Securitas Q4 improves free cash flow, sending shares up 8%

Feb 7, 2024



Stockholm: SecuritiesThe world's second largest security services group reported better than expected on Wednesday free cash flow in the fourth quarter and said that it has been cut loanSend shares Up about 8%.
In the three months to the end of December, Securitas' free cash flow doubled to 3.50 billion Swedish crowns ($333.4 million), a significant increase from 1.17 billion a year earlier and well above the 2.4 billion expected by consensus cited by Jefferies. Is leading.
While Jefferies said free cash flow had been the main focus in the results, ABG Sund Collier analyst Stephen Knutson said the strong reading was driving shares on Wednesday.
The company's shares, among the top performers of the European STOXX 600 index, were up about 8% at 0819 GMT.
It said Securitas reduced total liabilities by the end of the period to $79.70 billion from $84.01 billion at the end of the third quarter.
“It's all about debt reduction,” said Kepler Chevreux analyst Johan Eliasson. “This is what has held shares back into 2023 – it now looks much better for 2024.”
Knutsson said shares were also potentially slightly lower, with Securitas losing more than 9% of its shares ahead of the report, according to the Swedish Financial Supervisory Authority.
Its operating profit before interest, taxes, depreciation and amortization (EBITA) rose to 2.68 billion Swedish crowns from 2.49 billion crowns a year earlier, compared with the average analyst forecast of 2.75 billion crowns in a company survey.
In a statement, CEO Magnus Ahlqvist said profitability was hampered by weakness in the group's critical infrastructure services business, which includes nuclear power plants, oil and gas companies and other power generation facilities.
There was “somewhat underperformance in Europe as well,” he said.
Securitas proposed a dividend of 3.80 crowns per share in 2023, up from 3.45 crowns a year earlier and above the 3.77 crowns expected by analysts surveyed by LSEG.



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