Following the acquisition of STANLEY Security, that was completed and consolidated into Securitas as of July 22, 2022, the Group has defined new financial targets of 8-10 percent technology & solutions annual average real sales growth, 8 percent Group operating margin by year-end 2025 and a net debt to EBITDA ratio below 3.0x.
Securitas will present the strategy and roadmap for the new targets, as well as a trading update for STANLEY Security, at an investor update today at 2.00 p.m. CEST.
Complex security needs
Bringing together Securitas and STANLEY Security is an industry-defining event. They will have an outstanding position to serve complex security needs for the clients and by joining forces they are creating a strong global tech platform that will future proof the business for next-generation security solutions.
Bringing together Securitas and STANLEY Security is an industry-defining event
They are now embarking on a truly exciting journey as one company, together geared for high value growth in the coming years. The new financial targets are aligned with the strategy to be a security solutions partner with technology and expertise, strongly positioned to deliver superior growth and increased margins:
- 8-10 percent technology & 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.
Respective business segments
The new margin target replaces the previous target of an average increase in earnings per share of 10 percent and the margin targets in the respective business segments related to the business transformation programs in the Group.
The existing operating cash flow target of 70-80 percent of operating income before amortization remains the same, and the new capital structure target of a net debt to EBITDA ratio of below 3.0x replaces the previous net debt to EBITDA ratio of on average 2.5x, and is estimated to be achieved in 2024. The dividend policy is unchanged, remaining in a range of 50-60 percent of annual net income over time.
Electronic security sales
In 2021, STANLEY Security had an installation backlog growth of 33 percent
The strategic transformation ambition – to double the security solutions and electronic security sales by 2023, compared to 2018, is discontinued as the ambition was fulfilled by the acquisition of STANLEY Security.
The integration of STANLEY Security is proceeding well and according to plan. In 2021, STANLEY Security had an installation backlog growth of 33 percent. Adjusted sales were approximately MUSD 1 650 with organic sales growth of 7 percent during the year, and the adjusted EBITDA margin was 11 percent.
Record installation backlog
For the first six months of 2022, STANLEY Security had a record installation backlog, with a growth of 18 percent compared to the same period last year. Adjusted sales were approximately MUSD 805 with organic sales growth of 3 percent.
The adjusted EBITDA margin was 9 percent, temporarily impacted by the corona pandemic, supply chain issues, inflationary cost increases, and obsolete pricing processes. The profitability improved in the second quarter of 2022 compared to the first quarter of 2022 with a continued positive trend. Pricing, efficiency, and cost actions have been implemented, and together with solid commercial momentum and accelerated value creation execution, profitability will improve going forward.
