By Greta Rosen Fondahn STOCKHOLM, Feb 5 (Reuters) - Sweden's Assa Abloy, the world's largest lock maker, said on Thursday it believed the U.S. residential market had bottomed out, lifting its shares,
Assa Abloy Believes U.S. Residential Market Has Reached Its Low Point
U.S. Residential Market Analysis
By Greta Rosen Fondahn
Current Market Challenges
STOCKHOLM, Feb 5 (Reuters) - Sweden's Assa Abloy, the world's largest lock maker, said on Thursday it believed the U.S. residential market had bottomed out, lifting its shares, even as a stronger crown weighed on fourth-quarter profit.
Sales Performance Overview
The company's shares were up about 2.5% at 1000 GMT, taking their year-to-date rise to 8%, after CEO Nico Delvaux said that while the U.S. residential market remained challenging, "we definitely believe" it has "bottomed out".
Future Outlook and Projections
Assa Abloy, which generates about half its revenue in the U.S., has been hit by high borrowing and material costs that have hampered home building.
Operating profit dipped to 6.46 billion crowns ($718.1 million) in the quarter from 6.58 billion a year earlier, on organic sales growth of 4%. Analysts polled by LSEG had on average expected 6.47 billion crowns.
Overall sales fell 3% as currency effects had a negative impact of 10% due to a stronger crown.
AMERICAS BETTER THAN EXPECTED
Delvaux described 2025 as a year with a "challenging market environment marked by tariffs, high interest rates and heightened geopolitical uncertainty".
While he did not foresee a short-term recovery in U.S. new-builds, he said he felt "a bit more positive" on a recovery in "remove and replace" activity. The non-residential segment in North America was strong, he added.
Quarterly sales rose 5% organically in the Americas division, which JPMorgan analysts said was a "surprising" positive.
The company reported strong sales growth in the Nordics and Central Europe, while the residential market in China remained "very weak" in the quarter.
Assa Abloy, which competes with Allegion and Dormakaba, proposed a dividend of 6.40 crowns per share for 2025, up from 5.90 crowns the previous year and compared with an expected 6.19 crowns.
($1 = 8.9957 Swedish crowns)
(Reporting by Greta Rosen Fondahn. Editing by Terje Solsvik and Mark Potter)
