ASSA ABLOY: Record earnings despite severe market downturn

* There was a severe downturn in new construction on all the
world's major markets.
* All divisions were affected but Entrance Systems, HID and the
growth markets remained relatively stable.
* Sales totaled SEK 8,881 M (8,203), an increase of 8%, with -12%
organic growth, 4% acquired growth and exchange-rate effects of
+16%.
* Major efficiency gains throughout the Group led to sustained
margins and continued strong cash flow. The successful
restructuring program is continuing.
* Operating income (EBIT) amounted to SEK 1,328 M (1,244), an
increase of 7% excluding restructuring costs of SEK 109 M,
representing a margin of 15.0% (15.2).
* Net income excluding restructuring costs amounted to SEK 827 M
(772).
* Earnings per share excluding restructuring costs amounted to SEK
2.20 (2.08), an increase of 6%.

SALES AND INCOME

Full year First quarter
2007 2008 Change 2008 2009 Change
Sales, SEK M 33,550 34,918 +4% 8,203 8,881 +8%
of which,
Organic growth +0% -12%
Acquisitions +4% +4%
Exchange-rate effects -1,131 +16 +0% -275 +1,460 +16%
Operating income (EBIT),
SEK M 5,458 5,526* +1% 1,244 1,328* +7%
Operating margin (EBIT), % 16.3 15.8* 15.2 15.0*
Income before tax, SEK M 4,609 4,756* +3% 1,055 1,124 +7%
Net income, SEK M 3,368 2,438** - 772 718** -
Operating cash flow, SEK M 4,808 4,769 - 1% 583 838 +44%
Earnings per share (EPS),
SEK 9.02 9.21* +2% 2.08 2.20* +6%

* Excluding non-recurring and restructuring costs amounting to SEK
1,257 M for the full year 2008 and to SEK 109 M for the first quarter
of 2009.
** Excluding non-recurring and restructuring costs, net income was
SEK 3,451 M for the full year 2008 and SEK 827 M for the first
quarter of 2009.
COMMENTS BY THE PRESIDENT AND CEO"All markets showed a weakening trend during the first quarter. At
the same time, ongoing restructuring measures and adjustments in
production capacity meant that both income and cash flow continued to
improve. Despite this good performance in the first quarter, the
remainder of 2009 is expected to be extremely challenging, both in
terms of sales and income, since the financial crisis has had severe
negative effects on investments in new construction. Implementation
of the plan to reduce the number of production units and adjust
production capacity is continuing, which will guarantee the Group's
long-term competitiveness. Investments in improved market coverage
and new products, primarily in the fast-growing electromechanical
segment, are continuing with undiminished vigor," said Johan Molin,
President and CEO.

FIRST QUARTER
The Group's sales totaled SEK 8,881 M (8,203), representing growth of
8% compared with 2008. Organic growth for comparable units was -12%
(0), while acquired units accounted for 4% (3) of the increase.
Exchange-rate effects had a positive impact of SEK 1,460 M (i.e. 16%)
on sales.

Operating income before depreciation, EBITDA, excluding restructuring
costs, amounted to SEK 1,594 M (1,476), an increase of 8% compared
with 2008. The EBITDA margin was 17.9% (18.0). The Group's operating
income, EBIT, excluding restructuring costs, amounted to SEK 1,328 M
(1,244), an increase of 7%, after positive currency effects of
SEK 225 M. The operating margin was 15.0% (15.2).

Net financial items amounted to SEK 205 M (189), which corresponds to
an average net interest rate of just over 5%. The Group's income
before tax amounted to SEK 1,015 M (1,055). Adjusted for
restructuring costs, income before tax was SEK 1,124 M, representing
an increase of 7%. Exchange-rate effects had a positive impact of
SEK 140 M on the Group's income before tax. The profit margin was
11.4% (12.9). The Group's tax charge amounted to SEK 296 M (283).
Earnings per share amounted to SEK 1.92 (2.08). Adjusted for
restructuring costs, earnings per share were SEK 2.20, an increase of
6%.

RESTRUCTURING MEASURES
Payments related to the two restructuring programs amounted to SEK
144 M during the quarter.

The restructuring program initiated in 2006 has been a great success
and will be completed during 2009. More than 2,300 employees have
left the Group in connection with the implementation of the program.
During the first quarter costs of SEK 109 M where taken for
additional costs in two projects.
The restructuring program initiated during the second half of 2008 is
fully underway and just over 1,000 people have so far left the Group.
The program comprises some 40 projects, is expected to cost SEK 1,180
M and will affect a total of 1,800 employees. The payback time is 2-3
years.

COMMENTS BY DIVISION

EMEA
Sales in EMEA division during the quarter totaled SEK 3,473 M
(3,473), with organic growth of -15%. The weakening on all markets
except Africa continued. Acquired growth amounted to 5%. Operating
income excluding restructuring costs amounted to SEK 496 M (567),
which represents an operating margin (EBIT) of 14.3% (16.3). The
effects of the restructuring programs and other efficiency measures
compensated for many of the effects of the negative growth in volume.
Return on capital employed excluding restructuring costs amounted to
15.2% (21.0). The return was impacted chiefly by the lower income.
Operating cash flow before interest paid totaled SEK 339 M (241).

AMERICAS
Organic growth in Americas division turned negative during the
quarter. All units apart from Canada and Brazil were affected by the
slowing of the economy that has now extended to the non-residential
segment. The sales trend in the residential segment remained
negative. Total sales amounted to SEK 2,744 M (2,422), with -15%
organic growth. Acquired growth amounted to 3%. By means of
restructuring and capacity changes, the operating margin was
maintained at a very strong level and amounted to 19.2% (19.3).
Return on capital employed amounted to 20.2% (22.0). Operating cash
flow before interest paid totaled SEK 487 M (227).

ASIA PACIFIC
Organic growth in Asia Pacific division was negative in the first
quarter. The business units in Australia and New Zealand showed
negative growth. On the Chinese market too, weakening was seen on the
lock side, while security doors showed growth. On the Asian markets
apart from China growth was positive. The division's sales totaled
SEK 759 M (692), with -6% organic growth. Acquired growth amounted to
6%. Operating income totaled SEK 54 M (54), which represents an
operating margin (EBIT) of 7.1% (7.8). The quarter's return on
capital employed amounted to 7.4% (8.4). Operating cash flow before
interest paid totaled SEK 34 M (85).

GLOBAL TECHNOLOGIES
Global Technologies division reported negative organic growth for the
quarter. The weakened market situation made itself felt at all
business units except HID/Fargo which remained relatively stable.
Total sales in the first quarter were SEK 1,279 M (1,158), with
organic growth of -8%. Acquired growth amounted to 0%. The division's
operating income amounted to SEK 199 M (160), giving an operating
margin (EBIT) of 15.6% (13.8). Return on capital employed amounted to
12.5% (13.2). Operating cash flow before interest paid totaled SEK 90
M (41).

ENTRANCE SYSTEMS
Entrance Systems division reported sales of SEK 822 M (697) in the
first quarter, representing organic growth of -2% (3). Acquired
growth amounted to 5%. Demand from the retailing sector weakened but
was counteracted to some extent by demand from the hospital and
healthcare sector and a positive trend on the service side. Operating
income amounted to SEK 128 M (89), giving an operating margin (EBIT)
of 15.5% (12.7). Return on capital employed amounted to 14.8% (11.0).
Operating cash flow before interest paid totaled SEK 241 M (173).

ACQUISITIONS
Four minor acquisitions were consolidated during the first quarter.
The combined acquisition price for these acquisitions amounts to
SEK 191 M, and preliminary acquisition analyses indicate that
goodwill and other intangible assets with indefinite useful life
amount to about SEK 70 M. The acquisition price is adjusted for
acquired net debt and estimated earn-outs.

SUSTAINABLE DEVELOPMENT
ASSA ABLOY's third Sustainability Report was published in April. The
Report contains a review of targets and outcomes in the Group's
20-point program and a description of how sustainability operations
are run. Major advances regarding energy consumption, carbon dioxide
emissions and the use of chemicals in production were reported during
the year.
There is also a description of how ASSA ABLOY communicates with the
outside world on sustainability issues and how reporting was made at
the C level of the GRI. The Report can be found on the Group's
website, www.assaabloy.com.

PARENT COMPANY
'Other operating income' for the Parent company ASSA ABLOY AB totaled
SEK 80 M (480) for the first quarter. Income before tax amounted to
SEK -69 M (381). Investments in tangible and intangible assets
totaled SEK 1 M (0). Liquidity is good and the equity ratio was 43.9%
(47.8).

ACCOUNTING PRINCIPLES
ASSA ABLOY applies International Financial Reporting Standards (IFRS)
as endorsed by the European Union. Significant accounting and
valuation principles are detailed on pages 56-60 of the 2008 Annual
Report. New or revised IFRS effective after 31 December 2008 have had
no material effect on the consolidated income statement or balance
sheet. The Group's Interim Reports are prepared in accordance with
IAS 34. The Parent company applies RFR 2.2.

TRANSACTIONS WITH RELATED PARTIES
No transactions that significantly affected the company's position
and income have taken place between ASSA ABLOY and related parties.

RISKS AND UNCERTAINTY FACTORS
As an international Group with a wide geographic spread, ASSA ABLOY
is exposed to a number of business and financial risks. The business
risks can be divided into strategic, operational and legal risks. The
financial risks are related to such factors as exchange rates,
interest rates, liquidity, the giving of credit, raw materials and
financial instruments. Risk management in ASSA ABLOY aims to
identify, control and reduce risks. This work begins with an
assessment of the probability of risks occurring and their potential
effect on the Group. For a more detailed description of risks and
risk management, see pages 41-43 of the 2008 Annual Report. No
significant risks other than the risks described there are judged to
have occurred.

OUTLOOK*
Long-term outlook
Long term, ASSA ABLOY expects an increase in security-driven demand.
Focus on end-user value and innovation as well as leverage on ASSA
ABLOY's strong position will accelerate growth and increase
profitability.

Organic sales growth is expected to continue at a good rate. The
operating margin (EBIT) and operating cash flow are expected to
develop well.

Outlook for the year
2009 will be a challenging year since the financial crisis has had a
strongly negative effect on investments in construction, and negative
organic growth for the year is therefore expected for ASSA ABLOY.

Easter is expected to have a negative impact on sales and earnings in
the second quarter.

*) The Outlooks published on 13 February 2009 were:

Long-term outlook
Long term, ASSA ABLOY expects an increase in security-driven demand.
Focus on end-user value and innovation as well as leverage on ASSA
ABLOY's strong position will accelerate growth and increase
profitability.

Organic sales growth is expected to continue at a good rate. The
operating margin (EBIT) and operating cash flow are expected to
develop well.

Stockholm, 22 April 2009

Johan Molin
President and CEO

The Interim Report has not been reviewed by the Company's Auditor.

Financial information
The Interim Report for the second quarter will be published on 29
July 2009.

Further information can be obtained from:
Johan Molin, President and CEO, Tel: +46 8 506 485 42
Tomas Eliasson, Chief Financial Officer, Tel: +46 8 506 485 72

ASSA ABLOY is holding an analysts' meeting at 13.00 today
at Klarabergsviadukten 90 in Stockholm.
The analysts' meeting can also be followed on the Internet at
www.assaabloy.com.
It is possible to submit questions by telephone on:
+46 8 5052 0270, +44 208 817 9301 or +1 718 354 1226.

This information is that which ASSA ABLOY is required to disclose
under the Swedish Securities Exchange and Clearing Operations Act
and/or the Swedish Financial Instruments Trading Act.
The information is released for publication at 12.00 on 22 April.

ASSA ABLOY: Record earnings despite severe market downturn

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