Good sales and earnings trend for ASSA ABLOY

* The sales trend was positive for all divisions in the second
quarter and sales increased in local currencies by 8%.
* Sales growth in Western Europe continued on a weak level, sales
in North America were stable at a good level, and growth remained
strong on the Asian, African and South American markets.
* The gross margin improved as a result of the restructuring and
efficiency programs carried out.
* Sales amounted to SEK 8,526 M (8,329), with 5% organic growth, 3%
acquired growth and exchange-rate effects of -5%.
* Operating income (EBIT) amounted to SEK 1,378 M (1,325), an
increase of 4% after negative currency effects of SEK 72 M,
representing a margin of 16.2% (15.9).
* Net income amounted to SEK 865 M (822).
* Earnings per share amounted to SEK 2.30 (2.20), an increase of
5%.
* In order to further accelerate the pace of restructuring, a new
revision of the production structure in high-cost countries has
been initiated. The preliminary cost is estimated to be SEK
700-800 M with a payback time of 2-3 years.
* For 2008 the organic growth is expected to be positive, but can
be lower than 3% depending on the development of the business
cycle (previous guidance 3-5%).

SALES AND INCOME

First half-year Second quarter

2007 2008 Change 2007 2008 Change
Sales, SEK M 16,556 16,728 +1% 8,329 8,526 +2%
of which,
Organic growth +3% +5%
Acquisitions +3% +3%
Exchange-rate effects -661 -4% -386 -5%
Operating income (EBIT),
SEK M 2,614 2,621 +0% 1,325 1,378 +4%
Operating margin (EBIT), % 15.8 15.7 15.9 16.2
Income before tax, SEK M 2,229 2,243 +1% 1,128 1,188 +5%
Net income, SEK M 1,625 1,637 +1% 822 865 +5%
Operating cash flow, SEK M 1,762 1,663 -6% 957 1,081 +13%
Earnings per share (EPS), SEK 4.36 4.38 +1% 2.20 2.30 +5%

COMMENTS BY THE PRESIDENT AND CEO"ASSA ABLOY's sales trend during the quarter was good in spite of
continuing weakness on the West European markets. The restructuring
program and other efficiency-improving measures continued to raise
the gross margin. Growth on the new markets remained strong, with
contributions from both organic and acquired growth at the same time
as it was very pleasing to see a number of acquisitions completed on
the mature markets of Western Europe and North America" said Johan
Molin, President and CEO.

SECOND QUARTER

The Group's sales totaled SEK 8,526 M (8,329), representing growth of
2% compared with 2007. In local currencies the increase amounted to
8% (12), of which organic growth for comparable units was 5% (7)
while acquired units accounted for 3% (5) of the increase.
Exchange-rate effects had a negative impact of SEK 386 M on sales,
i.e. 5%.

Operating income before depreciation, EBITDA, amounted to SEK 1,599 M
(1,554), a rise of 3% compared with 2007. The EBITDA margin was 18.8%
(18.7). The Group's operating income, EBIT, amounted to SEK 1,378 M
(1,325), a rise of 4%, after negative currency effects of SEK 72 M.
The operating margin was 16.2% (15.9).

Net financial items amounted to SEK 190 M (197), which corresponds to
an average interest rate of just over 5%. The Group's income before
tax amounted to SEK 1,188 M (1,128), which represents a rise of 5% on
the previous year. After translation of subsidiaries' income
statements, exchange-rate effects had a negative impact of SEK 62 M
on the Group's income before tax. The profit margin was 13.9% (13.5).
The Group's tax charge totaled SEK 323 M (306), corresponding to an
effective tax rate of 27% for the quarter. Earnings per share
amounted to SEK 2.30 (2.20), which represents a rise of 5%.

FIRST HALF-YEAR

Sales for the first half of 2008 totaled SEK 16,728 M (16,556), which
represents an increase of 1% compared with 2007. Organic growth was
3% (8). Newly acquired units contributed 3% (5). Exchange-rate
effects affected sales negatively by SEK 661 M, i.e. 4%, compared
with the first half of 2007.

Operating income before depreciation, EBITDA, amounted to SEK 3,075 M
(3,072) for the half-year. The corresponding margin was 18.4% (18.6).
The Group's operating income, EBIT, amounted to SEK 2,621 M (2,614),
representing a small increase after negative exchange-rate effects of
SEK 124 M. The corresponding operating margin (EBIT) was 15.7%
(15.8).

Earnings per share for the first half-year increased to SEK 4.38
(4.36). Operating cash flow for the half-year amounted to SEK 1,663 M
(1,762).

RESTRUCTURING MEASURES

Payments related to the restructuring program amounted to SEK 97 M
during the quarter, bringing the total for the half-year to SEK 207
M. Savings during the quarter resulting from measures carried out are
SEK 50 M compared with the same period last year. The quarterly rate
of savings from the start of the program now amounts to SEK 110 M.

So far 1,702 out of the total of 2,000 employees affected by the
restructuring program have left the Group. The full program is
expected to have reached completion by the end of the year.

In order to further accelerate the pace of restructuring, a new
revision of the production structure in high-cost countries has been
initiated. The revision covers those units that have not yet been
converted from full production to assembly. Preliminary results
indicate that some thirty projects can be carried out. The total cost
is estimated to be SEK 700-800 M, with a payback time in line with
the current restructuring plan of around two to three years. The cost
of the program is expected to be fully expensed in 2008.

COMMENTS BY DIVISION

EMEA

Sales in EMEA division totaled SEK 3,578 M (3,370), with organic
growth of 4%. Overall, the weakening of the West European markets
continued even though the 'Easter Effect' was recovered in April. On
the emerging markets in Eastern Europe, the Middle East and Africa
growth was good to strong. Acquired growth amounted to 2%. Operating
income amounted to SEK 608 M (556), which represents an operating
margin (EBIT) of 17.0% (16.5). Return on capital employed amounted to
22.4% (20.7). Operating cash flow before interest paid totaled SEK
672 M (502).

AMERICAS

Growth in the commercial segment in the Americas division was good
and stable while the sales trend in the residential segment was
negative, as for the past three quarters. Total sales amounted to SEK
2,419 M (2,607), with 5% organic growth. The net figure for acquired
growth and disposals/closures was -1% because of the disposal of
Quadrastat in 2007. The operating margin improved further from an
already good level and amounted to 20.5% (19.4). Return on capital
employed amounted to 24.1% (22.4). Operating cash flow before
interest paid totaled SEK 564 M (450).

ASIA PACIFIC

Sales in Asia Pacific division grew strongly on the Asian markets,
especially in China, while the sales trend in Australia and New
Zealand weakened. Sales totaled SEK 856 M (650), with 8% organic
growth. Acquired growth amounted to 27%. Operating income amounted to
SEK 104 M (73), which represents an operating margin (EBIT) of 12.2%
(11.3). The quarter's return on capital employed amounted to 16.1%
(13.9). Operating cash flow before interest paid totaled SEK 55 M
(60).

GLOBAL TECHNOLOGIES

Global Technologies division reported continued growth overall, but
with considerable variations between the business units. HID and
Hospitality had good-to-strong growth, whereas ITG had a negative
sales trend as the program to phase out unprofitable customers
continued and delays arose on some customer projects. Total sales in
the second quarter was SEK 1,157 M (1,174), of which organic growth
accounted for 4%. Acquired growth amounted to 2%. The operation to
merge HID and ITG proceeded according to plan and will in time yield
good effects on both sales and production. Operating income for the
division amounted to SEK 159 M (169), giving an operating margin
(EBIT) of 13.7% (14.4). The operating margin improved further for
HID, decreased for Hospitality and remained weak for ITG. Return on
capital employed amounted to 12.6% (13.1). Operating cash flow before
interest paid totaled SEK 183 M (160).

ENTRANCE SYSTEMS

Entrance Systems division reported sales of SEK 758 M (749) in the
second quarter, representing organic growth of 6%. Growth in Europe
and North America was weak but it remained very strong in the
division's newly established operations in Asia. Operating income
amounted to SEK 105 M (108), giving an operating margin (EBIT) of
13.8% (14.4). Operating income was boosted by price increases made,
but diminished by a growing price pressure, especially in the retail
sector, caused by the weak market situation. Return on capital
employed amounted to 13.5% (13.7). Operating cash flow before
interest paid totaled SEK 65 M (102).

ACQUISITIONS

The major acquisitions completed and consolidated during the second
quarter were those of Rockwood in the USA and Beijing Tianming in
China. Information about Beijing Tianming was published on 18 March
and information about Rockwood was published on 25 June. Adding
smaller acquisitions, a total of seven companies were consolidated
during the first half-year. The combined acquisition price amounts to
SEK 530 M and preliminary acquisition analyses indicate that goodwill
and other intangible assets with indefinite useful life amount to
about SEK 400 M. The acquisition price is adjusted for acquired
interest-bearing liabilities including estimated earn-outs.

On 9 June it was announced that EMEA division has signed a contract
to acquire Gardesa, one of Italy's leading manufacturers of
high-security steel doors. Gardesa is based near Piacenza and has
some 200 employees and sales of EUR 45 M. The acquisition was
completed after the end of the reporting period and is expected to be
consolidated from 1 July.

On 7 July it was announced that EMEA division's acquisition of
Valli&Valli, reported in January, has been completed and that the
company will be consolidated from 1 July. Valli&Valli is a leading
Italian manufacturer of designer handles, based near Milan, with 170
employees and expected sales of more than EUR 30 M in 2008.

On July 30 it was announced that Entrance Systems division acquired
Cheil. The company is a leading company in the Korean door automation
market and will be consolidated during the third quarter. The company
has 50 employees and is expected to reach a turnover of SEK 150 M in
2008.

The competition authorities in Sweden and Germany are still reviewing
the acquisitions of Copiax and SimonsVoss respectively.

During the quarter the operations of Visioncard in Austria, which
belonged to ITG in Global Technologies division, were sold off.

SUSTAINABLE DEVELOPMENT

During the quarter ASSA ABLOY launched its first products to carry a
full Environmental Product Declaration (EPD). The Declaration covers
the whole life of the product, from the materials it is made of to
how the residual products shall be handled, in accordance with ISO
14025. More information about this and other information about
sustainable development and the Group's program for sustainable
development can be found at www.assaabloy.com.

PARENT COMPANY

'Other operating income' for the Parent company ASSA ABLOY AB totaled
SEK 1,036 M (836) for the half-year. Income before tax amounted to
SEK 1,310 M (1,393). Investments in tangible and intangible assets
totaled SEK 0 M (2). Liquidity is good and the equity ratio was 47.3%
(47.5).

ACCOUNTING PRINCIPLES

ASSA ABLOY applies International Financial Reporting Standards (IFRS)
as endorsed by the European Union. Significant accounting and
valuation principles are detailed on pages 67-71 of the 2007 Annual
Report. New or revised IFRS effective after 31 December 2007 have had
no material effect on the consolidated income statements or balance
sheets. The Group's Interim Reports are prepared in accordance with
IAS 34. The Parent company applies RFR 2.1.

TRANSACTIONS WITH RELATED PARTIES

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

RISKS AND UNCERTAINTY FACTORS

As an international Group with a wide geographic spread, ASSA ABLOY
is exposed to a number of business and financial risks. The business
risks can be divided into strategic, operational and legal risks. The
financial risks are related to such factors as exchange rates,
interest rates, liquidity, the giving of credit, raw materials and
financial instruments. Risk management in ASSA ABLOY aims to
identify, control and reduce risks. This work begins with an
assessment of the probability of risks occurring and their potential
effect on the Group. For a more detailed description of risks and
risk management refer to the 2007 Annual Report. No significant risks
other than the risks described there are judged to have occurred.

OUTLOOK *)

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

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

For 2008 the organic growth is expected to be positive, but can be
lower than 3% depending on the development of the business cycle
(previous guidance 3-5%).

*) The Outlook published in the Interim Report dated 23 April 2008:

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

The Board of Directors and the President and CEO declare that this
half-year report gives an accurate picture of the Parent company's
and the Group's operations, position and income and describes
significant risks and uncertainty factors faced by the Parent company
and the companies making up the Group.

Stockholm, 30 July 2008

Gustaf Douglas Carl Douglas Jorma Halonen
Chairman Board member Board member

Birgitta Klasén Eva Lindqvist Johan Molin
Board member Board member President and CEO

Sven-Christer Nilsson Lars Renström Ulrik Svensson
Board member Board member Board member

Seppo Liimatainen Mats Persson
Employee representative Employee
representative

REVIEW REPORT

We have reviewed this report for the period 1 January 2008 to 30 June
2008 for ASSA ABLOY AB (publ). The board of directors and the CEO are
responsible for the preparation and presentation of this interim
report in accordance with IAS 34 and the Swedish Annual Accounts Act.
Our responsibility is to express a conclusion on this interim report
based on our review.

We conducted our review in accordance with the Swedish Standard on
Review Engagements SÖG 2410, Review of Interim Report Performed by
the Independent Auditor of the Entity. A review consists of making
inquiries, primarily of persons responsible for financial and
accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit
conducted in accordance with Standards on Auditing in Sweden, RS, and
other generally accepted auditing standards in Sweden. The procedures
performed in a review do not enable us to obtain assurance that we
would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit
opinion.

Based on our review, nothing has come to our attention that causes us
to believe that the interim report is not prepared, in all material
respects, in accordance with IAS 34 and the Swedish Annual Accounts
Act, regarding the Group, and with the Swedish Annual Accounts Act,
regarding the Parent Company.

Stockholm, 30 July 2008

PricewaterhouseCoopers AB

Peter Nyllinge Bo Karlsson
Authorised Public Accountant Authorised Public
Accountant
Auditor in charge

FINANCIAL INFORMATION

The Interim Report for the third quarter will be published on 22
October 2008.

Further information can be obtained from:

Johan Molin, President and CEO, Tel: +46 8 506 485 42
Tomas Eliasson, Chief Financial Officer, Tel: +46 8 506 485 72

ASSA ABLOY is holding an analysts' meeting at 12.00 today
at Klarabergsviadukten 90 in Stockholm.
The analysts' meeting can also be followed on the Internet at
www.assaabloy.com.
It is possible to submit questions by telephone on +46 8 5052 0270,
+44 208 817 9301 or +1 718 354 1226.

This information is that which ASSA ABLOY is required to disclose
under the Swedish Securities Exchange and Clearing Operations Act
and/or the Swedish Financial Instruments Trading Act. The information
is released for publication at 08.00 on 30 July.

The full report with tables can be downloaded via the PDF link.

Good sales and earnings trend for ASSA ABLOY

Attachments