Securitas AB Annual Report 2005

The Mobile services unit, whose services are directed at small customers, is an example of how the division successfully deals with specialization and refi nement
of services. Modern technology, exemplifi ed by GPS-equipped call-out vehicles and Internet-based customer support, allows for a more effective and
secure service delivery for both customers and employees. The unit in the Netherlands experienced organic sales growth from zero to six percent in 2005.
Market and customers
The market for guarding and security services in Europe
is estimated at slightly more than MSEK 200,000 of
which 75 percent, MSEK 151,000, is outsourced – the
addressable market for Securitas.
The market has grown 4-6 percent annually in the past few
years, slightly exceeding GDP growth. In 2005, the market
expanded by 3-4 percent. The outsourced part generally
grows faster than the market average.
Competition
Securitas is the market leader in Europe, with a market
share of around 17 percent. The largest competitor is the
newly merged Group 4 Securicor, with a slightly lower
market share than that of Securitas, and with an operation
similar to Securitas in most European countries that
have a security industry. Other players with a regional
and considerable smaller market share include Prosegur
(Spain-Portugal) and Initial-Rentokil (United Kingdom-
Belgium). For the most part, Securitas’ competitors
offer the same range of services, except in the small to
medium-sized customer segments. In many countries,
mobile services – for example, beat patrol and call-outs
– are only offered by Securitas. Pricing by large players
is generally comparable, but in some countries and areas,
Securitas meets fi erce price competition from local and
regional players. In Europe as a whole, more than 19,000
companies employ a total of approximately 1.1 million
security offi cers.
Strong position
Security Services Europe’s market position is strong,
with fi nancial strength, stable organic sales growth and
sound operating margins. The new and more customer-
focused organization makes the division more responsive
to customer needs, providing the potential to further
increase market share.
The European economy was generally weak during
the year, especially in major countries like France and
Germany. Spain also showed a somewhat lower level
of activity than previous year. On the other hand, the
economic climate was more favorable in Norway,
Sweden, the United Kingdom and Eastern Europe.
The security industry is a somewhat late-cyclical
business. This means that the division is to some extent
affected by general market conditions although, it usually
takes time before a change in the economic environment
impacts sales and income.
Sales and market shares
Country
Sales
MSEK
Sales
MLOC
Market
share, %
Sweden 2,764 2,764 > 50
Norway 1,486 1,278 > 50
Denmark 267 214 24
Finland 897 96 50
Estonia 64 108 14
Germany 3,806 409 15
UK/Ireland 1,117 82 6
Belgium 1,756 189 46
The Netherlands 1,805 194 20
Switzerland 480 80 19
Austria 308 33 17
France 5,082 546 23
Spain1 4,153 446 23
Portugal 943 101 26
Argentina1 222 85 5
Hungary 89 2,379 10
Poland 225 97 3
Czech Republic 134 426 5
Elimination of internal sales2 –111
Total1 25,487 17
1 Adjusted for full-year sales of acquired units.
2 Refers to sales within the Security Services Europe division.
Security Services Europe
SECURITAS 2005 51