STOCKHOLM, Feb. 7, 2023 /PRNewswire/ --
*Number of shares outstanding have been adjusted for the rights issue completed on October 11, 2022.
For further information refer to Data per share on page 22.
**Includes STANLEY Security's 12 months adjusted estimated EBITDA.
Comments from the President and CEO
"A year of strong performance and strategic achievements"
Securitas delivered solid growth, profitability and cash flow in the fourth quarter. We target to become the most attractive security and solutions partner for our clients, and together with STANLEY Security, we know we are on track. The integration and value creation processes with STANLEY Security are proceeding very well.
We concluded the year with organic sales growth of 9 percent in the fourth quarter, with good commercial traction in all business segments. Organic sales growth in North America continued to increase in the quarter and due to the previously announced renewal and expanded scope of a significant client contract we expect continued improvement in the first quarter of 2023.
Technology and solutions sales had real sales growth of 80 percent (10) in the fourth quarter, and 15 percent (10) exluding STANLEY Security, now representing 32 percent (23) of Group sales.
The operating margin improved to 6.5 percent (5.9) and the operating result, adjusted for changes in exchange rates, increased by 39 percent in the fourth quarter, with a material contribution from STANLEY Security and a good performance in the legacy business. The STANLEY Security business continued to perform well, and we are ahead of schedule in North America thanks to solid execution of the integration and value creation plan.
The operating margin in North America exceeded 8 percent for the first time, with strong improvement also excluding STANLEY Security. In Europe and Ibero-America, the operating margins improved on a full-year basis, but were flat in the quarter. Business conditions in Europe remain challenging as a result of the labor shortage.
The Group's operating margin continues to improve by realizing benefits from our transformation programs and execution of the value creation plan from the acquired STANLEY Security business, as well as from pursuing active management of lower profitability contracts. We continue with disciplined pricing in the guarding business and have continued to protect a positive price and wage balance in a high inflationary environment.
The Group's operating cash flow was solid in the quarter at 83 percent of the operating result. Maintaining strong cash flows remains a key priority to further reducing our leverage position following the acquisition of STANLEY Security.
CREATING THE FUTURE SECURITAS
In North America we see significant value in the day-to-day operations through increased data-driven efficiency, productivity and financial transparency as a result of the transformation program, which was also an important enabler of the positive operating margin trend.
We continue to execute the business transformation program in Europe, although with a small delay as we calibrate the program with the STANLEY Security integration plan to optimize costs and benefits. The corresponding program in Ibero-America is on track and we expect to realize financial and operational benefits in the coming years.
While the macroeconomic environment is uncertain, we are continuously working to ensure we are prepared to manage more challenging times. One of our strengths as a company is our resilient business model with long-term client relationships and the continuous need for security throughout the economic cycle. Combining our talent and expertise with STANLEY Security has set us up for higher growth thanks to an outstanding client offering and we expect significant operating margin enhancement opportunities with a target to reach 8 percent by the end of 2025. Our margin improvement in 2022 gives us confidence that we are on the right track, and we will continue to strategically assess our footprint and business mix to further sharpen our performance and position.
In 2022, we also took significant steps in our sustainability agenda as we became the first major company in our industry to commit to the Science Based Targets initiative.
I would like to thank our clients and the Securitas team for their tremendous work during a challenging year of geopolitical uncertainty and inflationary pressure. We are developing a stronger client offering and position in the market, and along with solid client relationships, this enables us to improve the returns for our shareholders in the coming years.
President and CEO
FINANCIAL INFORMATION CALENDAR
May 3, 2023, app. 1.00 p.m. (CEST)
Interim Report January–March 2023
May 4, 2023
Annual General Meeting in Stockholm
July 28, 2023, app. 1.00 p.m. (CEST)
Interim Report January–June 2023
November 7, 2023, app. 1.00 p.m. (CET)
Interim Report January–September 2023
For further information regarding Securitas IR activities, refer to
PRESENTATION OF THE FULL YEAR REPORT
Analysts and media are invited to participate in a telephone conference on on February 7, 2023, at 2.30 p.m. (CET) where President and CEO Magnus Ahlqvist and CFO Andreas Lindback will present the report and answer questions. The telephone conference will also be audio cast live via Securitas' website www.securitas.com
To follow the audio cast of the telephone conference via the web, please follow the link www.securitas.com/investors/webcasts
A recorded version of the audio cast will be available at
www.securitas.com/investors/webcasts after the telephone conference.
For further information, please contact:
Micaela Sjökvist, Vice President, Investor Relations +46 76 116 7443
Securitas has a leading global and local market presence with operations in 47 markets. Our operations are organized in three business segments: Security Services North America, Security Services Europe and Security Services Ibero-America. We also have operations in Africa, the Middle East, Asia and Australia, which form the AMEA division. Securitas serves a wide range of clients of all sizes in a variety of industries and segments. Security solutions based on client-specific needs are built through different combinations of on-site, mobile and remote guarding, electronic security, fire and safety, and corporate risk management. We adapt our security solutions based on the risks and needs of each client through increased client engagement and continuously enhanced knowledge. Securitas is listed in the Large Cap segment at Nasdaq Stockholm.
At Securitas, we are leading the transformation of the security industry by putting our clients at the heart of our business. We solve our clients' security needs by offering qualified and engaged people, in-depth expertise and innovation within each of our protective services, the ability to combine services into solutions and by using data to add further intelligence. To execute on our strategy to become a security solutions partner with world-leading technology and expertise, we are focusing on four areas: Taking the lead within technology, quality guarding services focused on profitability, creating a global security solutions partner, leveraging a global platform to drive innovation.
Group financial targets
Securitas has four financial targets:
Securitas AB (publ.)
P.O. Box 12307, SE-102 28 Stockholm, Sweden
Telephone: +46 10 470 30 00
Corporate registration number: 556302–7241
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