Atlas Ontario L.P. (dba Allied Universal)

Overview Key strengths Key risks Global market leader in security services, generating more than $21 billion in annual revenue. Very high debt service burden with exposure to floating interest rates. Resilient through economic cycles with a track record of positive organic revenue growth. Highly competitive industry with relatively low switching costs drives customer churn and limits pricing power. Diverse end markets and good customer diversification. Medium-term refinancing risk is elevated with approaching debt maturity wall. The company reported fourth quarter annualized customer retention had returned to the historical average of 95% after a temporary drop to 92% earlier in the year. We expect retention rates will be sustained in the mid-90% area, enabling organic revenue growth of about 4% driven

...Allied's healthy revenue growth and incremental margin expansion will likely continue through 2025, benefiting from improved customer retention and its profit-improvement initiatives. The company reported fourth quarter annualized customer retention had returned to the historical average of 95% after a temporary drop to 92% earlier in the year. We expect retention rates will be sustained in the mid-90% area, enabling organic revenue growth of about 4% driven by price increases and new business wins. We believe Allied maintains a measured approach to pricing intended to expand its gross profit margin over time, though the competitive nature of the industry limits its pricing power. Its profit-improvement initiatives,...

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