Prosegur Compañía de Seguridad (PSG) Q2 2024 earnings summary

Executive summary

• Sales for H1 2024 rose 6.9% year-over-year to €2,347.5–2,348 million, driven by organic growth across all geographies and business lines, with consolidation of Indian operations from April 2024.

• Transformation Products in Cash exceeded 32% of sales, supporting diversification and improved Europe's share.

• Profitability was impacted by FX headwinds, restructuring costs in Australia, and setup costs in Forex, but underlying business trends remain positive.

• Security segment led growth with a 12% sales increase, while Alarms and Cybersecurity posted double-digit growth.

• A partial takeover bid by Gubel S.L. was accepted for 13.23% of share capital; Yirayira International acquired an additional 8%.

Financial highlights

• EBITDA for H1 2024 was €255.6 million (margin 10.9%), while adjusted EBITA was €146.9–147 million (margin 6.3%), both slightly down year-over-year due to temporary impacts.

• Net income attributable to owners was €27.6–28 million, down 22% year-over-year, mainly due to hyperinflation effects in Argentina.

• Excluding hyperinflation, net results improved by 50% year-over-year.

• CapEx totaled €84.2–89 million, focused on transformation products and Forex.

• Net financial debt stood at €1,164.1–1,360 million, with a net debt/EBITDA ratio of 2.79–2.8x.

Outlook and guidance

• Management expects continued positive growth and profitability improvements in H2 2024, with repricing initiatives and strong cash flow generation supporting margin recovery.

• Security Business EBITDA margin is expected to increase year-over-year, with positive cash flow anticipated for the full year.

• Recurring cash run-rate for Alarms business estimated at €59–60 million per year.