20% - Assa Abloy

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The security market 8 The security market Great potential on a growing market ASSA ABLOY is the world-leading supplier of total lock and door solutions today. As the Group has grown, its product portfolio has expanded and evolved to cover the widely varying needs of airports, schools, healthcare, offices, homes and more. Growth in the security market is mainly fueled by increasing prosperity, urbanization and a general trend toward higher security. Another factor is that crime, violence and terrorism have increased. The underlying trends and growing uncertainty in the world put security high on the agenda, pushing the development of increasingly advanced solutions and upgrades of existing security systems. The total security market consists primarily of security services and electronic and mechanical security products. ASSA ABLOY estimates the total security market to be worth something over EUR 200 billion. The Group has concentrated its efforts on electronic and mechanical security products, which represent about 15 percent of the total market. ASSA ABLOY has a market share of over 10 percent. Electronic and mechanical security products In the field of electronic security, ASSA ABLOY’s product range includes electronic cylinders, automatic doors, secure identification and various products for access control, some of which use radio-frequency identification (RFID). As a rule, electronic products offer high functionality and high security, making them ideal for commercial applications. Focused product development in this area is continuously expanding the areas of use of ASSA ABLOY’s electromechanical products. The annual growth of the market for electronic security products is two to three times higher than for mechanical security products. Today electronic products represent about one-third of the Group’s sales, and that share is increasing every year. As well as locks, mechanical security products include door handles, door closers, emergency exit devices, security doors and door and window hardware. Development in the field of mechanical security products is mainly driven by renovations and replacements of old locks in existing windows and doors, as well as new construction. In the long term this market is expected to grow in tandem with each country’s GDP (averaged over a business cycle). The market for mechanical security products is relatively stable for ASSA ABLOY, both because the large aftermarket makes this market less sensitive to shifts in the economy, and because ASSA ABLOY is active in a large number of countries with different economic cycles. In the mechanical security products segment, consolidation of players on the market is common, and this trend is expected to continue. Complete security solutions ASSA ABLOY works with architects, authorities and large end-customers to offer the best security solutions for different types of door openings. The security solution for any given door must therefore be adapted to the location and type of use of the door – an entry to a building, or the door to a computer room or a conference room. The functions of the door must also be adapted to needs for security and convenience – for example, whether it is an interior or exterior door, how often it will be opened, how many people will use it, and special requirements such as fire safety. Customers are also increasingly demanding that the products can be integrated into new or existing security systems and IT networks. Differences between markets Americans spend more than twice as much on emergency exit devices as Europeans. Conversely, northern Europeans spend three to four times as much on high-security locks for their homes as Americans. Automatic doors are also much more common in Europe than in the United States. The prevalence of electromechanical products is significantly larger in the commercial segment than in the residential segment. If the demands for security and evacuation solutions were equally great in Europe and the United States, the overall market would roughly double. One challenge for ASSA ABLOY is to develop the market towards increased growth and thereby reduce the large discrepancies between countries and market segments. In global terms the lock market is still relatively fragmented; however, the market in each country is fairly consolidated, because companies in the industrialized parts of the world are often still family-owned and leaders on their home markets. They are well-established and have strong ties with local distributors. In less-developed countries, however, established lock standards and brands are less common. The whole security market ASSA ABLOY’s sales by product group Alarm centers, 9% IT security & logical ASSA ABLOY’s access control, 4% product areas, 15% 80 Intrusion protection, 3 % 90 Doors & windows, 40% Security guards 65 & other, 27% 45 25 Fire alarms, 2% 10 ASSA ABLOYs produktområden, 15% Bevakning & Övrigt, 27% Brandlarm, 2% Dörrar & fönster, 40% Intrångsskydd, 3% IT-säkerhet & logisk behörighetskontroll, 4% Larmcentraler, 9% Mekaniska lås, låssystem och tillbehör, 48% Elektromekaniska lås, passagekontroll, automatiska dörrar och Mechanical locks, lock systems and identifieringstekonologi, 33% accessories, 48% Electromechanical locks, access control, automatic doors and identification technology, 33% Security doors and fittings,19% Säkerhetsdörrar och beslag, 19%
Presence and strong relationships the key in China China is an attractive growth market for ASSA ABLOY, not only because of the security needs of the Olympic Games and upcoming events such as the 2010 World Expo in Shanghai, but because of its booming commercial and industrial sectors. As regards the Games, ASSA ABLOY Group companies are involved in more than 50 percent of the high-class hotel projects and are supplying security solutions to both the National Stadium (the Bird’s Nest) and the National Aquatic Center (the Water Cube). Winning such prestigious projects against tough competition reflects ASSA ABLOY’s reputation in the region for business know-how and leading-edge technology. This reputation has been built up over many years and made possible by having a strong base in the country. The Group has about 5,000 employees in China, with service centers in 10 major cities and a strong manufacturing presence through the Group companies Guli and Wangli and the recently acquired company Baodean. The security market 9 Estimated to be worth EUR 2 billion, the Chinese market is still relatively undeveloped from an international perspective. It is market that is full of potential considering the increasing wealth of its residents and urbanization of the population, which are driving a boom in residential security. ASSA ABLOY has a leading position on the Chinese market. Projects awarded to ASSA ABLOY in connection with the 2008 Olympics include: • VingCard’s access systems for the 5-star, 950-room hotel connected to the Olympic Green Convention Center, which will be the media headquarters and home to indoor events such as shooting. • Trimec’s V-Lock solution for the new National Stadium, also known as the Bird’s Nest. • ASSA ABLOY’s magnetic locks for the electronic doors in the Aquatic Center, also known as the Water Cube.
Page 1 and 2: Annual Report 2007 The global leade
Page 3 and 4: Significant events Financials in br
Page 5: ASSA ABLOY is the global leader in
Page 8: CEO’s statement 4 innovative prod
Page 11: 1 Excluding restructuring costs. 2
Page 15 and 16: In the security market today, manuf
Page 17 and 18: HID’s Crescendo Smart Card allows
Page 19 and 20: Check in with your cellphone Signat
Page 21 and 22: ASSA ABLOY worked closely with the
Page 23 and 24: The division manufactures and sells
Page 25 and 26: Security a top concern at new biote
Page 27 and 28: Woodside in Australia is one of the
Page 29 and 30: The division sells electronic secur
Page 31 and 32: “In today’s turbulent times, bu
Page 33 and 34: In 2007 ASSA ABLOY Entrance Systems
Page 35 and 36: More information about sustainable
Page 37 and 38: Open House in Brazil Sustainable de
Page 39 and 40: Tom Devine from ASSA ABLOY Australi
Page 41 and 42: Report of the Board of Directors, C
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Page 45 and 46: End Corporate governance report ASS
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Page 49 and 50: Gustaf Douglas Melker Schörling Ca
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Cash flow statement - Group ASSA AB
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Income statement Parent company Bal
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Financial risk management ASSA ABLO
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Maturity - financial liabilities an
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Note 1 Notes Note 1 Significant acc
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Note 1 cont. benefits can be reliab
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Note 1 cont. USA, which are reporte
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Notes 9-12 Note 9 Employee benefits
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Note 15 cont. ASSA ABLOY Annual Rep
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Notes 17 -18 Note 17 Shares in subs
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Notes 24-25 Note 24 Cash and cash e
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Note 29 cont. A) Specification of a
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Notes 30-35 Note 30 Other provision
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Note 36 Adams Rite On 24 March 2006
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Five years in summary 2003 Business
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Quarterly information ASSA ABLOY An
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Proposed disposition of earnings Th
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The ASSA ABLOY share Share price tr
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Convertible debentures for personne
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Production: Hallvarsson & Halvarsso
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20% - Assa Abloy

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