☒
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Ireland
|
98-1108930
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
Title of each class
|
Trading symbol
|
Name of exchange on which registered
|
Ordinary shares, par value $0.01 per share
|
ALLE
|
New York Stock Exchange
|
Large accelerated filer
|
☒
|
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Accelerated filer
|
☐
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|
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Non-accelerated filer
|
☐
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Smaller reporting company
|
☐
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|
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|
|
|
|
|
|
Emerging growth company
|
☐
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|
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Item 1 -
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Item 2 -
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Item 3 -
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Item 4 -
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Item 1 -
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Item 1A -
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Item 2 -
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Item 6 -
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Three months ended
|
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Six months ended
|
||||||||||||
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June 30,
|
|
June 30,
|
||||||||||||
In millions, except per share amounts
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net revenues
|
$
|
731.2
|
|
|
$
|
704.7
|
|
|
$
|
1,386.2
|
|
|
$
|
1,317.8
|
|
Cost of goods sold
|
410.5
|
|
|
399.1
|
|
|
788.6
|
|
|
754.4
|
|
||||
Selling and administrative expenses
|
175.0
|
|
|
162.2
|
|
|
343.9
|
|
|
321.3
|
|
||||
Operating income
|
145.7
|
|
|
143.4
|
|
|
253.7
|
|
|
242.1
|
|
||||
Interest expense
|
13.4
|
|
|
13.4
|
|
|
27.1
|
|
|
26.3
|
|
||||
Other expense (income), net
|
0.7
|
|
|
(1.6
|
)
|
|
(0.4
|
)
|
|
(2.0
|
)
|
||||
Earnings before income taxes
|
131.6
|
|
|
131.6
|
|
|
227.0
|
|
|
217.8
|
|
||||
Provision for income taxes
|
22.2
|
|
|
17.6
|
|
|
37.3
|
|
|
31.4
|
|
||||
Net earnings
|
109.4
|
|
|
114.0
|
|
|
189.7
|
|
|
186.4
|
|
||||
Less: Net earnings attributable to noncontrolling interests
|
0.1
|
|
|
0.1
|
|
|
0.2
|
|
|
0.3
|
|
||||
Net earnings attributable to Allegion plc
|
$
|
109.3
|
|
|
$
|
113.9
|
|
|
$
|
189.5
|
|
|
$
|
186.1
|
|
Earnings per share attributable to Allegion plc ordinary shareholders:
|
|
|
|
|
|
|
|
||||||||
Basic net earnings
|
$
|
1.17
|
|
|
$
|
1.20
|
|
|
$
|
2.01
|
|
|
$
|
1.96
|
|
Diluted net earnings
|
$
|
1.16
|
|
|
$
|
1.19
|
|
|
$
|
2.00
|
|
|
$
|
1.94
|
|
Weighted-average shares outstanding
|
|
|
|
|
|
|
|
||||||||
Basic
|
93.8
|
|
|
95.0
|
|
|
94.1
|
|
|
95.1
|
|
||||
Diluted
|
94.5
|
|
|
95.6
|
|
|
94.8
|
|
|
95.7
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Total comprehensive income
|
$
|
114.5
|
|
|
$
|
62.5
|
|
|
$
|
180.1
|
|
|
$
|
162.0
|
|
Less: Total comprehensive (loss) income attributable to noncontrolling interests
|
(0.5
|
)
|
|
(2.2
|
)
|
|
0.2
|
|
|
(1.0
|
)
|
||||
Total comprehensive income attributable to Allegion plc
|
$
|
115.0
|
|
|
$
|
64.7
|
|
|
$
|
179.9
|
|
|
$
|
163.0
|
|
In millions
|
June 30,
2019 |
|
December 31,
2018 |
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
157.8
|
|
|
$
|
283.8
|
|
Restricted cash
|
3.4
|
|
|
6.8
|
|
||
Accounts and notes receivable, net
|
380.0
|
|
|
324.9
|
|
||
Inventories
|
304.7
|
|
|
280.3
|
|
||
Other current assets
|
37.3
|
|
|
35.8
|
|
||
Total current assets
|
883.2
|
|
|
931.6
|
|
||
Property, plant and equipment, net
|
281.7
|
|
|
276.7
|
|
||
Goodwill
|
878.1
|
|
|
883.0
|
|
||
Intangible assets, net
|
533.6
|
|
|
547.1
|
|
||
Other noncurrent assets
|
272.7
|
|
|
171.8
|
|
||
Total assets
|
$
|
2,849.3
|
|
|
$
|
2,810.2
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
206.5
|
|
|
$
|
235.0
|
|
Accrued expenses and other current liabilities
|
275.5
|
|
|
250.5
|
|
||
Short-term borrowings and current maturities of long-term debt
|
35.1
|
|
|
35.3
|
|
||
Total current liabilities
|
517.1
|
|
|
520.8
|
|
||
Long-term debt
|
1,393.1
|
|
|
1,409.5
|
|
||
Other noncurrent liabilities
|
275.5
|
|
|
225.9
|
|
||
Total liabilities
|
2,185.7
|
|
|
2,156.2
|
|
||
Equity:
|
|
|
|
||||
Allegion plc shareholders’ equity:
|
|
|
|
||||
Ordinary shares, $0.01 par value (93,451,331 and 94,637,450 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively)
|
0.9
|
|
|
0.9
|
|
||
Capital in excess of par value
|
—
|
|
|
—
|
|
||
Retained earnings
|
892.7
|
|
|
873.6
|
|
||
Accumulated other comprehensive loss
|
(233.1
|
)
|
|
(223.5
|
)
|
||
Total Allegion plc shareholders’ equity
|
660.5
|
|
|
651.0
|
|
||
Noncontrolling interests
|
3.1
|
|
|
3.0
|
|
||
Total equity
|
663.6
|
|
|
654.0
|
|
||
Total liabilities and equity
|
$
|
2,849.3
|
|
|
$
|
2,810.2
|
|
|
Six months ended
|
||||||
|
June 30,
|
||||||
In millions
|
2019
|
|
2018
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net earnings
|
$
|
189.7
|
|
|
$
|
186.4
|
|
Adjustments to arrive at net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
41.4
|
|
|
45.5
|
|
||
Changes in assets and liabilities and other non-cash items
|
(124.1
|
)
|
|
(113.2
|
)
|
||
Net cash provided by operating activities
|
107.0
|
|
|
118.7
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Capital expenditures
|
(29.3
|
)
|
|
(20.9
|
)
|
||
Acquisition of and equity investments in businesses, net of cash acquired
|
(4.6
|
)
|
|
(280.5
|
)
|
||
Other investing activities, net
|
(2.3
|
)
|
|
0.1
|
|
||
Net cash used in investing activities
|
(36.2
|
)
|
|
(301.3
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Payments of short-term borrowings
|
(0.2
|
)
|
|
(0.5
|
)
|
||
Proceeds from revolving facility
|
—
|
|
|
40.0
|
|
||
Repayments of revolving facility
|
—
|
|
|
(40.0
|
)
|
||
Payments of other long-term debt
|
(17.7
|
)
|
|
(17.9
|
)
|
||
Debt repayments, net
|
(17.9
|
)
|
|
(18.4
|
)
|
||
Dividends paid to ordinary shareholders
|
(50.5
|
)
|
|
(39.7
|
)
|
||
Repurchase of ordinary shares
|
(133.6
|
)
|
|
(30.0
|
)
|
||
Other financing activities, net
|
1.4
|
|
|
(2.3
|
)
|
||
Net cash used in financing activities
|
(200.6
|
)
|
|
(90.4
|
)
|
||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
0.4
|
|
|
(3.6
|
)
|
||
Net decrease in cash, cash equivalents and restricted cash
|
(129.4
|
)
|
|
(276.6
|
)
|
||
Cash, cash equivalents and restricted cash - beginning of period
|
290.6
|
|
|
466.2
|
|
||
Cash, cash equivalents and restricted cash - end of period
|
$
|
161.2
|
|
|
$
|
189.6
|
|
In millions
|
June 30,
2019 |
|
December 31,
2018 |
||||
Raw materials
|
$
|
125.2
|
|
|
$
|
117.2
|
|
Work-in-process
|
38.1
|
|
|
34.4
|
|
||
Finished goods
|
141.4
|
|
|
128.7
|
|
||
Total
|
$
|
304.7
|
|
|
$
|
280.3
|
|
In millions
|
Americas
|
|
EMEIA
|
|
Asia Pacific
|
|
Total
|
||||||||
December 31, 2018 (gross)
|
$
|
486.1
|
|
|
$
|
767.1
|
|
|
$
|
115.3
|
|
|
$
|
1,368.5
|
|
Accumulated impairment
|
—
|
|
|
(478.6
|
)
|
|
(6.9
|
)
|
|
(485.5
|
)
|
||||
December 31, 2018 (net)
|
486.1
|
|
|
288.5
|
|
|
108.4
|
|
|
883.0
|
|
||||
Acquisitions and adjustments(a)
|
(1.3
|
)
|
|
3.7
|
|
|
(4.4
|
)
|
|
(2.0
|
)
|
||||
Currency translation
|
0.2
|
|
|
(2.4
|
)
|
|
(0.7
|
)
|
|
(2.9
|
)
|
||||
June 30, 2019 (net)
|
$
|
485.0
|
|
|
$
|
289.8
|
|
|
$
|
103.3
|
|
|
$
|
878.1
|
|
(a)
|
In 2019, the Company made reclassifications to goodwill across all segments related to a change in how revenue is managed for a specific immaterial product line where revenue previously managed in the Asia Pacific segment is now being managed in the Americas and EMEIA segments.
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
In millions
|
|
Gross carrying amount
|
|
Accumulated amortization
|
|
Net carrying amount
|
|
Gross carrying amount
|
|
Accumulated amortization
|
|
Net carrying amount
|
||||||||||||
Completed technologies/patents
|
|
$
|
59.5
|
|
|
$
|
(16.8
|
)
|
|
$
|
42.7
|
|
|
$
|
59.4
|
|
|
$
|
(14.2
|
)
|
|
$
|
45.2
|
|
Customer relationships
|
|
416.7
|
|
|
(98.3
|
)
|
|
318.4
|
|
|
419.3
|
|
|
(88.5
|
)
|
|
330.8
|
|
||||||
Trade names (finite-lived)
|
|
84.1
|
|
|
(48.7
|
)
|
|
35.4
|
|
|
84.9
|
|
|
(47.4
|
)
|
|
37.5
|
|
||||||
Other
|
|
14.3
|
|
|
(7.3
|
)
|
|
7.0
|
|
|
9.5
|
|
|
(6.5
|
)
|
|
3.0
|
|
||||||
Total finite-lived intangible assets
|
|
574.6
|
|
|
$
|
(171.1
|
)
|
|
403.5
|
|
|
573.1
|
|
|
$
|
(156.6
|
)
|
|
416.5
|
|
||||
Trade names (indefinite-lived)
|
|
130.1
|
|
|
|
|
130.1
|
|
|
130.6
|
|
|
|
|
130.6
|
|
||||||||
Total
|
|
$
|
704.7
|
|
|
|
|
$
|
533.6
|
|
|
$
|
703.7
|
|
|
|
|
$
|
547.1
|
|
Business
|
|
Date
|
Technical Glass Products, Inc. ("TGP")
|
|
January 2018
|
Hammond Enterprises, Inc. ("Hammond")
|
|
January 2018
|
Qatar Metal Industries LLC ("QMI")
|
|
February 2018
|
AD Systems, Inc. ("AD Systems")
|
|
March 2018
|
Gainsborough Hardware and API Locksmiths ("Door and Access Systems")
|
|
July 2018
|
ISONAS Security Systems, Inc. ("ISONAS")
|
|
July 2018
|
In millions
|
|
||
Accounts receivable, net
|
$
|
28.9
|
|
Inventories
|
28.5
|
|
|
Other current assets
|
1.3
|
|
|
Property, plant and equipment, net
|
27.6
|
|
|
Goodwill
|
139.8
|
|
|
Intangible assets, net
|
204.3
|
|
|
Other noncurrent assets
|
2.0
|
|
|
Accounts payable
|
(11.1
|
)
|
|
Accrued expenses and other current liabilities
|
(35.7
|
)
|
|
Other noncurrent liabilities
|
(11.1
|
)
|
|
Total
|
$
|
374.5
|
|
In millions
|
Three months ended June 30, 2018
|
|
Six months ended June 30, 2018
|
||||
Net revenues
|
$
|
724.4
|
|
|
$
|
1,360.3
|
|
Net earnings attributable to Allegion plc
|
118.3
|
|
|
193.8
|
|
In millions
|
June 30,
2019 |
|
December 31,
2018 |
||||
Term Facility
|
$
|
638.8
|
|
|
$
|
656.3
|
|
Revolving Facility
|
—
|
|
|
—
|
|
||
3.200% Senior Notes due 2024
|
400.0
|
|
|
400.0
|
|
||
3.550% Senior Notes due 2027
|
400.0
|
|
|
400.0
|
|
||
Other debt
|
0.8
|
|
|
1.2
|
|
||
Total borrowings outstanding
|
1,439.6
|
|
|
1,457.5
|
|
||
Less discounts and debt issuance costs, net
|
(11.4
|
)
|
|
(12.7
|
)
|
||
Total debt
|
1,428.2
|
|
|
1,444.8
|
|
||
Less current portion of long-term debt
|
35.1
|
|
|
35.3
|
|
||
Total long-term debt
|
$
|
1,393.1
|
|
|
$
|
1,409.5
|
|
|
|
|
Designated as hedge instruments
|
|
Not designated as hedge instruments
|
||||||||||||
In millions
|
Balance Sheet classification
|
|
June 30,
2019 |
|
December 31,
2018 |
|
June 30,
2019 |
|
December 31,
2018 |
||||||||
Asset derivatives
|
|
|
|
|
|
|
|
|
|
||||||||
Currency derivatives
|
Other current assets
|
|
$
|
0.1
|
|
|
$
|
1.7
|
|
|
$
|
0.3
|
|
|
$
|
0.4
|
|
Interest rate swaps
|
Other noncurrent assets
|
|
1.8
|
|
|
5.7
|
|
|
—
|
|
|
—
|
|
||||
Total asset derivatives
|
|
|
1.9
|
|
|
7.4
|
|
|
0.3
|
|
|
0.4
|
|
||||
Liability derivatives
|
|
|
|
|
|
|
|
|
|
||||||||
Currency derivatives
|
Accrued expenses and other current liabilities
|
|
0.7
|
|
|
—
|
|
|
0.4
|
|
|
0.1
|
|
||||
Total liability derivatives
|
|
|
$
|
0.7
|
|
|
$
|
—
|
|
|
$
|
0.4
|
|
|
$
|
0.1
|
|
|
Amount of gain (loss) recognized in Accumulated other comprehensive loss
|
|
Location of gain recognized
in Net earnings |
|
Amount of gain reclassified from Accumulated other comprehensive loss and
recognized into Net earnings |
||||||||||||
In millions
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|||||||||
Currency derivatives
|
$
|
0.4
|
|
|
$
|
0.4
|
|
|
Cost of goods sold
|
|
$
|
1.3
|
|
|
$
|
0.4
|
|
Interest rate swaps
|
(1.5
|
)
|
|
0.3
|
|
|
Interest expense
|
|
0.8
|
|
|
0.7
|
|
||||
Total
|
$
|
(1.1
|
)
|
|
$
|
0.7
|
|
|
|
|
$
|
2.1
|
|
|
$
|
1.1
|
|
|
Amount of gain (loss) recognized in Accumulated other comprehensive loss
|
|
Location of gain recognized
in Net earnings |
|
Amount of gain reclassified from Accumulated other comprehensive loss and
recognized into Net earnings |
||||||||||||
In millions
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|||||||||
Currency derivatives
|
$
|
1.0
|
|
|
$
|
2.2
|
|
|
Cost of goods sold
|
|
$
|
3.3
|
|
|
$
|
1.0
|
|
Interest rate swaps
|
(2.2
|
)
|
|
2.6
|
|
|
Interest expense
|
|
1.7
|
|
|
0.9
|
|
||||
Total
|
$
|
(1.2
|
)
|
|
$
|
4.8
|
|
|
|
|
$
|
5.0
|
|
|
$
|
1.9
|
|
•
|
The Company elected to not separate non-lease components from lease components and instead to account for each separate lease component, and the non-lease components associated with that lease component, as a single lease component.
|
•
|
If at the lease commencement date, a lease had a term of less than 12 months and did not include a purchase option that was reasonably certain to be exercised, the Company elected not to apply ASC 842 recognition requirements. Nonetheless, the Company will include leases of less than 12 months within the updated footnote disclosures where applicable.
|
•
|
If the Company enters into a large number of leases in the same month with the same terms and conditions, these will be looked at as a group (portfolio) assuming the lease model under this approach will not materially differ from applying ASC 842 to each individual lease.
|
•
|
The Company elected to not reassess arrangements entered into prior than January 1, 2019, in terms of whether an arrangement is or contained a lease, the lease classification applied or to separate initial direct costs.
|
•
|
The Company elected to use hindsight in determining the lease term for lease contracts that have historically been renewed or amended.
|
In millions
|
Balance Sheet classification
|
|
Real estate
|
|
Equipment
|
|
Total
|
||||||
ROU asset
|
Other noncurrent assets
|
|
$
|
60.8
|
|
|
$
|
20.8
|
|
|
$
|
81.6
|
|
Lease liability - current
|
Accrued expenses and other current liabilities
|
|
15.3
|
|
|
10.4
|
|
|
25.7
|
|
|||
Lease liability - noncurrent
|
Other noncurrent liabilities
|
|
45.5
|
|
|
10.4
|
|
|
55.9
|
|
|||
|
|
|
|
|
|
|
|
||||||
Other information:
|
|
|
|
|
|
|
|||||||
Weighted-average remaining term (years)
|
|
6.8 years
|
|
|
2.4 years
|
|
|
|
|||||
Weighted-average discount rate
|
|
4.6
|
%
|
|
4.1
|
%
|
|
|
In millions
|
|
Real estate
|
|
Equipment
|
|
Total
|
||||||
Cash paid for amounts included in the measurement of lease liabilities
|
|
$
|
9.6
|
|
|
$
|
7.1
|
|
|
$
|
16.7
|
|
ROU assets obtained in exchange for new lease liabilities
|
|
7.0
|
|
|
6.2
|
|
|
13.2
|
|
In millions
|
|
Total
|
||
2019
|
|
$
|
30.3
|
|
2020
|
|
21.5
|
|
|
2021
|
|
14.1
|
|
|
2022
|
|
9.3
|
|
|
2023
|
|
5.5
|
|
In millions
|
|
Remainder of 2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
|
Total
|
||||||||||||||
Real estate leases
|
|
$
|
9.3
|
|
|
$
|
15.7
|
|
|
$
|
12.5
|
|
|
$
|
9.4
|
|
|
$
|
5.7
|
|
|
$
|
18.8
|
|
|
$
|
71.4
|
|
Equipment leases
|
|
6.3
|
|
|
8.4
|
|
|
4.8
|
|
|
1.7
|
|
|
0.6
|
|
|
—
|
|
|
21.8
|
|
|||||||
Total
|
|
$
|
15.6
|
|
|
$
|
24.1
|
|
|
$
|
17.3
|
|
|
$
|
11.1
|
|
|
$
|
6.3
|
|
|
$
|
18.8
|
|
|
$
|
93.2
|
|
|
Non-U.S.
|
||||||||||||||
|
Three months ended
|
|
Six months ended
|
||||||||||||
In millions
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Service cost
|
$
|
0.4
|
|
|
$
|
0.4
|
|
|
$
|
0.8
|
|
|
$
|
1.0
|
|
Interest cost
|
2.2
|
|
|
2.1
|
|
|
4.4
|
|
|
4.2
|
|
||||
Expected return on plan assets
|
(3.3
|
)
|
|
(3.9
|
)
|
|
(6.5
|
)
|
|
(7.8
|
)
|
||||
Administrative costs and other
|
0.4
|
|
|
0.4
|
|
|
0.7
|
|
|
0.8
|
|
||||
Net amortization of:
|
|
|
|
|
|
|
|
||||||||
Prior service costs
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
||||
Plan net actuarial losses
|
0.4
|
|
|
0.2
|
|
|
0.7
|
|
|
0.4
|
|
||||
Net curtailment and settlement losses
|
1.4
|
|
|
—
|
|
|
1.4
|
|
|
—
|
|
||||
Net periodic pension benefit cost (income)
|
$
|
1.5
|
|
|
$
|
(0.8
|
)
|
|
$
|
1.6
|
|
|
$
|
(1.4
|
)
|
•
|
Level 1 – Inputs based on quoted prices in active markets for identical assets or liabilities.
|
•
|
Level 2 – Inputs other than Level 1 quoted prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability.
|
•
|
Level 3 – Unobservable inputs based on little or no market activity and that are significant to the fair value of the assets and liabilities.
|
|
Fair value measurements
|
|
Total
fair value |
||||||||||||
In millions
|
Quoted prices in active markets for identical assets (Level 1)
|
|
Significant other observable inputs (Level 2)
|
|
Significant unobservable inputs (Level 3)
|
|
|||||||||
Recurring fair value measurements
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Investments
|
$
|
—
|
|
|
$
|
16.4
|
|
|
$
|
—
|
|
|
$
|
16.4
|
|
Interest rate swaps
|
—
|
|
|
1.8
|
|
|
—
|
|
|
1.8
|
|
||||
Foreign currency contracts
|
—
|
|
|
0.4
|
|
|
—
|
|
|
0.4
|
|
||||
Total asset recurring fair value measurements
|
$
|
—
|
|
|
$
|
18.6
|
|
|
$
|
—
|
|
|
$
|
18.6
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Foreign currency contracts
|
$
|
—
|
|
|
$
|
1.1
|
|
|
$
|
—
|
|
|
$
|
1.1
|
|
Deferred compensation and other retirement plans
|
—
|
|
|
21.0
|
|
|
—
|
|
|
21.0
|
|
||||
Total liability recurring fair value measurements
|
$
|
—
|
|
|
$
|
22.1
|
|
|
$
|
—
|
|
|
$
|
22.1
|
|
Financial instruments not carried at fair value
|
|
|
|
|
|
|
|
||||||||
Total debt
|
$
|
—
|
|
|
$
|
1,435.8
|
|
|
$
|
—
|
|
|
$
|
1,435.8
|
|
Total financial instruments not carried at fair value
|
$
|
—
|
|
|
$
|
1,435.8
|
|
|
$
|
—
|
|
|
$
|
1,435.8
|
|
|
Fair value measurements
|
|
Total
fair value |
||||||||||||
In millions
|
Quoted prices in active markets for identical assets (Level 1)
|
|
Significant other observable inputs (Level 2)
|
|
Significant unobservable inputs (Level 3)
|
|
|||||||||
Recurring fair value measurements
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Investments
|
$
|
—
|
|
|
$
|
14.3
|
|
|
$
|
—
|
|
|
$
|
14.3
|
|
Interest rate swaps
|
—
|
|
|
5.7
|
|
|
—
|
|
|
5.7
|
|
||||
Foreign currency contracts
|
—
|
|
|
2.1
|
|
|
—
|
|
|
2.1
|
|
||||
Total asset recurring fair value measurements
|
$
|
—
|
|
|
$
|
22.1
|
|
|
$
|
—
|
|
|
$
|
22.1
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Foreign currency contracts
|
$
|
—
|
|
|
$
|
0.1
|
|
|
$
|
—
|
|
|
$
|
0.1
|
|
Deferred compensation and other retirement plans
|
—
|
|
|
19.1
|
|
|
—
|
|
|
19.1
|
|
||||
Total liability recurring fair value measurements
|
$
|
—
|
|
|
$
|
19.2
|
|
|
$
|
—
|
|
|
$
|
19.2
|
|
Financial instruments not carried at fair value
|
|
|
|
|
|
|
|
||||||||
Total debt
|
$
|
—
|
|
|
$
|
1,403.2
|
|
|
$
|
—
|
|
|
$
|
1,403.2
|
|
Total financial instruments not carried at fair value
|
$
|
—
|
|
|
$
|
1,403.2
|
|
|
$
|
—
|
|
|
$
|
1,403.2
|
|
•
|
Investments – These instruments include equity mutual funds and corporate bond funds. The fair value is obtained based on observable market prices quoted on public exchanges for similar instruments.
|
•
|
Interest rate swaps – These instruments include interest rate swap contracts for $250.0 million of the Company's variable rate debt. The fair value of the derivative instruments is determined based on quoted prices for the Company's swaps, which is not considered an active market.
|
•
|
Foreign currency contracts – These instruments include foreign currency contracts for non-functional currency balance sheet exposures. The fair value of the foreign currency contracts is determined based on a pricing model that uses spot rates and forward prices from actively quoted currency markets that are readily accessible and observable.
|
•
|
Deferred compensation and other retirement plans – These include obligations related to deferred compensation and other retirement plans adjusted for market performance. The fair value is obtained based on observable market prices quoted on public exchanges for similar instruments.
|
•
|
Debt – These instruments are recorded at cost and include senior notes maturing through 2027. The fair value of the long-term debt instruments is obtained based on observable market prices quoted on public exchanges for similar instruments.
|
|
|
|
Allegion plc shareholders' equity
|
|
|
|||||||||||||||||||||
|
|
|
Ordinary shares
|
|
|
|
|
|
|
|
|
|||||||||||||||
In millions
|
Total equity
|
|
Amount
|
|
Shares
|
|
Capital in excess of par value
|
|
Retained earnings
|
|
Accumulated other comprehensive loss
|
|
Noncontrolling
interests |
|||||||||||||
Balance at December 31, 2018
|
$
|
654.0
|
|
|
$
|
0.9
|
|
|
94.6
|
|
|
$
|
—
|
|
|
$
|
873.6
|
|
|
$
|
(223.5
|
)
|
|
$
|
3.0
|
|
Net earnings
|
80.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80.2
|
|
|
—
|
|
|
0.1
|
|
||||||
Other comprehensive (loss) income, net
|
(14.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15.3
|
)
|
|
0.6
|
|
||||||
Share-based compensation activity
|
7.1
|
|
|
—
|
|
|
0.2
|
|
|
7.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Dividends to ordinary shareholders ($0.27 per share)
|
(25.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25.5
|
)
|
|
—
|
|
|
—
|
|
||||||
Repurchase of ordinary shares
|
(63.8
|
)
|
|
—
|
|
|
(0.7
|
)
|
|
(7.1
|
)
|
|
(56.7
|
)
|
|
—
|
|
|
—
|
|
||||||
Balance at March 31, 2019
|
637.4
|
|
|
0.9
|
|
|
94.1
|
|
|
—
|
|
|
871.6
|
|
|
(238.8
|
)
|
|
3.7
|
|
||||||
Net earnings
|
109.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
109.3
|
|
|
—
|
|
|
0.1
|
|
||||||
Other comprehensive income (loss), net
|
5.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5.7
|
|
|
(0.6
|
)
|
||||||
Share-based compensation activity
|
6.8
|
|
|
—
|
|
|
0.1
|
|
|
6.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Dividends to noncontrolling interests
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
||||||
Dividends to ordinary shareholders ($0.27 per share)
|
(25.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25.2
|
)
|
|
—
|
|
|
—
|
|
||||||
Repurchase of ordinary shares
|
(69.8
|
)
|
|
—
|
|
|
(0.7
|
)
|
|
(6.8
|
)
|
|
(63.0
|
)
|
|
—
|
|
|
—
|
|
||||||
Balance at June 30, 2019
|
$
|
663.6
|
|
|
$
|
0.9
|
|
|
93.5
|
|
|
$
|
—
|
|
|
$
|
892.7
|
|
|
$
|
(233.1
|
)
|
|
$
|
3.1
|
|
|
|
|
Allegion plc shareholders' equity
|
|
|
|||||||||||||||||||||
|
|
|
Ordinary shares
|
|
|
|
|
|
|
|
|
|||||||||||||||
In millions
|
Total equity
|
|
Amount
|
|
Shares
|
|
Capital in excess of par value
|
|
Retained earnings
|
|
Accumulated other comprehensive loss
|
|
Noncontrolling
interests |
|||||||||||||
Balance at December 31, 2017
|
$
|
405.5
|
|
|
$
|
1.0
|
|
|
95.1
|
|
|
$
|
9.1
|
|
|
$
|
544.4
|
|
|
$
|
(152.9
|
)
|
|
$
|
3.9
|
|
Net earnings
|
72.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
72.2
|
|
|
—
|
|
|
0.2
|
|
||||||
Other comprehensive income, net
|
27.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26.1
|
|
|
1.0
|
|
||||||
Share-based compensation activity
|
6.0
|
|
|
—
|
|
|
0.3
|
|
|
6.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Dividends to ordinary shareholders ($0.21 per share)
|
(19.9
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19.9
|
)
|
|
—
|
|
|
—
|
|
||||||
Repurchase of ordinary shares
|
(30.0
|
)
|
|
(0.1
|
)
|
|
(0.4
|
)
|
|
(15.1
|
)
|
|
(14.8
|
)
|
|
—
|
|
|
—
|
|
||||||
Balance at March 31, 2018
|
461.1
|
|
|
0.9
|
|
|
95.0
|
|
|
—
|
|
|
581.9
|
|
|
(126.8
|
)
|
|
5.1
|
|
||||||
Net earnings
|
114.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
113.9
|
|
|
—
|
|
|
0.1
|
|
||||||
Other comprehensive loss, net
|
(51.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(49.2
|
)
|
|
(2.3
|
)
|
||||||
Share-based compensation activity
|
5.2
|
|
|
—
|
|
|
—
|
|
|
5.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Dividends to noncontrolling interests
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
||||||
Dividends to ordinary shareholders ($0.21 per share)
|
(20.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20.0
|
)
|
|
—
|
|
|
—
|
|
||||||
Other
|
0.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
||||||
Balance at June 30, 2018
|
$
|
508.7
|
|
|
$
|
0.9
|
|
|
95.0
|
|
|
$
|
5.2
|
|
|
$
|
675.8
|
|
|
$
|
(175.9
|
)
|
|
$
|
2.7
|
|
In millions
|
|
Cash flow hedges
|
|
Pension and OPEB Items
|
|
Foreign Currency Items
|
|
Total
|
||||||||
December 31, 2018
|
|
$
|
6.1
|
|
|
$
|
(123.2
|
)
|
|
$
|
(106.4
|
)
|
|
$
|
(223.5
|
)
|
Other comprehensive (loss) income before reclassifications
|
|
(2.9
|
)
|
|
0.5
|
|
|
(8.0
|
)
|
|
(10.4
|
)
|
||||
Amounts reclassified from accumulated other comprehensive loss(a)
|
|
(3.3
|
)
|
|
3.0
|
|
|
—
|
|
|
(0.3
|
)
|
||||
Tax benefit (expense)
|
|
1.6
|
|
|
(0.5
|
)
|
|
—
|
|
|
1.1
|
|
||||
June 30, 2019
|
|
$
|
1.5
|
|
|
$
|
(120.2
|
)
|
|
$
|
(114.4
|
)
|
|
$
|
(233.1
|
)
|
In millions
|
|
Cash flow hedges
|
|
Pension and OPEB Items
|
|
Foreign Currency Items
|
|
Total
|
||||||||
December 31, 2017
|
|
$
|
3.8
|
|
|
$
|
(107.6
|
)
|
|
$
|
(49.1
|
)
|
|
$
|
(152.9
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
4.8
|
|
|
1.6
|
|
|
(29.3
|
)
|
|
(22.9
|
)
|
||||
Amounts reclassified from accumulated other comprehensive loss(a)
|
|
(1.0
|
)
|
|
2.1
|
|
|
—
|
|
|
1.1
|
|
||||
Tax expense
|
|
(0.9
|
)
|
|
(0.3
|
)
|
|
—
|
|
|
(1.2
|
)
|
||||
June 30, 2018
|
|
$
|
6.7
|
|
|
$
|
(104.2
|
)
|
|
$
|
(78.4
|
)
|
|
$
|
(175.9
|
)
|
(a)
|
Amounts reclassified from Accumulated other comprehensive loss and recognized into Net earnings related to cash flow hedges are recorded in Cost of goods sold and Interest expense. Amounts reclassified from Accumulated other comprehensive loss and recognized into Net earnings related to pension and OPEB items and foreign currency items are recorded in Other expense (income), net.
|
|
Three months ended
|
|
Six months ended
|
||||||||||||
In millions
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Stock options
|
$
|
0.4
|
|
|
$
|
1.3
|
|
|
$
|
2.8
|
|
|
$
|
2.9
|
|
RSUs
|
2.0
|
|
|
2.4
|
|
|
6.4
|
|
|
5.5
|
|
||||
PSUs
|
1.8
|
|
|
1.3
|
|
|
3.4
|
|
|
3.1
|
|
||||
Deferred compensation
|
0.5
|
|
|
0.5
|
|
|
2.2
|
|
|
0.6
|
|
||||
Pre-tax expense
|
4.7
|
|
|
5.5
|
|
|
14.8
|
|
|
12.1
|
|
||||
Tax benefit
|
(0.6
|
)
|
|
(0.4
|
)
|
|
(1.8
|
)
|
|
(0.9
|
)
|
||||
After-tax expense
|
$
|
4.1
|
|
|
$
|
5.1
|
|
|
$
|
13.0
|
|
|
$
|
11.2
|
|
|
2019
|
|
2018
|
||||||||||
|
Number
granted |
|
Weighted-
average fair value per award |
|
Number
granted |
|
Weighted-
average fair value per award |
||||||
Stock options
|
195,675
|
|
|
$
|
19.58
|
|
|
160,614
|
|
|
$
|
21.29
|
|
RSUs
|
115,137
|
|
|
$
|
89.21
|
|
|
108,180
|
|
|
$
|
85.26
|
|
|
2019
|
|
2018
|
||
Dividend yield
|
1.23
|
%
|
|
0.97
|
%
|
Volatility
|
21.44
|
%
|
|
22.38
|
%
|
Risk-free rate of return
|
2.53
|
%
|
|
2.75
|
%
|
Expected life
|
6.0 years
|
|
|
6.0 years
|
|
In millions
|
Total
|
||
December 31, 2018
|
$
|
2.1
|
|
Additions, net of reversals
|
9.8
|
|
|
Cash and non-cash uses
|
(3.8
|
)
|
|
June 30, 2019
|
$
|
8.1
|
|
|
Three months ended
|
|
Six months ended
|
||||||||||||
In millions
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Interest income
|
$
|
(0.4
|
)
|
|
$
|
(0.1
|
)
|
|
$
|
(0.7
|
)
|
|
$
|
(0.3
|
)
|
Foreign currency exchange loss (gain)
|
0.5
|
|
|
(0.6
|
)
|
|
0.3
|
|
|
(0.2
|
)
|
||||
Loss (earnings) from equity method investments
|
0.3
|
|
|
(0.1
|
)
|
|
0.4
|
|
|
(0.1
|
)
|
||||
Net periodic pension and postretirement benefit cost (income), less service cost
|
0.9
|
|
|
(0.8
|
)
|
|
1.8
|
|
|
(1.6
|
)
|
||||
Other
|
(0.6
|
)
|
|
—
|
|
|
(2.2
|
)
|
|
0.2
|
|
||||
Other expense (income), net
|
$
|
0.7
|
|
|
$
|
(1.6
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(2.0
|
)
|
|
Three months ended
|
|
Six months ended
|
||||||||
In millions
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Weighted-average number of basic shares
|
93.8
|
|
|
95.0
|
|
|
94.1
|
|
|
95.1
|
|
Shares issuable under incentive stock plans
|
0.7
|
|
|
0.6
|
|
|
0.7
|
|
|
0.6
|
|
Weighted-average number of diluted shares
|
94.5
|
|
|
95.6
|
|
|
94.8
|
|
|
95.7
|
|
|
Three months ended June 30, 2019
|
|
Six months ended June 30, 2019
|
||||||||||||||||||||||||||||
In millions
|
Americas
|
|
EMEIA
|
|
Asia Pacific
|
|
Consolidated
|
|
Americas
|
|
EMEIA
|
|
Asia Pacific
|
|
Consolidated
|
||||||||||||||||
Net revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Products
|
$
|
545.1
|
|
|
$
|
137.1
|
|
|
$
|
41.8
|
|
|
$
|
724.0
|
|
|
$
|
1,020.4
|
|
|
$
|
275.8
|
|
|
$
|
76.5
|
|
|
$
|
1,372.7
|
|
Services
|
—
|
|
|
5.1
|
|
|
2.1
|
|
|
7.2
|
|
|
—
|
|
|
9.3
|
|
|
4.2
|
|
|
13.5
|
|
||||||||
Total Net revenues
|
$
|
545.1
|
|
|
$
|
142.2
|
|
|
$
|
43.9
|
|
|
$
|
731.2
|
|
|
$
|
1,020.4
|
|
|
$
|
285.1
|
|
|
$
|
80.7
|
|
|
$
|
1,386.2
|
|
|
Three months ended June 30, 2018
|
|
Six months ended June 30, 2018
|
||||||||||||||||||||||||||||
In millions
|
Americas
|
|
EMEIA
|
|
Asia Pacific
|
|
Consolidated
|
|
Americas
|
|
EMEIA
|
|
Asia Pacific
|
|
Consolidated
|
||||||||||||||||
Net revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Products
|
$
|
526.8
|
|
|
$
|
143.3
|
|
|
$
|
30.1
|
|
|
$
|
700.2
|
|
|
$
|
965.8
|
|
|
$
|
290.1
|
|
|
$
|
53.9
|
|
|
$
|
1,309.8
|
|
Services
|
—
|
|
|
4.5
|
|
|
—
|
|
|
4.5
|
|
|
—
|
|
|
8.0
|
|
|
—
|
|
|
8.0
|
|
||||||||
Total Net revenues
|
$
|
526.8
|
|
|
$
|
147.8
|
|
|
$
|
30.1
|
|
|
$
|
704.7
|
|
|
$
|
965.8
|
|
|
$
|
298.1
|
|
|
$
|
53.9
|
|
|
$
|
1,317.8
|
|
|
Three months ended
|
|
Six months ended
|
||||||||||||
In millions
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net revenues
|
|
|
|
|
|
|
|
||||||||
Americas
|
$
|
545.1
|
|
|
$
|
526.8
|
|
|
$
|
1,020.4
|
|
|
$
|
965.8
|
|
EMEIA
|
142.2
|
|
|
147.8
|
|
|
285.1
|
|
|
298.1
|
|
||||
Asia Pacific
|
43.9
|
|
|
30.1
|
|
|
80.7
|
|
|
53.9
|
|
||||
Total
|
$
|
731.2
|
|
|
$
|
704.7
|
|
|
$
|
1,386.2
|
|
|
$
|
1,317.8
|
|
Segment operating income (loss)
|
|
|
|
|
|
|
|
||||||||
Americas
|
$
|
161.2
|
|
|
$
|
152.0
|
|
|
$
|
282.1
|
|
|
$
|
261.7
|
|
EMEIA
|
1.6
|
|
|
11.2
|
|
|
12.4
|
|
|
19.7
|
|
||||
Asia Pacific
|
1.3
|
|
|
0.8
|
|
|
(0.2
|
)
|
|
(0.7
|
)
|
||||
Total
|
164.1
|
|
|
164.0
|
|
|
294.3
|
|
|
280.7
|
|
||||
Reconciliation to Operating income
|
|
|
|
|
|
|
|
||||||||
Unallocated corporate expense
|
(18.4
|
)
|
|
(20.6
|
)
|
|
(40.6
|
)
|
|
(38.6
|
)
|
||||
Operating income
|
145.7
|
|
|
143.4
|
|
|
253.7
|
|
|
242.1
|
|
||||
Reconciliation to earnings before income taxes
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
13.4
|
|
|
13.4
|
|
|
27.1
|
|
|
26.3
|
|
||||
Other expense (income), net
|
0.7
|
|
|
(1.6
|
)
|
|
(0.4
|
)
|
|
(2.0
|
)
|
||||
Earnings before income taxes
|
$
|
131.6
|
|
|
$
|
131.6
|
|
|
$
|
227.0
|
|
|
$
|
217.8
|
|
In millions
|
2019
|
|
2018
|
||||
Balance at beginning of period
|
$
|
14.5
|
|
|
$
|
14.1
|
|
Reductions for payments
|
(4.4
|
)
|
|
(3.7
|
)
|
||
Accruals for warranties issued during the current period
|
5.7
|
|
|
4.1
|
|
||
Changes to accruals related to preexisting warranties
|
(0.2
|
)
|
|
—
|
|
||
Acquisitions
|
—
|
|
|
0.4
|
|
||
Currency translation
|
—
|
|
|
(0.1
|
)
|
||
Balance at end of period
|
$
|
15.6
|
|
|
$
|
14.8
|
|
In millions
|
Allegion plc
|
|
Allegion US Holding
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||
Net revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
731.2
|
|
|
$
|
—
|
|
|
$
|
731.2
|
|
Cost of goods sold
|
—
|
|
|
—
|
|
|
410.5
|
|
|
—
|
|
|
410.5
|
|
|||||
Selling and administrative expenses
|
1.7
|
|
|
—
|
|
|
173.3
|
|
|
—
|
|
|
175.0
|
|
|||||
Operating (loss) income
|
(1.7
|
)
|
|
—
|
|
|
147.4
|
|
|
—
|
|
|
145.7
|
|
|||||
Equity earnings (loss) in affiliates, net of tax
|
119.7
|
|
|
72.8
|
|
|
—
|
|
|
(192.5
|
)
|
|
—
|
|
|||||
Interest expense
|
7.2
|
|
|
6.2
|
|
|
—
|
|
|
—
|
|
|
13.4
|
|
|||||
Intercompany interest and fees
|
1.5
|
|
|
26.5
|
|
|
(28.0
|
)
|
|
—
|
|
|
—
|
|
|||||
Other expense, net
|
—
|
|
|
—
|
|
|
0.7
|
|
|
—
|
|
|
0.7
|
|
|||||
Earnings (loss) before income taxes
|
109.3
|
|
|
40.1
|
|
|
174.7
|
|
|
(192.5
|
)
|
|
131.6
|
|
|||||
Provision (benefit) for income taxes
|
—
|
|
|
(8.0
|
)
|
|
30.2
|
|
|
—
|
|
|
22.2
|
|
|||||
Net earnings (loss)
|
109.3
|
|
|
48.1
|
|
|
144.5
|
|
|
(192.5
|
)
|
|
109.4
|
|
|||||
Less: Net earnings attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|||||
Net earnings (loss) attributable to Allegion plc
|
$
|
109.3
|
|
|
$
|
48.1
|
|
|
$
|
144.4
|
|
|
$
|
(192.5
|
)
|
|
$
|
109.3
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total comprehensive income (loss)
|
$
|
115.0
|
|
|
$
|
45.8
|
|
|
$
|
150.8
|
|
|
$
|
(197.1
|
)
|
|
$
|
114.5
|
|
Less: Total comprehensive loss attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(0.5
|
)
|
|
—
|
|
|
(0.5
|
)
|
|||||
Total comprehensive income (loss) attributable to Allegion plc
|
$
|
115.0
|
|
|
$
|
45.8
|
|
|
$
|
151.3
|
|
|
$
|
(197.1
|
)
|
|
$
|
115.0
|
|
In millions
|
Allegion plc
|
|
Allegion US Holding
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||
Net revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,386.2
|
|
|
$
|
—
|
|
|
$
|
1,386.2
|
|
Cost of goods sold
|
—
|
|
|
—
|
|
|
788.6
|
|
|
—
|
|
|
788.6
|
|
|||||
Selling and administrative expenses
|
3.1
|
|
|
—
|
|
|
340.8
|
|
|
—
|
|
|
343.9
|
|
|||||
Operating (loss) income
|
(3.1
|
)
|
|
—
|
|
|
256.8
|
|
|
—
|
|
|
253.7
|
|
|||||
Equity earnings (loss) in affiliates, net of tax
|
209.0
|
|
|
108.0
|
|
|
—
|
|
|
(317.0
|
)
|
|
—
|
|
|||||
Interest expense
|
14.7
|
|
|
12.3
|
|
|
0.1
|
|
|
—
|
|
|
27.1
|
|
|||||
Intercompany interest and fees
|
1.7
|
|
|
52.8
|
|
|
(54.5
|
)
|
|
—
|
|
|
—
|
|
|||||
Other income, net
|
—
|
|
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
|
(0.4
|
)
|
|||||
Earnings (loss) before income taxes
|
189.5
|
|
|
42.9
|
|
|
311.6
|
|
|
(317.0
|
)
|
|
227.0
|
|
|||||
Provision (benefit) for income taxes
|
—
|
|
|
(16.0
|
)
|
|
53.3
|
|
|
—
|
|
|
37.3
|
|
|||||
Net earnings (loss)
|
189.5
|
|
|
58.9
|
|
|
258.3
|
|
|
(317.0
|
)
|
|
189.7
|
|
|||||
Less: Net earnings attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
|
0.2
|
|
|||||
Net earnings (loss) attributable to Allegion plc
|
$
|
189.5
|
|
|
$
|
58.9
|
|
|
$
|
258.1
|
|
|
$
|
(317.0
|
)
|
|
$
|
189.5
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total comprehensive income (loss)
|
$
|
179.9
|
|
|
$
|
55.4
|
|
|
$
|
251.2
|
|
|
$
|
(306.4
|
)
|
|
$
|
180.1
|
|
Less: Total comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
|
0.2
|
|
|||||
Total comprehensive income (loss) attributable to Allegion plc
|
$
|
179.9
|
|
|
$
|
55.4
|
|
|
$
|
251.0
|
|
|
$
|
(306.4
|
)
|
|
$
|
179.9
|
|
In millions
|
Allegion plc
|
|
Allegion US Holding
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||
Net revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
704.7
|
|
|
$
|
—
|
|
|
$
|
704.7
|
|
Cost of goods sold
|
—
|
|
|
—
|
|
|
399.1
|
|
|
—
|
|
|
399.1
|
|
|||||
Selling and administrative expenses
|
2.2
|
|
|
—
|
|
|
160.0
|
|
|
—
|
|
|
162.2
|
|
|||||
Operating (loss) income
|
(2.2
|
)
|
|
—
|
|
|
145.6
|
|
|
—
|
|
|
143.4
|
|
|||||
Equity earnings (loss) in affiliates, net of tax
|
123.0
|
|
|
43.3
|
|
|
0.1
|
|
|
(166.4
|
)
|
|
—
|
|
|||||
Interest expense
|
6.9
|
|
|
6.3
|
|
|
0.2
|
|
|
—
|
|
|
13.4
|
|
|||||
Intercompany interest and fees
|
—
|
|
|
26.4
|
|
|
(26.4
|
)
|
|
—
|
|
|
—
|
|
|||||
Other income, net
|
—
|
|
|
—
|
|
|
(1.6
|
)
|
|
—
|
|
|
(1.6
|
)
|
|||||
Earnings (loss) before income taxes
|
113.9
|
|
|
10.6
|
|
|
173.5
|
|
|
(166.4
|
)
|
|
131.6
|
|
|||||
Provision (benefit) for income taxes
|
—
|
|
|
(4.1
|
)
|
|
21.7
|
|
|
—
|
|
|
17.6
|
|
|||||
Net earnings (loss)
|
113.9
|
|
|
14.7
|
|
|
151.8
|
|
|
(166.4
|
)
|
|
114.0
|
|
|||||
Less: Net earnings attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|||||
Net earnings (loss) attributable to Allegion plc
|
$
|
113.9
|
|
|
$
|
14.7
|
|
|
$
|
151.7
|
|
|
$
|
(166.4
|
)
|
|
$
|
113.9
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total comprehensive income (loss)
|
$
|
64.7
|
|
|
$
|
14.9
|
|
|
$
|
94.4
|
|
|
$
|
(111.5
|
)
|
|
$
|
62.5
|
|
Less: Total comprehensive loss attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(2.2
|
)
|
|
—
|
|
|
(2.2
|
)
|
|||||
Total comprehensive income (loss) attributable to Allegion plc
|
$
|
64.7
|
|
|
$
|
14.9
|
|
|
$
|
96.6
|
|
|
$
|
(111.5
|
)
|
|
$
|
64.7
|
|
In millions
|
Allegion plc
|
|
Allegion US Holding
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||
Net revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,317.8
|
|
|
$
|
—
|
|
|
$
|
1,317.8
|
|
Cost of goods sold
|
—
|
|
|
—
|
|
|
754.4
|
|
|
—
|
|
|
754.4
|
|
|||||
Selling and administrative expenses
|
3.3
|
|
|
—
|
|
|
318.0
|
|
|
—
|
|
|
321.3
|
|
|||||
Operating (loss) income
|
(3.3
|
)
|
|
—
|
|
|
245.4
|
|
|
—
|
|
|
242.1
|
|
|||||
Equity earnings (loss) in affiliates, net of tax
|
202.4
|
|
|
73.2
|
|
|
0.1
|
|
|
(275.7
|
)
|
|
—
|
|
|||||
Interest expense
|
13.0
|
|
|
13.1
|
|
|
0.2
|
|
|
—
|
|
|
26.3
|
|
|||||
Intercompany interest and fees
|
—
|
|
|
51.9
|
|
|
(51.9
|
)
|
|
—
|
|
|
—
|
|
|||||
Other income, net
|
—
|
|
|
—
|
|
|
(2.0
|
)
|
|
—
|
|
|
(2.0
|
)
|
|||||
Earnings (loss) before income taxes
|
186.1
|
|
|
8.2
|
|
|
299.2
|
|
|
(275.7
|
)
|
|
217.8
|
|
|||||
Provision (benefit) for income taxes
|
—
|
|
|
(12.3
|
)
|
|
43.7
|
|
|
—
|
|
|
31.4
|
|
|||||
Net earnings (loss)
|
186.1
|
|
|
20.5
|
|
|
255.5
|
|
|
(275.7
|
)
|
|
186.4
|
|
|||||
Less: Net earnings attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
|
0.3
|
|
|||||
Net earnings (loss) attributable to Allegion plc
|
$
|
186.1
|
|
|
$
|
20.5
|
|
|
$
|
255.2
|
|
|
$
|
(275.7
|
)
|
|
$
|
186.1
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total comprehensive income (loss)
|
$
|
163.0
|
|
|
$
|
22.6
|
|
|
$
|
223.3
|
|
|
$
|
(246.9
|
)
|
|
$
|
162.0
|
|
Less: Total comprehensive loss attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(1.0
|
)
|
|
—
|
|
|
(1.0
|
)
|
|||||
Total comprehensive income (loss) attributable to Allegion plc
|
$
|
163.0
|
|
|
$
|
22.6
|
|
|
$
|
224.3
|
|
|
$
|
(246.9
|
)
|
|
$
|
163.0
|
|
In millions
|
Allegion plc
|
|
Allegion US Holding
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
4.2
|
|
|
$
|
1.3
|
|
|
$
|
152.3
|
|
|
$
|
—
|
|
|
$
|
157.8
|
|
Restricted cash
|
—
|
|
|
—
|
|
|
3.4
|
|
|
—
|
|
|
3.4
|
|
|||||
Accounts and notes receivable, net
|
0.1
|
|
|
—
|
|
|
379.9
|
|
|
—
|
|
|
380.0
|
|
|||||
Inventories
|
—
|
|
|
—
|
|
|
304.7
|
|
|
—
|
|
|
304.7
|
|
|||||
Other current assets
|
0.2
|
|
|
16.5
|
|
|
21.4
|
|
|
(0.8
|
)
|
|
37.3
|
|
|||||
Accounts and notes receivable affiliates
|
—
|
|
|
824.5
|
|
|
381.2
|
|
|
(1,205.7
|
)
|
|
—
|
|
|||||
Total current assets
|
4.5
|
|
|
842.3
|
|
|
1,242.9
|
|
|
(1,206.5
|
)
|
|
883.2
|
|
|||||
Investment in affiliates
|
1,463.2
|
|
|
853.3
|
|
|
—
|
|
|
(2,316.5
|
)
|
|
—
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
—
|
|
|
281.7
|
|
|
—
|
|
|
281.7
|
|
|||||
Intangible assets, net
|
—
|
|
|
—
|
|
|
1,411.7
|
|
|
—
|
|
|
1,411.7
|
|
|||||
Notes receivable affiliates
|
31.2
|
|
|
1,061.2
|
|
|
2,822.5
|
|
|
(3,914.9
|
)
|
|
—
|
|
|||||
Other noncurrent assets
|
5.1
|
|
|
76.1
|
|
|
191.5
|
|
|
—
|
|
|
272.7
|
|
|||||
Total assets
|
$
|
1,504.0
|
|
|
$
|
2,832.9
|
|
|
$
|
5,950.3
|
|
|
$
|
(7,437.9
|
)
|
|
$
|
2,849.3
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and other current liabilities
|
$
|
2.9
|
|
|
$
|
6.8
|
|
|
$
|
473.1
|
|
|
$
|
(0.8
|
)
|
|
$
|
482.0
|
|
Short-term borrowings and current maturities of long-term debt
|
35.0
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
35.1
|
|
|||||
Accounts and notes payable affiliates
|
1.9
|
|
|
379.2
|
|
|
824.6
|
|
|
(1,205.7
|
)
|
|
—
|
|
|||||
Total current liabilities
|
39.8
|
|
|
386.0
|
|
|
1,297.8
|
|
|
(1,206.5
|
)
|
|
517.1
|
|
|||||
Long-term debt
|
599.1
|
|
|
793.3
|
|
|
0.7
|
|
|
—
|
|
|
1,393.1
|
|
|||||
Notes payable affiliates
|
202.0
|
|
|
2,620.6
|
|
|
1,092.3
|
|
|
(3,914.9
|
)
|
|
—
|
|
|||||
Other noncurrent liabilities
|
2.6
|
|
|
5.9
|
|
|
267.0
|
|
|
—
|
|
|
275.5
|
|
|||||
Total liabilities
|
843.5
|
|
|
3,805.8
|
|
|
2,657.8
|
|
|
(5,121.4
|
)
|
|
2,185.7
|
|
|||||
Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total shareholders' equity (deficit)
|
660.5
|
|
|
(972.9
|
)
|
|
3,289.4
|
|
|
(2,316.5
|
)
|
|
660.5
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
3.1
|
|
|
—
|
|
|
3.1
|
|
|||||
Total equity (deficit)
|
660.5
|
|
|
(972.9
|
)
|
|
3,292.5
|
|
|
(2,316.5
|
)
|
|
663.6
|
|
|||||
Total liabilities and equity
|
$
|
1,504.0
|
|
|
$
|
2,832.9
|
|
|
$
|
5,950.3
|
|
|
$
|
(7,437.9
|
)
|
|
$
|
2,849.3
|
|
In millions
|
Allegion plc
|
|
Allegion US Holding
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
4.2
|
|
|
$
|
1.0
|
|
|
$
|
278.6
|
|
|
$
|
—
|
|
|
$
|
283.8
|
|
Restricted cash
|
—
|
|
|
—
|
|
|
6.8
|
|
|
—
|
|
|
6.8
|
|
|||||
Accounts and notes receivable, net
|
—
|
|
|
—
|
|
|
324.9
|
|
|
—
|
|
|
324.9
|
|
|||||
Inventories
|
—
|
|
|
—
|
|
|
280.3
|
|
|
—
|
|
|
280.3
|
|
|||||
Other current assets
|
0.5
|
|
|
33.7
|
|
|
19.1
|
|
|
(18.3
|
)
|
|
35.0
|
|
|||||
Assets held for sale
|
—
|
|
|
—
|
|
|
0.8
|
|
|
—
|
|
|
0.8
|
|
|||||
Accounts and notes receivable affiliates
|
—
|
|
|
816.2
|
|
|
369.8
|
|
|
(1,186.0
|
)
|
|
—
|
|
|||||
Total current assets
|
4.7
|
|
|
850.9
|
|
|
1,280.3
|
|
|
(1,204.3
|
)
|
|
931.6
|
|
|||||
Investment in affiliates
|
1,265.8
|
|
|
718.2
|
|
|
—
|
|
|
(1,984.0
|
)
|
|
—
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
—
|
|
|
276.7
|
|
|
—
|
|
|
276.7
|
|
|||||
Intangible assets, net
|
—
|
|
|
—
|
|
|
1,430.1
|
|
|
—
|
|
|
1,430.1
|
|
|||||
Notes receivable affiliates
|
30.8
|
|
|
1,061.2
|
|
|
2,553.4
|
|
|
(3,645.4
|
)
|
|
—
|
|
|||||
Other noncurrent assets
|
4.0
|
|
|
61.2
|
|
|
106.6
|
|
|
—
|
|
|
171.8
|
|
|||||
Total assets
|
$
|
1,305.3
|
|
|
$
|
2,691.5
|
|
|
$
|
5,647.1
|
|
|
$
|
(6,833.7
|
)
|
|
$
|
2,810.2
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and other current liabilities
|
$
|
2.0
|
|
|
$
|
6.8
|
|
|
$
|
495.0
|
|
|
$
|
(18.3
|
)
|
|
$
|
485.5
|
|
Short-term borrowings and current maturities of long-term debt
|
35.0
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
|
35.3
|
|
|||||
Accounts and notes payable affiliates
|
0.3
|
|
|
369.5
|
|
|
816.2
|
|
|
(1,186.0
|
)
|
|
—
|
|
|||||
Total current liabilities
|
37.3
|
|
|
376.3
|
|
|
1,311.5
|
|
|
(1,204.3
|
)
|
|
520.8
|
|
|||||
Long-term debt
|
615.8
|
|
|
792.8
|
|
|
0.9
|
|
|
—
|
|
|
1,409.5
|
|
|||||
Notes payable affiliates
|
—
|
|
|
2,553.4
|
|
|
1,092.0
|
|
|
(3,645.4
|
)
|
|
—
|
|
|||||
Other noncurrent liabilities
|
1.2
|
|
|
5.5
|
|
|
219.2
|
|
|
—
|
|
|
225.9
|
|
|||||
Total liabilities
|
654.3
|
|
|
3,728.0
|
|
|
2,623.6
|
|
|
(4,849.7
|
)
|
|
2,156.2
|
|
|||||
Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total shareholders' equity (deficit)
|
651.0
|
|
|
(1,036.5
|
)
|
|
3,020.5
|
|
|
(1,984.0
|
)
|
|
651.0
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
3.0
|
|
|
—
|
|
|
3.0
|
|
|||||
Total equity (deficit)
|
651.0
|
|
|
(1,036.5
|
)
|
|
3,023.5
|
|
|
(1,984.0
|
)
|
|
654.0
|
|
|||||
Total liabilities and equity
|
$
|
1,305.3
|
|
|
$
|
2,691.5
|
|
|
$
|
5,647.1
|
|
|
$
|
(6,833.7
|
)
|
|
$
|
2,810.2
|
|
In millions
|
Allegion plc
|
|
Allegion US Holding
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||
Net cash (used in) provided by operating activities
|
$
|
(1.5
|
)
|
|
$
|
(93.4
|
)
|
|
$
|
217.6
|
|
|
$
|
(15.7
|
)
|
|
$
|
107.0
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
—
|
|
|
—
|
|
|
(29.3
|
)
|
|
—
|
|
|
(29.3
|
)
|
|||||
Acquisition of and equity investments in businesses, net of cash acquired
|
—
|
|
|
—
|
|
|
(4.6
|
)
|
|
—
|
|
|
(4.6
|
)
|
|||||
Other investing activities, net
|
—
|
|
|
(1.5
|
)
|
|
(2.3
|
)
|
|
1.5
|
|
|
(2.3
|
)
|
|||||
Net cash (used in) provided by investing activities
|
—
|
|
|
(1.5
|
)
|
|
(36.2
|
)
|
|
1.5
|
|
|
(36.2
|
)
|
|||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Debt repayments, net
|
(17.5
|
)
|
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
|
(17.9
|
)
|
|||||
Net inter-company proceeds (payments)
|
201.6
|
|
|
95.2
|
|
|
(296.8
|
)
|
|
—
|
|
|
—
|
|
|||||
Dividends paid
|
—
|
|
|
—
|
|
|
(15.7
|
)
|
|
15.7
|
|
|
—
|
|
|||||
Dividends paid to shareholders
|
(50.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(50.5
|
)
|
|||||
Repurchase of ordinary shares
|
(133.6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(133.6
|
)
|
|||||
Other financing activities, net
|
1.5
|
|
|
—
|
|
|
1.4
|
|
|
(1.5
|
)
|
|
1.4
|
|
|||||
Net cash provided by (used in) financing activities
|
1.5
|
|
|
95.2
|
|
|
(311.5
|
)
|
|
14.2
|
|
|
(200.6
|
)
|
|||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
—
|
|
|
—
|
|
|
0.4
|
|
|
—
|
|
|
0.4
|
|
|||||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
—
|
|
|
0.3
|
|
|
(129.7
|
)
|
|
—
|
|
|
(129.4
|
)
|
|||||
Cash, cash equivalents and restricted cash - beginning of period
|
4.2
|
|
|
1.0
|
|
|
285.4
|
|
|
—
|
|
|
290.6
|
|
|||||
Cash, cash equivalents and restricted cash - end of period
|
$
|
4.2
|
|
|
$
|
1.3
|
|
|
$
|
155.7
|
|
|
$
|
—
|
|
|
$
|
161.2
|
|
In millions
|
Allegion plc
|
|
Allegion US Holding
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||
Net cash provided by (used in) operating activities
|
$
|
108.9
|
|
|
$
|
(62.3
|
)
|
|
$
|
246.0
|
|
|
$
|
(173.9
|
)
|
|
$
|
118.7
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
—
|
|
|
—
|
|
|
(20.9
|
)
|
|
—
|
|
|
(20.9
|
)
|
|||||
Acquisition of and equity investments in businesses, net of cash acquired
|
—
|
|
|
(233.3
|
)
|
|
(47.2
|
)
|
|
—
|
|
|
(280.5
|
)
|
|||||
Other investing activities, net
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|||||
Net cash used in investing activities
|
—
|
|
|
(233.3
|
)
|
|
(68.0
|
)
|
|
—
|
|
|
(301.3
|
)
|
|||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Debt repayments, net
|
(17.5
|
)
|
|
—
|
|
|
(0.9
|
)
|
|
—
|
|
|
(18.4
|
)
|
|||||
Net inter-company (payments) proceeds
|
(21.7
|
)
|
|
295.9
|
|
|
(274.2
|
)
|
|
—
|
|
|
—
|
|
|||||
Dividends paid
|
—
|
|
|
—
|
|
|
(173.9
|
)
|
|
173.9
|
|
|
—
|
|
|||||
Dividends paid to shareholders
|
(39.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(39.7
|
)
|
|||||
Repurchase of ordinary shares
|
(30.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(30.0
|
)
|
|||||
Other financing activities, net
|
—
|
|
|
—
|
|
|
(2.3
|
)
|
|
—
|
|
|
(2.3
|
)
|
|||||
Net cash (used in) provided by financing activities
|
(108.9
|
)
|
|
295.9
|
|
|
(451.3
|
)
|
|
173.9
|
|
|
(90.4
|
)
|
|||||
Effect of exchange rate changes on cash and cash equivalents
|
—
|
|
|
—
|
|
|
(3.6
|
)
|
|
—
|
|
|
(3.6
|
)
|
|||||
Net increase (decrease) in cash and cash equivalents
|
—
|
|
|
0.3
|
|
|
(276.9
|
)
|
|
—
|
|
|
(276.6
|
)
|
|||||
Cash and cash equivalents - beginning of period
|
0.7
|
|
|
0.3
|
|
|
465.2
|
|
|
—
|
|
|
466.2
|
|
|||||
Cash and cash equivalents - end of period
|
$
|
0.7
|
|
|
$
|
0.6
|
|
|
$
|
188.3
|
|
|
$
|
—
|
|
|
$
|
189.6
|
|
In millions, except per share amounts
|
2019
|
|
% of
revenues |
|
2018
|
|
% of
revenues |
||||||
Net revenues
|
$
|
731.2
|
|
|
|
|
$
|
704.7
|
|
|
|
||
Cost of goods sold
|
410.5
|
|
|
56.1
|
%
|
|
399.1
|
|
|
56.6
|
%
|
||
Selling and administrative expenses
|
175.0
|
|
|
23.9
|
%
|
|
162.2
|
|
|
23.0
|
%
|
||
Operating income
|
145.7
|
|
|
19.9
|
%
|
|
143.4
|
|
|
20.3
|
%
|
||
Interest expense
|
13.4
|
|
|
|
|
13.4
|
|
|
|
||||
Other expense (income), net
|
0.7
|
|
|
|
|
(1.6
|
)
|
|
|
||||
Earnings before income taxes
|
131.6
|
|
|
|
|
131.6
|
|
|
|
||||
Provision for income taxes
|
22.2
|
|
|
|
|
17.6
|
|
|
|
||||
Net earnings
|
109.4
|
|
|
|
|
114.0
|
|
|
|
||||
Less: Net earnings attributable to noncontrolling interests
|
0.1
|
|
|
|
|
0.1
|
|
|
|
||||
Net earnings attributable to Allegion plc
|
$
|
109.3
|
|
|
|
|
$
|
113.9
|
|
|
|
||
Diluted net earnings per ordinary share attributable to Allegion plc ordinary shareholders:
|
|
|
|
|
|
|
|
||||||
Net earnings
|
$
|
1.16
|
|
|
|
|
$
|
1.19
|
|
|
|
In millions
|
Operating Income
|
|
Operating Margin
|
|||
June 30, 2018
|
$
|
143.4
|
|
|
20.3
|
%
|
Pricing and productivity in excess of inflation
|
14.9
|
|
|
1.6
|
%
|
|
Volume / product mix
|
2.2
|
|
|
0.2
|
%
|
|
Restructuring / acquisition expenses
|
(8.3
|
)
|
|
(1.2
|
)%
|
|
Currency exchange rates
|
(2.1
|
)
|
|
0.1
|
%
|
|
Investment spending
|
(4.7
|
)
|
|
(0.7
|
)%
|
|
Acquisitions
|
0.3
|
|
|
(0.4
|
)%
|
|
June 30, 2019
|
$
|
145.7
|
|
|
19.9
|
%
|
In millions
|
2019
|
|
2018
|
||||
Interest income
|
$
|
(0.4
|
)
|
|
$
|
(0.1
|
)
|
Foreign currency exchange loss (gain)
|
0.5
|
|
|
(0.6
|
)
|
||
Loss (earnings) from equity method investments
|
0.3
|
|
|
(0.1
|
)
|
||
Net periodic pension and postretirement benefit cost (income), less service cost
|
0.9
|
|
|
(0.8
|
)
|
||
Other
|
(0.6
|
)
|
|
—
|
|
||
Other expense (income), net
|
$
|
0.7
|
|
|
$
|
(1.6
|
)
|
In millions, except per share amounts
|
2019
|
|
% of
revenues |
|
2018
|
|
% of
revenues |
||||||
Net revenues
|
$
|
1,386.2
|
|
|
|
|
$
|
1,317.8
|
|
|
|
||
Cost of goods sold
|
788.6
|
|
|
56.9
|
%
|
|
754.4
|
|
|
57.2
|
%
|
||
Selling and administrative expenses
|
343.9
|
|
|
24.8
|
%
|
|
321.3
|
|
|
24.4
|
%
|
||
Operating income
|
253.7
|
|
|
18.3
|
%
|
|
242.1
|
|
|
18.4
|
%
|
||
Interest expense
|
27.1
|
|
|
|
|
26.3
|
|
|
|
||||
Other income, net
|
(0.4
|
)
|
|
|
|
(2.0
|
)
|
|
|
||||
Earnings before income taxes
|
227.0
|
|
|
|
|
217.8
|
|
|
|
||||
Provision for income taxes
|
37.3
|
|
|
|
|
31.4
|
|
|
|
||||
Net earnings
|
189.7
|
|
|
|
|
186.4
|
|
|
|
||||
Less: Net earnings attributable to noncontrolling interests
|
0.2
|
|
|
|
|
0.3
|
|
|
|
||||
Net earnings attributable to Allegion plc
|
$
|
189.5
|
|
|
|
|
$
|
186.1
|
|
|
|
||
Diluted net earnings per ordinary share attributable to Allegion plc ordinary shareholders:
|
|
|
|
|
|
|
|
||||||
Net earnings
|
$
|
2.00
|
|
|
|
|
$
|
1.94
|
|
|
|
In millions
|
Operating Income
|
|
Operating Margin
|
|||
June 30, 2018
|
$
|
242.1
|
|
|
18.4
|
%
|
Pricing and productivity in excess of inflation
|
20.7
|
|
|
1.2
|
%
|
|
Volume / product mix
|
12.3
|
|
|
0.5
|
%
|
|
Restructuring / acquisition expenses
|
(9.7
|
)
|
|
(0.7
|
)%
|
|
Currency exchange rates
|
(4.7
|
)
|
|
(0.1
|
)%
|
|
Investment spending
|
(6.9
|
)
|
|
(0.5
|
)%
|
|
Acquisitions
|
(0.1
|
)
|
|
(0.5
|
)%
|
|
June 30, 2019
|
$
|
253.7
|
|
|
18.3
|
%
|
In millions
|
2019
|
|
2018
|
||||
Interest income
|
$
|
(0.7
|
)
|
|
$
|
(0.3
|
)
|
Foreign currency exchange loss (gain)
|
0.3
|
|
|
(0.2
|
)
|
||
Loss (earnings) from equity method investments
|
0.4
|
|
|
(0.1
|
)
|
||
Net periodic pension and postretirement benefit cost (income), less service cost
|
1.8
|
|
|
(1.6
|
)
|
||
Other
|
(2.2
|
)
|
|
0.2
|
|
||
Other income, net
|
$
|
(0.4
|
)
|
|
$
|
(2.0
|
)
|
Pricing
|
|
2.5
|
%
|
Volume
|
|
0.8
|
%
|
Acquisitions
|
|
0.4
|
%
|
Currency exchange rates
|
|
(0.2
|
)%
|
Total
|
|
3.5
|
%
|
Pricing
|
|
2.6
|
%
|
Volume
|
|
2.7
|
%
|
Acquisitions
|
|
0.6
|
%
|
Currency exchange rates
|
|
(0.2
|
)%
|
Total
|
|
5.7
|
%
|
In millions
|
|
Operating Income
|
|
Operating Margin
|
|||
June 30, 2018
|
|
$
|
152.0
|
|
|
28.9
|
%
|
Pricing and productivity in excess of inflation
|
|
13.5
|
|
|
1.8
|
%
|
|
Volume / product mix
|
|
0.9
|
|
|
(0.1
|
)%
|
|
Currency exchange rates
|
|
(0.9
|
)
|
|
(0.1
|
)%
|
|
Investment spending
|
|
(3.3
|
)
|
|
(0.6
|
)%
|
|
Acquisitions
|
|
(0.1
|
)
|
|
(0.1
|
)%
|
|
Restructuring / acquisition expenses
|
|
(0.9
|
)
|
|
(0.2
|
)%
|
|
June 30, 2019
|
|
$
|
161.2
|
|
|
29.6
|
%
|
In millions
|
|
Operating Income
|
|
Operating Margin
|
|||
June 30, 2018
|
|
$
|
261.7
|
|
|
27.1
|
%
|
Pricing and productivity in excess of inflation
|
|
20.2
|
|
|
1.3
|
%
|
|
Volume / product mix
|
|
9.4
|
|
|
0.3
|
%
|
|
Currency exchange rates
|
|
(1.5
|
)
|
|
(0.1
|
)%
|
|
Investment spending
|
|
(4.9
|
)
|
|
(0.5
|
)%
|
|
Acquisitions
|
|
(0.7
|
)
|
|
(0.3
|
)%
|
|
Restructuring / acquisition expenses
|
|
(2.1
|
)
|
|
(0.2
|
)%
|
|
June 30, 2019
|
|
$
|
282.1
|
|
|
27.6
|
%
|
Pricing
|
|
1.3
|
%
|
Volume
|
|
0.4
|
%
|
Currency exchange rates
|
|
(5.5
|
)%
|
Total
|
|
(3.8
|
)%
|
Pricing
|
|
1.1
|
%
|
Volume
|
|
0.6
|
%
|
Acquisitions
|
|
0.4
|
%
|
Currency exchange rates
|
|
(6.5
|
)%
|
Total
|
|
(4.4
|
)%
|
In millions
|
|
Operating Income
|
|
Operating Margin
|
|||
June 30, 2018
|
|
$
|
11.2
|
|
|
7.6
|
%
|
Pricing and productivity in excess of inflation
|
|
0.6
|
|
|
0.3
|
%
|
|
Volume / product mix
|
|
0.7
|
|
|
0.5
|
%
|
|
Currency exchange rates
|
|
(1.1
|
)
|
|
(0.5
|
)%
|
|
Investment spending
|
|
(1.0
|
)
|
|
(0.7
|
)%
|
|
Restructuring / acquisition expenses
|
|
(8.8
|
)
|
|
(6.1
|
)%
|
|
June 30, 2019
|
|
$
|
1.6
|
|
|
1.1
|
%
|
In millions
|
|
Operating Income
|
|
Operating Margin
|
|||
June 30, 2018
|
|
$
|
19.7
|
|
|
6.6
|
%
|
Pricing and productivity in excess of inflation
|
|
4.0
|
|
|
1.2
|
%
|
|
Volume / product mix
|
|
2.4
|
|
|
0.8
|
%
|
|
Currency exchange rates
|
|
(3.0
|
)
|
|
(0.7
|
)%
|
|
Investment spending
|
|
(1.5
|
)
|
|
(0.5
|
)%
|
|
Restructuring / acquisition expenses
|
|
(9.2
|
)
|
|
(3.1
|
)%
|
|
June 30, 2019
|
|
$
|
12.4
|
|
|
4.3
|
%
|
Volume
|
|
4.7
|
%
|
Acquisitions
|
|
47.3
|
%
|
Currency exchange rates
|
|
(6.2
|
)%
|
Total
|
|
45.8
|
%
|
Pricing
|
|
(0.2
|
)%
|
Volume
|
|
1.9
|
%
|
Acquisitions
|
|
54.2
|
%
|
Currency exchange rates
|
|
(6.2
|
)%
|
Total
|
|
49.7
|
%
|
In millions
|
|
Operating Income
|
|
Operating Margin
|
|||
June 30, 2018
|
|
$
|
0.8
|
|
|
2.7
|
%
|
Pricing and productivity in excess of inflation
|
|
0.6
|
|
|
2.1
|
%
|
|
Volume / product mix
|
|
0.6
|
|
|
1.6
|
%
|
|
Currency exchange rates
|
|
(0.1
|
)
|
|
(0.2
|
)%
|
|
Investment spending
|
|
(0.4
|
)
|
|
(1.3
|
)%
|
|
Acquisitions
|
|
0.4
|
|
|
—
|
%
|
|
Restructuring / acquisition expenses
|
|
(0.6
|
)
|
|
(1.9
|
)%
|
|
June 30, 2019
|
|
$
|
1.3
|
|
|
3.0
|
%
|
In millions
|
|
Operating Loss
|
|
Operating Margin
|
|||
June 30, 2018
|
|
$
|
(0.7
|
)
|
|
(1.3
|
)%
|
Pricing and productivity in excess of inflation
|
|
0.9
|
|
|
1.8
|
%
|
|
Volume / product mix
|
|
0.4
|
|
|
0.7
|
%
|
|
Currency exchange rates
|
|
(0.1
|
)
|
|
(0.2
|
)%
|
|
Investment spending
|
|
(0.5
|
)
|
|
(1.0
|
)%
|
|
Acquisitions
|
|
0.6
|
|
|
1.3
|
%
|
|
Restructuring / acquisition expenses
|
|
(0.8
|
)
|
|
(1.5
|
)%
|
|
June 30, 2019
|
|
$
|
(0.2
|
)
|
|
(0.2
|
)%
|
In millions
|
2019
|
|
2018
|
||||
Net cash provided by operating activities
|
$
|
107.0
|
|
|
$
|
118.7
|
|
Net cash used in investing activities
|
(36.2
|
)
|
|
(301.3
|
)
|
||
Net cash used in financing activities
|
(200.6
|
)
|
|
(90.4
|
)
|
In millions
|
June 30,
2019 |
|
December 31,
2018 |
||||
Term Facility
|
$
|
638.8
|
|
|
$
|
656.3
|
|
Revolving Facility
|
—
|
|
|
—
|
|
||
3.200% Senior Notes due 2024
|
400.0
|
|
|
400.0
|
|
||
3.550% Senior Notes due 2027
|
400.0
|
|
|
400.0
|
|
||
Other debt
|
0.8
|
|
|
1.2
|
|
||
Total borrowings outstanding
|
1,439.6
|
|
|
1,457.5
|
|
||
Less discounts and debt issuance costs, net
|
(11.4
|
)
|
|
(12.7
|
)
|
||
Total debt
|
1,428.2
|
|
|
1,444.8
|
|
||
Less current portion of long-term debt
|
35.1
|
|
|
35.3
|
|
||
Total long-term debt
|
$
|
1,393.1
|
|
|
$
|
1,409.5
|
|
•
|
economic, political and business conditions in the markets in which we operate;
|
•
|
the demand for our products and services, including changes in customer preferences, conditions of the commercial and residential construction and remodeling markets and our ability to maintain beneficial relationships with large customers;
|
•
|
competitive factors in the industry in which we compete, including technological developments;
|
•
|
the development, commercialization and acceptance of new products and services;
|
•
|
the ability to protect and use intellectual property;
|
•
|
fluctuations in currency exchange rates;
|
•
|
the ability to complete and integrate any acquisitions;
|
•
|
results of investments made to complement our existing businesses and our pursuit of business opportunities that may diverge from our core businesses;
|
•
|
our ability to operate efficiently and productively;
|
•
|
disruptions in our global supply chain, including product manufacturing and logistical services provided by outsourcing partners;
|
•
|
improper conduct by any of our employees, agents or business partners;
|
•
|
our ability to manage risks related to our information technology and operational technology systems and cyber-security, including disruption and breaches of our information systems and implementation of new processes that may cause disruptions and be more difficult, costly or time consuming than expected;
|
•
|
our reliance on third-party vendors for many of the critical elements of our global information and operational technology infrastructure and their failure to provide effective support for such infrastructure;
|
•
|
changes in tax requirements, including tax rate changes, the adoption of new U.S. or non-U.S. tax legislation or exposure to additional tax liabilities and revised tax law interpretations;
|
•
|
changes to trade agreements, sanctions, import and export regulations and custom duties;
|
•
|
the outcome of any litigation, governmental investigations or proceedings;
|
•
|
interest rate fluctuations and other changes in borrowing costs, in addition to risks associated with our outstanding and future indebtedness;
|
•
|
other capital market conditions, including availability of funding sources;
|
•
|
availability of and fluctuations in the prices of key commodities and the impact of higher energy prices;
|
•
|
potential further impairment of our goodwill, indefinite-lived intangible assets and/or our long-lived assets;
|
•
|
ability to recruit and retain a highly qualified and diverse workforce;
|
•
|
risks related to our spin-off from Ingersoll Rand plc;
|
•
|
the possible effects on us of future legislation or interpretations in the U.S. that may limit or eliminate potential U.S. tax benefits resulting from our incorporation in a non-U.S. jurisdiction, such as Ireland, or deny U.S. government contracts to us based upon our incorporation in such non-U.S. jurisdiction; and
|
•
|
the impact our outstanding indebtedness may have on our business and operations.
|
Period
|
|
Total number of shares purchased (000s)
|
|
Average price paid per share
|
|
Total number of shares purchased as part of program (000s)
|
|
Approximate dollar value of shares still available to be purchased under the program (000s)
|
|||||
April 1 - April 30
|
|
213
|
|
|
93.66
|
|
|
213
|
|
|
$
|
289,007
|
|
May 1 - May 31
|
|
460
|
|
|
99.77
|
|
|
460
|
|
|
243,138
|
|
|
June 1 - June 30
|
|
41
|
|
|
97.94
|
|
|
41
|
|
|
239,095
|
|
|
Total
|
|
714
|
|
|
97.84
|
|
|
714
|
|
|
$
|
239,095
|
|
Exhibit No.
|
|
Description
|
|
Method of Filing
|
|
|
|
||
|
Amended and restated Memorandum and Articles of Association of Allegion plc.
|
|
Incorporated by reference to Exhibit 3.1 to the Company's Form 8-K filed with the SEC on June 13, 2016 (File No. 001-35971).
|
|
|
|
|
|
|
|
Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Filed herewith.
|
|
|
|
|
||
|
Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Filed herewith.
|
|
|
|
|
||
|
Certifications of Chief Executive Officer and Chief Financial Officer Pursuant to Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
Furnished herewith.
|
|
|
|
|
||
101.INS
|
|
XBRL Instance Document.
|
|
The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
|
Filed herewith.
|
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
Filed herewith.
|
|
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
Filed herewith.
|
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Labels Linkbase Document.
|
|
Filed herewith.
|
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
Filed herewith.
|
|
|
ALLEGION PLC
(Registrant)
|
|
|
|
Date:
|
July 25, 2019
|
/s/ Patrick S. Shannon
|
|
|
Patrick S. Shannon, Senior Vice President
and Chief Financial Officer
Principal Financial Officer
|
|
|
|
Date:
|
July 25, 2019
|
/s/ Douglas P. Ranck
|
|
|
Douglas P. Ranck, Vice President,
Controller and Chief Accounting Officer
Principal Accounting Officer
|
1.
|
I have reviewed the Quarterly Report on Form 10-Q of Allegion plc for the three and six months ended June 30, 2019;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
|
Date:
|
July 25, 2019
|
|
/s/ David D. Petratis
|
|
|
|
David D. Petratis
|
|
|
|
Principal Executive Officer
|
1.
|
I have reviewed the Quarterly Report on Form 10-Q of Allegion plc for the three and six months ended June 30, 2019;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
|
Date:
|
July 25, 2019
|
|
/s/ Patrick S. Shannon
|
|
|
|
Patrick S. Shannon
|
|
|
|
Principal Financial Officer
|
|
/s/ David D. Petratis
|
David D. Petratis
|
Principal Executive Officer
|
July 25, 2019
|
|
/s/ Patrick S. Shannon
|
Patrick S. Shannon
|
Principal Financial Officer
|
July 25, 2019
|