Condensed Financial Information of Parent Company Only Disclosure | GUARANTOR INFORMATION Allegion US Hold Co is the issuer of the 3.200% Senior Notes and 3.550% Senior Notes and is the guarantor of the 3.500% Senior Notes (all three senior notes, collectively, the "Senior Notes"). Allegion plc is the issuer of the 3.500% Senior Notes and is the guarantor of the 3.200% Senior Notes and 3.550% Senior Notes. The following condensed and consolidated financial information of Allegion plc, Allegion US Hold Co, and the other Allegion subsidiaries that are not guarantors (the "Other Subsidiaries") on a combined basis as of September 30, 2019 and December 31, 2018 , and for the three and nine months ended September 30, 2019 and 2018 , is being presented in order to meet the reporting requirements under the Senior Notes indentures and Rule 3-10 of Regulation S-X. In accordance with Rule 3-10(d) of Regulation S-X, separate financial statements for the Issuers, Allegion plc and Allegion US Hold Co, whom are guarantors, are not required to be filed with the SEC as the subsidiary debt issuers are directly or indirectly 100% owned by the Parent, whom is a guarantor, and the guarantees are full and unconditional and joint and several. Condensed and Consolidated Statement of Comprehensive Income For the three months ended September 30, 2019 In millions Allegion plc Allegion US Holding Other subsidiaries Consolidating adjustments Total Net revenues $ — $ — $ 748.3 $ — $ 748.3 Cost of goods sold — — 412.8 — 412.8 Selling and administrative expenses 1.6 — 165.8 — 167.4 Operating (loss) income (1.6 ) — 169.7 — 168.1 Equity earnings (loss) in affiliates, net of tax 145.2 88.9 — (234.1 ) — Interest expense 9.5 6.0 0.1 — 15.6 Intercompany interest and fees 2.5 27.0 (29.5 ) — — Other expense, net — — 2.0 — 2.0 Earnings (loss) before income taxes 131.6 55.9 197.1 (234.1 ) 150.5 Provision (benefit) for income taxes — (8.1 ) 26.9 — 18.8 Net earnings (loss) 131.6 64.0 170.2 (234.1 ) 131.7 Less: Net earnings attributable to noncontrolling interests — — 0.1 — 0.1 Net earnings (loss) attributable to Allegion plc $ 131.6 $ 64.0 $ 170.1 $ (234.1 ) $ 131.6 Total comprehensive income (loss) $ 91.7 $ 63.0 $ 130.2 $ (194.1 ) $ 90.8 Less: Total comprehensive loss attributable to noncontrolling interests — — (0.9 ) — (0.9 ) Total comprehensive income (loss) attributable to Allegion plc $ 91.7 $ 63.0 $ 131.1 $ (194.1 ) $ 91.7 Condensed and Consolidated Statement of Comprehensive Income For the nine months ended September 30, 2019 In millions Allegion plc Allegion US Holding Other subsidiaries Consolidating adjustments Total Net revenues $ — $ — $ 2,134.5 $ — $ 2,134.5 Cost of goods sold — — 1,201.4 — 1,201.4 Selling and administrative expenses 4.7 — 506.6 — 511.3 Operating (loss) income (4.7 ) — 426.5 — 421.8 Equity earnings (loss) in affiliates, net of tax 354.2 196.9 — (551.1 ) — Interest expense 24.2 18.3 0.2 — 42.7 Intercompany interest and fees 4.2 79.8 (84.0 ) — — Other income, net — — 1.6 — 1.6 Earnings (loss) before income taxes 321.1 98.8 508.7 (551.1 ) 377.5 Provision (benefit) for income taxes — (24.1 ) 80.2 — 56.1 Net earnings (loss) 321.1 122.9 428.5 (551.1 ) 321.4 Less: Net earnings attributable to noncontrolling interests — — 0.3 — 0.3 Net earnings (loss) attributable to Allegion plc $ 321.1 $ 122.9 $ 428.2 $ (551.1 ) $ 321.1 Total comprehensive income (loss) $ 271.6 $ 118.4 $ 381.4 $ (500.5 ) $ 270.9 Less: Total comprehensive loss attributable to noncontrolling interests — — (0.7 ) — (0.7 ) Total comprehensive income (loss) attributable to Allegion plc $ 271.6 $ 118.4 $ 382.1 $ (500.5 ) $ 271.6 Condensed and Consolidated Statement of Comprehensive Income For the three months ended September 30, 2018 In millions Allegion plc Allegion US Holding Other subsidiaries Consolidating adjustments Total Net revenues $ — $ — $ 711.5 $ — $ 711.5 Cost of goods sold — — 402.1 — 402.1 Selling and administrative expenses 1.3 — 165.8 — 167.1 Operating (loss) income (1.3 ) — 143.6 — 142.3 Equity earnings (loss) in affiliates, net of tax 124.5 73.2 — (197.7 ) — Interest expense 7.2 6.4 0.4 — 14.0 Intercompany interest and fees — 26.3 (26.3 ) — — Other income, net — — (1.9 ) — (1.9 ) Earnings (loss) before income taxes 116.0 40.5 171.4 (197.7 ) 130.2 Provision (benefit) for income taxes — (7.7 ) 21.8 — 14.1 Net earnings (loss) 116.0 48.2 149.6 (197.7 ) 116.1 Less: Net earnings attributable to noncontrolling interests — — 0.1 — 0.1 Net earnings (loss) attributable to Allegion plc $ 116.0 $ 48.2 $ 149.5 $ (197.7 ) $ 116.0 Total comprehensive income (loss) $ 103.9 $ 48.1 $ 142.5 $ (191.2 ) $ 103.3 Less: Total comprehensive loss attributable to noncontrolling interests — — (0.6 ) — (0.6 ) Total comprehensive income (loss) attributable to Allegion plc $ 103.9 $ 48.1 $ 143.1 $ (191.2 ) $ 103.9 Condensed and Consolidated Statement of Comprehensive Income For the nine months ended September 30, 2018 In millions Allegion plc Allegion US Holding Other subsidiaries Consolidating adjustments Total Net revenues $ — $ — $ 2,029.3 $ — $ 2,029.3 Cost of goods sold — — 1,156.5 — 1,156.5 Selling and administrative expenses 4.6 — 483.8 — 488.4 Operating (loss) income (4.6 ) — 389.0 — 384.4 Equity earnings (loss) in affiliates, net of tax 327.0 146.4 — (473.4 ) — Interest expense 20.3 19.4 0.6 — 40.3 Intercompany interest and fees — 78.2 (78.2 ) — — Other income, net — — (3.9 ) — (3.9 ) Earnings (loss) before income taxes 302.1 48.8 470.5 (473.4 ) 348.0 Provision (benefit) for income taxes — (20.0 ) 65.5 — 45.5 Net earnings (loss) 302.1 68.8 405.0 (473.4 ) 302.5 Less: Net earnings attributable to noncontrolling interests — — 0.4 — 0.4 Net earnings (loss) attributable to Allegion plc $ 302.1 $ 68.8 $ 404.6 $ (473.4 ) $ 302.1 Total comprehensive income (loss) $ 266.9 $ 70.7 $ 365.8 $ (438.1 ) $ 265.3 Less: Total comprehensive loss attributable to noncontrolling interests — — (1.6 ) — (1.6 ) Total comprehensive income (loss) attributable to Allegion plc $ 266.9 $ 70.7 $ 367.4 $ (438.1 ) $ 266.9 Condensed and Consolidated Balance Sheet September 30, 2019 In millions Allegion plc Allegion US Holding Other subsidiaries Consolidating adjustments Total Current assets: Cash and cash equivalents $ 16.6 $ 2.4 $ 213.9 $ — $ 232.9 Restricted cash — — 3.4 — 3.4 Accounts and notes receivable, net — — 367.5 — 367.5 Inventories — — 293.9 — 293.9 Other current assets 1.2 25.8 19.8 (14.3 ) 32.5 Assets held for sale — — 2.9 — 2.9 Accounts and notes receivable affiliates — 510.1 408.1 (918.2 ) — Total current assets 17.8 538.3 1,309.5 (932.5 ) 933.1 Investment in affiliates 1,571.6 873.7 — (2,445.3 ) — Property, plant and equipment, net — — 281.9 — 281.9 Intangible assets, net — — 1,372.1 — 1,372.1 Notes receivable affiliates 31.2 1,404.8 2,868.4 (4,304.4 ) — Other noncurrent assets 4.8 56.3 217.2 — 278.3 Total assets $ 1,625.4 $ 2,873.1 $ 6,049.1 $ (7,682.2 ) $ 2,865.4 Current liabilities: Accounts payable and other current liabilities $ 3.8 $ 13.5 $ 488.1 $ (14.3 ) $ 491.1 Short-term borrowings and current maturities of long-term debt — — 0.1 — 0.1 Accounts and notes payable affiliates 4.3 403.8 510.1 (918.2 ) — Total current liabilities 8.1 417.3 998.3 (932.5 ) 491.2 Long-term debt 632.8 793.5 0.7 — 1,427.0 Notes payable affiliates 297.0 2,571.4 1,436.0 (4,304.4 ) — Other noncurrent liabilities 2.5 6.1 251.4 — 260.0 Total liabilities 940.4 3,788.3 2,686.4 (5,236.9 ) 2,178.2 Equity: Total shareholders' equity (deficit) 685.0 (915.2 ) 3,360.5 (2,445.3 ) 685.0 Noncontrolling interests — — 2.2 — 2.2 Total equity (deficit) 685.0 (915.2 ) 3,362.7 (2,445.3 ) 687.2 Total liabilities and equity $ 1,625.4 $ 2,873.1 $ 6,049.1 $ (7,682.2 ) $ 2,865.4 Condensed and Consolidated Balance Sheet December 31, 2018 In millions Allegion plc Allegion US Holding Other subsidiaries Consolidating adjustments Total Current assets: Cash and cash equivalents $ 4.2 $ 1.0 $ 278.6 $ — $ 283.8 Restricted cash — — 6.8 — 6.8 Accounts and notes receivable, net — — 324.9 — 324.9 Inventories — — 280.3 — 280.3 Other current assets 0.5 33.7 19.1 (18.3 ) 35.0 Assets held for sale — — 0.8 — 0.8 Accounts and notes receivable affiliates — 816.2 369.8 (1,186.0 ) — Total current assets 4.7 850.9 1,280.3 (1,204.3 ) 931.6 Investment in affiliates 1,265.8 718.2 — (1,984.0 ) — Property, plant and equipment, net — — 276.7 — 276.7 Intangible assets, net — — 1,430.1 — 1,430.1 Notes receivable affiliates 30.8 1,061.2 2,553.4 (3,645.4 ) — Other noncurrent assets 4.0 61.2 106.6 — 171.8 Total assets $ 1,305.3 $ 2,691.5 $ 5,647.1 $ (6,833.7 ) $ 2,810.2 Current liabilities: Accounts payable and other current liabilities $ 2.0 $ 6.8 $ 495.0 $ (18.3 ) $ 485.5 Short-term borrowings and current maturities of long-term debt 35.0 — 0.3 — 35.3 Accounts and notes payable affiliates 0.3 369.5 816.2 (1,186.0 ) — Total current liabilities 37.3 376.3 1,311.5 (1,204.3 ) 520.8 Long-term debt 615.8 792.8 0.9 — 1,409.5 Notes payable affiliates — 2,553.4 1,092.0 (3,645.4 ) — Other noncurrent liabilities 1.2 5.5 219.2 — 225.9 Total liabilities 654.3 3,728.0 2,623.6 (4,849.7 ) 2,156.2 Equity: Total shareholders' equity (deficit) 651.0 (1,036.5 ) 3,020.5 (1,984.0 ) 651.0 Noncontrolling interests — — 3.0 — 3.0 Total equity (deficit) 651.0 (1,036.5 ) 3,023.5 (1,984.0 ) 654.0 Total liabilities and equity $ 1,305.3 $ 2,691.5 $ 5,647.1 $ (6,833.7 ) $ 2,810.2 Condensed and Consolidated Statement of Cash Flows For the nine months ended September 30, 2019 In millions Allegion plc Allegion US Holding Other subsidiaries Consolidating adjustments Total Net cash (used in) provided by operating activities $ (10.4 ) $ (43.2 ) $ 410.9 $ (77.9 ) $ 279.4 Cash flows from investing activities: Capital expenditures — — (49.4 ) — (49.4 ) Acquisition of and equity investments in businesses, net of cash acquired — — (4.6 ) — (4.6 ) Other investing activities, net — (1.5 ) (2.2 ) 1.7 (2.0 ) Net cash (used in) provided by investing activities — (1.5 ) (56.2 ) 1.7 (56.0 ) Cash flows from financing activities: Debt repayments, net (17.5 ) — (0.5 ) — (18.0 ) Debt issuance costs (3.0 ) — — — (3.0 ) Net inter-company proceeds (payments) 296.6 46.0 (342.6 ) — — Dividends paid — — (77.9 ) 77.9 — Dividends paid to shareholders (75.5 ) — — — (75.5 ) Repurchase of ordinary shares (179.7 ) — — — (179.7 ) Other financing activities, net 1.9 0.1 1.5 (1.7 ) 1.8 Net cash provided by (used in) financing activities 22.8 46.1 (419.5 ) 76.2 (274.4 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash — — (3.3 ) — (3.3 ) Net increase (decrease) in cash, cash equivalents and restricted cash 12.4 1.4 (68.1 ) — (54.3 ) Cash, cash equivalents and restricted cash - beginning of period 4.2 1.0 285.4 — 290.6 Cash, cash equivalents and restricted cash - end of period $ 16.6 $ 2.4 $ 217.3 $ — $ 236.3 Condensed and Consolidated Statement of Cash Flows For the nine months ended September 30, 2018 In millions Allegion plc Allegion US Holding Other subsidiaries Consolidating adjustments Total Net cash provided by (used in) operating activities $ 135.4 $ (68.5 ) $ 402.5 $ (209.0 ) $ 260.4 Cash flows from investing activities: Capital expenditures — — (31.8 ) — (31.8 ) Acquisition of and equity investments in businesses, net of cash acquired — (247.1 ) (128.7 ) — (375.8 ) Other investing activities, net — — (1.1 ) — (1.1 ) Net cash used in investing activities — (247.1 ) (161.6 ) — (408.7 ) Cash flows from financing activities: Debt repayments, net (26.3 ) — (1.1 ) — (27.4 ) Net inter-company (payments) proceeds (22.0 ) 329.3 (307.3 ) — — Dividends paid — — (209.0 ) 209.0 — Dividends paid to shareholders (59.6 ) — — — (59.6 ) Repurchase of ordinary shares (30.0 ) — — — (30.0 ) Other financing activities, net 2.4 — (2.3 ) — 0.1 Net cash (used in) provided by financing activities (135.5 ) 329.3 (519.7 ) 209.0 (116.9 ) Effect of exchange rate changes on cash and cash equivalents — — (4.5 ) — (4.5 ) Net (decrease) increase in cash and cash equivalents (0.1 ) 13.7 (283.3 ) — (269.7 ) Cash and cash equivalents - beginning of period 0.7 0.3 465.2 — 466.2 Cash and cash equivalents - end of period $ 0.6 $ 14.0 $ 181.9 $ — $ 196.5 |