Research Update: Swedish Security Provider Securitas AB Affirmed At 'BBB-' On Solid Operating Performance And Deleveraging Prospects

We expect that Swedish security provider Securitas AB will pursue the integration of security products business Stanley Security in 2023 that, combined with price increases and the continuous shift toward the technology and solutions business, will result in 9.5%-10.5% sales growth and higher S&P Global Ratings-adjusted EBITDA margins of 8.0%-8.5%. The solid operational performance will lower S&P Global Ratings-adjusted leverage to about 3.5x by year-end 2023 and below 3.0x by year-end 2024. Similarly, we forecast that despite higher interest rates on the debt issued to refinance the bridge acquired in 2022 to finance the Stanley acquisition, funds from operations (FFO) to debt will rise above 20% in 2023 and be near 25% in 2024. We therefore affirmed our 'BBB-' long-term

...- We expect that Swedish security provider Securitas AB will pursue the integration of security products business Stanley Security in 2023 that, combined with price increases and the continuous shift toward the technology and solutions business, will result in 9.5%-10.5% sales growth and higher S&P Global Ratings-adjusted EBITDA margins of 8.0%-8.5%. - The solid operational performance will lower S&P Global Ratings-adjusted leverage to about 3.5x by year-end 2023 and below 3.0x by year-end 2024. - Similarly, we forecast that despite higher interest rates on the debt issued to refinance the bridge acquired in 2022 to finance the Stanley acquisition, funds from operations (FFO) to debt will rise above 20% in 2023 and be near 25% in 2024. - We therefore affirmed our '###-' long-term issuer credit rating on Securitas and our '###-' issue rating on its senior unsecured debt. We also affirmed our short-term rating on the company at 'A-3' and our Nordic scale rating at 'K-3'. - The stable outlook...

Research Update