Speaking this morning during an ‘information meeting’ convened at Securitas’ head office in Lindhagensplan, Stockholm, Goransson suggested that the shift in focus within Securitas from an acquisition-driven expansion towards organic growth and profitability has proved to be the right way forward in light of the present worldwide recession.
“We intend to continue along this route and to be selective with respect to acquisitions, although we will exploit acquisition opportunities as they occur,” said the CEO.
“The organic sales growth in Security Services North America across 2008 was 3%, which is in line with the security market growth. However, the organic sales growth in the fourth quarter slowed down to 1% due to a reduction in new sales, and some customers requesting cutbacks on existing contracts.”
In line with European market statistics
Goransson added: “The organic sales growth 2008 in Security Services Europe is also in line with European security market growth figures, and stands at around 7%. In Europe, certain customer segments – primarily aviation, construction and retail – have experienced a decline in the fourth quarter, but the more important factor determining our organic sales growth in Europe is our strategy to prioritise profitability over volume.”
According to Goransson, that strategic choice is supported by the implementation of a higher degree of specialisation in operations, the sharing of knowledge and Best Practices and by further investments in the development of security expertise and security solutions.
“In all business segments, the price increases have been on a par with wage cost developments. The operating margin in the Group improved when compared to last year. In Security Services North America the consistent and systematic work with management of the contract portfolio paid off as operating margins improved by 5.7%. That compares with 5.2% in 2007.”
The fourth quarter was also “positively impacted” by the final outcome of mainly wage-related accruals during the year. In Security Services Europe, the operating margin remained basically flat at 5.7%. The operations acquired in Germany, and consolidated as of 30 June, negatively impacted the operating margin during the second half of the year. That was as expected. Aviation which is part of Security Services Europe – showed a positive trend, and contributed to maintaining the operating margin in Securitas’ European security guarding operation.
Mobile and Monitoring Services
In Mobile and Monitoring, the organic sales growth continued to improve compared to the previous year. The operating margin improved in the second half of the year, while the first six months were ‘burdened’ by the investments to build a larger sales organisation and open up new mobile routes.
As planned, cash operation Loomis was distributed to the shareholders in Securitas and listed on the NASDAQ OMX Stockholm on 9 December.
The results in detail
– Total sales: MSEK 56,572
– Income before tax: MSEK 2,617
– Items affecting comparability and impairment losses of goodwill: MSEK -29
– Net income (continuing operations): MSEK 1,890
– Net income (all operations): MSEK 2,322
– Earnings per share (continuing operations): SEK 5.18 (3.70)
– Earnings per share (all operations): SEK 6.36
– Proposed dividend: SEK 2.90