Securitas

Quarterly Report • Jul 31, 2019

SECURITAS AB INTERIM REPORT

January–June 2019

APRIL–JUNE 2019

• • Total sales MSEK 27 684 (25 466)
• • Organic sales growth 5 percent (7)
• • Operating income before amortization MSEK 1 377 (1 286)
• • Operating margin 5.0 percent (5.0)
• • Items affecting comparability (IAC) MSEK –46 (0), relating to IS/IT transformation programs
• • Earnings per share SEK 2.18 (2.28)
• • Earnings per share, before IAC, SEK 2.27 (2.28)

JANUARY–JUNE 2019

• • Total sales MSEK 54 428 (48 822)
• • Organic sales growth 6 percent (7)
• • Operating income before amortization MSEK 2 667 (2 377)
• • Operating margin 4.9 percent (4.9)
• • Items affecting comparability (IAC) MSEK –66 (0), relating to IS/IT transformation programs
• • Earnings per share SEK 4.25 (4.17)
• • Earnings per share, before IAC, SEK 4.39 (4.17)
• • Free cash flow/net debt 0.14 (0.07)

We continue to grow ahead of the market

Contents

January–June
summary 2
Group development 3
Development in
the Group's business
segments 5
Cash flow 8
Capital employed
and financing 9
Acquisitions and
divestitures 10
Changes in Group Manage
ment and creation of
functional units 12
Other significant
events 13
Risks and
uncertainties 13
Parent Company
operations 14
Signatures of the
Board of Directors 15
Report of Review 16
Consolidated financial
statements 17
Segment overview 21
Notes 23
Parent Company 29
Financial
information 30

Organic sales growth in the Group was 5 percent (7) in the second quarter and 6 percent (7) in the first half year. North America delivered solid organic sales growth, despite strong comparatives. In Europe, organic sales growth was hampered by a few large guarding contract losses during the second quarter in a competitive business environment. We grew faster than the security market in general in the first six months, despite a slowdown in a few countries in Europe. Security solutions and electronic security sales grew by 15 percent in the first half year, and now represent 21 percent of total

The operating margin in the second quarter was unchanged at 5.0 percent (5.0). It was also unchanged in the first half year at 4.9 percent (4.9), with a strong performance in North America, and Europe and Ibero-America were flat. In Europe we had challenging labor conditions and were not able to fully offset wage cost increases through price increases in two countries. Managing the price and wage balance, and cost efficiency, will remain key focus areas throughout the year. The operating margin in Europe was supported by the cost savings program

Group sales.

initiated during 2018, which developed according to plan. The operating result, adjusted for changes in exchange rates, grew with 7 percent.

Comments from the President and CEO

Earnings per share, adjusted for changes in exchange rates and items affecting comparability, was slightly behind last year, negatively impacted by a higher effective tax rate in the US and by a negative net effect from IFRS 16.

Operating and free cash flow improved compared with the first six months last year. Cash management remains a key priority across all business segments.

Driving the transformation of the security services industry

During the second quarter, we announced three new global units to support our strategy of specialization in each of our protective services, adding datadriven intelligence and delivering client centric solutions. We also announced changes to the Securitas Group Management team.

Earlier this year we announced two comprehensive multi-year programs, which are progressing according to plan. The first

program will modernize our global IS/IT platform and capability across the Group and the second is a business transformation of our North American operations.

In the near term, we maintain our focus on delivering value to clients through our leading protective services offering. We are also driving employeefocused activities to continuously increase our employee engagement and to provide better conditions and opportunities for our employees.

This way, we continue to accelerate the transformation of our company and the security services industry.

Magnus Ahlqvist President and Chief Executive Officer

January–June summary

Securitas has adopted IFRS 16 Leases as of January 1, 2019. The cumulative effect of the adoption has been recognized without restatement of the comparative periods. Further information can be found in notes 1 and 2 on pages 23–24.

FINANCIAL SUMMARY

	Q2		Change, %		H1		Change, %		Full year	Change, %
MSEK	2019	2018	Total	Real	2019	2018	Total	Real	2018	Total
Sales	27 684	25 466	9	7	54 428	48 822	11	8	101 467	10
Organic sales growth, %	5	7			6	7			6
Operating income before amortization	1 377	1 286	7	3	2 667	2 377	12	7	5 304	13
Operating margin, %	5.0	5.0			4.9	4.9			5.2
Amortization of acquisition related intangible assets	–70	–65			–136	–128			–260
Acquisition-related costs	–17	–16			–29	–25			–120
Items affecting comparability*	–46	–			–66	–			–455
Operating income after amortization	1 244	1 205	3	0	2 436	2 224	10	4	4 469	2
Financial income and expenses	–150	–103			–289	–196			–441
Income before taxes	1 094	1 102	–1	–7	2 147	2 028	6	–1	4 028	0
Net income for the period	794	831	–4	–10	1 554	1 521	2	–5	3 021	10
Earnings per share, SEK	2.18	2.28	–4	–10	4.25	4.17	2	–5	8.26	10
EPS before items affecting comparability, SEK	2.27	2.28	0	–6	4.39	4.17	5	–2	9.17	17
Cash flow from operating activities, %	69	62			33	–5			60
Free cash flow	616	528			10	–900			1 884
Free cash flow to net debt ratio	–	–			0.14	0.07			0.13
Net debt to EBITDA ratio	–	–			2.9	2.6			2.3

* Refer to note 8 on page 26 for further information.

ORGANIC SALES GROWTH AND OPERATING MARGIN DEVELOPMENT PER BUSINESS SEGMENT

Organic sales growth						Operating margin
	Q2			H1		Q2	H1
%	2019	2018	2019	2018	2019	2018	2019	2018
Security Services North America	5	8	5	8	6.3	6.1	6.0	5.8
Security Services Europe	1	5	3	4	5.0	5.1	5.0	5.0
Security Services Ibero-America	16	11	17	10	4.6	4.7	4.6	4.6
Group	5	7	6	7	5.0	5.0	4.9	4.9

Group development

APRIL–JUNE 2019

Sales development

Sales amounted to MSEK 27 684 (25 466) and organic sales growth was 5 percent (7). Security Services North America delivered organic sales growth of 5 percent (8) on strong comparatives. Security Services Europe showed organic sales growth of 1 percent (5) and was hampered by the termination of a few large contracts, of which most were terminated in the beginning of the quarter. Security Services Ibero-America had 16 percent (11).

Real sales growth, including acquisitions and adjusted for changes in exchange rates, was 7 percent (8).

Sales of security solutions and electronic security sales amounted to MSEK 5 768 (5 066) or 21 percent (20) of total sales in the second quarter 2019. Real sales growth, including acquisitions and adjusted for changes in exchange rates, was 12 percent (21).

Operating income before amortization

Operating income before amortization was MSEK 1 377 (1 286) which, adjusted for changes in exchange rates, represented a real change of 3 percent (11).

The Group's operating margin was 5.0 percent (5.0). The operating margin in Security Services North America improved, while it declined in Security Services Europe and Security Services Ibero-America. Continued investments in the Vision 2020 strategy at the Group level, included under Other in the segment reporting, impacted the Group operating margin by –0.1 percent.

The adoption of IFRS 16 Leases had a positive impact on the operating result of MSEK 17 in the quarter. For further information refer to notes 1 and 2.

Operating income after amortization

Amortization of acquisition related intangible assets amounted to MSEK –70 (–65).

Acquisition related costs were MSEK –17 (–16). For further information refer to note 7.

Items affecting comparability were MSEK –46 (0), related to the IS/IT transformation programs. For further information refer to note 8.

Financial income and expenses

Financial income and expenses amounted to MSEK –150 (–103). The adoption of IFRS 16 Leases had a negative impact of MSEK –37. Furthermore, financial income and expenses were negatively impacted by the development of USD interest rates, a weaker Swedish krona and increased net debt. Financial income and expenses were positively impacted by an amount of MSEK 3 related to hyperinflation accounting in Argentina. For further information refer to note 3.

Income before taxes

Income before taxes was MSEK 1 094 (1 102). The adoption of IFRS 16 Leases had a negative effect of MSEK –20 on income before taxes. For further information refer to notes 1 and 2.

Taxes, net income and earnings per share

The Group's tax rate was 27.4 percent (24.6). The increase compared to full year 2018 is mainly due to reversed effects from the US tax reform. The tax rate before tax on items affecting comparability was 27.3 percent.

Net income was MSEK 794 (831). The adoption of IFRS 16 Leases had a negative effect on net income. For further information refer to notes 1 and 2.

Earnings per share amounted to SEK 2.18 (2.28). Earnings per share before items affecting comparability amounted to SEK 2.27 (2.28).

JANUARY–JUNE 2019

Sales development

Sales amounted to MSEK 54 428 (48 822) and organic sales growth was 6 percent (7). Security Services North America delivered solid organic sales growth of 5 percent (8) on strong comparatives. Security Services Europe showed organic sales growth of 3 percent (4), a decline due to the termination of a few large contracts. Security Services Ibero-America had 17 percent (10).

Real sales growth, including acquisitions and adjusted for changes in exchange rates, was 8 percent (8).

Sales of security solutions and electronic security sales amounted to MSEK 11 296 (9 588) or 21 percent (20) of total sales in the first half year 2019. Real sales growth, including acquisitions and adjusted for changes in exchange rates, was 15 percent (21).

Operating income before amortization

Operating income before amortization was MSEK 2 667 (2 377) which, adjusted for changes in exchange rates, represented a real change of 7 percent (9).

The Group's operating margin was 4.9 percent (4.9). The operating margin in Security Services North America improved, while it was unchanged in Security Services Europe and Security Services Ibero-America. Continued investments in the Vision 2020 strategy at the Group level, included under Other in the segment reporting, impacted the Group operating margin by –0.1 percent. Total price adjustments in the Group were slightly behind wage cost increases due to Security Services Europe.

The adoption of IFRS 16 Leases had a positive impact on the operating result of MSEK 34 in the first half year. For further information refer to notes 1 and 2.

Operating income after amortization

Amortization of acquisition related intangible assets amounted to MSEK –136 (–128).

Acquisition related costs were MSEK –29 (–25). For further information refer to note 7.

Items affecting comparability were MSEK –66 (0), related to the IS/IT transformation programs. For further information refer to note 8.

Financial income and expenses

Financial income and expenses amounted to MSEK –289 (–196). The adoption of IFRS 16 Leases had a negative impact of MSEK –73. Furthermore, financial income and expenses were negatively impacted by the development of USD interest rates, a weaker Swedish krona and increased net debt. Financial income and expenses were positively impacted by an amount of MSEK 10 related to hyperinflation accounting in Argentina. For further information refer to note 3.

Income before taxes

Income before taxes was MSEK 2 147 (2 028). The adoption of IFRS 16 Leases had a negative effect of MSEK –39 on income before taxes. For further information refer to notes 1 and 2.

Taxes, net income and earnings per share

The Group's tax rate was 27.6 percent (25.0). The increase compared to full year 2018 is mainly due to reversed effects from the US tax reform. The tax rate before tax on items affecting comparability was 27.5 percent. Assessing the current tax base and tax matters, the best judgment now is that the full year Group tax rate in 2019 is expected to be around 27.6 percent.

Net income was MSEK 1 554 (1 521).

Earnings per share amounted to SEK 4.25 (4.17). Earnings per share before items affecting comparability amounted to SEK 4.39 (4.17).

Group quarterly

Quarterly sales

Development in the Group's business segments

Security Services North America

Security Services North America provides protective services in the US, Canada and Mexico and comprises 15 business units: the national and global accounts organization, five geographical regions and seven specialized business units in the US – critical infrastructure services, healthcare, Pinkerton Corporate Risk Management, mobile, manufacturing, oil and gas and Securitas Electronic Security – plus Canada and Mexico. In total, there are approximately 720 branch managers and 122 000 employees.

	Q2		Change, %		H1		Change, %		Full year
MSEK	2019	2018	Total	Real	2019	2018	Total	Real	2018
Total sales	12 050	10 478	15	8	23 619	19 843	19	9	42 366
Organic sales growth, %	5	8			5	8			6
Share of Group sales, %	44	41			43	41			42
Operating income before amortization	756	639	18	12	1 411	1 151	23	13	2 589
Operating margin, %	6.3	6.1			6.0	5.8			6.1
Share of Group operating income, %	55	50			53	48			49

April–June 2019

Organic sales growth was 5 percent (8), on strong comparatives. Main contribution derived from the five geographical regions and the business unit critical infrastructure services.

Security solutions and electronic security sales represented MSEK 2 199 (1 760) or 18 percent (17) of total sales in the business segment in the second quarter.

The operating margin was 6.3 percent (6.1), supported mainly by Securitas Electronic Security and continued healthy development in the five guarding regions. The adoption of IFRS 16 Leases had a slight positive impact on the operating result in the business segment.

The Swedish krona exchange rate weakened against the US dollar, which had a positive effect on operating income in Swedish kronor. The real change was 12 percent in the second quarter.

January–June 2019

Organic sales growth was 5 percent (8). The first half year faced strong comparatives and a slightly lower client retention rate of 90 percent (91). Main contribution to organic sales growth was the five geographical regions and the business unit critical infrastructure services.

Security solutions and electronic security sales represented MSEK 4 277 (3 292) or 18 percent (17) of total sales in the business segment in the first half year.

The operating margin was 6.0 percent (5.8), supported mainly by the risk management business and Securitas Electronic Security. The adoption of IFRS 16 Leases had a slight positive impact on the operating result in the business segment.

The Swedish krona exchange rate weakened against the US dollar, which had a positive effect on operating income in Swedish kronor. The real change was 13 percent in the first half year.

Quarterly sales

North America quarterly operating income development Quarterly operating income development

Security Services Europe

Security Services Europe provides security services for large and medium-sized clients in 28 countries, and airport security in 15 countries. The service offering also includes mobile security services for small and medium-sized businesses and residential sites, and electronic alarm surveillance services. In total, the organization has approximately 770 branch managers and 128 000 employees.

		Q2 Change, %		H1		Change, %		Full year
MSEK	2019	2018	Total	Real	2019	2018	Total	Real	2018
Total sales	11 826	11 407	4	3	23 277	21 982	6	4	45 040
Organic sales growth, %	1	5			3	4			4
Share of Group sales, %	43	45			43	45			44
Operating income before amortization	586	583	1	0	1 153	1 097	5	4	2 511
Operating margin, %	5.0	5.1			5.0	5.0			5.6
Share of Group operating income, %	43	45			43	46			47

April–June 2019

Organic sales growth was 1 percent (5), a decline mainly due to France and the UK. In addition to the termination of an Aviation contract in France in April, worth MEUR 22 in annual sales, a few other large contracts were terminated in France and in the UK, of which most were terminated in the beginning of the quarter. Organic sales growth was supported by Belgium and Germany, the Nordic countries and the guarding business in Turkey.

Security solutions and electronic security sales represented MSEK 2 582 (2 449) or 22 percent (21) of total sales in the business segment.

The operating margin was 5.0 percent (5.1). The decline was mainly explained by continued challenging conditions in France, including the contract terminations mentioned above as well as regulatory changes. Furthermore, the operating margin was hampered by the termination of a profitable contract in Sweden as previously communicated. Also, wage increases were not fully offset with price increases in France and the Netherlands in the second quarter.The operating margin was supported by the cost savings program initiated during 2018, which developed according to plan. The adoption of IFRS 16 Leases had a positive impact on the operating result in the business segment.

The Swedish krona exchange rate weakened against foreign currencies, primarily the Euro, which had a small positive effect on operating income in Swedish kronor. The real change was 0 percent in the second quarter.

January–June 2019

Organic sales growth was 3 percent (4), a decline explained by the contract terminations in France and the UK during the second quarter. The client retention rate was 91 percent (93). Main contribution to organic sales growth derived from Belgium, Germany, the Nordic countries and Turkey.

Security solutions and electronic security sales represented MSEK 5 098 (4 638) or 22 percent (21) of total sales in the business segment.

The operating margin was 5.0 percent (5.0), supported by the cost savings program initiated during 2018 and by Turkey. The operating margin was hampered by France and Sweden as well as the negative price and wage balance in two countries during the second quarter. The adoption of IFRS 16 Leases had a positive impact on the operating result in the business segment.

The Swedish krona exchange rate weakened against foreign currencies, primarily the Euro, which had a small positive effect on operating income in Swedish kronor. The real change was 4 percent in the first half year.

Security Services Ibero-America

Security Services Ibero-America provides security services for large and medium-sized clients in nine Latin American countries as well as in Portugal and Spain in Europe. Security Services Ibero-America has a combined total of approximately 170 branch managers and 63 000 employees.

	Q2		Change, %		H1		Change, %		Full year
MSEK	2019	2018	Total	Real	2019*	2018	Total	Real	2018
Total sales	3 306	3 147	5	16	6 546	6 159	6	17	12 315
Organic sales growth, %	16	11			17	10			12
Share of Group sales, %	12	12			12	13			12
Operating income before amortization	151	148	2	-1	304	282	8	10	550
Operating margin, %	4.6	4.7			4.6	4.6			4.5
Share of Group operating income, %	11	12			11	12			10

* As of July 1, 2018, Securitas has adopted IAS 29 Financial reporting in hyperinflationary economies for our operations in Argentina. When calculating the key ratios for organic sales growth percentage and real change percentage, the impact from the remeasurement is treated similarly to currency change. The calculated key ratio percentages are thus comparable as to how these were calculated before the adoption of IAS 29. The impact from IAS 29 is a remeasurement of sales with MSEK –4 and a remeasurement of operating income before amortization of MSEK –1 for H1 2019.

April–June 2019

Organic sales growth was 16 percent (11). The improvement derived mainly from Spain with double-digit organic sales growth and from price increases in Argentina.

Security solutions and electronic security sales represented MSEK 918 (816) or 28 percent (26) of total sales in the business segment.

The operating margin was 4.6 percent (4.7), a decline mainly due to Argentina. Spain showed continued strong performance supported by high margin security solutions sales in Spain – of which an important part are short term contracts – and leverage from the strong topline growth. The adoption of IFRS 16 Leases had a positive impact on the operating result in the business segment.

The Swedish krona exchange rate weakened against the Euro while it strengthened against the Argentinian peso. The net effect was positive on operating income in Swedish kronor. The real change in the segment was –1 percent in the second quarter.

January–June 2019

Organic sales growth was 17 percent (10). The improvement derived mainly from Spain with double-digit organic sales

Security solutions and electronic security sales represented MSEK 1 803 (1 579) or 28 percent (26) of total sales in the business segment.

The operating margin was 4.6 percent (4.6), supported by Spain but burdened by Argentina. The situation in Argentina remains challenging. As previously communicated, management changes have been made. A thorough investigation into improper behavior is being conducted and further actions will be taken where required.

The adoption of IFRS 16 Leases had a positive impact on the operating result in the business segment.

The Swedish krona exchange rate strengthened against the Argentinian peso while it weakened against the Euro. The net effect was negative on operating income in Swedish kronor. The real change in the segment was 10 percent in the first half year.

Cash flow

The adoption of IFRS16 Leases had no net impact on cash flow from operating activities nor on the free cash flow according to Securitas financial model. The cash flow is consequently prepared on the same basis as in 2018.

April–June 2019

Cash flow from operating activities amounted to MSEK 946 (801), equivalent to 69 percent (62) of operating income before amortization.

The impact from changes in accounts receivable was MSEK –266 (–463). Changes in other operating capital employed were MSEK –45 (119).

Free cash flow was MSEK 616 (528), equivalent to 68 percent (57) of adjusted income.

Cash flow from investing activities, acquisitions, was MSEK –233 (–721).

Cash flow from items affecting comparability amounted to MSEK –77 (0). Refer to note 8 for further information.

Cash flow from financing activities was MSEK –1 083 (312) due to dividend paid of MSEK –1 606 (–1 460) and a net increase in borrowings of MSEK 523 (1 772).

Cash flow for the period was MSEK –777 (119).

January–June 2019

Cash flow from operating activities amounted to MSEK 879 (–124), equivalent to 33 percent (–5) of operating income before amortization.

The impact from changes in accounts receivable was MSEK –399 (–737). Changes in other operating capital employed were MSEK –1 202 (–1 484).

Free cash flow

MSEK	Jan–Jun 2019
Operating income before amortization1)	2 667
Net investments2)	–187
Change in accounts receivable	–399
Change in other operating capital employed	–1 202
Cash flow from operating activities	879
Financial income and expenses paid	–344
Current taxes paid	–525
Free cash flow	10

1) Effect from IFRS 16 amounts to MSEK 34.

2) Net effect from IFRS 16 amounts to MSEK –34, consisting of investments MSEK –456 and reversal of depreciation MSEK 422. Cash flow from operating activities include net investments in non-current tangible and intangible assets, amounting to MSEK –187 (–280). The net investments include capital expenditures in equipment for solution contracts and is the result of investments of MSEK –1 487 (–1 075) and reversal of depreciation of MSEK 1 300 (795). The adoption of IFRS 16 Leases impacted investments with MSEK –456 and reversal of depreciation with MSEK 422.

Free cash flow was MSEK 10 (–900), equivalent to 1 percent (–53) of adjusted income.

Cash flow from investing activities, acquisitions, was MSEK –382 (–1 235), of which purchase price payments accounted for MSEK –362 (–1 238), assumed net debt for MSEK 36 (41) and acquisition related costs paid for MSEK –56 (–38).

Cash flow from items affecting comparability amounted to MSEK –143 (0). Refer to note 8 for further information.

Cash flow from financing activities was MSEK –61 (1 116) due to dividend paid of MSEK –1 606 (–1 460) and a net increase in borrowings of MSEK 1 545 (2 576).

Cash flow for the period was MSEK –576 (–1 019). The closing balance for liquid funds after translation differences of MSEK 41 was MSEK 2 694 (3 229 as of December 31, 2018).

Quarterly free cash flow Quarterly free cash flow

Capital employed and financing

Capital employed as of June 30, 2019

The Group's operating capital employed was MSEK 14 293 (9 199 as of December 31, 2018), corresponding to 13 percent of sales (9 as of December 31, 2018), adjusted for the full-year sales figures of acquired units. Adjusted for the impact of IFRS 16 Leases the operating capital employed as percent of sales would have been 10 percent (9 as of December 31, 2018). The adoption of IFRS 16 Leases increased the Group´s operating capital employed by MSEK 3 433 as of January 1, 2019. The increase in operating capital employed is further explained by the free cash flow. The translation of foreign operating capital employed to Swedish kronor increased the Group's operating capital employed by MSEK 104.

The Group's total capital employed was MSEK 38 370 (32 170 as of December 31, 2018). The translation of foreign capital employed to Swedish kronor increased the Group's capital employed by MSEK 846. The return on capital employed was 13 percent (15 as of December 31, 2018). Adjusted for the impact of IFRS 16 Leases the return on capital employed would have been 14 percent (15 as of December 31, 2018).

Financing as of June 30, 2019

The Group's net debt amounted to MSEK 20 460 (14 513 as of December 31, 2018). The net debt was negatively impacted mainly by a change in lease liabilities of MSEK –3 415, a dividend of MSEK –1 606, paid to the shareholders in May 2019, the translation of net debt in foreign currency to Swedish kronor of MSEK –456 and payments for acquisitions of MSEK –382.

The free cash flow to net debt ratio amounted to 0.14 (0.07). The net debt to EBITDA ratio was 2.9 (2.6). The interest coverage ratio amounted to 9.4 (12.1). Adjusted for the impact of IFRS 16 Leases the free cash flow to net debt ratio would have been 0.16 (0.07) and the net debt to EBITDA ratio would have been 2.5 (2.6), while the interest coverage ratio would have been 10.7 (12.1).

Securitas has a revolving credit facility with its 12 key relationship banks. This credit facility comprises two respective tranches of MUSD 550 and MEUR 440 and matures in 2022. On June 30, 2019, the facility was undrawn. Further information regarding financial instruments and credit facilities is provided in note 9.

Standard and Poor's rating for Securitas is BBB. The "stable" outlook was upgraded to "positive" outlook on April 16, 2019.

Shareholders' equity amounted to MSEK 17 910 (17 657 as of December 31, 2018). The translation of foreign assets and liabilities into Swedish kronor increased shareholders' equity by MSEK 390. Refer to the statement of comprehensive income on page 17 for further information.

The total number of shares amounted to 365 058 897 (365 058 897) as of June 30, 2019. On June 24, 2019, 125 000 shares were repurchased. Refer to pages 13 and 20 for further information.

Capital employed and financing

MSEK Jun 30, 2019
Operating capital employed	14 293
Goodwill	22 070
Acquisition related intangible assets	1 523
Shares in associated companies	484
Capital employed	38 370
Net debt	20 460
Shareholders' equity	17 910
Financing	38 370

Net debt development

MSEK
Jan 1, 2019	–14 513
Free cash flow	10
Acquisitions	–382
Items affecting comparability	–143
Dividend paid	–1 606
Lease liabilities	–3 415
Change in net debt	–5 536
Revaluation	45
Translation	–456
Jun 30, 2019	–20 460

Free cash flow/Net debt Free cash flow/Net debt

Acquisitions and divestitures

ACQUISITIONS AND DIVESTITURES JANUARY–JUNE 2019 (MSEK)

Company	Business segment1)	Included from	Acquired share2)	Annual sales3)	Enterprise value4)	Goodwill	Acq. related intangible assets
Opening balance						21 061	1 458
	Security Services
Global Elite Group, the US 6)	North America	Jan 10	100	290	154	123	70
Allcooper Group, the UK 6)	Security Services Europe	Apr 1	100	88	59	31	26
Staysafe,Australia 6)	Other	Apr 4	100	72	90	128	59
Other acquisitions and divestitures 5) 6)		–	–	–15	23	–4	2
Total acquisitions and divestitures January–June 2019				435	326	278	157
Amortization of acquisition related intangible assets						–	–136
Exchange rate differences and remeasurement for hyperinflation						731	44
Closing balance						22 070	1 523

1) Refers to business segment with main responsibility for the acquisition.

2) Refers to voting rights for acquisitions in the form of share purchase agreements. For asset deals no voting rights are stated.

3) Estimated annual sales.

4) Purchase price paid/received plus acquired/divested net debt but excluding any deferred considerations.

5) Related to other acquisitions and divestitures for the period and updated previous year acquisition calculations for the following entities: Nortrax Veg og Trafikk, Norway, WHD Wachdienst Heidelberg, Wach- und Schließgesellschaft Hof Inh. I Müller, Germany and Securitas Interim (divestiture), France. Related also to deferred considerations paid in Sweden, France, Austria, Czech Republic and Australia.

6) Deferred considerations have been recognized mainly based on an assessment of the future profitability development in the acquired entities for an agreed period. The net of new deferred considerations, payments made from previously recognized deferred considerations and revaluation of deferred considerations in the Group was MSEK 117. Total deferred considerations, short-term and long-term, in the Group's balance sheet amount to MSEK 396.

All acquisition calculations are finalized no later than one year after the acquisition is made. Transactions with noncontrolling interests are specified in the statement of changes in shareholders' equity on page 20. Transaction costs and revaluation of deferred considerations can be found in note 7 on page 26.

Global Elite Group, the US

Securitas Transport Aviation Services USA has acquired Global Elite Group, a leading security services provider to the aviation industry in the US. The purchase price is approximately MUSD 22 (MSEK 200), contingent upon reaching certain targets. Global Elite Group is based in Garden City, New York, and specializes in providing high level security services to various airlines, airports and airport related customers. The customer base consists of more than 60 commercial airlines and numerous general aviation clients. The growth pattern in the company has been solid over the years. The number of employees is approximately 1 050.

Securitas runs a twofold strategy in the US aviation market, addressing both the federal government with passenger and baggage screening for the Transportation Security Administration, as well as security services for the commercial market such as airlines, airports and airport related customers (e.g. cargo). The estimated market volume for the latter, i.e. the commercial market related to 450 airports, is between BUSD 1.3–1.8. The acquisition is consistent with Securitas strategy of expanding in the aviation industry. Global Elite Group is considered a premier aviation security service provider in the US. The company will strengthen and complement Securitas current aviation organization, and the combined network, footprint, licenses and know-how will increase the value we bring to existing and new customers. The acquisition was consolidated in Securitas as of January 10, 2019.

Allcooper Group, the UK

Securitas has acquired all shares in the electronic security company Allcooper Group in the United Kingdom. Allcooper Group, founded in 1987, specializes in the installation, maintenance and monitoring of a wide range of security and fire systems. It operates from bases in Gloucestershire, the West Midlands and London with around 100 employees. Allcooper's expertise in electronic security and its portfolio of long-term customers will provide excellent support in Securitas' pursuit of its strategic objectives. The acquisition was consolidated in Securitas as of April 1, 2019.

Staysafe, Australia

Securitas is strengthening its client value proposition in the Australian security market through the acquisition of Staysafe, a leading alarm monitoring company in Australia. Founded in 1987 and based in Melbourne, Staysafe is today one of the largest monitoring companies in Australia with MAUD 11 (MSEK 72) annual sales, 73 employees and 28 000 monitoring connections managed through two grade A1 monitoring centers located in Melbourne, Victoria and Adelaide in South Australia. Since entering the Australian market in 2017 Securitas has experienced strong growth and expanded its geographical footprint and capabilities across the country. The acquisition was consolidated in Securitas as of April 4, 2019.

ACQUISITIONS AFTER THE SECOND QUARTER

Securitas subsidiary Securitas Critical Infrastructure Services, Inc (SCIS), under the independent direction of its Board, has entered into an agreement to acquire certain inspection and background investigations assets of MSM Security Services LLC. The purchase price is approximately MUSD 11 (MSEK 102), contingent upon reaching certain business development targets. Securitas Critical Infrastructure Services, Inc is an independent US subsidiary of Securitas AB, which specializes in providing a wide range of security services to federal agencies, aerospace and defense contractors, and federally regulated energy and aviation facilities. The transaction will expand SCIS' federal background investigations business and is anticipated to add MUSD 15 (MSEK 140) of annual sales. The transaction is expected to close after regulatory approval, which is expected during the third quarter of 2019.

Changes in Group Management and creation of functional units

Three new global functional units have been created and changes to the Securitas Group Management team have been made to support the strategy and related to upcoming retirements.

From July 1, 2019 the three new global functional are:

• • Global Clients & Vertical Markets, responsible for Securitas largest global clients and for developing specialization in new vertical markets.
• • Global Electronic Security Business Center, responsible for developing a global business approach with common tools, processes, products and services within Electronic Security.
• • Global Guarding Center of Excellence, responsible for continuing to strengthen our core by developing global expertise, common tools and processes within Guarding.

The following changes in Group Management took effect from July 1, 2019:

• • Brian Riis Nielsen appointed to SVP Global Clients, leader of the Global Clients & Vertical Markets function and a member of Securitas Group Management
• • Tony Byerly continues in his role as President, Securitas Electronic Security North America and was appointed to a member of Securitas Group Management. Tony Byerly will also lead the Global Electronic Security Business Center unit
• • Luis Posadas retired from his role as Divisional President Ibero-America and stepped down from Securitas Group Management.
• • Jorge Couto appointed to Divisional President Ibero-America and a member of Securitas Group Management.

• Andreas Lindback continues in his role as Divisional President AMEA and appointed a member of Securitas Group Management.

The following changes will take effect from January 1, 2020:

• • Santiago Galaz is appointed Executive Chairman of Securitas North America and steps down from Securitas Group Management.
• • Greg Anderson is appointed to President, North American Guarding, and a member of Securitas Group Management.
• • José Castejon is appointed to Chief Operating Officer, North American Guarding and a member of Securitas Group Management. José will also lead the Global Guarding Center of Excellence unit.
• • Bill Barthelemy retires from his role as Chief Operating Officer, North America and steps down from Securitas Group Management. Bill will assist as an advisor and continue working with select clients through 2021.

Additionally, a process to identify a global SVP of People and member of Securitas Group Management has been initiated.

The following individuals continue in their present roles: Bart Adam (CFO), Peter Karlströmer (Divisional President Security Services Europe), Henrik Zetterberg (COO Security Services Europe), Aimé Lyagre (COO and CTO Security Services Europe), Marc Pissens (President Aviation), Martin Althén (CIO), Jan Lindström (SVP Finance), Frida Rosenholm (SVP General Counsel) and Helena Andreas (SVP Brand & Communications).

Other significant events

For critical estimates and judgments, provisions and contingent liabilities refer to the 2018 Annual Report and to note 12 on page 28. If no significant events have occurred relating to the information in the Annual Report, no further comments are made in the Interim Report for the respective case.

Board of Directors of Securitas AB (publ) resolved to repurchase the company's own shares to ensure the company's undertakings under share-related incentive programs

The Board of Directors of Securitas AB has resolved, pursuant to the authorization granted by the Annual General Meeting held on 6 May 2019, to acquire the company's own shares of series B on Nasdaq Stockholm. The purpose of the acquisition is to ensure Securitas' undertakings in respect of share-related or share-based incentive programs (other than delivery of shares to participants of incentive programs), including covering social security costs.

The acquisition commenced on 5 June 2019 and shall end no later than 1 May 2020 and will be administrated by Skandinaviska Enskilda Banken (SEB), which, based on the trading order given by Securitas to SEB, will take trading decisions independently of Securitas with regard to the timing of the acquisition.

Acquisition may comprise a maximum of 1 000 000 series B shares on one or several occasions and shall be made on Nasdaq Stockholm in accordance with its Rule Book for Issuers. The acquisitions will be made at a price per share within the from time to time registered trading interval. Payment for the shares will be made in cash. Reporting will take place through the stock exchange in accordance with applicable rules. In the event of a fully executed share repurchase, the company will own shares representing maximum 0.3 percent of the issued shares in the company.

The total number of shares amounted to 365 058 897 (365 058 897) as of June 30, 2019. On June 24, 2019, 125 000 shares were repurchased. Refer to page 20 for further information.

Risks and uncertainties

Risk management is necessary for Securitas to be able to fulfill its strategies and achieve its corporate objectives. Securitas' risks fall into three main categories; contract and acquisition risks, operational assignment risks and financial risks. Securitas' approach to enterprise risk management is described in more detail in the Annual Report for 2018.

In the preparation of financial reports, the Board of Directors and Group Management are required to make estimates and judgments. These estimates and judgments impact the statement of income and balance sheet as well as disclosures such as contingent liabilities. The actual outcome may differ from these estimates and judgments under different circumstances and conditions.

For the forthcoming six-month period, the financial impact of certain items affecting comparability, provisions and contingent liabilities, as described in the Annual Report for 2018 and, where applicable, under the heading "Other significant events" above, may vary from the current financial estimates and provisions made by management. This could affect the Group's profitability and financial position.

Parent Company operations

The Group's Parent Company, Securitas AB, is not involved in any operating activities. Securitas AB consists of Group Management and support functions for the Group.

January–June 2019

The Parent Company's income amounted to MSEK 581 (487) and mainly relates to license fees and other income from subsidiaries.

Financial income and expenses amounted to MSEK 2 371 (2 256). Income before taxes amounted to MSEK 2 446 (2 301).

As of June 30, 2019

The Parent Company's non-current assets amounted to MSEK 46 211 (43 506 as of December 31, 2018) and mainly comprise shares in subsidiaries of MSEK 43 523 (41 332 as of December 31, 2018). Current assets amounted to MSEK 7 389 (7 329 as of December 31, 2018) of which liquid funds accounted for MSEK 1 364 (1 326 as of December 31, 2018).

Shareholders' equity amounted to MSEK 29 203 (28 499 as of December 31, 2018). A dividend of MSEK 1 606 (1 460) was paid to the shareholders in May 2019.

The Parent Company's liabilities and untaxed reserves amounted to MSEK 24 397 (22 336 as of December 31, 2018) and mainly consist of interest-bearing debt.

For further information, refer to the Parent Company's condensed financial statements on page 29.

Signatures of the Board of Directors

The Board of Directors and the President and CEO certify that the interim report gives a true and fair overview of the Parent Company's and Group's operations, their financial position

and results of operations, and describes significant risks and uncertainties facing the Parent Company and other companies in the Group.

Stockholm, July 31, 2019

Marie Ehrling Chairman

Carl Douglas Ingrid Bonde Vice Chairman Director

Director Director Director

John Brandon Anders Böös Fredrik Cappelen

Sofia Schörling Högberg Dick Seger Director Director

Susanne Bergman Israelsson Åse Hjelm Jan Prang Employee Representative Employee Representative Employee Representative

Magnus Ahlqvist President and Chief Executive Officer

Report of Review

(Translation of Swedish Original)

Review report over Interim Financial Statements (Interim report) prepared in accordance with IAS 34 and Chapter 9 of the Swedish Annual Accounts Act.

Introduction

We have reviewed this report for the period January 1, 2019 to June 30, 2019 for Securitas AB. The Board of Directors and the CEO and President are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.

Scope of Review

We conducted our review in accordance with the International Standard on Review Engagements ISRE 2410, Review of Interim Report Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of

persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, in accordance with IAS 34 and the Swedish Annual Accounts Act, regarding the Group, and with the Swedish Annual Accounts Act, regarding the Parent Company.

Stockholm, July 31, 2019 PricewaterhouseCoopers AB

Patrik Adolfson Madeleine Endre Authorised Public Accountant Authorised Public Accountant Auditor in charge

Consolidated financial statements

STATEMENT OF INCOME

MSEK	Apr–Jun 2019	Apr–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Dec 2018
Sales	27 134	25 208	53 329	48 319	99 707
Sales, acquired business	550	258	1 099	503	1 760
Total sales4)	27 684	25 466	54 428	48 822	101 467
Organic sales growth, %5)	5	7	6	7	6
Production expenses2)	–22 882	–21 039	–44 995	–40 344	–83 570
Gross income2)	4 802	4 427	9 433	8 478	17 897
Selling and administrative expenses2)	–3 443	–3 153	–6 793	–6 130	–12 654
Other operating income4)	9	8	17	15	30
Share in income of associated companies	9	4	10	14	31
Operating income before amortization2)	1 377	1 286	2 667	2 377	5 304
Operating margin, %	5.0	5.0	4.9	4.9	5.2
Amortization of acquisition related intangible assets	–70	–65	–136	–128	–260
Acquisition related costs7)	–17	–16	–29	–25	–120
Items affecting comparability8)	–46	–	–66	–	–455
Operating income after amortization2)	1 244	1 205	2 436	2 224	4 469
Financial income and expenses2, 3, 9)	–150	–103	–289	–196	–441
Income before taxes2)	1 094	1 102	2 147	2 028	4 028
Net margin, %	4.0	4.3	3.9	4.2	4.0
Current taxes	–318	–264	–623	–477	–962
Deferred taxes2)	18	–7	30	–30	–45
Net income for the period2)	794	831	1 554	1 521	3 021
Whereof attributable to:
Equity holders of the Parent Company	795	833	1 553	1 522	3 016
Non-controlling interests	–1	–2	1	–1	5
Earnings per share before and after dilution2) (SEK)	2.18	2.28	4.25	4.17	8.26
Earnings per share before and after dilution and before items affecting comparability2) (SEK)	2.27	2.28	4.39	4.17	9.17

STATEMENT OF COMPREHENSIVE INCOME

MSEK	Apr–Jun 2019	Apr–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Dec 2018
Net income for the period	794	831	1 554	1 521	3 021
Other comprehensive income for the period
Items that will not be reclassified to the statement of income
Remeasurements of defined benefit pension plans net of tax	–29	13	5	31	–72
Total items that will not be reclassified to the statement of income10)	–29	13	5	31	–72
Items that subsequently may be reclassified to the statement of income
Remeasurement for hyperinflation net of tax3)	20	–	42	–	314
Cash flow hedges net of tax	56	–9	17	20	63
Cost of hedging net of tax	15	4	19	6	–44
Net investment hedges net of tax	–126	–254	–358	–444	–381
Other comprehensive income from associated companies, translation differences	–2	24	18	24	19
Translation differences	–37	815	730	1 344	668
Total items that subsequently may be reclassified to the statement of income10)	–74	580	468	950	639
Other comprehensive income for the period10)	–103	593	473	981	567
Total comprehensive income for the period	691	1 424	2 027	2 502	3 588
Whereof attributable to:
Equity holders of the Parent Company	692	1 425	2 025	2 502	3 583
Non-controlling interests	–1	–1	2	0	5

Notes 2–10 refer to pages 23–27.

STATEMENT OF CASH FLOW

Operating cash flow MSEK	Apr–Jun 2019	Apr–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Dec 2018
Operating income before amortization	1 377	1 286	2 667	2 377	5 304
Investments in non-current tangible and intangible assets	–780	–556	–1 487	–1 075	–2 188
Reversal of depreciation	660	415	1 300	795	1 693
Change in accounts receivable	–266	–463	–399	–737	–1 575
Change in other operating capital employed	–45	119	–1 202	–1 484	–62
Cash flow from operating activities	946	801	879	–124	3 172
Cash flow from operating activities, %	69	62	33	–5	60
Financial income and expenses paid	–55	–39	–344	–282	–432
Current taxes paid	–275	–234	–525	–494	–856
Free cash flow	616	528	10	–900	1 884
Free cash flow, %	68	57	1	–53	48
Cash flow from investing activities, acquisitions and divestitures	–233	–721	–382	–1 235	–1 755
Cash flow from items affecting comparability 8)	–77	–	–143	–	–117
Cash flow from financing activities	–1 083	312	–61	1 116	–376
Cash flow for the period	–777	119	–576	–1 019	–364

Cash flow MSEK	Apr–Jun 2019	Apr–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Dec 2018
Cash flow from operations	1 259	1 063	1 225	138	3 858
Cash flow from investing activities	–753	–1 256	–1 357	–2 273	–3 846
Cash flow from financing activities	–1 283	312	–444	1 116	–376
Cash flow for the period	–777	119	–576	–1 019	–364

Change in net debt MSEK	Apr–Jun 2019	Apr–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Dec 2018
Opening balance	–19 290	–14 467	–14 513	–12 333	–12 333
Cash flow for the period	–777	119	–576	–1 019	–364
Change in lease liabilities	44	–31	–3 415	–46	–31
Change in loans	–523	–1 741	–1 545	–2 530	–1 053
Change in net debt before revaluation and translation differences	–1 256	–1 653	–5 536	–3 595	–1 448
Revaluation of financial instruments9)	91	–8	45	33	26
Translation differences	–5	–604	–456	–837	–758
Change in net debt	–1 170	–2 265	–5 947	–4 399	–2 180
Closing balance	–20 460	–16 732	–20 460	–16 732	–14 513

Notes 8–9 refer to page 26–27.

CAPITAL EMPLOYED AND FINANCING

MSEK	Jun 30, 2019	Jun 30, 2018	Dec 31, 2018
Operating capital employed2)	14 293	10 514	9 199
Operating capital employed as % of sales	13	10	9
Return on operating capital employed, %	43	54	58
Goodwill	22 070	20 845	21 061
Acquisition related intangible assets	1 523	1 358	1 458
Shares in associated companies	484	452	452
Capital employed2)	38 370	33 169	32 170
Return on capital employed, %	13	15	15
Net debt2)	–20 460	–16 732	–14 513
Shareholders' equity	17 910	16 437	17 657
Net debt equity ratio, multiple	1.14	1.02	0.82

BALANCE SHEET

MSEK	Jun 30, 2019	Jun 30, 2018	Dec 31, 2018
ASSETS
Non-current assets
Goodwill	22 070	20 845	21 061
Acquisition related intangible assets	1 523	1 358	1 458
Other intangible assets	1 664	1 274	1 450
Right-of-use assets2)	3 594	237	222
Other tangible non-current assets	3 627	3 532	3 532
Shares in associated companies	484	452	452
Non-interest-bearing financial non-current assets	1 812	1 810	1 744
Interest-bearing financial non-current assets	485	545	499
Total non-current assets2)	35 259	30 053	30 418
Current assets
Non-interest-bearing current assets	24 153	22 224	21 701
Other interest-bearing current assets	125	127	121
Liquid funds	2 694	2 630	3 229
Total current assets	26 972	24 981	25 051
TOTAL ASSETS2)	62 231	55 034	55 469

MSEK	Jun 30, 2019	Jun 30, 2018	Dec 31, 2018
SHAREHOLDERS' EQUITY AND LIABILITIES
Shareholders' equity
Attributable to equity holders of the Parent Company	17 884	16 418	17 632
Non-controlling interests	26	19	25
Total shareholders' equity	17 910	16 437	17 657
Equity ratio, %	29	30	32
Long-term liabilities
Non-interest-bearing long-term liabilities	336	357	336
Long-term lease liabilities2)	2 717	126	116
Other interest-bearing long-term liabilities	16 427	16 931	15 858
Non-interest-bearing provisions	2 605	3 411	2 527
Total long-term liabilities2)	22 085	20 825	18 837
Current liabilities
Non-interest-bearing current liabilities and provisions	17 616	14 795	16 587
Current lease liabilities2)	920	111	106
Other interest-bearing current liabilities	3 700	2 866	2 282
Total current liabilities2)	22 236	17 772	18 975
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES2)	62 231	55 034	55 469

Note 2 refers to pages 23–24.

CHANGES IN SHAREHOLDERS' EQUITY

	Jun 30, 2019			Jun 30, 2018			Dec 31, 2018
MSEK	Attributable to equity holders of the Parent Company	Non controlling interests	Total	Attributable to equity holders of the Parent Company	Non controlling interests	Total	Attributable to equity holders of the Parent Company	Non controlling interests	Total
Opening balance January 1, 2019/2018	17 632	25	17 657	15 518	21	15 539	15 518	21	15 539
Total comprehensive income for the period	2 025	2	2 027	2 502	0	2 502	3 583	5	3 588
Transactions with non-controlling interests	0	–1	–1	–1	–2	–3	–2	–1	–3
Share based incentive schemes	–167	–	–1671)	–141	–	–141	–7	–	–7
Dividend paid to the shareholders of the Parent Company	–1 606	–	–1 606	–1 460	–	–1 460	–1 460	–	–1 460
Closing balance June 30/December 31, 2019/2018	17 884	26	17 910	16 418	19	16 437	17 632	25	17 657

1) Refers to a swap agreement in Securitas AB shares of MSEK –147, hedging the share portion of Securitas share based incentive scheme 2018, and adjustment to grant date value of non-vested shares of MSEK 1, related to Securitas share based incentive scheme 2017. Refers also to repurchase of own shares of MSEK –21.

DATA PER SHARE

SEK	Apr–Jun 2019	Apr–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Dec 2018
Share price, end of period	162.90	147.45	162.90	147.45	142.25
Earnings per share before and after dilution1, 2, 3)	2.18	2.28	4.25	4.17	8.26
Earnings per share before and after dilution and before items affecting comparability1, 2, 3)	2.27	2.28	4.39	4.17	9.17
Dividend	–	–	–	–	4.40
P/E-ratio after dilution and before items affecting comparability	–	–	–	–	16
Share capital (SEK)	365 058 897	365 058 897	365 058 897	365 058 897	365 058 897
Number of shares outstanding1, 3)	364 933 897	365 058 897	364 933 897	365 058 897	365 058 897
Average number of shares outstanding1, 3, 4)	365 049 282	365 058 897	365 054 063	365 058 897	365 058 897

1) There are no convertible debenture loans. Consequently there is no difference before and after dilution regarding earnings per share and number of shares.

2) Number of shares used for calculation of earnings per share includes shares related to the Group's share based incentive schemes that have been hedged through swap agreements.

3) On June 24, 2019, 125 000 shares were repurchased.

4) Used for calculation of earnings per share.

Segment overview April–June 2019 and 2018

APRIL–JUNE 2019

	Security Services	Security Services	Security Services
MSEK	North America	Europe	Ibero-America	Other	Eliminations	Group
Sales, external	12 050	11 826	3 306	502	–	27 684
Sales, intra-group	0	0	0	1	–1	–
Total sales	12 050	11 826	3 306	503	–1	27 684
Organic sales growth, %	5	1	16	–	–	5
Operating income before amortization	756	586	151	–116	–	1 377
of which share in income of associated companies	–1	–	–	10	–	9
Operating margin, %	6.3	5.0	4.6	–	–	5.0
Amortization of acquisition related intangible assets	–16	–40	–8	–6	–	–70
Acquisition related costs	–1	–12	–	–4	–	–17
Items affecting comparability	–23	–13	0	–10	–	–46
Operating income after amortization	716	521	143	–136	–	1 244
Financial income and expenses	–	–	–	–	–	–150
Income before taxes	–	–	–	–	–	1 094

APRIL–JUNE 2018

	Security Services	Security Services	Security Services
MSEK	North America	Europe	Ibero-America	Other	Eliminations	Group
Sales, external	10 477	11 407	3 147	435	–	25 466
Sales, intra-group	1	–	0	0	–1	–
Total sales	10 478	11 407	3 147	435	–1	25 466
Organic sales growth, %	8	5	11	–	–	7
Operating income before amortization	639	583	148	–84	–	1 286
of which share in income of associated companies	–2	–	–	6	–	4
Operating margin, %	6.1	5.1	4.7	–	–	5.0
Amortization of acquisition related intangible assets	–13	–40	–8	–4	–	–65
Acquisition related costs	–13	–3	–	0	–	–16
Items affecting comparability	–	–	–	–	–	–
Operating income after amortization	613	540	140	–88	–	1 205
Financial income and expenses	–	–	–	–	–	–103
Income before taxes	–	–	–	–	–	1 102

Segment overview January–June 2019 and 2018

JANUARY–JUNE 2019

	Security Services	Security Services	Security Services
MSEK	North America	Europe	Ibero-America	Other	Eliminations	Group
Sales, external	23 616	23 277	6 546	989	–	54 428
Sales, intra-group	3	0	0	2	–5	–
Total sales	23 619	23 277	6 546	991	–5	54 428
Organic sales growth, %	5	3	17	–	–	6
Operating income before amortization	1 411	1 153	304	–201	–	2 667
of which share in income of associated companies	–7	–	–	17	–	10
Operating margin, %	6.0	5.0	4.6	–	–	4.9
Amortization of acquisition related intangible assets	–32	–79	–15	–10	–	–136
Acquisition related costs	–9	–16	–	–4	–	–29
Items affecting comparability	–32	–16	–1	–17	–	–66
Operating income after amortization	1 338	1 042	288	–232	–	2 436
Financial income and expenses	–	–	–	–	–	–289
Income before taxes	–	–	–	–	–	2 147

JANUARY–JUNE 2018

	Security	Security	Security
MSEK	Services North America	Services Europe	Services Ibero-America	Other	Eliminations	Group
Sales, external	19 842	21 982	6 158	840	–	48 822
Sales, intra-group	1	–	1	0	–2	–
Total sales	19 843	21 982	6 159	840	–2	48 822
Organic sales growth, %	8	4	10	–	–	7
Operating income before amortization	1 151	1 097	282	–153	–	2 377
of which share in income of associated companies	–5	–	–	19	–	14
Operating margin, %	5.8	5.0	4.6	–	–	4.9
Amortization of acquisition related intangible assets	–24	–78	–17	–9	–	–128
Acquisition related costs	–18	–7	–	0	–	–25
Items affecting comparability	–	–	–	–	–	–
Operating income after amortization	1 109	1 012	265	–162	–	2 224
Financial income and expenses	–	–	–	–	–	–196
Income before taxes	–	–	–	–	–	2 028

NOTE 1 Accounting principles

This interim report has been prepared in accordance with IAS 34 Interim Financial Reporting and the Swedish Annual Accounts Act. The interim report comprises pages 1–30 and pages 1–16 are thus an integrated part of this financial report.

Securitas' consolidated financial statements are prepared in accordance with International Financial Reporting Standards (IFRS) as endorsed by the European Union, the Swedish Annual Accounts Act and the Swedish Financial Reporting Board's standard RFR 1 Supplementary Accounting Rules for Groups. The most important accounting principles under IFRS, which is the basis for the preparation of this interim report, can be found in note 2 on pages 73 to 79 in the Annual Report for 2018. The accounting principles are also available on the Group's website www.securitas.com under the section Investors – Financial data – Accounting Principles.

The Parent Company's financial statements are prepared in accordance with the Swedish Annual Accounts Act and the Swedish Financial Reporting Board's standard RFR 2 Accounting for Legal Entities. The most important accounting principles used by the Parent Company can be found in note 41 on page 131 in the Annual Report for 2018.

Adoption and impact of new and revised IFRS that have been applied as from January 1, 2019

IFRS 16 Leases came into force on January 1, 2019 and has been adopted by Securitas as of that date. For further information regarding Securitas adoption of IFRS 16, refer to note 2 in this interim report as well as to note 2 and note 40 in the Annual Report 2018.

Amendments to IAS 19 Employee Benefits came into force on January 1, 2019 and has been adopted by Securitas as of that date. The amendments clarify the accounting for defined benefit plan amendments, curtailments and settlements. They are not expected to have any material impact on the Group's financial statements.

None of the other published standards and interpretations that are mandatory for the Group's financial year 2019 are assessed to have any impact on the Group's financial statements.

Introduction and effect of new and revised IFRS that are effective as from 2020 and onwards

The effect on the Group's financial statements from standards and interpretations that are mandatory for the Group's financial year 2020 or later remain to be assessed.

Usage of key ratios not defined in IFRS

For definitions and calculations of key ratios not defined in IFRS, refer to notes 5 and 6 in this interim report as well as to note 3 in the Annual Report 2018.

NOTE 2 Adoption of IFRS 16 Leases

Securitas has adopted IFRS 16 as of January 1, 2019. The cumulative effect of the adoption has been recognized without restatement of the comparative periods.

Securitas' lease agreements are mainly attributable to buildings and vehicles. As from the transition to IFRS 16, they are accounted for as right-of-use assets and long-term and current lease liabilities in the consolidated balance sheet.

In the consolidated statement of income, depreciation of the right-of-use assets is accounted for on the lines production expenses and selling and administrative expenses. Interest expenses are accounted for on the line financial income and expenses. In the Group´s segment overviews, the effects of the adoption of IFRS 16 are accounted for under each segment.

The lease liabilities on January 1, 2019 have been measured at the present value of remaining lease payments, discounted by using the incremental borrowing rate for each country. The right-of-use assets on January 1, 2019 have been measured at an amount equal to the lease liabilities.

Extension clauses are evaluated for each lease agreement and are applied based on our best estimate at each closing. Leases for which the lease term ends within 12 months of the date of initial application have been accounted for as short-term leases and are thus excluded from the lease liabilities accounted for under IFRS 16.

IFRS 16 has been adopted on segment level. As a consequence, the Group will change the level of impairment testing for goodwill from country level to segment level in 2019.

The effects on the consolidated statement of income and the consolidated balance sheet from the adoption of IFRS 16 are specified in the tables below.

EFFECTS ON CONSOLIDATED STATEMENT OF INCOME

MSEK	Apr–Jun 2019	Jan–Jun 2019
Operating income before amortization*	17	34
Financial expenses	–37	–73
Income before taxes	–20	–39
Deferred taxes	6	11
Net income for the period	–14	–28
Earnings per share before and after dilution (SEK)	–0.04	–0.08
Earnings per share before and after dilution and before items affecting comparability
(SEK)	–0.04	–0.08

* Depreciation of right-of-use assets included in operating income was MSEK –220 for April–June 2019 and MSEK –422 for January–June 2019.

BRIDGE BETWEEN OPERATING LEASES UNDER IAS 17 AND LEASE LIABILITY ACCORDING TO IFRS 16

MSEK	Jan 1, 2019
Operating leases under IAS 17 at December 31, 2018	4 259
Effect of discounting	–504
Finance leases recognized at December 31, 2018	222
Short-term leases recognized on a straight-line basis as expense	–269
Low-value leases recognized on a straight-line basis as expense	–53
Lease liability under IFRS 16 at January 1, 2019	3 655

EFFECTS ON CONSOLIDATED CAPITAL EMPLOYED AND FINANCING

MSEK	Jan 1, 2019
Capital employed
Previously recognized financial lease assets Jan 1, 2019	222
Additional right-of-use assets under IFRS 16 Jan 1, 2019	3 433
Operating capital employed Jan 1, 2019	3 655
Financing
Previously recognized financial lease liabilities Jan 1, 2019	222
Additional lease liabilities under IFRS 16 Jan 1, 2019	3 433
Net debt Jan 1, 2019	3 655

EFFECTS ON CONSOLIDATED BALANCE SHEET

MSEK	Jan 1, 2019
Assets
Previously recognized financial lease assets Jan 1, 2019	222
Additional right-of-use assets under IFRS 16 Jan 1, 2019	3 433
Total right-of-use assets Jan 1, 2019*	3 655
Liabilities
Previously recognized financial lease liabilities Jan 1, 2019	222
Additional lease liabilities under IFRS 16 Jan 1, 2019	3 433
Total lease liabilities Jan 1, 2019*	3 655

* As of June 30, 2019 total right-of-use assets were MSEK 3 594 while total long-term and current lease liabilities were MSEK 3 636.

Note 2, cont.

	Jun 30, 2019	Impact from IFRS 16	Jun 30, 2019 adjusted for IFRS 16	Jun 30, 2018
Net debt to EBITDA	2.9	–0.4	2.5	2.6
Free cash flow to net debt	0.14	0.02	0.16	0.07
Interest coverage ratio	9.4	1.3	10.7	12.1
Operating capital employed as % of sales	13	–3	10	10
Return on operating capital employed, %	43	7	50	54
Return on capital employed, %	13	1	14	15
Net debt to equity ratio	1.14	–0.19	0.95	1.02
Equity, %	29	1	30	30

NOTE 3 Remeasurement for hyperinflation

The impact on the consolidated statement of income from the application of IAS 29 Financial reporting in Hyperinflationary economies is illustrated below. The SEK/ARS rate as of December 31, 2018 was 0.23 and as of June 30, 2019 it was 0.22.

REMEASUREMENT IMPACT RECOGNIZED IN OTHER COMPREHENSIVE INCOME

MSEK	Apr–Jun 2019	Apr–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Dec 2018
Remeasurement on first time adoption July 1, 2018	–	–	–	–	275
Remeasurement current period	20	–	42	–	39
Total remeasurement for hyperinflation, net of taxes	20	–	42	–	314

NET MONETARY GAIN RECOGNIZED IN THE CONSOLIDATED STATEMENT OF INCOME

MSEK	Apr–Jun 2019	Apr–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Dec 2018
Financial income and expenses	3	–	10	–	23
Total monetary gain	3	–	10	–	23

NOTE 4 Revenue

MSEK	Apr–Jun 2019	%	Apr–Jun 2018	%	Jan–Jun 2019	%	Jan–Jun 2018	%	Jan–Dec 2018	%
Guarding services	21 478	77	20 036	79	42 256	77	38 557	79	79 567	79
Security solutions and electronic
security	5 768	21	5 066	20	11 296	21	9 588	20	20 440	20
Other	438	2	364	1	876	2	677	1	1 460	1
Total sales	27 684	100	25 466	100	54 428	100	48 822	100	101 467	100
Other operating income	9	0	8	0	17	0	15	0	30	0
Total revenue	27 693	100	25 474	100	54 445	100	48 837	100	101 497	100

Guarding services

This comprises on-site and mobile guarding, which is services with the same revenue recognition pattern. Revenue is recognized over time, as the services are rendered by Securitas and simultaneously consumed by the customers. Such services cannot be reperformed.

Security solutions and electronic security

This comprises two broad categories regarding security solutions and electronic security.

Security solutions are a combination of services such as on-site and/or mobile guarding and/or remote guarding. These services are combined with a technology component in terms of equipment owned and managed by Securitas and used in the provision of services. The equipment is installed at the customer site. The revenue recognition pattern is over time, as the services are rendered by Securitas and simultaneously consumed by the customers. A security solution normally constitutes one performance obligation.

Electronic security consists of the sale of alarm installations comprising design and installation (time, material and related expenses). Revenue is recognized as per the contract, either upon completion of the conditions in the contract, or over time based on the percentage of completion. Remote guarding (in the form of alarm

monitoring services), that is sold separately and not as part of a security solution, is also included in this category. Revenue recognition is over time as this is also a service that is rendered by Securitas and simultaneously consumed by the customers. The category further includes maintenance services, that are either performed upon request (time and material) with revenue recognition at a point in time (when the work has been performed), or over time if part of a service level contract with a subscription fee. Finally there is also a to a limited extent product sales (alarms and components) without any design or installation. The revenue recognition is at a point in time (upon delivery).

Other

Other comprises mainly corporate risk management services that are either recognized over time or at a point in time as well as other ancillary business.

Other operating income

Other operating income consists in its entirety of trade mark fees for the use of the Securitas brand name.

Revenue per segment

The disaggregation of revenue by segment is shown in the table below. Total sales agree to total sales in the segment overviews.

	Security Services Security Services North America Europe		Security Services Ibero-America		Other		Eliminations		Group
MSEK	Apr–Jun 2019	Apr–Jun 2018	Apr–Jun 2019	Apr–Jun 2018	Apr–Jun 2019	Apr–Jun 2018	Apr–Jun 2019	Apr–Jun 2018	Apr–Jun 2019	Apr–Jun 2018	Apr–Jun 2019	Apr–Jun 2018
Guarding services	9 413	8 354	9 244	8 958	2 388	2 331	434	394	–1	–1	21 478	20 036
Security solutions and electronic security	2 199	1 760	2 582	2 449	918	816	69	41	–	–	5 768	5 066
Other	438	364	–	–	–	–	–	–	–	–	438	364
Total sales	12 050	10 478	11 826	11 407	3 306	3 147	503	435	–1	–1	27 684	25 466
Other operating income	–	–	–	–	–	–	9	8	–	–	9	8
Total revenue	12 050	10 478	11 826	11 407	3 306	3 147	512	443	–1	–1	27 693	25 474

Note 4, cont.

	Security Services North America			Security Services Security Services Europe Ibero-America			Other Eliminations			Group
MSEK	Jan–Jun 2019	Jan–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Jun 2019	Jan–Jun 2018
Guarding services	18 466	15 874	18 179	17 344	4 743	4 580	873	761	–5	–2	42 256	38 557
Security solutions and electronic security	4 277	3 292	5 098	4 638	1 803	1 579	118	79	–	–	11 296	9 588
Other	876	677	–	–	–	–	–	–	–	–	876	677
Total sales	23 619	19 843	23 277	21 982	6 546	6 159	991	840	–5	–2	54 428	48 822
Other operating income	–	–	–	–	–	–	17	15	–	–	17	15
Total revenue	23 619	19 843	23 277	21 982	6 546	6 159	1 008	855	–5	–2	54 445	48 837

NOTE 5 Organic sales growth and currency changes

The calculation of real and organic sales growth and the specification of currency changes on operating income before and after amortization, income before taxes, net income and earnings per share are specified below. The impact from remeasurement for hyperinflation due to the application of IAS 29 is included in currency change.

MSEK	Apr–Jun 2019	Apr–Jun 2018	Apr–Jun %	Jan–Jun 2019	Jan–Jun 2018	Jan–Jun %
Total sales	27 684	25 466	9	54 428	48 822	11
Currency change from 2018	–437	–		–1 698	–
Currency adjusted sales growth	27 247	25 466	7	52 730	48 822	8
Acquisitions/divestitures	–550	–12		–1 099	–16
Organic sales growth	26 697	25 454	5	51 631	48 806	6
Operating income before amortization	1 377	1 286	7	2 667	2 377	12
Currency change from 2018	–50	–		–125	–
Currency adjusted operating income before amortization	1 327	1 286	3	2 542	2 377	7
Operating income after amortization	1 244	1 205	3	2 436	2 224	10
Currency change from 2018	–45	–		–117	–
Currency adjusted operating income after amortization	1 199	1 205	0	2 319	2 224	4
Income before taxes	1 094	1 102	–1	2 147	2 028	6
Currency change from 2018	–66	–		–146	–
Currency adjusted income before taxes	1 028	1 102	–7	2 001	2 028	–1
Net income for the period	794	831	–4	1 554	1 521	2
Currency change from 2018	–50	–		–109	–
Currency adjusted net income for the period	744	831	–10	1 445	1 521	–5
Net income attributable to equity holders of
the Parent Company	795	833	–5	1 553	1 522	2
Currency change from 2018	–50	–		–109	–
Currency adjusted net income attributable to equity holders of the Parent Company	745	833	–11	1 444	1 522	–5
Average number of shares outstanding	365 049 282	365 058 897		365 054 063	365 058 897
Currency adjusted earnings per share	2.04	2.28	–10	3.96	4.17	–5

NOTE 6 Definitions and calculation of key ratios

The calculations below relate to the period January–June 2019.

Interest coverage ratio

Operating income before amortization (rolling 12 months) plus interest income (rolling 12 months) in relation to interest expenses (rolling 12 months). Calculation: (5 594 + 51) / 598 = 9.4

Free cash flow as % of adjusted income

Free cash flow as a percentage of adjusted income (operating income before amortization adjusted for financial income and expenses, excluding revaluation of financial instruments, and current taxes). Calculation: 10 / (2 667 – 289 + 1 – 623) = 1%

Free cash flow in relation to net debt

Free cash flow (rolling 12 months) in relation to closing balance net debt. Calculation: 2 794 / 20 460 = 0.14

Net debt to EBITDA ratio

Net debt in relation to operating income after amortization (rolling 12 months) plus amortization of acquisition related intangible assets (rolling 12 months) and depreciation (rolling 12 months). Calculation: 20 460 / (4 681 + 268 + 2 198) = 2.9

Operating capital employed as % of total sales

Operating capital employed as a percentage of total sales adjusted for the full-year sales of acquired entities.

Calculation: 14 293 / 110 992 = 13%

Return on operating capital employed

Operating income before amortization (rolling 12 months) plus items affecting comparability (rolling 12 months) as a percentage of the average balance of operating capital employed.

Calculation: (5 594 – 521) / ((14 293 + 9 199) / 2) = 43%

Return on capital employed

Operating income before amortization (rolling 12 months) plus items affecting comparability (rolling 12 months) as a percentage of closing balance of capital employed. Calculation: (5 594 – 521) / 38 370 = 13%

Net debt equity ratio

Net debt in relation to shareholders' equity. Calculation: 20 460 / 17 910 = 1.14

NOTE 7 Acquisition related costs

MSEK	Apr–Jun 2019	Apr–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Dec 2018
Restructuring and integration costs	–10	–2	–12	–8	–90
Transaction costs	–6	–13	–15	–15	–25
Revaluation of deferred considerations	–1	–1	–2	–2	–5
Total acquisition related costs	–17	–16	–29	–25	–120

For further information regarding the Group's acquisitions, refer to the section Acquisitions and divestitures.

NOTE 8 Items affecting comparability

MSEK	Apr–Jun 2019	Apr–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Dec 2018
Recognized in the statement of income
IS/IT transformation programs	–46	–	–66	–	–187
Cost savings program, Security Services Europe	–	–	–	–	–268
Total recognized in the statement of income before tax	–46	–	–66	–	–455
Taxes	10	–	16	–	122
Total recognized in the statement of income after tax	–36	–	–50	–	–333
Cash flow impact
IS/IT transformation programs	–40	–	–63	–	–51
Cost savings program, Security Services Europe	–37	–	–80	–	–66
Total cash flow impact	–77	–	–143	–	–117

NOTE 9 Financial instruments and credit facilities

Revaluation of financial instruments

Revaluation of financial instruments is recognized in the statement of income on the line financial income and expenses. Revaluation of cash flow hedges (and the subsequent recycling into the statement of income) is recognized in other comprehensive income on the line cash flow hedges. Cost of hedging (and the subsequent recycling into the statement of income) is recognized on the corresponding line in other comprehensive income.

The amount disclosed in the specification of change in net debt is the total revaluation before tax in the table below.

MSEK	Apr–Jun 2019	Apr–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Dec 2018
Recognized in the statement of income
Revaluation of financial instruments	0	–1	–1	0	2
Deferred tax	–	–	–	–	–
Impact on net income	0	–1	–1	0	2
Recognized in the statement of comprehensive income
Cash flow hedges	71	–11	21	26	80
Cost of hedging	20	4	25	7	–56
Deferred tax	–20	2	–10	–7	–5
Total recognized in the statement of comprehensive income	71	–5	36	26	19
Total revaluation before tax	91	–8	45	33	26
Total deferred tax	–20	2	–10	–7	–5
Total revaluation after tax	71	–6	35	26	21

Fair value hierarchy

The methods and assumptions used by the Group in estimating the fair value of the financial instruments are disclosed in note 7 in the Annual Report 2018. Further information regarding the accounting principles for financial instruments is disclosed in note 2 in the Annual Report 2018.

There have been no transfers between any of the the valuation levels during the period.

MSEK	Quoted market prices	Valuation techniques using observable market data	Valuation techniques using non-observable market data	Total
June 30, 2019
Financial assets at fair value through profit or loss	–	4	–	4
Financial liabilities at fair value through profit or loss	–	–12	–396	–408
Derivatives designated for hedging with positive fair value	–	343	–	343
Derivatives designated for hedging with negative fair value	–	–182	–	–182
December 31, 2018
Financial assets at fair value through profit or loss	–	16	–	16
Financial liabilities at fair value through profit or loss	–	–10	–272	–282
Derivatives designated for hedging with positive fair value	–	356	–	356
Derivatives designated for hedging with negative fair value	–	–127	–	–127

Financial instruments by category – carrying and fair values

For financial assets and liabilities other than those disclosed in the table below, fair value is deemed to approximate the carrying value. A full comparison of fair value and carrying value for all financial assets and liabilities is disclosed in note 7 in the Annual Report 2018.

	Jun 30, 2019		Dec 31, 2018
MSEK	Carrying value	Fair value	Carrying value	Fair value
Long-term loan liabilities	14 310	14 689	13 939	14 065
Total financial instruments by category	14 310	14 689	13 939	14 065

SUMMARY OF CREDIT FACILITIES AS OF JUNE 30, 2019

Type	Currency	Facility amount (million)	Available amount (million)	Maturity
EMTN FRN private placement	USD	85	0	2019
EMTN FRN private placement	USD	40	0	2020
EMTN FRN private placement	USD	40	0	2021
EMTN FRN private placement	USD	60	0	2021
EMTN FRN private placement	USD	40	0	2021
EMTN Eurobond, 2.625% fixed	EUR	350	0	2021
EMTN Eurobond, 1.25% fixed	EUR	350	0	2022
Multi Currency Revolving Credit Facility	USD (or equivalent)	550	550	2022
Multi Currency Revolving Credit Facility	EUR (or equivalent)	440	440	2022
EMTN Eurobond, 1.125% fixed	EUR	350	0	2024
EMTN Eurobond, 1.25% fixed	EUR	300	0	2025
Commercial Paper (uncommitted)	SEK	5 000	2 200	n/a

NOTE 10 Deferred tax on other comprehensive income

MSEK	Apr–Jun 2019	Apr–Jun 2018	Jan–Jun 2019	Jan–Jun 2018	Jan–Dec 2018
Deferred tax on remeasurements of defined benefit pension plans	10	–5	–3	–10	25
Deferred tax on remeasurement for hyperinflation	–	–	–	–	–15
Deferred tax on cash flow hedges	–15	2	–4	–6	–17
Deferred tax on cost of hedging	–5	0	–6	–1	12
Deferred tax on net investment hedges	34	71	97	125	107
Total deferred tax on other comprehensive income	24	68	84	108	112

NOTE 11 Pledged assets

MSEK	Jun 30, 2019	Jun 30, 2018	Dec 31, 2018
Pension balances, defined contribution plans	119	130	128
Finance leases according to IAS 17	n/a	237	222
Total pledged assets	119	367	350

NOTE 12 Contingent liabilities

MSEK	Jun 30, 2019	Jun 30, 2018	Dec 31, 2018
Guarantees	0	0	1
Guarantees related to discontinued operations	16	16	15
Total contingent liabilities	16	16	16

For critical estimates and judgments, provisions and contingent liabilities, refer to note 4 and note 37 in the Annual Report 2018 as well as to the section Other significant events in this report.

Parent Company

STATEMENT OF INCOME

MSEK	Jan–Jun 2019	Jan–Jun 2018
License fees and other income	581	487
Gross income	581	487
Administrative expenses	–306	–306
Operating income	275	181
Financial income and expenses	2 371	2 256
Income after financial items	2 646	2 437
Appropriations	–200	–136
Income before taxes	2 446	2 301
Taxes	–142	–209
Net income for the period	2 304	2 092

BALANCE SHEET

MSEK	Jun 30, 2019	Dec 31, 2018
ASSETS
Non-current assets
Shares in subsidiaries	43 523	41 332
Shares in associated companies	112	112
Other non-interest-bearing non-current assets	718	520
Interest-bearing financial non-current assets	1 858	1 542
Total non-current assets	46 211	43 506
Current assets
Non-interest-bearing current assets	864	422
Other interest-bearing current assets	5 161	5 581
Liquid funds	1 364	1 326
Total current assets	7 389	7 329
TOTAL ASSETS	53 600	50 835
SHAREHOLDERS' EQUITY AND LIABILITIES
Shareholders' equity
Restricted equity	7 797	7 797
Non-restricted equity	21 406	20 702
Total shareholders' equity	29 203	28 499
Untaxed reserves	630	455
Long-term liabilities
Non-interest-bearing long-term liabilities/provisions	288	251
Interest-bearing long-term liabilities	16 400	15 818
Total long-term liabilities	16 688	16 069
Current liabilities
Non-interest-bearing current liabilities	1 243	744
Interest-bearing current liabilities	5 836	5 068
Total current liabilities	7 079	5 812
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES	53 600	50 835

Financial information

PRESENTATION OF THE INTERIM REPORT

Analysts and media are invited to participate in a telephone conference on July 31, 2019 at 2:30 p.m. (CET) where President and CEO Magnus Ahlqvist and CFO Bart Adam will present the report and answer questions. The telephone conference will also be audio cast live via Securitas website. To participate in the telephone conference, please dial in five minutes prior to the start of the conference call:

US:	+1 855 269 2605
Sweden:	+46 8519 993 55
UK:	+44 203 194 0550

FINANCIAL INFORMATION CALENDAR

February 6, 2020, app. 1.00 p.m. (CET) Full Year Report January–December 2019

November 6, 2019, 8.00 a.m. (CET) Interim Report January–September 2019

Micaela Sjökvist, Head of Investor Relations.

To follow the audio cast of the telephone conference

A recorded version of the audio cast will be available at www.securitas.com/investors/webcasts after the telephone

FOR FURTHER INFORMATION. PLEASE CONTACT:

via the web, please follow the link www.securitas.com/investors/webcasts.

conference.

• 46 761167443

For further information regarding Securitas IR activities, refer to www.securitas.com/investors/financial calendar

ABOUT SECURITAS

Securitas has a leading position in the security services industry with a strong local and global market presence. We currently operate in 58 countries and employ 370 000 people. Our operations have been organized in a decentralized structure and include three business segments: Security Services North America, Security Services Europe and Security Services Ibero-America. We also have operations in Africa, the Middle East and Asia, which form the AMEA division. Securitas serves a wide range of customers of all sizes in a variety of industries and customer segments. Security solutions based on customerspecific needs are built through different combinations of on-site, mobile and remote guarding, electronic security, fire and safety, and corporate risk management. Securitas can respond to the unique and specific security challenges facing its customers, and tailor its offering according to

their specific industry demands. Securitas is listed in the Large Cap segment at Nasdaq Stockholm.

Group strategy

Our strategy is to offer protective services that integrate all our areas of competence. Together with our customers, we develop optimal and cost-efficient solutions that are suited for the customers' needs. This brings added value to the customers and results in stronger, more long-term customer relationships and improved profitability.

Group financial targets

Securitas focuses on two financial targets. The first target relates to the statement of income: average growth of earnings per share of 10 percent annually. The second target relates to the balance sheet: free cash flow in relation to net debt of at least 0.20.

This is information that Securitas AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 1:00 p.m. (CET) on Wednesday, July 31, 2019.

Securitas AB (publ.)

P.O. Box 12307, SE-102 28 Stockholm, Sweden Visiting address: Lindhagensplan 70 Telephone: +46 10 470 30 00. Fax: +46 10 470 31 22 Corporate registration number: 556302–7241 www.securitas.com