Securitas Falls on North America Margin: Stockholm Mover

Securitas AB (SECUB), the world’s second- biggest guarding services company, fell to a six-month low after saying the first-quarter operating margin narrowed in North America because of a failure to win orders.

Securitas dropped as much as 7.1 percent to 55.60 kronor, the lowest intraday price since Nov. 3, and was down 6.6 percent at 3 p.m. in Stockholm, where the company is based. That pushed the stock to a 5.9 percent decline this year, valuing Securitas at 20.4 billion kronor ($3 billion).

“We had a weak first quarter in North America,” where Securitas lost some contracts in the aerospace and automotive industries, Chief Executive Officer Alf Goeransson said today in a phone interview.

First-quarter net income fell to 356 million kronor, or 0.97 krona per share, from 369 million kronor, or 1.01 krona, a year earlier, Securitas said today in a statement. Profit missed the 401 million-kronor average estimate in a Bloomberg analyst survey. Sales rose 9.2 percent to 15.1 billion kronor.

The operating margin in North America narrowed to 4.6 percent from 5.3 percent a year earlier, and the customer- retention rate in that market was 89 percent, “slightly lower” than in the 2011 period, Securitas said.

The guard provider, which competes with G4S Plc (GFS) for the top spot in the security industry, will be “very restrictive” with acquisitions in the coming quarters to improve its ratio of free cash flow to net debt, Goeransson said. Securitas aims for a ratio of 0.2, compared with 0.12 in the first quarter and 0.13 a year earlier. Goeransson declined to say when he thinks that goal will be achieved.

To contact the reporter on this story: Ola Kinnander in Stockholm at

To contact the editor responsible for this story: Benedikt Kammel at

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