Steady growth helped by the launch of new technology · 2010-02-22 · Steady growth helped by the launch of new technology Market and market trends The Scandinavian operations continued

28 • ASSA ABLOY / 2001

Scandinavia:

Steady growth helped by thelaunch of new technology

Market and market trendsThe Scandinavian operations continuedto show stable growth during 2001,with Sweden stronger than Norwayand Denmark. In 2002 the Norwegianmarket in particular is expected toshow an upswing.

The region’s steady growth isfounded on a comprehensive portfolioof locally manufactured products, complemented by increased sales ofproducts from other Group companies.During the year the Scandinavian companies collaborated in launching anupdated range of Do-It-Yourself products, with local profiling in eachcountry.

However, the year’s most signifi-cant event was the development andlaunch of the new cliq lock technology,which offers customers the best features of mechanical locking withadded flexibility and greater securityderived from the latest advanced electronics. The technology is equallyapplicable to new and existing installa-tions without adding to installationcosts.

During the year the Grorud door-hardware plant in Norway was closedand the business transferred to otherScandinavian companies and to assaabloy’s new Romanian companyUrbis International.

Awareness about assa abloythroughout Scandinavia has beenincreased by a number of activitiesconnected with the Volvo Ocean Raceand the forthcoming stopover inGothenburg.

SWEDENassa abloy’s Swedish operations com-prise Assa, Assa Industri, fix, fasLåsfabrik, Solid and the locksmith’swholesaler aki låsgrossisten.

Assa Industri and fix manufacture andmarket products for oem customers,mainly in Scandinavia. Assa Industrimanufactures hinges, lock cases andindustrial cylinder locks, while fix pro-duces multipoint locks and door andwindow hardware. fas Låsfabrikmanufactures and markets mortisedeadlocks and other locks for privatehomes and for safes.

Assa and Solid serve the commercialconstruction and consumer markets.Solid develops and markets access con-trol systems, while Assa manufacturesand markets security systems based ona comprehensive range of mechanicaland electromechanical lock products.The Assa Security Master (asm) specifi-cation software has been upgraded withnew functions designed to encouragesales of complete door hardwarepackages.

Individual locksmiths form themain distribution channel for productsby Assa and Solid. As electromechanicalproducts continue to grow in importance,which naturally affects distribution,relationships with locksmiths weredeveloped and strengthened during 2001.

The year saw a continued slowincrease in building activity, focusedprimarily on the major cities and espe-cially on southern Sweden.

The launch during 2001 of the newgeneration of lock cylinders using cliqtechnology represents a breakthroughfor products that combine mechanicaland electronic features to maximumadvantage, and will have the greatestpossible significance for the cylindermarket.

The new Do-It-Yourself displaypanel for customers has achieved greatsuccess in both traditional buildingsupply stores and specialized lock outlets.

NORWAYassa abloy’s organization in Norwayconsists of TrioVing and Låsgruppen.

TrioVing is Norway’s leading lockmanufacturer, selling to the construc-tion industry, oem and retrofit mar-kets. During 2001 TrioVing tenderedsuccessfully for a number of majorstart-up projects. These included thenew super-luxury residential ship ‘TheWorld’ and the leading telephone company Telenor’s new headquartersat Fornebu. The development ofFornebu, formerly Oslo’s main airport,involves several phases of expansion.

The launch of the new cliq locktechnology has been received very posi-tively in Norway and has created astrong marketing base for all theGroup’s high-security products.

The expanded Do-It-Yourself rangewas also well received and producedsignificant sales growth during thefourth quarter of 2001.

Låsgruppen is a group of five lock-smith retailers which, together withother leading locksmiths, make up theTrioVing Security Centers group. Thesecenters have a leading role in developing

31998_ASSA_Fram_E_DS 02-03-14 13.14 Sida 28

SEK M 2001 2000 1999 1998 1997

Sales 1,971 1,889 1,777 1,701 1,660

Average no.of employees 1,765 1,726 1,651 1,657 1,702

Mechanical locks, lock systems and accessories, 59%

Security doors and fittings, 21%

Industrial locks, 4%

Electromechanical locks and electronic

locks, 16%

Sales by product group

Trends

Scandinavia:Consolidated sales by companies in the Scandinavian countries in 2001amounted to SEK 1,971 M (1,889), representing organic growth of 2 percent.

GROUP VICE PRESIDENT ASSA ABLOY:HANS JOHANSSON

SWEDEN

Assa ABManufactures and markets mechanical and electromechanical lock products.President: Stellan Svensson

Assa Industri ABManufactures and markets lock cases, hinges and cabinet locks for industrial customers.President: Hans Johansson

AB FAS LåsfabrikMarket leader in mortise deadlocks.President: Ulf Petersson

FIX AB Manufactures and markets espagnolettes and fixtures.President: Jerry Pull

Solid ABMarkets electromechanical lock products under the ABLOY and SOLID brand names.President: John Hedesand

AKI Låsgrossisten ABOne of Sweden's leading locksmith's wholesalers. President: Harry Grabinsky

Another company in the Swedish organization is Assa Portuguesa LDA.

NORWAY

Låsgruppen a.s.Markets and sells locks and fittings.President: Bjørn Haugsvaer

TrioVing a.s.Total supplier of locks and security products for the Norwegian market.President: Tor-Arne Jensen

DENMARK

Ruko A/STotal supplier of locks and security products for the Danish market.President: Carl Trock

FIX A/SSells ASSA ABLOY products to the Danish door and window industry.President: Keld Madsen

M. Sloth & Co. A/SOne of Denmark’s leading locksmith’s wholesalers.President: Poul Sloth

the market for high-security productsand in encouraging skilled installationand outstanding service. In 2001 Låsgruppen succeeded in winning some important contracts with customers covering the whole country.

DENMARK assa abloy’s organization in Denmarkconsists of the lock manufacturerRuko and its subsidiaries Ruko Serviceand fix. M. Sloth & Co was fully inte-grated into the Ruko organizationduring 2001.

Ruko is the leading total supplierto the lock and security market inDenmark. Mechanical lock systemsbased on the Combi high-securitycylinder form the company’s core busi-ness and meet the Danish Standard’shighest security classification. Rukoalso leads the trend toward highersecurity in Denmark with productssuch as electromechanical locks andelectronic access control systems, whichare steadily growing in importance.

Ruko Service is responsible forafter-sales services, while fix handles

all sales of Group products to theDanish door and window industry.

In 2001 the Danish market wasmarked by changing conditions andstructures and increased competition.During the year Ruko has worked tointensify and to take advantage of theresources within the Sloth organization.The integration process required majoreffort, but is now ready to produce theexpected benefits in 2002.

The new cliq lock technology waslaunched in Denmark during 2001and, helped by the installed base oflock products meeting the highest secu-rity classification, is creating substan-tial added value for customers.

fix has reported some notable suc-cesses during the year, including a newslot-guided hinge which has created anew quality standard for the market.

The constant arrivals and departures among several hundred small IT businesses renting office/workshopunits at Ronneby in Sweden present a security nightmare for the landlord Kjell Svensson at Soft CenterFastighets AB. To avoid changing the locks every time, 25 ASSA Twin Combi cylinders have been upgraded, for evaluation, with ASSA ABLOY’s new CLIQ technology, which allows them to be repro-grammed using software.



Operations of assa abloy in Finlandconsist of Abloy and Björkboda Lås.Abloy manufactures and marketsmechanical and electromechanicallocks, door automatics, door closers,fire-door closing systems, handles and fittings. Björkboda Lås produceslock cases for interior doors, cylinderlock cases and high-security lever locks.

Market and market trendsAbloy’s exports continued to grow in2001. Sales developed rapidly ineastern Europe, especially in Russia,the Baltic countries and the CzechRepublic. Exports to western Europeshowed strong increases, especially in the uk and France, althoughScandinavia stagnated. The North andSouth American market areas grew,and in Asia sales increased strongly,especially in the northern part of thecontinent. The rapidly expanded inter-national network of assa abloy groupcompanies with their marketingresources offers good opportunities for further developing sales of abloyproducts.

Exports of abloy lock cases madeby Björkboda Lås to the Baltic coun-tries, Russia and Ukraine developedwell due to local representatives’ goodhold on the market. The uk market isalso promising thanks to the abloytrademark, which is already wellknown there. But efforts to developsales of lock cases to other easternEuropean countries including Poland,the Czech Republic and Hungary havemet with little success so far.

On the home market sales re-mained at the same level as in 2000despite the declining construction mar-ket. This decline is expected to continuein 2002. Abloy managed to maintainits sales levels thanks to an increase in

door-closer sales – achieved throughimproved delivery performance andservice – and to improved sales ofelectromechanical lock cases andindustrial locking.

In the fall of 2001 Abloy noted aglobal trend towards a split in the lock market. In general the new-construction market weakened in theturmoil following the terrorist attacksin New York in September, but thehigh-security market and the retrofitmarket grew. The features of abloyproducts mean that the company’sexport strategy is focused mainly onthe high-security and retrofit markets.Continuing strong development of the international market for abloyproducts is therefore expected.

The trend towards higher securityInternational and domestic customersalike are becoming more and moredemanding of high security. To offersolutions for this growing high-securitymarket, Abloy launched several newproducts during the year. In the spring,a new abloy high-security padlockrange was launched to both domesticand international markets. In the second half of the year a new-generationpatented high-security disk cylinder,abloy protec, was launched on selectedmarkets; and a new-generation electriclock range with handle control wasintroduced in the fall. In addition, newexit products created cooperatively byAbloy and jpm in France were launchedin Finland during the year.

The abloy project-hardware prod-uct range was strengthened with twounique new families of architecturalhardware designs, abloy interia andabloy forma.

In the fall of 2001 Abloy started a

campaign to replace out-of-date lockingin residential buildings and businesspremises in Finland with more securenew solutions. The campaign will cont-inue in 2002 and aims to replace fallingsales volumes from the new-constructionmarket with similar volumes from theretrofit market.

One of the most important eventsof 2001 was the establishment of a newbusiness unit, Door Automatics, inOctober. The new unit will focuswholly on the Door Automatics busi-ness – previously part of the Electro-mechanical Locking business unit –and will allow efficient development ofthe international market for automateddoor environments.

Existing cooperation with the authorized abloy dealer network oflocksmiths was intensified by comple-menting the company’s own productrange with magnetic locks and electricstrikes from other Group companies.The internal education program incustomer relations management for theAbloy sales personnel begun in year2000 was completed in 2001.Continuous product development, training and close communication withcustomers have enabled Abloy toattract the industry’s most professionaldistribution partners to consult andserve end-users during sales, installa-tion and after-sales service.

Export growth compensatesfor a flat domestic market

Finland:


During the year Abloy was chosen as asolution supplier for various applica-tions to provide safety and to secureproperties, infrastructure and valu-ables against theft, vandalism andsabotage on the commercial, industrial,institutional and private markets.

Björkboda Lås found a develop-ment area in the distribution of lockcases to both commercial and residen-tial customer segments in a number ofcountries. Sales of the abloy range ofhigh-security lock cases meeting thedin Standard started promisingly inseveral market areas.

Integration regionally and worldwideThe business-unit-based organizationof Abloy facilitates close cooperationwith other Group companies to develop and manufacture purpose-built products that exactly meet theneeds of customers in different markets.Abloy participates in the Group’s pro-duct councils to find and develop newproduct concepts and solutions, anduses the benchmarking process to constantly develop its functions.

Numerous pre-studies for cross-selling opportunities between Abloy,Björkboda Lås and other assa abloygroup companies were made duringthe year. Various cooperation projectsare already underway to supply unique

technology products such as electro-mechanical locks, door automatics,door closers, padlocks and lock casesto Group companies.

The Architectural Hardware busi-ness unit continued its cooperationwith the Scandinavian Group compa-nies on door handles and espagnolettehandles. The new abloy range of pullhandles offers good potential forbroader cooperation in the future.

During 2001, Björkboda Lås wasactively involved in integration pro-jects in Scandinavia. In Sweden, fas’smanufacture of lock cases for interiordoors will be gradually replaced by thecorresponding abloy range. On theother hand, sales of abloy mechanicallock cases in Sweden have almost ceased and been replaced by the corre-sponding assa range.

Collaborative marketing opera-tions to sell abloy products in newmarket areas were started with otherGroup companies. In South America,for example, an abloy operation forBrazil has been established with thelocal Group company La Fonte.

Abloy OyManufactures and markets lock cylinders, mechanicaland electromechanical locks, door closers, door auto-matics and architectural hardware.President: Matti Virtaala

Abloy Oy’s business unitsConstruction Locks Manager: Kari MononenIndustrial Locks Manager: Juha PikkarainenElectromechanical Locks Manager: Matti AholaArchitectural Hardware Manager: Kyösti SormunenDoor Closers Manager: Markku KuivalainenDoor Automatics Manager: Jaakko MeriläinenExports Manager: Jari ToivanenDomestic Market Manager: Kari Mononen

Abloy Oy Eesti FiliaalMarkets and sells ABLOY products in the Baltic countries.Manager: Ahti Ovaskainen

Abloy Oy Representative Office RussiaMarkets and sells ABLOY products in Russia.Manager: Lauri Honka

Abloy Oy Representative Office UkraineMarkets and sells ABLOY products in Ukraine.Manager: Volodymyr Livinsky

Björkboda Lås Oy AbManufactures and markets lock cases.President: Henry Engblom

SEK M 2001 2000 1999 1998 1997

Sales 1,165 1,060 898 811 744

Average no.of employees 1,150 1,123 1,020 970 905

Mechanical locks,lock systems and accessories, 60%




locks, 16%


Trends

Finland:Sales by companies in the Finnishorganization in 2001 amounted to SEK 1,165 M (1,060), representingorganic growth of 2 percent.

GROUP VICE PRESIDENT ASSA ABLOY:MATTI VIRTAALA

Saku Suurhall in Tallinn, Estonia, the largest concert hall and indoor sports venue in the Baltic countries,will host the Eurovision Song Contest in 2002. The hall is comprehensively equipped with ABLOY doorclosers, architectural hardware and high-security door locks.



assa abloy central europe was createdduring 2001 to oversee the Group’soperations in Germany, the Nether-lands, Switzerland and Austria. Thenew regional organization has a soundoperational and financial base for futuregrowth and profit improvements.Continuous margin improvements andcapital rationalization are supportingcash flow, profit development andbalance sheet reduction. This workwill continue, giving good prospectsfor 2002.

The organization’s manufacturingunits comprise effeff, ikon, WilhelmDörrenhaus and bab-ikon in Germany,Lips in the Netherlands and keso inSwitzerland. In addition, there areseven sales units operating in CentralEurope.

The integration of the effeff groupin Germany and the divestment of itsnon-core alarms business are nowcompleted. The acquisitions of Lips in2000 and the keso group in 2001, andtheir subsequent integration, have created good market positions in theNetherlands and Switzerland. Coordi-nation of sales forces and productionoperations has started to improve salesand margins, and growing collabora-tion with other Group companies willsupport future expansion in the area.

The Volvo Ocean Race will be usedfor future integration of units andmake sure that our employees under-stand our way of working. The race isalso an ideal vehicle to get in closercontact to our customers and to pro-mote our local strong brands.

The Central European market slowed down in 2001. New-construc-tion volume was lower, while the after-sales business and sales of high-securityproducts remained static. The regionalorganization’s strong positions in

electromechanical products and high-security cylinders will ensure stabledevelopment. Changes in the distributionstructure, involving closer cooperationwith appointed System Partners, give opportunities to increase marketshares.The implementation of the Euro willharmonize and open the Europeanmarket, assisted by the changing distri-bution structure and continuing cross-border business integration. Com-panies like assa abloy, operating inthe whole area, can gain new opportu-nities in this process. The markets ofeastern Europe are also coming closerand closer to Germany and to the influ-ence of central Europe in general.

The very fragmented structure of theCentral European market, in which a lotof small and medium family-owned lockcompanies still operate, also generatespossibilities of future market restructur-ing and harmonization.

GERMANYEurope’s biggest and most developedmarket for security products has beenaffected by the overall slowdown ineconomic growth. New construction isdown by 5 percent overall and buildingactivities in the eastern part ofGermany have decreased dramatically.However the commercial and renova-tion segments remain at previouslevels. The outlook for the coming yearindicates no major changes apart fromsome increase in the renovation areaand after-sales market.

New regulations affecting equityratio have tightened credit ratings andcaused difficulties for many tradingand installation firms. The result is atendency towards mergers in trade andwholesaler chains. At the same timewholesalers and wholesale associations

have announced mergers involvingcontinuing expansion beyond Germanborders.

The awareness of a need for highersecurity in both the commercial andthe residential areas is increasing.Issues such as access control, electro-mechanical locking to achieve greatersecurity and added flexibility and,especially, safe emergency exit systemsare high on the priority list of publicauthorities and institutions such as air-ports, hospitals and schools.

With its strong operations in theareas of electromechanical locking,emergency exit systems and high-securitymasterkey and access control systems,assa abloy in Germany is now takinga leading position in influencing the market towards better locking solutions. The companies effeff, ikon,bab-ikon and Dörrenhaus offer pack-ages that combine security, safety andconvenience features, and throughtheir professional sales forces andstrong partnership concepts with lead-ing retail and installation firms they arein a position to communicate the valueof these packages to professional end-users, decision makers and residentialcustomers. In addition, new distribu-tion channels such as Do-it-Yourselfretail stores will help to generate a higher demand for high-quality securityproducts.

With their focus on r&d, theGerman assa abloy group companies

Excellent prospects for newregional organization

Central Europe:


ASSA ABLOY / 2001 • 33

will continue to raise standards in theareas of electromechanical and mech-anical locking. New multipoint locksand electronic cylinders will be intro-duced in 2002 and other products arecontinuously being developed inresponse to end-user needs.

THE NETHERLANDSConstruction activities in the Nether-lands remained stable for the commer-cial and renovation markets but theresidential market slowed down.

With its strong positions in the diyand service markets assa abloy hasbeen able to increase market shares. Byinfluencing architects, distributors andend-users the company has created a good base for improving sales to the commercial segment with its electromechanical and mechanicalhigh-security products.

The integration of Lips is proceed-ing according to plan. Business Unitshave been established, and significantimprovements in delivery times andservice have brought new customers.Sales development and better marginsare starting to improve ebita (opera-ting margin before goodwill amortiza-tion). The cross-selling of productsfrom other assa abloy companies willbe used to win market share in exitdevices, multipoint locks and cylin-ders. Positive development of sales andprofit is expected.

SWITZERLANDThe Swiss market is slow but very stable. Established high-security stand-ards form a base for future marketdevelopment towards electromechani-cal and even higher-security productsand solutions.

The acquisition of keso was a veryimportant step for assa abloy inSwitzerland. keso’s outstanding port-folio of high-security products andcylinders is a perfect complement to theexisting assa abloy product range and in particular expands its flat-keytechnology and systems.

The addition of keso gives assaabloy a good position in electro-mechanical locking, and a strongsecond position in the high-securitycylinder market behind kaba.

Integration of keso has startedvery well and is progressing faster thanplanned. The Group’s tools of bench-marking, cross-learning and continu-ous development work are expected toproduce substantial improvements.Cross-selling projects with other assaabloy group companies are expectedto bring significant sales developmentfor keso, and better growth is forecastfor next year. The local market is notexpected to decrease, and stable devel-opment will continue.

ASSA ABLOY / 2001 • 33

GROUP VICE PRESIDENT ASSA ABLOY:EERO LESKINEN

GERMANY

IKON AG PräzisionstechnikMainly manufactures and sells high-security cylinders and advanced masterkey systems.CEO: Eero LeskinenPresidents: Bernd-D. Wempen and Gerhardt Ernst

BAB-IKON GmbH SchliesstechnikManufactures and sells small lock systems and standard lock products.President: Eero Leskinen

effeff Fritz Fuss GmbH & Co. KGaAManufactures and sells electronic andelectromechanical security systems.Presidents: Martin Brandt, Bernhard Zimmermann and Manfred Kötzle

effeff ChinaPresident: Martin Brandt

Rofu AGSwiss manufacturer of electric strikes and door magnets with sales in Switzerland and Germany.President: Ugo Zanolari

effeff France S.A.President: Jean-Claude Paris

Wilhelm Dörrenhaus GmbHManufactures and sells standard and special lock cases, mainly for wooden doors.President: Holger Ritz

ASSA-Ruko Sicherheitssysteme GmbHMarkets and sells the ASSA and Ruko lock ranges on the German market.President: Svend Mølgaard Petersen

THE NETHERLANDS

Lips Netherland B.V.Manufactures an extensive range of electromechanical and mechanical products, backed by after-sales service and maintenance. President: Jaap Wind

Ambouw B.V.Markets and sells mechanical and electromechanical locks and building hardware on the Netherlands market, mainly supplied by IKON and other ASSA ABLOY companies.President: Gert Lubbersen

SWITZERLAND

IKON Switzerland S.A.Markets and sells IKON, BAB-IKON and ABLOY products on the Swiss market.President: Ugo Zanolari

KESO AGManufactures and sells high-security mechanical and electromechanical cylinders and lock systems.Presidents: Ernst Keller and Eugen Vigini

KESO Deutschland GmbHPresident: Andreas Lipowski

KESO France S.A.President: Christophe Jenny

KESO Austria GmbHPresident: Wilhelm Langanger

SEK M 2001 2000 1999 1998 1997

Sales 1,432 1,027 575 543 489

Average no.of employees 1,398 1,170 751 747 673

Mechanical locks, lock systems and accessories, 56%


Industrial locks, 3% Electromechanicallocks and electronic

locks, 39%


Trends

Central Europe:Sales by companies in the CentralEurope organization in 2001amounted to SEK 1,432 M (1,027).Organic growth for comparableunits was 3 percent.

Inside the Charlemagne Building in Brussels, headquarters of the European Commission, 2,200 BAB lockcylinders are installed.



A new regional organization, assa abloysouth europe, was created in 2001 tooversee the Group’s operations inFrance (Vachette, jpm, Laperche/icb,Stremler, Fichet Serrurerie Bâtiment,Yale Security France and Bezault),Belgium (Litto and Dupéray), Spain(azbe and tesa) and Italy (Nuovaf.e.b., mab, Yale Corni and YaleSecurity Group).

Market and market trendsIn France, the positive trend of late2000 continued at first, but volumesslowed towards year-end due to in-ventory reductions among distributorsand some caution before the Euro in-troduction. Growth is security-driven,helped significantly by new high-endproducts such as masterkey cylindersand multipoint locks. Security hasbecome an important political issue inFrance, which explains the wide inter-est in l’Observatoire de la Sécurité –the association created by assa abloyfrance to inform the media and publicabout security and safety measures.

The specialized high-security com-panies achieved really strong growththis year. As in other markets, orders forelectromechanical products fell back inthe second half, but are forecast toregain previous growth levels since theprojects are delayed rather than lost.

The larger general lock companiespicked up in the fall, especially jpmwhere major improvements in the pro-duction flow organization and newproduct launches are starting to bearfruit. But, as predicted, the entry-levelproducts faced competition from cheap imports sold by price-orienteddistributors.

The Belgian units recorded anothergood year of healthy, strong growth.The very active building market stabi-

lized in the second half-year and vol-umes remained good. Sales of Fichet’shigh-security doors (integrated into the Belgian organization in 1999) rosesubstantially in response to growingsecurity demands and revitalized market efforts. Hotel lock sales werebrisk early in the year but then slowed,as did sales of industrial locks to the telecom sector. Continuing high-security demand and a strong presencein replacement/renovation projects willassure continued positive developmentin Belgium.

Spain is the region’s strongestgrowth market, achieving record volumes for the high-security abloycylinders and other security products,despite some slowing in the telecomsector. Further attention given toFichet, acquired by assa abloy in mid2000, paid off in extensions to thePoint Fort dealer network and in higher sales per outlet. Hotel lock salesheld up well. Towards the end of theyear the tesa acquisition was com-pleted and the work of integrating thecompany into the Group started.

In Italy too there is increasing awareness of – and interest in – betterlocking solutions.

The lack of clear market leadershiphas produced a depressed, price-focusedmarket. assa abloy’s units kept upwell and are targeting margin improve-ments rather than volumes. A good lastquarter lifted sales above last year’s.The newly acquired door-closer manu-facturer mab is integrating very positi-vely in both the region and the Group.

Growth for the region is moderate,but still well above that of recent years.There is increasing penetration of electromechanical products made byYale Corni and Nuova f.e.b. in Italy andby icb, jpm and Laperche in France.

The trend towards higher securitySafety and convenience have becomeimportant additional drivers of secur-ity-driven growth. Studies conductedby l’Observatoire de la Sécurité (just before the terrorist attacks onSeptember 11) show that 43 percent of the French population think supermarkets, schools and cinemashave insufficient safety measures. Thefigures rise to 49 percent for footballstadiums, 50 percent for office buildings, 60 percent for the subwayand 64 percent for nightclubs and discos. 65 percent also believe that thesecurity measures in public buildingsare not renewed sufficiently often.These results attracted wide attentionin the French media, winning recognitionfor assa abloy. The better-informedpublic demand for safer public buildingswill benefit the entire industry.

New products targeting thedemands for higher security and saferpublic buildings have multiplied. jpmintroduced an innovative panic exitdevice. Vachette launched a new family of multipoint locks with goodexport potential and two new high-security cylinder lines. Laperche’s safety-featured lock won the innovationaward for locks at Paris’s batimat2001 fair in November. Fichet’s newrange of high-security doors attractedwide interest – and new volumes – andinvestments in production are beingstepped up to meet demand fromFrance, Belgium and Spain.

Improved growth driven by security and safety demands

South Europe:


GROUP VICE PRESIDENT ASSA ABLOY: BO DANKIS

FRANCEBezault S.A.Manufactures door and window fittings.Managing Director: Michel Brassié

Fichet Serrurerie BâtimentManufactures high-security cylinders, high-security locks and security doors. Managing Director: Robert Fidanza

JPM S.A.Manufactures locks, cylinders, panic bars and escape fittings.Managing Director: Eric Baudru

Laperche S.A./ICBManufactures multipoint locks, cylinders and electromechanical locks.Managing Director: Robert Fidanza

Stremler S.A.Manufactures locks and fittings for glass and aluminum-frame doors.Managing Director: Robert Fidanza

Vachette S.A.Manufactures locks, multipoint locks, high-security cylinders, panicbars and escape fittings.Managing Director: Frédéric Chanel

Yale Security FranceSells locks, multipoint locks, cylinders and electromechanical locks.Managing Director: Pascal Bureau

BELGIUMDupéray S.A.Specifies locking solutions aimed at large building projects with prod-ucts mainly from IKON, effeff, Abloy and other Group companies.Managing Director: Dominique Osstyn

Litto n.v.Manufactures and sells locks and cylinders with an emphasis on high security.Managing Director: Fernand Clapdorp

SPAINASSA ABLOY IBÉRICA, S.L.Parent company for ASSA ABLOY’s operations in Spain.Vice President: Jorge García MartínezVice President: Jose Agustin Telleria

AZBE B. ZUBIA, S.A.Manufactures and markets a complete portfolio, through fourBusiness Units.Managing Director: Jorge García Martínez

TESA Talleres de Escoriaza S.A.Manufactures a comprehensive range of products including locks,multipoint locks, cylinders and knobsets for buildings.Managing Director: Jose Agustin Telleria

ITALYYale Security Group – ItalySells cylinders, mechanical and electric rim/mortise locks, cabinetlocks, safes and padlocks, in Italy and internationally.Managing Director: Roberto Renzi

Nuova F.E.B. S.r.l.Specializes in the production of locks, electric strikes, panic exitdevices and electrical supplies.Managing Director: Gilberto Allievi

MAB MASELLIS Industriale S.p.A.Manufactures door closers, floor springs and panic exit devices.Managing Director: Gilberto Allievi

Yale Corni Sistemi di Sicurezza S.p.A.Panic devices, aluminum/fire locks and electromechanical/electronicclosing systems. Managing Director: Roberto Renzi

SEK M 2001 2000 1999 1998 1997

Sales 2,905 2,232 1,682 1,559 901






locks, 7%


Trends

South Europe:Sales by companies in the SouthEurope organization in 2001 amountedto SEK 2,905 M (2,232). Organic growthfor comparable units was 4 percent.

In Italy, Nuova f.e.b. launched a new lineof panic exit devices and also a newdesign concept for panic exit devices,designed in Milan.

The cliq technology was acclaimedat its French launch at the Eiffel Towerin October. The industry is eagerlyawaiting the first deliveries in early2002.

The South Europe group is veryactive in the various European com-mittees for standards and certification.Possibly the most significant advancesare in panic exit devices, where assaabloy is the regional market leader. Allunits will apply for the new ce certifi-cations and markings as they becomeavailable in early 2002, before becoming mandatory later.

Integration regionally and within the GroupThe integration of the newly acquiredcompanies is proceeding well. Newmanagement structures developed inthe creation of a South Europe regioncater for ongoing communication andinformation flow.

Cross-border trade between thecompanies is becoming important asrelations improve. Litto in Belgium hasdistributed Vachette products for twoyears now, while jpm panic exit devicesgo to the Belgian market via Dupéray.

azbe in Spain is introducing door closers and panic exit devices fromFrance. Yale in Italy is sourcing high-security cylinders from Vachette andcomplementary products from Nuovaf.e.b. Yale products also go to severalFrench companies. Even more ties arein the making.

The French group has actively cul-tivated common projects since 1997and is now a well functioning team.During 2001 a successful ManagementTraining Program was started wheretwelve young potential managers weretrained in business and assa abloyvalues and strategies. The programwill be extended to the entire SouthEurope region from early 2002. It is anexcellent tool both for internal groom-ing of new generations of managersand for company integration.

The South Europe region will hostone of the Volvo Ocean Race stopoversat La Rochelle, France in May 2002.Preparations are well underway, handled by a project team from all thecountries.

Other projects conducted region-ally are Supply Management andPurchase Coordination, an it Forum, aBrand Management Council and seve-ral business development projects.

The Opéra Garnier in Paris, with its ceiling paintings by Chagall and crystal chandelier weighing over six tons, remains the masterpiece of the French architect Charles Garnier (1825-1898). Since 1989 theopera house has been protected by a high-security masterkey system from JPM using over 400 KESOcylinders as well as rim locks matching the style of the building. This system is continually updated withthe latest technologies.



assa abloy uk, which was formedafter the acquisition of Yale IntruderSecurity in late 2000, has pursued apolicy of integration while takingadvantage of the strength of the indivi-dual Group companies operating in theuk. Each company has its ownstrengths in products and marketing,and the aim is to develop these uniqueaspects while facilitating cross-learningand synergies that achieve cost savingsand spread best practice.

assa abloy uk is the country’s largest supplier of door and windowsecurity products and has a dominantposition in the high-security lock mar-ket. But it currently enjoys a relativelysmall market share of the general doorand window hardware market. Thisleaves exciting opportunities to capita-lize on its strong brands, market pres-ence and access to Group products andto introduce new products in manyancillary areas such as door closers,door handles and window hardware.

Separately, assa abloy uk is themajor uk-based automotive lock sup-plier.

Chubb Locks Custodial Servicesdominates the jail-sector lock businessin the uk, and together with Union-brand products contributes to exportsamounting to sek 210 m.

Extensive strategic market researchhas been undertaken to plan the ukgroup’s development using its strongnational brands and companies, supplemented by the vast range ofproducts available from the globalassa abloy group. This evaluation hasidentified opportunities for all the ukcompanies to develop without unduelevels of intra-Group competition. Thetwin aims are to give existing custo-mers greater choice by enlarging theproduct range, and to expand the

customer base. During 2001 each company progressed in line with thisstrategy:

• Abloy Security and assa continued togrow in the high-security commercialsegments with the support of theNordic factories and the introductionof new keying and electromechanicalproducts. Abloy focuses on distribut-ing through locksmiths and securitycenters while assa supports the speci-fication of solutions for institutionalbuildings via architects and builders.

• Grorud, supplying fittings to doorand window manufacturers, grewstrongly after the acquisition of aprincipal supplier and significantnew contracts in the British oemmarket.

• Chubb Lock Custodial Servicescommissioned the construction of apurpose-built site to accommodateall the manufacturing and admini-strative/sales functions of the compa-ny. This confirmed its commitmentto supplying a total service to custo-dial establishments, and continuesthe development of sophisticatedsystems that meet the stringentdemands for economy and security inprivate and state-run jails and othersecure establishments.

• C E Marshall invested in added magnesium diecasting capacity tosupport the growing market forlightweight steering-column locks,and maintained its profitability despite a difficult year in the auto-motive field. By year end it was collaborating with assa abloy’sother car-lock manufacturer fab ofthe Czech Republic to pursue newopportunities.

• Yale Security Products focused oncontinued operational efficiency

improvements and the developmentof new product plans to support the repositioning of its Yale, Unionand Chubb brands. With this repositioning Yale will focus on residential products and the securityof private accommodation, Unionwill develop a wide range of productsfrom within the Group to supportcommercial specifiers and ironmongers,and Chubb will provide high-security,technically advanced products forboth markets.

Market and market trendsWhile the overall market was difficultand remains largely price-driven,significant opportunities for high-specification products have supportedthe focused strategies of assa, Abloyand Grorud and their continuedgrowth. This reflects the underlyingincrease in awareness of security, drivenby rising criminality and increasedaccumulation of personal possessionsand other valuable assets such as information.

The repositioning of the Yale,Union and Chubb brands, and theintroduction of innovative and higher-value-added products, will offer themarket attractive alternatives to theplethora of imported copycat products.

Despite the difficult overall market,assa abloy uk was able to maintain orincrease sales in most segments whileimproving margins during the year.Particular emphasis was placed onrestructuring and repositioning Yale inthis regard and has resulted in a stronginitial order intake in 2002.

The trend towards higher securitySecurity requirements continue to grow,and the companies work together with

Group synergies, integration andstrong brands stabilize sales

United Kingdom:


GROUP VICE PRESIDENT ASSA ABLOY: GEOFF NORCOTT

Abloy Security Ltd.Primarily markets ABLOY electromechanical locks,padlocks and industrial locks.Managing Director: Robin Rice

ASSA Ltd.Markets a complete range of ASSA, Ruko and SOLID lock products.Managing Director: Paul Green

Grorud Industries Ltd.Manufactures and markets door and window fittings.Managing Director: Bjørn Mønster

C E Marshall (Wolverhampton) LtdManufactures and supplies high-security locks and door handles as original equipment items to the automotive industry.Managing Director: Raymond Dovey

Yale Security Products UK LtdManufactures and markets a complete range of door locks, padlocks and architectural hardwareunder the Yale, Chubb and Union brands.Managing Director: Michael Rayner

Chubb Locks Custodial Services LimitedProvides custodial locking products and systems tocorrectional facilities worldwide.Managing Director: Steve Wood

SEK M 2001 2000 1999 1998 1997

Sales 1,545 665 270 266 236

Average no.of employees 1,795 704 128 132 147





locks, 6%


Trends

United Kingdom:Sales by companies in the UKorganization in 2001 amounted to SEK 1,545 M (665). Organic growth for comparable units was 8 percent.

government organizations, insurancecompanies and Standardization bodiesto increase consumers’ awareness ofstandards and the products and solu-tions available.

Focus on the end-user has beenassisted by the Yale Security Road-show, a purpose-built mobile exhibi-tion which tours the country, visitingtrade shows and supporting customersand local-community activities. Thedisplay aims to inform customers ofgeneral issues related to security andenjoys the support of allied organiza-tions such as ‘Secure by Design’ (apolice initiative), insurance companiesand Neighborhood Watch.

The improvement of security viadoor and window manufacturers hasbeen supported by the introduction ofnew multipoint locking products fromboth Yale and Grorud. This focus onfitting by the manufacturer will protectfuture sales.

Customer research for new prod-ucts focuses on end-users’ desire forproducts that are both functional andappealing, and has revealed significantopportunities to raise public awarenessof security products. Packaging, advert-ising and point-of-sale displays are therefore directed towards customereducation to increase understanding ofthe products’ technical superiority.

Integration regionally and worldwideThe integration of the uk group hasprogressed well, exploiting opportuni-ties to share production facilities, skillsand services. The companies’ combinedknowledge has been incorporated in aproduct/market matrix, from whichstrategies to best utilize each company’sstrengths in products and marketinghave been defined.

In the drive to reposition the Yale,Chubb and Union brands, resourceshave been seconded from Australia,Sweden and Finland.

In critical product areas, strategiesutilizing products, designs and market-ing programs from other Group com-panies have been developed. There willbe significant new product launches in2002 based on cross-buying, localmanufacture and joint sourcing strat-egies. A typical initiative will be theextension of the successful padlockrange from Lockwood in Australia toYale uk.

Supported by the Volvo OceanRace initiative, a real momentum hasbeen developed in the former YaleIntruder Security companies which willmanifest itself in a more proactive andconfident uk group over the next fewyears.

The National Security Roadshow is a mobile exhibition center created by Yale Security Products UK.It attends customer open days, exhibitions and conferences, publicizing both the Volvo Ocean Raceparticipation and the latest high-security products.



The operations of assa abloy northamerica have undergone strong and rapidexpansion which has resulted in a doub-ling in size over the last 15 months.Following the addition of the Yale Secu-rity Group in late 2000, Phillips andtesa in Mexico were acquired during2001, while in the usa the Door Groupjoint venture with spx Corporation hasbrought four new companies into theNorth American organization: Ceco,Dominion, Fleming and Trussbilt.

Today the North American groupconsists of more than 30 operatingunits and employs over 10,000 people.Organic growth has been stable at alevel well above the general growth ofthe economy and the market. ebita(operating margin before goodwillamortization) has also developed positively, both as a result of improvedperformance by companies in the ‘old’group and through efforts focused onintegrating the new companies into thegroup. During 2001 these companieshave already been able to report gainsin efficiency and reduced overheadcosts which have had a positive impacton the group’s earnings.

assa abloy’s participation in theVolvo Ocean Race has spread Groupculture and enhanced team spiritamong the American companies. It hasalso played an important role in inte-grating new units. And all this, longbefore the boats even have arrived toNorth American waters.

At a time of strong growth it is crit-ical to create the right environment tosupport efficient integration of the newunits as well as to ensure that availablesynergies are exploited to the maximumpossible extent. The overall objective isto create profitable and sustainableorganic growth for the group. By midyear a new structure had been laun-

ched with the three main objectives ofcontinued and strengthened focus onoperational excellence, increased focuson product development to ensuresatisfactory levels of innovation andspeed to market, and finally a broade-ning of market coverage through addi-tional coordination and focus.

In the new structure, companiesand units with a common base in termsof products and operations have beenbrought together, and two additionalgroups with similar market focus andgeographical coverage have been formed. The new structure consists offive product-based groups:

• Architectural Hardware Group –Corbin Russwin, McKinney, Norton,Rixson, Sargent, Yale CommercialLocks and Hardware

• Door Group – Ceco, Curries,Dominion, Fleming, Graham,Trussbilt

• High Security and AftermarketGroup – Abloy, Arrow, ASSA, Medeco,Mul-T-Lock, NEL

• Electromechanical Group – FolgerAdam Electric Door Control, HES(Hanchett Entry Systems), Securitron

• Residential Group – Emtek, YaleResidential

The two main sales and marketingorganizations – essex and ysg (YaleSecurity Group) – will be kept separateto support the new strategy of offeringmore than one alternative in each mar-ket. Additional coordination andbrand positioning are other importantelements in this strategy.

The operations in Canada andMexico will also be run as separate butcoordinated units.

Even though the successful integra-tion of the North American group and

exploitation of synergies will depend ondevelopment within each of the indivi-dual groupings above, there are alsosubstantial opportunities for cross-groupcollaboration, such as closer marketcoordination between Ceco and ysg,and cooperation in the detention mar-ket between Trussbilt and Folger Adam.

USA The market situation in the usa has softened during the year. A slowdownin new construction was detected quiteearly in the year. This was compensatedto some extent by continued stabledevelopment in sectors of prime impor-tance for the us group – institutionalconstruction in general and the educa-tional sector in particular. The negativeimpact that the events of September 11have had on the economy as a wholehas further slowed down overall con-struction activity. Added emphasis onsecurity and security upgrades isexpected to have a positive impact onparts of the assa abloy business overthe next few years. But it is too early tosay whether this positive impact willcompletely balance the negative impactfrom the softer economy.

The us group has developed positi-vely during the year and shows overallorganic growth of 4 percent with gains inparticular for Emtek, hes and YaleResidential. The group’s general marketposition has been strengthened duringthe year.

Integration of the new units hasprogressed well and is ahead of plan.For the Yale Security Group the addi-tional focus on operational efficiency,price stability and reducing overheadcosts has paid off in lower inventory,increased margins and improved overallprofitability. Even though sales havebeen somewhat soft, the gains in

New structures sustain development of a group doubled in size

North America:


GROUP VICE PRESIDENT ASSA ABLOY: CLAS THELIN

USA ESSEX Industries, Inc.Joint sales operation for Curries, Graham, HES, McKinney,Sargent and Securitron, with focus on the institutional construction market.Vice President, Sales and Marketing: Joseph J Hynds, Jr

Yale Security Group (YSG) Sales, marketing, service, and support for Ceco Door Products,Corbin Russwin Architectural Hardware, Folger Adam ElectricDoor Controls, Norton Door Controls, Rixson Specialty DoorControls and Yale Commercial Locks and Hardware. Vice President, Sales and Marketing: Larry Bonhaus

Folger Adam Security Inc.Supplier of locks and hardware to the highest-security markets,such as detention and correctional facilities.President: Donald C Stading

ARCHITECTURAL HARDWARE GROUPPresident: Thanasis Molokotos

Corbin Russwin Architectural HardwareManufactures a full range of architectural door hardware andlocks, including mechanical and electromechanical mortise andcylindrical locks, panic exit devices, door closers and cylinders. General Manager: Dan Daino

McKinney Products CompanyManufactures a broad, complete line of hinges.General Manager. John Cordes

Norton Door Controls Manufactures a comprehensive range of mechanical and electromechanical surface door closers, door holders and ADA automatic door operators. General Manager: Doug Millikan

Rixson Specialty Door ControlsManufactures concealed closers, pivots, and mechanical/electromechanical door holders, particularly suitable for specialapplications involving heavier doors, stringent esthetic requirements or other unique openings. General Manager: Eric Tannhauser

Sargent Manufacturing CompanyManufactures a complete line of locks and door hardware with awide range of cylindrical locks, mortise locks, exit devices, doorclosers, electromechanical products and cylinder systems.Director of Operations: Rich Hafersat

Yale Commercial Locks and HardwareManufactures a wide range of commercial door hardware andlocks, including mechanical and electromechanical mortise andcylindrical locks, panic exit devices, door closers and cylinders. General Manager: Dick Krajewski

DOOR GROUP (USA AND CANADA)President: Ben Fellows

Ceco Door Products Manufactures a broad range of steel doors and frames forcommercial, industrial and institutional construction markets. President: Carl Hellman

Curries CompanyManufactures a full range of hollow metal doors and frames withprimary focus on the institutional and commercial market.President: Jerry N Currie

Dominion Building ProductsManufactures a full range of steel frames and doors, aluminumwindows and preassembled door units for industrial pre-engineered buildings.President: Tom Granitz

Fleming Door Products, LtdCanada’s largest manufacturer of steel doors and frames for thenon-residential building market.President: Bill Strong

Graham Manufacturing CorporationManufactures architectural flush wood doors.President: Jerry N Currie

TrussbiltManufactures high-quality security hollow metal products primarilyfor the detention market, with a market leading position in thissegment.President: Steve Wolgamot

HIGH SECURITY AND AFTERMARKET GROUPAbloy Security Inc.Active in the market for industrial locks.President: Jeffrey Carpenter (acting)

Arrow Lock Manufacturing CompanyMechanical locks and lock cylinders, with an emphasis on theaftermarket and the north-eastern USA.President: Charles E. Armstrong

profitability have far outweighed anynegative impact on the sales side. Thecreation of the Architectural HardwareGroup has further speeded up the integration process and ensured improved utilization of resources andfurther cross-learning between themember companies.

Folger Adam Security is wellunderway to regain its leadership rolein detention security. Additional focuson the core business, right sizing of theoperation and a strong emphasis onefficiency should bring the companyback to double-digit profitability in thenext 12 to 18 months. To support thisprocess, the loss-making WilliamBayley window division will be discontinued.

The assa abloy Door Group, formed in April 2001 as a joint venturewith spx Corporation, also showsgood progress towards integration. In the joint venture assa abloy has 80 percent ownership, managementresponsibility and the right to buy the remaining shares after two years,so in practical terms the operationalready acts as part of the us group.The rationale for the agreement wasthat the minority partner was a leading producer of security and safetysteel doors that were often sold in conjunction with Yale door hardware

and were complementary to the doorsmade by the assa abloy companiesCurries and Graham.

Curries and Ceco, the two largestunits in the Door Group and also theones with most similar market presen-ce, complement each other well:Curries with its main focus on framesand custom doors and Ceco with an excellent operation producing standarddoors. It is expected that it will bepossible to exploit further synergiesduring the next one to two yearsthrough a focused and differentiatedinvestment program.

Trussbilt, the Door Group’s sup-plier of doors and hollow-metal framesto the detention industry, has success-fully built up a very strong backlog oforders over the last year. A substantialportion of this business is coming fromnew products and services, which ispromising for the future since it hasexpanded the company’s potentialmarket. Some of these new productscan also be used outside the detentionindustry in applications where increasedsecurity is of importance.

The strongest growth in the usgroup has been on the residential side.Emtek has achieved growth exceeding50 percent for the second year runningand continues to develop positively inits chosen niche of the market – decor-

North America:Sales by companies in the NorthAmerican organization in 2001 amounted to SEK 9,682 M (5,409).Organic growth for comparable unitswas 4 percent.

The new addition to the Minneapolis Convention Center combines the solid traditional security of aSARGENT mechanical key system with a SECURITRON digital entry system and exit delay system.Exit delay systems secure exterior doors electronically while permitting authorized entry, but delayunauthorized egress from within, so reducing loss from theft.



ative locks and hardware for homes ofdistinction. Yale Residential alsoshows strong growth in both retailsales and sales to builders. During theyear the two residential companieshave successfully launched a significantnumber of new products to supportthis growth.

The formation of a product groupfocusing specifically on High Securityand the Aftermarket (where most deci-sions for security upgrades are made)provides increased opportunities toinfluence the trend towards highersecurity. The member companies takejoint initiatives to broaden this marketby increasing demand for high-securityproducts. Within the framework of theNational Crime Prevention Council(ncpc), the assa abloy group is one ofthe main sponsors of the NationalSafety and Security Council (nssc),committed to increasing awareness ofsafety and security measures that canprevent crime.

In order to take advantage of thestrength that the different companieshave built up over the years, there is aneed for further brand positioning andcoordination of sales and marketingefforts. The characteristics of local marketsvary, based on traditions, distributorsupport and previous geographic cove-

rage. The important work of develo-ping strategies adapted to the differentlocal markets is well underway. Itinvolves the sales forces of all themajor us companies and is coordinatedat national level. The us group’s ove-rall strategy is always to offer the mar-ket more than one alternative.

Coordination and cooperation be-tween companies of the High SecurityGroup and the Architectural HardwareGroup have also increased during theyear. This is essential to drive the trendtowards high security on the new-construction side and to increaseawareness among end-users, specifiers,architects, contractors and otherimportant opinion-formers in this segment of the market.

Many product introductions by theArchitectural Hardware Group havebeen focused on such higher-securityapplications. Sargent has launched anew bored-in lock, of so-called T Zoneconstruction, which offers outstandingperformance and strength. Yale’s newdelayed egress device and CorbinRusswin’s mortise lock for classroomsare other notable launches. Sargent hasalso launched a new family of stand-alone battery-operated access controldevices incorporating proximity tech-nology by hid.

Another initiative aimed at drivingthe trend towards higher security wasthe Building Security program success-fully launched in 2001. assa abloyjoined forces with other companiesincluding Diebold, one of the country’sleading security systems integrators, tooffer end-users a complete package ofsafety and security products and services.

CANADAThe Canadian market has stabilizedafter a relatively soft year in 2000. All companies in the Canadian groupshow stable growth.

The integration process has alsoproceeded smoothly in Canada withthe major focus on further marketcoordination and sharing of best practice in the areas of following-upprospects and projects and managingthe early stages of the sales process.

In addition to the traditionallystrong Sargent, Yale-Corbin, Medecoand Abloy presence on the Canadianmarket, significant inroads have beenmade for McKinney, Securitron, hesand Mul-T-Lock. This success has beenbased on focused efforts to utilize exis-ting channels to the market and buildon the strength of the established units.

Canada is traditionally a stronghigh-security market. The main potential

The US architectural profession's highest prize – the 2001 AIA Honor Award for Interior Architecture – has gone to architects Hardy Holzman Pfeifer Associatesfor their dazzling restoration of New York's famous Radio City Music Hall, originally built in 1932. The glittering new hall uses Yale Security Group hardwarethroughout, including Rixson floor closers with special layouts, Corbin Russwin ML2000 locksets and Norton 7500 closers.


SEK M 2001 2000 1999 1998 1997

Sales 9,682 5,409 3,721 2,916 2,402






locks, 9%


Trends

for further growth in this segment is by increasing the base during the new-construction phase. This is there-fore the main emphasis of assa abloy’sefforts to drive the trend towards highersecurity. Leads are now shared betweenthe companies, and a more cooperativeapproach is used to sell high-securitysolutions in the new-construction market. Implementation has so far beensuccessful and well received by the market. With the broad range of products available it has been possibleto offer different high-security solutionsbased on individual customer needs.

MEXICOEven though growth in the Mexicanmarket in 2001 was considerably lowerthan for the last 4-5 years, the situationis very promising since this has been themost stable first year of office for manyyears for any newly elected MexicanPresident. The underlying need for construction is also very strong in thisfast-expanding market. However, theMexican economy’s strong dependenceon the usa means that it is likely to benegatively influenced by the slowdownthere.

The Mexican group consists of YaleSecurity Mexico (the new name forScovill), tesa and Phillips – three

companies with different focus andstrengths. Phillips is the market leaderin traditional Mexican locking prod-ucts and padlocks, while Yale and tesaare more focused on American-stylebored-in locks. Both Yale and tesahave stable market positions in Mexicobut also play a significant role in cost-efficient sourcing of products for the usmarket.

tesa has been a main supplier ofproducts to Yale Residential in the usafor some years, and Yale SecurityMexico is playing an ever bigger role asa cost-efficient source of products soldby Arrow in the usa.

Integration in Mexico has only juststarted, since the closing of the Phillipstransaction took place in Septemberand tesa joined the group in November.A Country Manager was recruitedfrom the industry in September and thenew management team has alreadyidentified a number of areas to address.They include cross-sourcing of productsand components, better utilization of the total production resources,development of best practice on themanufacturing side and coordinationof purchasing and export activities.

ASSA Inc.Occupies a leading position in the high-security segment of themarket.National Sales Manager: Thomas Demont

Medeco Security Locks Inc.Market leader in high-security locks and lock systems for doorsand industrial applications.President: Robert Cook

NEL Corporation Primarily focuses on marketing and sales of exterior security rimlocks under the SEGAL brand.Director: Joseph Kingma

ELECTROMECHANICAL GROUP Folger Adam Electric Door Controls Manufactures an extensive range of electric strikes, electro-magnetic locks, power supplies and access control accessories. General Manager: Eric Tannhauser

Hanchett Entry Systems, IncProvides a variety of electromechanical locking products withemphasis on electric strikes.President: Michael Webb

Securitron Magnalock Corp.Market leader in magnetic locks and other electromechanical lockproducts.President: Robert Cook

RESIDENTIAL GROUPEmtek Products Inc.Decorative locks and hardware for the residential market.President: Thomas Millar

Yale Residential Security Products, Inc.Provides residential locksets for both new construction and retailaftermarket applications.President: Craig Dorsher

CANADAASSA ABLOY of Canada Ltd.Markets and sells Sargent, McKinney, Arrow, Securitron and HESproducts in Canada. Responsible for overall market coordinationin Canada including also Abloy and Medeco.President: Greg M Erwin

Abloy Canada Inc.Markets and sells ABLOY products in Canada.President: Stephen Timmons

Medeco of CanadaMarkets and sells Medeco products in Canada.Director: Alan Heaney

Yale-Corbin Canada Limited Canadian distribution company for Yale Security Group.President: Bill McLean

MEXICOCountry Manager: Jorge Arnau

Grupo Industrial Phillips S.A de C.V.Leader in the Mexican market for locks and padlocks, manu-facturer of a complete line of rim and mortise locks, hinges, padlocks and door hardware under the brands PHILLIPS and PARKER.President: Juan Manuel Mozas

Tesa, S.A. de C.V.Residential locksets manufactured and assembled for new construction, retail aftermarket applications and export under the brands TESA and THOR.President: Lars-Inge Aronsson

Yale Security MexicoMarket leader in Mexico in cylindrical and tubular locks under thebrands YALE and SEGUREX. Responsible for distribution ofTOVER locks.President: Roberto Lebrija Pariente



assa abloy south pacific was formedduring 2001 to coordinate the operations of this region. At the startof the year operations consisted ofAbloy Security Limited in Australia(100 percent owned), LockwoodSecurity Products of Australia andLockwood Arrow of New Zealand(both 50 percent) and TrimecTechnology in Australia (100 percent).

In April 2001 Lockwood SecurityProducts (including Lockwood Arrownz) became a wholly owned subsidiaryof assa abloy ab when the former50/50 joint-venture partner EmailLimited sold its interests under a priorarrangement. However, these opera-tions have been managed as whollyowned assa abloy companies since1999 and much of their success is dueto the resulting synergies.

In October 2001 assa abloy ac-quired Interlock Group of NewZealand, strengthening the Group’sposition in New Zealand and bringingwith it valuable knowledge of the oemwindow market and innovative products and production techniques.Half of Interlock’s sales are exported,primarily to the usa and Japan.

Market and market trendsDuring the first half of 2001 theAustralian market continued to sufferthe effects of the 10 percent Goods andServices Tax imposed on 1 July 2000.This particularly affected the residen-tial market. However, by the end of thethird quarter a recovery was wellunderway.

Lockwood’s aggressive productintroduction strategy, focusing particu-larly on higher-specification commer-cial products, resulted in organic growthof 4 percent for the year despite a softresidential market.

With the residential market recoveringand the launching of new productsunabated, 2001 has set a firm base forthe promotion of a wider range of pro-ducts – both locally manufactured andGroup-sourced – in coming years.

The New Zealand market recov-ered towards the end of 2001 and willprovide many opportunities in futureyears, helped by a new door-closerrange from Lockwood Arrow andsynergies resulting from the Interlockacquisition.

The export market, particularly toAsia, has been difficult, but addedresources and restructuring of the assaabloy asia Sales Offices have producedan initial improvement in results.

The trend towards higher securityWhile security demands are increasingin the area, there are also opportunitiesfor products that improve sealing andenergy conservation, particularly in thewindow market.

With Lockwood’s technical re-sources, significant input can be madeto the development of standards and,in conjunction with major door and window manufacturers, of moresophisticated products to enhance safetyand security in residential and commer-cial applications. Interlock’s innovativerange will also enhance convenience,esthetics and cost-effectiveness.

This drive to high-value productsgives window and door manufacturersand builders the opportunity to dis-tinguish themselves from the cost-driven end of the market and promote addedproduct features and customer benefits.

Lockwood and Abloy retain amajority share of the commercial marketsegment and supply the most highlydeveloped keying systems available,

based on Scandinavian designs.Abloy’s disk-based technology focuseson the industrial market but also offerscommercial building customers analternative to Lockwood’s more tradi-tional pinned cylinder systems.

The companies use the develop-ment of standards to promote thetrend to higher security directly to thepublic via diy stores and locksmiths.For example, Lockwood’s new pad-lock range is supported by a newAustralian Standard drafted by thecompany and based on the EuropeanStandard. In addition, the LockwoodTwin Security Council, comprisingcompany representatives and a net-work of leading locksmiths, promotesthe assa abloy philosophy of the‘positive spiral’.

Modified versions of existingResidential and Commercial TrainingPackages are now used to train policepersonnel in most Australian states,and cooperation with NeighborhoodWatch schemes continually improvescommunity awareness.

Integration regionally and worldwideA significant contribution to the presentposition of Lockwood in the Austra-lian market is attributable to the transfer of products and knowledgefrom the Group.

The Twin Keying product line(supported by Assa, Sweden) and thepanic exit device range (supported byjpm, France) are two good examples.In both these cases Lockwood was ableto launch sophisticated products to themarket cost-effectively and rapidly andthereby accelerate the promotion ofthe trend to higher security.

More recently, Lockwood has beenable to support other Group companies

Integration benefits the region and the Group

South Pacific:


such as Yale uk with Australian devel-opments such as its new padlock range(providing both the product and themarketing approach). This has alsoenabled our major suppliers to benefitfrom increased volumes generated bycoordinated Group purchasing.

Joint marketing programs havebeen developed with Union (uk) to addTrimec and Lockwood to the rangesold by Union in the Middle East. TheAustralian companies will supplyUnion-branded products to expand theoffering to architectural customersthere.

Opportunities have been taken tosource products from within theGroup. For example, Guli (China)now manufactures window-stays forLockwood that were previouslybought from Asian companies outsidethe Group.

The future product range for theregion will utilize the expertise ofTrimec in electromechanical applica-tions to add value and flexibility tomechanical ranges that are alreadyoutstanding.

The acquisition of Interlock createsopportunities for a new range of win-dow products to be added to other

Group companies’ ranges and for theexchange of production techniques andcoordination of purchasing in theregion.

Despite the distances involved,assa abloy south pacific is active inmany of the Group’s central councilssuch as Product Councils and SourcingCouncils. It derives considerable bene-fit from them, and provides equallyvaluable input.

Sound foundations have been laidand growth is accelerating for this partof assa abloy. Its performance andimpact on the Group are expected to show increasing benefits over the next few years. The success of theassa abloy racing team (winningboth the Sydney to Hobart Race andLeg 3 of the Volvo Ocean Race –Sydney to Auckland) underpinned an extremely successful integrationprogram particularly within the widerassa abloy south pacific community,including not only employees butcustomers and business partners.

GROUP VICE PRESIDENT ASSA ABLOY: GEOFF NORCOTT

AUSTRALIA

Lockwood Security Products Pty LimitedManufactures and markets lock products such as door and window hardware, mortise locks, rim locks and door closers for the Australian residential and commercial markets.President: Geoff NorcottGeneral Manager Commercial Products: Joe PereraGeneral Manager Residential Products: Edgar Chin

Abloy Security Pty Ltd.Markets and sells the full range of ABLOY products.Managing Director: Joe Lahoud

Trimec Technology Pty Ltd.Manufactures electric strikes and related products for Australian and international markets.Managing Director: Roy Bowyer

NEW ZEALAND

Interlock Group LimitedManufactures and distributes door and window security hardware in the New Zealand market andexports to OEMs in USA, Japan, UK and Canada.Managing Director: Anthony Gledhill

Lockwood Arrow Ltd.Manufactures door closers and markets Lockwood products on the New Zealand market.Manager: Bruce Pollard

SEK M 2001 2000 1999 1998 1997

Sales 841 772 590 – –

Average no.of employees 1,098 1,004 1,111 – –





locks, 7%


Trends

South Pacific:Sales by companies in the SouthPacific organization in 2001 amountedto SEK 841 M (772). Organic growth forcomparable units was 3 percent.

A system for grading the security performance of padlocks, developed by Lockwood Security Productsin Australia to guide customers to the correct padlock selection for their application, has since beenadopted as the official Australian Padlock Standard.



ASIAIn the past two years the Group’s inter-ests in Asia have been greatly expan-ded by the Yale and Lockwood acqui-sitions. During 2001 the operations ineach country were integrated under theholding company formed last year,assa abloy asia.

Market and market trendsThe Asian economies remained weakdue to the global economic slowdownfollowing the terrorist attacks in theusa. Regional instability in Indonesiaand the Philippines further promptedmany governments to downgrade fore-casts for economic growth. However,China’s entry into the World TradeOrganization in early 2002 and hostingof the 2008 Olympic Games will offsetsome of the negative economic impact.

Yale and Guli remained the majorretail brands in Asia. diy has developedsignificantly, rapidly complementing the traditional hardware distributionchannels. Product lead-time and servicelevel to the diy sector provide animportant competitive edge.

The Group also focused on projectspecification. Major projects achievedin China include the Beijing head-quarters of the Bank of China and theIndustrial and Commercial Bank ofChina, Plaza 66 in Shanghai, and theBeijing International School.

The trend towards higher security assa abloy asia continues to lead thetrend toward higher security. In China,the government adopted the Group’stesting procedures for door closers andmortise locks as industry standards. In Malaysia, the Institute of FireEngineers appointed assa abloy to theTechnical Committee for drafting new

fire-door hardware standards. 2002will focus on establishing SecurityCenters throughout the region to educate the market and to enhance service level. Guli’s technical servicecenters in China will continue to providetechnical support and 24-hour emergency lock-out service.

Integration regionally and worldwideUnder the unifying influence of theVolvo Ocean Race, business integra-tion progressed well. The Chinesemanufacturing company becamewholly-owned in February and thename was changed to Guli SecurityProducts, focusing on the local brand.The assa abloy businesses in China –Yale, Guli and effeff – were integratedinto assa abloy china. In Hong Kong,Singapore, Malaysia and Thailandsimilarly, assa abloy, Lockwood andYale businesses were consolidated,achieving significant business synergiesthrough cross-learning, overheadsavings and sharing of project informa-tion and technical knowledge. To support continuing expansion, assaabloy philippines and a presence inIndia will be established in 2002.

EASTERN EUROPEIn 2001 most of the Group’s marketsin eastern Europe developed well.

In the Baltic countries Abloy isrepresented by the subsidiary Abloy OyEesti Filiaal in Estonia and representa-tive offices in Latvia and Lithuania.Assa’s Estonian subsidiary assabaltmarkets the products of the Group’sSwedish companies in all three Balticcountries.

Good organic growth continued inLatvia and Lithuania, and assa abloyhas further developed the distribution

network. A notable project is the SakuSuurhall sport and concert hall inTallinn, Estonia, where the EurovisionSong Contest will be held in 2002.

In the Czech Republic andSlovakia, assa abloy’s organizationconsists of fab, the Czech Republic’slargest lock company, and fab Slovakia.The sales company fab Projekt wasintegrated into fab in 2001.

The local distributor of Abloy andVingCard products was acquired in2001 and the business was renamedAbloy Czech and Abloy Slovakia. Bothcompanies have developed very well.Abloy Czech has been integrated intothe Czech organization and now alsodistributes electromechanical productsfrom effeff in Germany and Securitronin the usa. fab has broadened its port-folio and continues to add productsfrom other Group companies, mostlymarketed under its own brand.

2001 saw moderate growth as theeconomy picked up after recession.Construction locking and sales of electromechanical products havedeveloped particularly well, but revenues from car locks remainedweak. Demand for higher-security products continued to grow, and the on-going development of the diy businessincreased direct sales during the year.

In Hungary, the sales companyassa abloy hungary is developing wellin a very fragmented market. There areencouraging signs of growing demandin the high-security segment.

In Poland the Group’s sales arehandled by assa abloy poland, whichhas a strong position in the high end of the lock market. After some strongyears the Polish economy has weakenedsignificantly and new-constructionactivity has leveled out. Nonethelesssales were maintained at the level of

Continued strong growth reinforced byintegration and international projects

New Markets:


2000, and awareness of high-securityproducts is continuing to increase. The Polish Telecom headquarters is anotable project due to be completedearly in 2002.

In Romania the Group is repre-sented by assa abloy romania, whichmarkets high-security products fromGroup companies including Assa andVingCard, and by the manufacturerUrbis Security, which holds a leadingposition on the Romanian lock market.

During 2001, a new company,Urbis International, was formed tomanufacture door hardware for Groupcompanies. The relocation of produc-tion machinery from Grorud inNorway, begun last year, was com-pleted and production technology wasupgraded by major investment in anew surface treatment plant.

Despite a difficult market and acontinuing weak economy, assa abloyromania achieved good organicgrowth, especially in the high-securityand hotel sectors, while Urbis main-tained domestic sales at 2000 levels.

SOUTH AMERICAassa abloy’s interests in SouthAmerica consist of the lock manufac-turer La Fonte in Brazil.

Market and market trendsIn a highly fragmented and stronglycompetitive Brazilian market shared by more than fifteen companies, salesvolumes were comparable to last year’s.Organic growth fell back, but La Fonteremains the market-leading brand andthe leader in technology in Brazil, andits awareness of market needs meansthat prospects for future sales growthare highly positive. Increased construc-tion in 2001 was not enough to offsetthe enormous housing shortage, whichis likely to provide excellent futuresales opportunities.

Brazilian customers remain prima-rily concerned with new designs andstyles, but there are signs of increasedinterest in quality and customer serviceand in higher-security products andsolutions.

Sales of Yale-branded products toother South American countries haveincreased, based on a closer relation-ship with the local distributors. In theseareas the prospects for strong organicgrowth are also positive.

The trend towards higher securityA general sense of insecurity in Brazil isdriving the locks market and the lockindustry towards higher security.

GROUP VICE PRESIDENT ASSA ABLOY: ÅKE SUND

ASIA

ASSA ABLOY Asia Pacific LimitedActs as holding company for the Asia region, marketing and selling Group products primarily for commercial, institutional, residential and industrialapplications across Asia.President and CEO: C.K. Jeang

Guli Security Products LimitedThe largest lock factory in China, manufacturing andsupplying primarily residential locks and door closers forChina and international markets. Sales are conductedfrom its headquarters in Zhongshan, Guangdong, supported by four strategic business units and branchoffices in Beijing, Shanghai, Chongqing and Wuhan. Managing Director: C.K. Jeang

ASSA ABLOY Hong Kong LimitedResponsible for all sales and marketing activities in North Asia (excluding China) covering Hong Kong,Taiwan, the Philippines, Japan, Korea, Vietnam,Myanmar, Cambodia and Laos.General Manager: Keith Chan

ASSA ABLOY Singapore Pte LimitedResponsible for all sales and marketing activities inSouth Asia (excluding Malaysia and Thailand) coveringSingapore, India, Pakistan, Bangladesh and Indonesia.Managing Director: Jim Heng Lee

ASSA ABLOY Malaysia Sdn BhdResponsible for sales and marketing activities in Malaysia.Managing Director: Michael Pan

ASSA ABLOY (Thailand) LimitedResponsible for sales and marketing activities in Thailand.Managing Director: Tab Teh

THE BALTIC COUNTRIES

ASSABalt AS Markets and sells ASSA products in the Baltic countries.President: Tarmo Talvet

Abloy Oy Eesti FiliaalMarkets and sells ABLOY products in the Baltic countries.Manager: Ahti Ovaskainen

CZECH REPUBLIC

FAB a.s.Manufactures and markets construction locks, industrial locks, padlocks, cable locks and car locks. President: Vladimir Bayer

Abloy Czech s.r.o.Markets and sells Abloy, VingCard, effeff and Securitron products in Czech Republic.President: Tomas Richter

SLOVAKIA

FAB Slovakia s.r.o.Manufactures lock cases; markets and sells other FAB products.President: Jaroslav Holzer

Abloy Slovakia s.r.o.Markets and sells Abloy, VingCard, effeff and Securitron products in Slovakia.President: Tomas Richter

HUNGARY

ASSA ABLOY Hungary kft.Markets and sells ASSA ABLOY products in Hungary.Managing Director: Géza Póka

New Markets:Consolidated sales in New Markets in 2001 amounted to SEK 1,764 M (981).Organic growth for comparable units was 18 percent.

Ricardo Orlando, at one of La Fonte’s Metalferco franchise stores in Brazil, demonstrates the resultof a joint project with Mul-T-Lock in Israel.



However demand currently centers onalarm systems and guard services, andlocks are not yet perceived as the maincomponent in improving security.

La Fonte’s strategy is to educate themarket by promoting high-tech productsto dealers, contractors, consultants andopinion makers as well as end-users.The company’s access to the wholerange of assa abloy group productswill give it a significant technicaladvantage over local competitors andavoid the need to engage in price warsover ‘commodity’ products.

Integration regionally and worldwideThe company currently supplies leverhandles to sister companies in the usa.In the other direction, La Fonte hasintroduced a new high-security cylin-der on the Brazilian market as a resultof a partnership with Mul-T-Lock inIsrael, and a partnership has beenestablished to market abloy productsfrom Finland.

Employee satisfaction has in-creased enormously since the companywas acquired by the assa abloygroup. The major efforts made to inte-grate the company and to transmitGroup culture have paid off in impro-ving employees’ confidence about thecompany. The Volvo Ocean Race hasbeen a great unifying factor, with spe-cial events beginning in July 2001 andrunning right through to the Race stopover in Rio de Janeiro in Februaryand March 2002.

SOUTHERN AFRICAA year after the acquisition of Yale-Union in August 2000, the assa abloygroup acquired another leading SouthAfrican lock company, Viro Locks (sa),which complements the product range.A new holding company, assa abloysouth africa, was formed to integratethe companies, which together hold aclear leading position on the SouthAfrican lock market.

Market and market trendsThe South African market is highlycompetitive due to the low per capita

gdp, which tends to push demandtowards low-cost products. The mar-ket was therefore developed during2001 by beginning to resurrect aninsurance grading system for locks andlock solutions.

Much work was done with thePublic Works Department to getGroup products specified for Govern-ment buildings. Presentations to custo-mers explaining the need to promotehigh-security locking products wereaccompanied by the launch of high-security Group products from effeff inGermany and Mul-T-Lock in Israel.Other products have been sourcedfrom Securitron and hid in the usa.

Sales of diy products continue toincrease. The Yale brand is currentlybeing relaunched on the retail marketwith decision-making guides to helpconsumers purchase the right productfor the application.

The trend towards higher securitySouth African consumers have beenpersuaded that for better home securitythey must install burglar bars, alarmsystems, security sensors and panicdevices. assa abloy has now embarkedon a campaign to convince them that achain is only as strong as its weakestlink, and that good locks and lockingsolutions should be re-evaluated forhome security. The Association ofInsurers & Insurance Assessors has beencanvassed to give this campaign legiti-macy. A training academy will also beestablished to educate both staff anddistributors about the benefits of high-security products and provide themwith arguments to sell better lockingsolutions.

A padlock grading system based onEuropean (cen) security Standards willbe introduced and is expected to beendorsed by the South African Bureauof Standards.

Integration regionally and worldwideRationalization of the Yale-Union andViro product ranges was started duringthe year. Cross-learning visits to best-

practice assa abloy factories genera-ted valuable ideas to implement locally.Thus ideas drawn from the Lockwoodpadlock case in Australia are beingused to relaunch the Viro padlockunder the Yale brand.

The Volvo Ocean Race stopover inCape Town was a valuable tool in theintegration of Yale-Union and Virointo the Group (read more about it onpage 27).

ISRAELassa abloy’s subsidiary in Israel, Mul-T-Lock, operates in 70 countriesworldwide and is represented by foursubsidiaries – in the usa, Canada, theuk and France – and some 100 distrib-utors.

Market and market trendsIsrael’s continuing severe recessioncalled for special marketing efforts athome from Mul-T-Lock, its leadinglock manufacturer. The companyexpanded its product range with complementary products purchasedfrom Group companies.

The most significant internationalactivity was in Japan, where Mul-T-Lock seized a major marketing oppor-tunity and launched some twenty specially designed types of cylinder.400,000 cylinders were sold to Japanin 2001, but growing local competitionand a slowdown in demand are nowaffecting sales.

Most other export markets, andespecially the developing countries,have seen continuing sales expansion.In Latin America, special high-securitylocking solutions for telecommunica-tions companies deepened penetrationof the institutional market. In easternEurope the main advance was to doormanufacturers. In western Europe,market shares continued to increase,but slightly more slowly than in 2000. Among the four marketing anddistribution subsidiaries, the penetrationof new products and a substantialincrease in customers gave the Frenchcompany an outstanding growth rate of 30 percent. The uk companycontinued promoting the market for

New Markets:


SEK M 2001 2000 1999 1998 1997

Sales 1,764 981 354 186 68

Average no.of employees 5,777 3,296 1,774 1,936 385





locks, 2%


Trends

Mul-T-Lock’s top-of-the-range E-seriespadlocks. The us company continuedto expand into areas outside New York,while sales in Canada grew by 20 percent.

The trend towards higher securityMul-T-Lock continues to focus invest-ment on r&d. A new ElectromechanicsDepartment was established during theyear to develop products using thecliq technology. The company furtherexpanded its cylinder and lock productrange to provide solutions for custom-ers worldwide. One outstanding newproduct was the Hercular deadbolt,which offers an especially high level ofsecurity suited to market needs in theusa and Canada.

Another new product, the sbesliding-bolt padlock series, comple-ments the extra-high-security E-seriespadlocks. Mul-T-Lock also continuesto develop tailor-made solutions and provide sophisticated masterkeysystems for the professional market.

Integration regionally and worldwideDuring 2001, Mul-T-Lock finalized itsoperational plans as a Group member.

Business activities with sister com-panies were strengthened and jointventures have been established withGuli in China, La Fonte in Brazil, andYale-Union in South Africa.

Despite difficult security, politicaland economic circumstances, themorale of Mul-T-Lock staff remainedhigh. Even though the route of theVolvo Ocean Race lies far from Israel,the event has attracted a lot of interestand stimulated a strong sense ofbelonging to the Group.

POLAND

ASSA ABLOY Poland Sp. z o.o. Markets and sells ASSA ABLOY products in Poland.President: Jakub Gawecki

ROMANIA

ASSA ABLOY Romania s.r.l.Markets and sells ASSA ABLOY products in Romania.President: Gabriel Nicolaescu

Urbis Security s.r.l.Manufactures and markets locks and fittings.President: Gabriel Nicolaescu

Urbis International s.r.l.Manufactures window and door hardware and sells to other Group companies.President: Attila Sylvester

SOUTH AMERICA

La Fonte Sistemas de Seguranca Ltda Manufactures a wide range of security products including locksets, exit devices and hinges for commercial, industrial and residential applications. President: Francisco Bastos

SOUTHERN AFRICA

ASSA ABLOY South Africa Offers the most comprehensive range of architectural, DIY and OEM ranges of physical security hardware.Managing Director: John Middleton

Chubb Locks Union ZimbabweMarkets a complete range of security products.Managing Director: Rory Vahey

ISRAEL

Mul-T-LockProduces high-security cylinders and locks for institutional, commercial, industrial and residential applications.President and CEO: Tzachi Wiesenfeld

UK: Mul-T-Lock (UK) Ltd.Managing Director: Dion McAllister

France: Mul-T-Lock France SAChairman: Yvan Haddad

USA: Mul-T-Lock USA Inc.President and CEO: Zvi Yaniv

Canada: Mul-T-Lock Canada Inc.President: J. Scott Ferguson

With 32 floors above ground and five below, the Polish Telecom headquarters in Warsaw is the tallestbuilding designed by a Polish architect. The 1500 steel, aluminum or wooden doors are linked into athree-level masterkey locking system based on ABLOY DISKLOCK PRO technology and combiningABLOY mechanical and electromechanical cylinders and FUNXION door hardware.



Increased high-security interest in a slow hospitality market

Hotel locks:

assa abloy’s international marketing of specialized security systems to thehospitality industry is conducted throughVingCard-Elsafe Group, with head-quarters in Norway, and Timelox, basedin Sweden.

Market and market trendsAfter several years of steady growth,2001 saw a stagnating world hospital-ity market.

The events of September 11 thenbrought an increased focus on securitybut a sharp decline in travel, new hotelbuilding, and aftermarket sales. The usmarket was most affected, whereasEurope and Asia experienced onlyminor setbacks. The marine cruiseindustry continued strong. In the longerterm, the world market is expected torecover and continue growing.

VingCard-Elsafe GroupIn these conditions VingCard, as theglobal hospitality leader with represen-tation in 137 countries, suffered a

slowdown in growth, especially in thelatter part of the year, and the safe pro-ducer Elsafe was even harder hit. Bothcompanies immediately responded bytrimming operations and cutting coststo safeguard profitability.

Security awareness among bothhotel guests and operators continuedto increase, and the lower end of themarket has gradually opened up.VingCard-Elsafe widened its productrange accordingly, and many futuresolutions will be aimed at expansioninto the volume market.

2001 saw a clear recognition ofexcellence in the Group’s product port-folio. The da vinci lock series wasgiven the Norwegian Design Council’sAward for Design Excellence, andElsafe’s innovative Sentinel andInfinity safes received two awards forbest new product at the InternationalHotel, Motel and Restaurant Show inNew York. The safes feature a modularconcept including cutting-edge bio-metric recognition technology.

During the year an organizationalchange has been carried through toseparate the production from the mar-keting organization to combine sourceswith other production units within theGroup.

TimeloxDespite the general slowdown Timelox’shotel division has strengthened its position, increasing sales of its world-leading Dual Card intelligent technology(magnetic cards for guests and smartcard for staff) in many new andexisting markets to compensate fordownturns elsewhere.

For guests, a new One Card versionnow offers not only room access (including remote check-in, bypassingthe front desk) but use for transactionsin the hotel’s restaurant, shops andcasino. An advanced system uses infraredcommunication to interface, on line, toenergy management systems. Staffcards are re-encoded automatically eachday so that maids, for example, haveaccess only to rooms due for cleaning.

After a successful introduction inSweden, Timelox wire-free access con-trol systems, based on the same smartcard technology as the hotel systems,are now marketed internationally.Functions can include recorded entrythrough exterior and interior doors,time-limited cards, and canceling ofuser cards. A camera option allowsremote supervision of outlying accesspoints. Customers include hospitals,government offices and military sites inmarkets such as South America and theFar East, as well as assa abloy groupcompanies worldwide.

On the cruise liner Celebrity Cruises Millennium, VingCard has installed 1,650 electronic guestroom locksusing Vision software.


hid Corporation, a us company, wasacquired by assa abloy in January2001. hid is a market leader in contactless cards and readers for accesscontrol, based on 125 khz RadioFrequency Identification (rfid) techno-logy. The majority of all new accesscontrol systems sold in the world todayare based on contactless technology.Because of its specialized technologyand distribution hid is separatelyorganized as a transnational unit.During the year the Indala business wasacquired from Motorola, with a similarproduct range as hid.

Market and market trends From 1997 through 1999, the accesscontrol industry grew at an annual rateof about 10 percent, driven in part bypreparation for y2k. Growth has sincedecelerated, but despite the continuingweak economy, hid expects the accesscontrol market to grow 8 to 10 percentnext year due to heightened securityconcerns fueled by the terrorist attackson September 11. hid also foreseesstronger international growth based on regionalization of distribution,customer service and technical supportin major markets.

Use of technologies that protect idcards from duplication and forgery (e.g.holograms and more secure printingmethods) is expected to increase.Another trend is the merging of corporateInformation Technology and PhysicalSecurity departments, which is chang-ing the way decisions are made andsecurity products are selected.

As knowledge becomes more valu-able and labor more costly, corpora-tions are demanding consolidation ofnetworks. it and Physical Securitydepartments are beginning to shareactivities and databases on centralizedsystems. By working together, the

departments can save money, obtainmore corporate resources and migrateto new technology sooner.

hid also anticipates heightenedinterest in the storage of biometric tem-plates on id cards, which may drive theuse of 13.56 mhz technology. 13.56mhz is a radio frequency identification(rfid) technology already extensivelyused internationally in contactlesssmart cards for mass transportationand cashless vending. The technologyis now being introduced into the accesscontrol market to meet the growinginterest in smart cards and multi-application cards.

Integration regionally and worldwideassa abloy group companies are becoming progressively more aware ofhid’s products and technologies. Forexample, hid’s EntryProx reader isbeing introduced to various assaabloy door-hardware distributionchannels.

In its new Low Profile range, the usGroup company Sargent has leveragedhid’s installed card base by manufac-turing a battery-powered, self-containedelectronic lock that incorporates hid’sembedded proximity (eProx) techno-logy, either used alone or combined witha keypad for added security. Applicationsinclude computer rooms, storage areas,classrooms and tenant spaces.

hid is now collaborating with assaabloy internationally in the develop-ment of an advanced electronic locksystem. hid is also taking leading rolesin the Group’s ElectromechanicalBoard and Access Control Symposium.

Viewed by assa abloy as a techno-logy leader, hid is dedicated to devel-oping and supporting new technologiesthat promote growth into innovativeproduct areas for the whole Group.

Hotel locks:Sales by ASSA ABLOY’s hotel locksoperations in 2001 amounted to SEK 1,056 M (1,052). Organic growth for comparable units was -7 percent.

VingCard a.s World-leading solution provider of card locks and safes to the hospitality industry. President and CEO of VingCard-Elsafe: Dag Schjerven

Elsafe International a.sWorld leader in safes for hotel rooms.President: Alvin Berg

VingCard subsidiariesBrazil President: Erik PetersenCanada President: Larry CechetFrance President: Christian HenonGermany President: Heiner KestingHong Kong President: Tommy LeungScandinavia President: Mats RydenSingapore President: Stephen LimThailand President: Phonlavit ManchakraUK President: Howard WittUSA President: Mats Gustafsson

VingCard Produksjon a.sPresident: Dan Enquist

Timelox ABManufactures and markets card-operated electro-mechanical locks for the hospitality market as well asaccess controls for hospitals, administrative and business areas.Timelox has distribution and supportchannels worldwide.President: Jan Wabréus

Timelox subsidiaries:USA Vice President: Matt MrowczynskiSpain Vice President: Victor Gomez-Guijo

SEK M 2001 2000 1999 1998 1997

Sales 1,056 1,052 965 952 794

Average no.of employees 634 710 669 605 623

Hotel safes, 8%

Hotel locks, 92%


Trends

Identification:

Continuing growth for contactless technologies

Identification:Total sales by Identification in 2001amounted to SEK 1,043 M.

HID CorporationWorld-leading producer of cards, readers and identi-fication technology for the access control industry.President and CEO: Joseph J. Grillo

IndalaWorld leader in production of RFID cards and readers.President: Steven J. Wagner

HID locationsUS/California President: Joseph J. GrilloUS/Colorado Vice President: Peter LoweUS/Connecticut General Manager: Frank D’EugenioEurope Managing Director: Spencer HallAsia Pacific Managing Director: Lester Doig

SEK M 2001 2000 1999 1998 1997

Sales 1,043 – – – –

Average no.of employees 311 – – – –

Trends


Documents

Steady growth helped by the launch of new technology · 2010-02-22 · Steady growth helped by the launch of new technology Market and market trends The Scandinavian operations continued