Securitas AB Interim Report January-September 2018

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Oct 26, 2018, 07:12 ET

STOCKHOLM, Oct. 26, 2018 /PRNewswire/ --

JULY–SEPTEMBER 2018
• Total sales MSEK 25 821 (22 651)
• Organic sales growth 6 percent (5)
• Operating income before amortization MSEK 1 452 (1 235)
• Operating margin 5.6 percent (5.5)
• Items affecting comparability MSEK –268 (0)
• Earnings per share SEK 2.07 (2.15)
• Earnings per share, before IAC,
SEK 2.61 (2.15)

JANUARY–SEPTEMBER 2018
• Total sales MSEK 74 643 (68 173)
• Organic sales growth 6 percent (4)
• Operating income before amortization MSEK 3 829 (3 428)
• Operating margin 5.1 percent (5.0)
• Items affecting comparability MSEK –268 (0)
• Earnings per share SEK 6.24 (5.76)
• Earnings per share, before IAC,
SEK 6.78 (5.76)
• Free cash flow/net debt 0.12 (0.12)

COMMENTS FROM THE PRESIDENT AND CEO
The Group continued with strong market momentum reaching organic sales growth of 6 percent (4) in the first nine months, despite facing tougher comparatives in the third quarter. We benefit from successful commercial activities in combination with excellent client retention, and we grew faster than the security market in general. We continue to drive our strategy of combining different protective services into security solutions to our customers. Security solutions and electronic security sales grew by 22 percent compared with the first nine months 2017 and represented 20 percent of total Group sales.

The operating margin was 5.1 percent (5.0), with improvements in both North America and Ibero-America while there was a slight decline in Europe. We have been able to balance wage cost increases with price increases in the first nine months. We see favourable macroeconomic conditions and labor shortage becoming more prominent in many markets. This situation is creating both challenges and opportunities and going into 2019 we continue with a strong focus on balancing prices and wages and offering alternative solutions to our customers.

The previously communicated cost savings program in Security Services Europe was initiated in the third quarter. The program will result in improved efficiency and includes 13 countries. Restructuring costs of MSEK 268 were recognized in the third quarter 2018 as an item affecting comparability. The payback period is about 2 years, some savings will start to come in during the fourth quarter 2018 but mostly during 2019.

Earnings per share, adjusted for changes in exchange rates and items affecting comparability, improved by 14 percent. This growth is based on our strategic and commercial development and positively impacted by the US tax reform.

During our investor update that took place in Stockholm in September, we were able to meet with many investors, analysts and media and I had the opportunity to share my view on the industry, our current situation and the journey ahead. Security is a good industry to be in and Securitas has a leading position in the market. We have demanding and loyal customers that believe in our direction and we are in a good position to create enhanced value for our customers and drive profitable growth. We are determined to deliver on our Vision 2020 strategy and lead the transformation of the global security industry. With intelligent security we will be able to further enhance the value for our customers through better security solutions. We will continue to invest and restructure in order to drive the digitization and modernize our information systems and capabilities. These are our focus areas as we go forward.

PRESENTATION OF THE INTERIM REPORT
Analysts and media are invited to participate in a telephone conference on October 26, 2018 at
2:30 p.m. (CET) where 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
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.

FINANCIAL INFORMATION CALENDAR
February 7, 2019, 08.00 a.m. (CET) Full Year Report January–December 2018
May 6, 2019, app. 1.00 p.m. (CET) Interim Report January–March 2019
May 6, 2019, 4.00 p.m. (CET) Annual General Meeting 2019
July 31, 2019, app. 1.00 p.m. (CET) Interim Report January–June 2019
November 6, 2019, 08.00 a.m. (CET) Interim Report January–September 2019

For further information regarding Securitas IR activities, refer to
www.securitas.com/investors/financialcalendar

About Securitas

Securitas is a knowledge leader in security and offers protective services in North America, Europe, Latin America, Africa, the Middle East, Asia and Australia. The organization is flat and decentralized with three business segments: Security Services North America, Security Services Europe and Security Services Ibero-America. 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 employs more than 345 000 people in 56 markets. Securitas is listed in the Large Cap segment at Nasdaq Stockholm.

Group strategy
Our strategy is to offer complete security solutions that integrate all of 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 and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 1.00 p.m. (CET) on Friday, October 26, 2018.

Magnus Ahlqvist
President and Chief Executive Officer

For Further Information. Please Contact:
Micaela Sjökvist, Head of Investor Relations.
+46-761167443

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SOURCE Securitas