Real sales growth within technology and solutions 7 percent (73)
Operating income before amortization MSEK 2 801 (2 620)
Operating margin 6.9 percent (6.6)
Earnings per share SEK 2.28 (2.05)
Earnings per share before IAC, SEK 2.60 (2.46)
Cash flow from operating activities 60 percent (46)
January–June 2024
Total sales MSEK 79 898 (77 660)
Organic sales growth 6 percent (11)
Real sales growth within technology and solutions 7 percent (75)
Operating income before amortization MSEK 5 158 (4 800)
Operating margin 6.5 percent (6.2)
Earnings per share SEK 4.12 (3.71)
Earnings per share before IAC, SEK 4.72 (4.49)
Net debt/EBITDA ratio 2.9 (3.3*)
Cash flow from operating activities 26 percent (29)
* The comparative is adjusted and includes STANLEY Security's 12 months adjusted estimated EBITDA.
Comments from the President and CEO
Solid performance in all business segments
We delivered good performance throughout the business with an operating margin of 6.9 percent (6.6) in the second quarter, with an improved margin development in our European operations. In accordance with our strategy, the Group's operating margin was supported by strong improvement both in security services and in technology and solutions.
Organic sales growth was 5 percent. Real sales growth in our technology and solutions business was good at 8 percent excluding the impact from the divestment of Securitas Argentina, supporting the mix change into higher margin business lines.
Operating cash flow in the second quarter improved compared to last year in line with our expectations after the weaker first quarter. We are in a solid position to deliver a strong full-year 2024 outcome.
SHAPING SECURITAS FOR LONG-TERM SUSTAINABLE SHAREHOLDER VALUE
We are shaping Securitas for long-term sustainable shareholder value, and the core of that execution is operational value creation through growth in technology and solutions, portfolio profitability in security services, cost efficiency and digital innovation.
Our portfolio management activities are generating good traction, as evidenced by the profitability development of our security services portfolio. New business continue to come in at higher margins. The recovery in the airport security business in Europe also supported.
Two years after the acquisition of STANLEY Security our global Technology business is stronger than ever before. Based on our leading global market position and our unique client offering, we delivered healthy organic sales growth of 8 percent in Technology in the second quarter. Today, we have more than BSEK 1.25 of recurring monthly revenue in the strategically important and high-margin monitoring and maintenance business which, together with effectively driving best practices and executing cost synergies, have supported a significantly increased operating margin since the closing of the acquisition.
With the majority of the integration activities completed in North America and with good progress in Europe we can accelerate our focus on commercial activities to continue growing the business going forward.
UNIQUE VALUE PROPOSITION PARTNERING WITH OUR CLIENTS
We are driving a client-centric transformation of Securitas to provide the most compelling value proposition in the security industry. With elevated global uncertainty and an increased threat environment, clients are looking for a future-oriented partner with deep security expertise who can support in shaping their security programs for the years to come. Our long-term partnership approach combined with our presence, technology and digital capabilities are important differentiators that make us the partner of choice for our clients.
Last month, we signed the first global vested contract in the industry with a technology company where we together will develop their security program leveraging our full offering.
To sharpen our performance and competitive position further we also continue to assess our business mix and presence.
Our performance in the second quarter and the confidence from our clients confirm that we are on the right path, and we remain committed to achieve the target of 8 percent operating margin by the end of 2025.
Magnus Ahlqvist President and CEO
PRESENTATION OF THE INTERIM REPORT
Analysts and media are invited to participate in a telephone conference on July 30, 2024, at 2.30 p.m. (CEST) 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
For further information, please contact: Micaela Sjökvist, Vice President, Investor Relations +46 76 116 7443
ABOUT SECURITAS
Securitas is a world-leading safety and security solutions partner that helps make your world a safer place. Nine decades of deep experience means we see what others miss. By leveraging technology in partnership with our clients, combined with an innovative, holistic approach, we're transforming the security industry. With approximately 341 000 employees in 44 markets, we see a different world and create sustainable value for our clients by protecting what matters most – their people and assets.
Group financial targets
Securitas has four financial targets:
8–10 percent technology and solutions annual average real sales growth
8 percent Group operating margin by year-end 2025, with a >10 percent long-term operating margin ambition
A net debt to EBITDA ratio below 3.0x
An operating cash flow of 70–80 percent of operating income before amortization
Securitas AB (publ.) P.O. Box 12307, SE-102 28 Stockholm, Sweden
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 1.00 p.m. (CEST) on Tuesday, July 30, 2024.
