Research Update: Securitas AB Upgraded To ?BBB? On Lower Leverage And Strong Cash Flow Generation; Outlook Stable

We forecast Securitas AB will post S&P Global Ratings-adjusted debt to EBITDA of 2.6x by year-end 2024 and funds from operations (FFO) to debt will surpass 25%. This is driven by our expectation of solid operational performance with 4% revenue growth in 2024 and S&P Global Ratings-adjusted EBITDA margins improving by 100 basis points to 8.9%. We therefore raised our long-term issuer credit rating on Securitas AB and its subsidiary Securitas Treasury Ireland Designated Activity Company, as well as the issue rating on its senior unsecured debt, to 'BBB' from 'BBB-'. We also raised our short-term rating on the company to 'A-2' from 'A-3', and our Nordic scale rating to 'K-2' from 'K-3'. The stable outlook reflects our expectation that

...- We forecast Securitas AB will post S&P Global Ratings-adjusted debt to EBITDA of 2.6x by year-end 2024 and funds from operations (FFO) to debt will surpass 25%. This is driven by our expectation of solid operational performance with 4% revenue growth in 2024 and S&P Global Ratings-adjusted EBITDA margins improving by 100 basis points to 8.9%. - We therefore raised our long-term issuer credit rating on Securitas AB and its subsidiary Securitas Treasury Ireland Designated Activity Company, as well as the issue rating on its senior unsecured debt, to '###' from '###-'. We also raised our short-term rating on the company to 'A-2' from 'A-3', and our Nordic scale rating to 'K-2' from 'K-3'. - The stable outlook reflects our expectation that positive organic growth and margin improvements, combined with strong free operating cash flow (FOCF) generation will support debt to EBITDA below 3.5x and FFO to debt above 25% in the next 24 months....

Research Update