UPDATE 1-Securitas says market still challenging after Q4 miss

Mon Feb 10, 2014 2:57am EST

* Q4 EBITA 879 mln SEK vs avg analyst forecast 839 mln

* Says economic recovery not feeding through to markets

* Proposes lower-than-forecast dividend of 3.00 crowns/share

STOCKHOLM, Feb 10 (Reuters) - Securitas, the world's second-biggest security group, said tentative signs of economic recovery in Europe and the United States had not fed through to the security market, as it reported below-forecast quarterly earnings.

The main miss for the group, which trails sector leader G4S by sales, was in a segment which includes seven countries in Latin America, Portugal and Spain.

"Fragile signs of macroeconomic recovery in Europe and the U.S. have not yet been reflected in security market growth," Chief Executive Alf Goransson said.

Securitas hires out guards and surveillance systems in 52 countries across the globe. It makes more than half of its sales in Europe, where a sovereign debt crisis has eaten into spending on security services.

Operating profit before amortisation rose 19 percent to 879 million Swedish crowns ($135 million) in the quarter, missing a forecast for 907 million in a Reuters poll of analysts.

Shares in the Sweden-based group have risen about 18 percent in the past year on recovery hopes. But while margins are improving, they continue to be hampered by the weak security market and slow organic sales growth.

Securitas, which according to Thomson One data had nine "sell" recommendations on its shares against seven "holds" and three "strong buys", said it would pay a dividend of 3.00 crowns per share, below expectations for 3.14 crowns.

Securitas has been boosting investments in high-tech surveillance systems such as intelligent cameras, sales of which it aims to triple by the end of 2015 from 6 percent of sales in 2012. Such sales made up 8 percent of its total in the fourth quarter.

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