UPDATE 1-Assa Abloy eyes more plant closures, cost cuts

Mon Oct 28, 2013 3:32am EDT

* Says to close about 30 plants and offices

* Restructuring costs seen at 1 bln SEK

* Q3 EBIT 2.09 bln SEK vs forecast 2.05 bln

* Chalks up organic growth in Europe

STOCKHOLM, Oct 28 (Reuters) - Assa Abloy, the world's biggest lock maker, said on Monday it would launch a new efficiency scheme before year-end that would see it shutter about 30 plants and offices over the coming three year.

The maker of Yale locks has grown through a steady stream of acquisitions in a fragmented market for household and commercial products over the past decade that has seen it carry out near constant restructuring to leverage economies of scale.

Assa also said earnings before interest and tax rose to 2.09 billion Swedish crowns ($330.2 million) from a year-earlier 1.93 billion to come in just above a mean forecast of 2.05 billion in a Reuters poll of analysts.

The company said its new restructuring measures would be launched in the fourth quarter and would result in one-off costs of about 1.00 billion crowns and the same level of savings over roughly three years. It did not specify how many jobs would be cut under the plan.

The company, a rival to U.S. Ingersoll-Rand and Stanley Black & Decker, said its sales rose 3 percent, excluding acquisitions and currency swings, in line with analysts' expectations and the rate of the preceding quarter.

Assa Abloy, whose products range from ordinary household locks to advanced digital entrance systems, has seen sluggish growth in a European market where it generates roughly half its sales and where a weak economy has curbed construction activity.

Assa said like-for-like sales in the region grew 1 percent, on the back of strength in markets such as Germany, the Nordic countries and eastern Europe in the third quarter, after being flat in the second and contracting around the turn of the year.

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