* Quarterly profit comes in ahead of estimates
* Organic growth 4 pct vs forecast 2.8 pct
* Cuts cost estimate for U.S. Affordable Care Act (Recasts with comments from CEO)
By Anna Ringstrom and Olof Swahnberg
STOCKHOLM, Nov 4 (Reuters) - Securitas, theworld's second-biggest security services firm, cut its forecaston Tuesday for costs related to U.S. healthcare reform, afurther boost as it posted profit-beating quarterly profit.
Securitas now sees staff costs in the United States, itsbiggest market, rising only 4-5 percent because of an obligationfrom 2015 to offer health care insurance to all employees aspart of the Affordable Care Act.
It had previously forecast an increase of 8-10 percent butnow believes fewer staff than initially expected will sign upfor the insurance.
The Swedish firm is renegotiating contracts across theUnited States as a consequence of the new law. Eighty percent ofits US contracts are now compliant, up from 60 percent at theend of the second quarter, it said.
Shares in Securitas, whose biggest rival is British G4S, rose on the news, trading up 6.4 percent at 1114 GMT.
However, Chief Executive Alf Goransson cautioned that theremaining 20 percent of US contracts that it aims to renegotiateby the end of the year would be the toughest ones to finalise.
Securitas employs around 310,000 people around the world,with a third of them in the United States, Canada and Mexico.
TECHNOLOGY DRIVE
Securitas still gets the bulk of revenues from supplyingguards but is pushing to expand its use of less labour-intensivetechnology such as smart cameras that can identify potentialthreats.
American clients have however been unexpectedly reluctant toadopt such technologies, Goransson said.
He said technology-based contracts account for a mere 2percent of turnover in the United States. That makes the firm'starget for them to comprise 18 percent of group turnover by theend of next year harder to achieve.
"Crucial for reaching the target is that we get a reasonableshare of technology solutions in the United States, and theshare is by mid-October smaller than we had counted on," he toldReuters.
In the third quarter technology based solutions accountedfor 9.5 percent of group turnover, up from 9 percent in thesecond quarter and 8.5 percent in the first.
Operating profit before amortisation at Securitas, whichoperates in 52 countries, grew to 962 million crowns ($130million) from 892 million a year ago.
That beat a forecast 923 million in a Reuters poll ofanalysts, helped by better than expected organic sales growth of4 percent with Argentina, Norway, Turkey and the United Statesperforming well.
As flagged in a Reuters interview in August, Securitas said on Tuesday it would reorganise its troubled operations incrisis-hit Spain, one of its biggest markets.
The overhaul will consist in moving resources to technologybased solutions -- which in Spain are nearing 20 percent ofturnover -- and cutting costs. Restructuring costs of up to 2million euros ($2.50 million) would be booked in the fourthquarter.
(1 US dollar = 7.4170 Swedish crown)
(1 US dollar = 0.7995 euro) (Reporting by Anna Ringstrom; Editing by Keith Weir)
* Organic growth 4 pct vs forecast 2.8 pct
* Cuts cost estimate for U.S. Affordable Care Act (Recasts with comments from CEO)
By Anna Ringstrom and Olof Swahnberg
STOCKHOLM, Nov 4 (Reuters) - Securitas, theworld's second-biggest security services firm, cut its forecaston Tuesday for costs related to U.S. healthcare reform, afurther boost as it posted profit-beating quarterly profit.
Securitas now sees staff costs in the United States, itsbiggest market, rising only 4-5 percent because of an obligationfrom 2015 to offer health care insurance to all employees aspart of the Affordable Care Act.
It had previously forecast an increase of 8-10 percent butnow believes fewer staff than initially expected will sign upfor the insurance.
The Swedish firm is renegotiating contracts across theUnited States as a consequence of the new law. Eighty percent ofits US contracts are now compliant, up from 60 percent at theend of the second quarter, it said.
Shares in Securitas, whose biggest rival is British G4S, rose on the news, trading up 6.4 percent at 1114 GMT.
However, Chief Executive Alf Goransson cautioned that theremaining 20 percent of US contracts that it aims to renegotiateby the end of the year would be the toughest ones to finalise.
Securitas employs around 310,000 people around the world,with a third of them in the United States, Canada and Mexico.
TECHNOLOGY DRIVE
Securitas still gets the bulk of revenues from supplyingguards but is pushing to expand its use of less labour-intensivetechnology such as smart cameras that can identify potentialthreats.
American clients have however been unexpectedly reluctant toadopt such technologies, Goransson said.
He said technology-based contracts account for a mere 2percent of turnover in the United States. That makes the firm'starget for them to comprise 18 percent of group turnover by theend of next year harder to achieve.
"Crucial for reaching the target is that we get a reasonableshare of technology solutions in the United States, and theshare is by mid-October smaller than we had counted on," he toldReuters.
In the third quarter technology based solutions accountedfor 9.5 percent of group turnover, up from 9 percent in thesecond quarter and 8.5 percent in the first.
Operating profit before amortisation at Securitas, whichoperates in 52 countries, grew to 962 million crowns ($130million) from 892 million a year ago.
That beat a forecast 923 million in a Reuters poll ofanalysts, helped by better than expected organic sales growth of4 percent with Argentina, Norway, Turkey and the United Statesperforming well.
As flagged in a Reuters interview in August, Securitas said on Tuesday it would reorganise its troubled operations incrisis-hit Spain, one of its biggest markets.
The overhaul will consist in moving resources to technologybased solutions -- which in Spain are nearing 20 percent ofturnover -- and cutting costs. Restructuring costs of up to 2million euros ($2.50 million) would be booked in the fourthquarter.
(1 US dollar = 7.4170 Swedish crown)
(1 US dollar = 0.7995 euro) (Reporting by Anna Ringstrom; Editing by Keith Weir)
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