Securitas - EGM 09 December 2020
ECGS notes that as a result of the Covid-19 pandemic the EGM will be held as an electronic meeting only. Consequently, it will not be possible to attend the EGM in person.
In general, Securitas is in compliance with the Swedish regulations relating to the organization and procedures of the Extraordinary General Meeting.
Under ITEM 6 the board of directors proposes to distribute an extraordinary dividend of SEK 4.80 per share. ECGS notes that Securitas decided to refrain from dividend payments at the AGM 2020 in view of the Covid-19 pandemic. As such it is proposed to increase the aggregate dividend per share from SEK 4.40 to SEK 4.80 (+9%).
The (proposed) dividend is covered by FCF as well as in accordance with Securitas'dividend policy. ECGS has no (major) concerns over the Company's dividend policy and considers said policy to be sustainable over the long-term. In addition, ECGS notes that Securitas'(financial) results to date of this report, although somewhat deteriorated (EPS Q3-end 2020: SEK 5.18 vs EPS Q3-end 2019: SEK 6.82; and total revenues down by 1%) are sufficiently healthy to warrant the (proposed) extraordinary dividend payment.
On the other hand, ECGS notes that the Company applied for Covid-19-related government support. Up to an including September 30, 2020 (Q3-end), Securitas has received Covid-19-related government grants of SEK 550 million (approx. EUR 52.5 million), corresponding to 16% of 9-month operating income before amortization (EBITA) and 29% of 9-month net income.
In view of the above, ECGS considers the (proposed) increase of dividend payments very undesirable. The Covid-19-related government support could (indirectly) be used to fund the extraordinary dividend, which is socially unacceptable. Therefore, ECGS recommend to vote OPPOSE.
Securitas is engaged in integrated security solutions. Co.'s main service offering categories are specialized guarding, mobile security services, monitoring, technical solutions and consulting and investigation services. Co. operates in 52 countries throughout North America, Europe, Latin America, the Middle East, Asia and Africa. Co. is organized into three business segments: Security Services North America, Security Services Europe and Security Services Ibero-America. In addition to the three business segments, Co. conducts guarding operations in the Middle East, Asia and Africa.
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