• Total sales MSEK 28 214 (25 821)
• Organic sales growth 4 percent (6)
• Operating income before amortization MSEK 1 574 (1 452)
• Operating margin 5.6 percent (5.6)
• Items affecting comparability (IAC) MSEK –60 (–268), relating to IS/IT transformation programs
• Earnings per share SEK 2.56 (2.07)
• Earnings per share, before IAC, SEK 2.68 (2.61)
• Total sales MSEK 82 642 (74 643)
• Organic sales growth 5 percent (6)
• Operating income before amortization MSEK 4 241 (3 829)
• Operating margin 5.1 percent (5.1)
• Items affecting comparability (IAC) MSEK –126 (–268), relating to IS/IT transformation programs
• Earnings per share SEK 6.82 (6.24)
• Earnings per share, before IAC, SEK 7.07 (6.78)
• Free cash flow/net debt 0.18 (0.12)
Comments from the President and CEO
Organic sales growth in the Group was 4 percent (6) in the third quarter and 5 percent (6) in the first nine months. The good organic sales growth was supported by North America and Ibero-America, however hampered by the previously communicated contracts losses in Europe. We have the strongest offering of protective services and we grew faster than the security market in general during the first nine months.
In terms of the macroeconomic environment, we see a slowdown in some key markets during the second half of 2019. Security solutions and electronic security sales grew by 11 percent in the first nine months, and now represent 21 percent of total Group sales.
The operating margin in the third quarter was unchanged at 5.6 percent (5.6). It was also unchanged in the first nine months at 5.1 percent (5.1), with a good performance in North America and Ibero-America. Labor markets are increasingly challenging in all our geographies, and managing the price and wage balance will remain a key focus this year as well as going into 2020. The cost savings program in Europe, initiated in 2018, developed according to plan and supported the operating margin.
The operating result, adjusted for changes in exchange rates, grew with 5 percent in the first nine months.
Earnings per share in the first nine months was, adjusted for changes in exchange rates and items affecting comparability, slightly behind last year negatively impacted by a higher effective tax rate in the US and by a negative net effect from IFRS 16.
Operating and free cash flow improved compared with the first nine months last year. Our strong focus on cash management has paid off but remains a key priority across all business segments.
Driving the transformation
We continue to drive the implementation of the two transformation programs that will bring increased efficiency, modernization and innovation. While the positive impact from these programs is still a few years out, we are progressing according to plan with the execution.
Offering solutions to our clients is a core part of our strategy, and we continue to build a stronger capability within technology to enable further growth. Our ambition is to increase security solutions and electronic security sales, as part of total Group sales, during the coming years. During a time when we see slowing growth in some economies yet upward wage pressure, being able to offer a solution as an alternative to our clients is as important as ever to enhance value to our clients and to manage total cost.
During the second half of the year, we are also working with the previously announced key leadership transitions. We have an Investor Day on the 5th of December in Stockholm, where we will share more about our strategy and you will also get to meet some of the great leaders in the Securitas team.
Chief Executive Officer
PRESENTATION OF THE INTERIM REPORT
Analysts and media are invited to participate in a telephone conference on November 6, 2019 at 9:30 a.m. (CET) where President and CEO Magnus Ahlqvist and CFO Bart Adam will present the report and answer questions. The telephone conference will also be audio cast live via Securitas website. To participate in the telephone conference, please dial in five minutes prior to the start of the conference call:
US: + 1 855 269 2605
Sweden: + 46 8 519 993 55
UK: + 44 203 194 0550
To follow the audio cast of the telephone conference via the web, please follow the link
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, Head of Investor Relations.
+ 46 761167443
FINANCIAL INFORMATION CALENDAR
February 6, 2020, app. 1.00 p.m. (CET) Full Year Report January–December 2019
May 7, 2020, app. 1.00 p.m. (CET) Interim Report January–March 2020
May 7, 2020, 4.00 p.m. (CET) Annual General Meeting 2020
July 29, 2020, app. 1.00 p.m. (CET) Interim Report January–June 2020
November 3, 2020, app. 1.00 p.m. (CET) Interim Report January–September 2020
For further information regarding Securitas IR activities, refer to
Securitas has a leading position in the security services industry with a strong local and global market presence. We currently operate in 58 countries and employ 370 000 people. Our operations have been organized in a decentralized structure and include three business segments: Security Services North America, Security Services Europe and Security Services Ibero-America. We also have operations in Africa, the Middle East and Asia, which form the AMEA division. Securitas serves a wide range of customers of all sizes in a variety of industries and customer segments. Security solutions based on customer-specific needs are built through different combinations of on-site, mobile and remote guarding, electronic security, fire and safety, and corporate risk management. Securitas can respond to the unique and specific security challenges facing its customers, and tailor its offering according to their specific industry demands. Securitas is listed in the Large Cap segment at Nasdaq Stockholm.
Our strategy is to offer protective services that integrate all our areas of competence. Together with our customers, we develop optimal and cost-efficient solutions that are suited for the customers’ needs. This brings added value to the customers and results in stronger, more long-term customer relationships and improved profitability.
Group financial targets
Securitas focuses on two financial targets. The first target relates to the statement of income: average growth of earnings per share of 10 percent annually. The second target relates to the balance sheet: free cash flow in relation to net debt of at least 0.20.
This is information that Securitas AB is obliged to make public pursuant to
the EU Market Abuse Regulation. The information was submitted for publication,
through the agency of the contact person set out above, at 8:00 a.m. (CET) on Wednesday, November 6, 2019.
Securitas AB (publ.)
P.O. Box 12307, SE-102 28 Stockholm, Sweden
Visiting address: Lindhagensplan 70
Telephone: +46 10 470 30 00. Fax: +46 10 470 31 22
Corporate registration number: 556302–7241