Securitas Releases Earnings for 2008

  • Total sales US$6.6 billion in 2008 ($6 billion in 2007)
  • Income before taxes $307.5 million ($221.8 million)
  • Items affecting comparability and impairment losses of goodwill -$3.4 million (-50.2 million )
  • Net income, continuing operations, $221.8 million ($158.9 million)
  • Net income, all operations, $272.4 million ($61.7 million)
  • Earnings per share, continuing operations, $0.61 ($0.43)
  • Earnings per share, all operations, $0.75 ($0.17)
  • Proposed dividend $0.34 ($0.36*)

    To compare the dividend of $0.34 with previous year's dividend of $0.36, this year's proposed dividend from Loomis must be considered.

    Comments from the President and CEO
    The shift in focus within Securitas from an acquisition-driven expansion to a focus on organic growth and profitability, has proved to be the right way forward in light of the present worldwide recession and is also reflected in the 2008 results. We intend to continue along this route and to be selective with respect to acquisitions, although we will exploit acquisition opportunities as they occur.

    The organic sales growth in Security Services North America in 2008 was 3 percent, which is in line with the security market growth. However, the organic sales growth in the fourth quarter slowed down to 1 percent as a consequence of a reduction in new sales and some customers requesting reductions in size of existing contracts. The organic sales growth 2008 in Security Services Europe is also in line with the European security market growth which is in the 7 percent range. 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 prioritize profitability over volume. This strategic choice is supported by the implementation of a higher degree of specialization in operations, sharing of knowledge, best practices and by further investments in the development of security expertise and security solutions. In all business segments the price increases have been approximately on par with wage cost development during 2008.

    The operating margin in the Group improved compared to last year. In Security Services North America the consistent and systematic work, primarily with management of the contract portfolio paid off by improving operating margins in 2008 by 5.7 percent compared to 5.2 percent 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 percent for 2008. The operations acquired in Germany, consolidated as of June 30, 2008, negatively impacted the operating margin during the second half of the year as expected. Aviation, part of Security Services Europe, showed a positive trend and contributed to maintaining the operating margin in Securitas European guarding operation.

    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 organization and open up new mobile routes.

    Loomis was, as planned, distributed to the shareholders in Securitas and listed on the NASDAQ OMX Stockholm on Dec. 9, 2008.
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