APi Group Provides Update on Chubb Value Capture Progress
November 27 2023 - 6:00AM
Business Wire
-Run-rate Value Capture Target Increased 25%
from $100 million to $125 million-
APi Group Corporation (NYSE: APG) (“APi” or the “Company”), a
global, market-leading business services provider of life safety,
security and specialty services, today provided an update on the
strategic initiatives relating to the Chubb business announced one
year ago at the Company’s Investor Day meeting in New York
City.
Russ Becker, APi’s President and Chief Executive Officer,
stated, “The leaders in our international business continue to
deliver organic growth and margin expansion while executing on our
Chubb value capture plan. I’m pleased that we are now in a position
to increase the Chubb value capture target by 25% to $125 million.
We expect that we will continue our 1:1, or better, cost-benefit
ratio and spend up to $125 million in total to capture these
savings. We expect to conclude these value capture efforts by
year-end 2025. The team has also driven a substantial reduction in
our loss-making branches in the international business through
operational improvements—supported by footprint optimization—and a
continued focus on addressing low-value contracts through increased
pricing and pruning. It is gratifying to know that the evolution in
our international business is inclusive of our culture as well,
with over 7,500 leaders participating in our online introductory “I
am a Leader” development program.
As I look across our global operation, I am confident in our
leaders’ ability to continue to deliver double-digit core
inspection organic growth and continued margin expansion across the
business as we drive towards our 2025 target of 13% (or more)
Adjusted EBITDA margin. As we look to 2024 and beyond, we have
great confidence in the business, our ability to deliver consistent
organic growth globally, while simultaneously increasing our
discipline on project selection and pruning low margin revenue
opportunities.
Our backlog is strong and our balance sheet is in an
advantageous position. We expect to end 2023 below our targeted
2.5x debt to Adjusted EBITDA ratio, which gives us many strategic
options for capital deployment in the coming years. We expect to
continue to evolve APi into an even lower capex, asset light
business focused on high-margin, statutorily mandated services. I
look forward to updating you early in the new year on our continued
progress, our year end 2023 results, and our 2024 guidance.”
About APi:
APi is a global, market-leading business services provider of
life safety, security and specialty services with a substantial
recurring revenue base and over 500 locations worldwide. APi
provides statutorily mandated and other contracted services to a
strong base of long-standing customers across industries. We have a
winning leadership culture driven by entrepreneurial business
leaders to deliver innovative solutions for our customers. More
information can be found at www.apigroupcorp.com.
Forward-Looking Statements and
Disclaimers
Certain statements in this press release and related comments
made by management may be considered forward-looking statements
within the meaning of the U.S federal securities laws.
Forward-looking statements are any statements other than statements
of historical fact and represent our current judgment about
possible future events. In some cases, you can identify
forward-looking statements by terms including “expect”,
“anticipate”, “project”, “will”, “should”, “believe”, “intend”,
“plan”, “estimate”, “potential”, “target”, “would”, and similar
expressions, although not all forward-looking statements contain
these identifying terms, including expectations regarding: (i) the
Company’s outlook and ability to execute on long-term goals, and
(ii) the timing and expected benefits of the acquisition of the
Chubb fire and security business.. While we believe these
statements are reasonable, they are not guarantees of future
performance and are subject to known and unknown risks,
uncertainties and other factors that could cause actual results to
differ materially from those expressed or implied by such
forward-looking statements, including (i) economic conditions,
competition, inflation, or currency impacts, (ii) the Company’s
financial targets, including leverage ratio and the impact on the
Company’s capital allocation, (iii) the ability to recognize the
anticipated benefits of the Company’s acquisitions, (iv) failure to
fully execute the Company’s inspection first strategy or to realize
the expected service revenue from such inspections, (v) risks
associated with the Company’s contract portfolio; and (vi) those
risks and uncertainties discussed in the “Risk Factors” section of
our Form 10-K filings, and any updates to the risk factors in our
Form 10-Q and 8-K filings with the U.S. Securities and Exchange
Commission. Given these risks and uncertainties, investors are
cautioned not to place undue reliance on forward-looking
statements. Forward-looking statements speak only as of the date of
such statements and, except as required by applicable law, the
Company does not undertake any obligation to update or revise
publicly any forward-looking statements, whether as a result of new
information, future events or otherwise.
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version on businesswire.com: https://www.businesswire.com/news/home/20231127572896/en/
Investor Relations & Media Inquiries: Adam Fee Vice
President of Investor Relations Tel: +1 651-240-7252 Email:
investorrelations@apigroupinc.us
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