the end of 2024, while long-term debt slightly decreased to$ 1.97 billion [6] - The company generated net cash of $104.5 million from operating activities, more than doubling year over year, with available cash flow of$ 83.4 million [7] - Allegion repurchased shares worth $40.0 million and paid dividends totaling$ 43.6 million, reflecting a 3.6% year-over-year increase [7] 2025 Outlook - Allegion has reaffirmed its 2025 guidance, expecting revenue growth of 1-3% and organic revenue growth of 1.5-3.5% [9] - Adjusted earnings are projected to be between $7.65 and$ 7.85 per share, with available cash flow estimated at 85-90% of adjusted net income [9]