By Agnieszka Olenska, Jesus Calero
(Reuters) -Securitas, one of the world’s largest security services providers, reported a smaller-than-expected rise in first-quarter core profit on Thursday owing to currency headwinds, sending it shares down 6.2% in early trade.
The Swedish company said its quarterly operating earnings before amortisation rose to 2.53 billion Swedish crowns ($259.17 million) from 2.36 billion crowns a year earlier.
That missed analysts’ average forecast of 2.63 billion crowns in a poll provided by the company.
Despite the miss, Securitas said it was seeing improvements across all business segments.
Its operating margin improved to 6.4% in the first quarter from 6.0% a year earlier, helped by gains in both its security services and technology and solutions divisions.
JP Morgan said the currency headwinds were worse than anticipated, dragging on the results.
The broker added that it has not fully accounted for the negative impact of weaker currencies on Securitas, which operates globally and reports in Swedish crowns.
Jefferies also noted continued weakness in the company’s critical infrastructure unit.
This has added further strain on the company’s financial performance. The 2022 acquisition of Stanley Security increased debt while diversifying Securitas’ technology solutions, which has required continuing debt reduction efforts in recent quarters.
“The business optimisation programme initiated at the start of the year is on track to achieve 200 Swedish million crowns in annualised savings by the end of 2025,” Securitas CEO Magnus Ahlqvist said in the statement.
The company said it remained committed to achieving its target of an 8.0% operating margin by the end of 2025.
Securitas was among the worst performers on the European benchmark STOXX 600 index on Thursday morning.
(Reporting by Agnieszka Olenska and Jesus Calero; Editing by Louise Heavens, Susan Fenton and Ewan Harwood)
