Allegion Plc (NYSE:ALLE) Q1 2019 Earnings Conference Call Transcript

Apr 25, 2019 • 08:00 am ET

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Allegion Plc (NYSE:ALLE) Q1 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good morning, and welcome to Allegion's First Quarter 2019 Earnings Conference Call. All participants will be in listen-only mode.

(Operator Instructions)

After today's presentation, there will be an opportunity to ask questions.

(Operator Instructions)

Please note, this event is being recorded. I'd now like to turn the conference over to host today Michael Wagnes, Vice President, Investor Relations and Treasurer. Please go ahead, sir.

Executive
Michael Wagnes

Thank you, Keith. Good morning, everyone. Welcome, and thank you for joining us for Allegion's First Quarter 2019 Earnings Call. With me today are Dave Petratis, Chairman, President and Chief Executive Officer; and Patrick Shannon, Senior Vice President and Chief Financial Officer of Allegion. Our earnings release, which was issued earlier this morning, and the presentation, which we will refer to in today's call are available on our website at allegion.com. This call will be recorded and archived on our website.

Please go to Slides number 2 and 3. Statements made in today's call that are not historical facts are considered forward-looking statements and are made pursuant to the safe harbor provisions of federal securities law. Please see our most recent SEC filings for a description of some of the factors that may cause actual results to differ materially from our projections. The Company assumes no obligation to update these forward-looking statements.

Today's presentation and commentary include non-GAAP financial measures. Please refer to the reconciliation in the financial tables of our press release for further details. Dave and Patrick will now discuss our first quarter 2019 results, which will be followed by a Q&A session. For the Q&A, we ask each caller to limit themselves to one question and one follow-up and then re-enter the queue. We will do our best to get to everyone, given the time allotted.

Please go to Slide 4, and I'll turn the call over to Dave.

Executive
David D. Petratis

Thanks, Mike. Good morning, and thank you for joining us today. Allegion got out of the starting gate with a good quarter, that has positioned us to deliver on our 2019 commitments. We have solid top-line revenue growth in the first quarter, which benefited from strength in the Americas and from the Gainsborough acquisition in the Asia Pacific region.

The Americas growth was driven by the non-residential business as end market fundamentals continue to be positive, particularly in institutional verticals. Pricing was also strong for the Company led by the Americas region. Electronics growth was almost 10% for the quarter, which was lower than the growth rates, we experienced in 2018. While growth improved sequentially from the last quarter, our product portfolio and new market partnerships will drive even better growth in the coming quarters. Allegion's combination of brands, expanded product portfolio, technical partnerships and continuously evolving channel relationships give us a great opportunity to take advantage of this market as it develops. For the full year 2019, we expect the Americas electronics growth rate to be similar to historical levels, which is supported by the healthy demand of the recently launched Schlage Encode residential