The organic sales growth in 2012 was 0 percent due to weak market conditions in many markets and negative organic sales growth in France, Portugal and Spain. The slowdown in organic and acquired sales growth has, combined with strong focus on cash flow and receivables, contributed to the strong free cash flow of $328 million in the Group in 2012. This has resulted in a free cash flow to net debt ratio of 0.21, thereby we have achieved our financial target of at least 0.20.
October–December 2012
- Total sales $2.64 billion (2.68)
- Organic sales growth 0 percent (2)
- Operating margin 4.5 percent (5.7)
- Items affecting comparability$–66.83 million (0)
- Earnings per share adjusted for IAC and impairment losses $0.16(0.21)
- Earnings per share $0.03 (0.21)
January–December 2012
- Total sales $10.48 billion (10.10)
- Organic sales growth 0 percent (3)
- Operating margin 4.6 percent (5.3)
- Items affecting comparability$–66.83 million (0)
- Earnings per share adjusted for IAC and impairment losses $0.66(0.75)
- Earnings per share $0.52 (0.75)
- Free cash flow/net debt 0.21 (0.08)
- Proposed dividend $0.47 (0.47)
Comments from Alf Goransson, President and CEO of Securitas:
The organic sales growth in 2012 was 0 percent due to weak market conditions in many markets and negative organic sales growth in France, Portugal and Spain. The slowdown in organic and acquired sales growth has, combined with strong focus on cash flow and receivables, contributed to the strong free cash flow of $328 million in the Group in 2012. This has resulted in a free cash flow to net debt ratio of 0.21, thereby we have achieved our financial target of at least 0.20.
The operating margin in Security Services North America and Security Services Europe has gradually improved during the year, even though Security Services Europe and Mobile and Monitoring in the fourth quarter were impacted by items which can be categorized as one-off adjustments. In addition, the major restructuring and cost savings program that was executed at high speed from mid October until mid December impacted the performance negatively.
The cost savings program in North America, Europe and Spain was in all material aspects finalized in December 2012. The restructuring cost amounted to$ –72.19 million and was recognized in the fourth quarter 2012. The savings are confirmed to be $58.32 million in 2013, net of additional investments in resources within technology and security solutions.
We continue to increase our investments in resources within technology and security solutions, and in 2012 the sales of technology and security solutions represented approximately 6 percent of Group sales. We have set a target to triple this share of sales, which I consider achievable by the end of 2015