Securitas launches cost-cutting plan following European slump

 
City A.M. Reporter
SWEDISH security services group Securitas yesterday announced plans to cut costs and merge two divisions after posting seven straight quarterly earnings drops.

The company, the world’s second largest security firm after British-Danish G4S has suffered from weakness in Europe during the sovereign debt crisis, which has affected key contracts. Profitability in the USā€ˆmarket has been weaker than expected.

“A cost-savings programme has been initiated at Security Services North America and at Security Services Europe,” the group said in a statement, referring to two core divisions which together accounted for 76 per cent of sales last year.

The firm said it was aiming for annual cost savings of 300m Swedish krona (£28.1m) from 2013 with estimated restructuring costs of about 360m Swedish krona.

The firm also said it would merge its mobile and monitoring division – which accounted for 10 per cent of sales in 2011 – with the Security Services Europe division.

The changes will lead to job losses of about 400 people within middle and higher level management. In 2011 the group employed about 300,000 people worldwide in 51 countries.