Research Update: Securitas AB Outlook Revised To Positive On Ongoing Stanley Integration And Growth Prospects; ?BBB-? Ratings Affirmed

We expect Swedish security provider Securitas AB's revenue to grow by about 18% in 2023 and by 4% in 2024. Additionally, we expect its S&P Global Ratings-adjusted EBITDA margins to expand to 8.2% this year and 9.1% next year, from 7.4% in 2022 as the company continues to pass on price inflation to customers, further tightens its cost base, and benefits from additional cost efficiencies following its Stanley acquisition. We forecast this growth will drive lower adjusted leverage of about 3.1x by year-end 2023 and 2.6x by year-end 2024. Similarly, we forecast that--despite higher interest rates on the debt issued to refinance the bridge onboarded in 2022 to finance the Stanley acquisition--funds from operations (FFO) to debt will rise to

...- We expect Swedish security provider Securitas AB's revenue to grow by about 18% in 2023 and by 4% in 2024. Additionally, we expect its S&P Global Ratings-adjusted EBITDA margins to expand to 8.2% this year and 9.1% next year, from 7.4% in 2022 as the company continues to pass on price inflation to customers, further tightens its cost base, and benefits from additional cost efficiencies following its Stanley acquisition. - We forecast this growth will drive lower adjusted leverage of about 3.1x by year-end 2023 and 2.6x by year-end 2024. Similarly, we forecast that--despite higher interest rates on the debt issued to refinance the bridge onboarded in 2022 to finance the Stanley acquisition--funds from operations (FFO) to debt will rise to about 22% in 2023 and above 26% in 2024. - We therefore revised our outlook on Securitas AB to positive from stable. At the same time, we affirmed our '###-' long-term issuer credit rating on Securitas AB and its subsidiary Securitas Treasury Ireland...

Research Update