Fragile signs of macroeconomic recovery in Europe and the US have not yet been reflected in security market growth, says the multi-national security company Securitas in its report for 2013.
Alf Göransson, President and Chief Executive Officer, reported that organic sales growth was 1 percent and reflected what he called the challenging macro-economic situation in the US and Europe, affecting especially the security markets in France, Portugal and Spain. Latin America continued to show strong organic sales growth.
The operating margin of 5.1pc represented an improvement of the 4.6 per cent of the year before, and was driven by cost savings, the company says. Alf Göransson said: “The quarter-on-quarter improvement trend [in margin] continued, although it was hampered by the weak security market and slow organic sales growth. The operating margin improved compared with the preceding year, mainly driven by various restructuring and cost-saving actions taken in 2012. We achieved cost savings in accordance with our restructuring plan.
“In 2012, sales of security solutions and technology represented approximately 6 percent of Group sales. We have set a target to triple this share of sales by the end of 2015. We continued to increase our investments in resources within security solutions and technology and the run rate in the fourth quarter of 2013 was 8 percent.”
Sales of security solutions and technology are gradually increasing, he said. “Due to current market dynamics and a gradual increase of the use of technology in security solutions, the security market in mature markets is no longer expected to grow 1 to 2 percent faster than GDP as it has historically, but rather the same pace as GDP” Göransson suggested this trend could be improved through more outsourcing of guarding activities and if the private security industry were to take over services done by public authorities and governments.
“The degree to which technology is being integrated into security solutions varies from country to country in Securitas’ markets. However, as the pace accelerates, we are confident that we will be able to gain markets shares by having a stronger and more cost-efficient offering than many traditional guarding companies. We have already seen proof of this in markets where we are well equipped to offer security solutions, where we will be able to grow faster than the security market average.”
