Allegion (ALLE) Q3 2024 earnings summary

Executive summary

• Q3 2024 delivered strong revenue growth and margin expansion, with net revenues up 5.4% to $967.1 million and adjusted EPS increasing 11.3% to $2.16; net earnings per share rose 12.4% to $1.99.

• Organic revenue grew 3.3%, driven by price realization, volume growth, and acquisitions, with additional support from currency tailwinds.

• Operating margin improved to 22.2% (adjusted 24.2%), reflecting positive price, productivity, and volume leverage.

• Four acquisitions completed in 2024, expanding both Americas and International segments.

• Accelerated capital deployment in 2024, including cash returns to shareholders, share repurchases, and accretive acquisitions.

Financial highlights

• Q3 2024 revenue was $967.1 million, up 5.4% year-over-year; organic revenue grew 3.3%.

• Adjusted EPS was $2.16, up 11.3% from the prior year; diluted EPS was $1.99, up 12.4%.

• Year-to-date available cash flow reached $388 million, a 21.1% increase year-over-year.

• Adjusted EBITDA margin rose 100 basis points to 25.7%.

• Cash and cash equivalents at September 30, 2024, were $878.9 million.

Outlook and guidance

• Full-year reported revenue growth expected at 2.5%–3.5%, with organic growth of 1.5%–2.5%.

• Adjusted EPS guidance raised to $7.35–$7.45 for the full year; available cash flow outlook affirmed at $540–$570 million.

• Americas organic revenue growth expected at 1.5%–2.5%, International at 1%–2% for FY 2024.

• Outlook assumes a headwind of ~$0.25 per share from a higher adjusted effective tax rate (16.5%–17.5%) due to global minimum tax.

• Expect stable markets and organic growth in 2025, with residential improving and multifamily remaining soft.