This article first appeared on GuruFocus .
Release Date: November 04, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Revenues grew 7.5% year-on-year to EUR3.9 billion, driven by strong organic growth of 7.0% and broad-based regional performance.
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Net consolidated profit increased by 5.6% year-on-year to EUR87 million, supported by improved tax efficiency and disciplined financial management.
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Operating cash flow rose 11% to EUR135 million, with free cash flow improving to EUR19 million from negative EUR2 million last year.
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S&P reaffirmed Prosegur Compania De Seguridad SA ( STU:PRHA )'s BBB rating and upgraded the outlook to stable, reflecting a strong financial profile.
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Movistar Prosegur Alarmas surpassed 650,000 connections, growing over 8% year-on-year, and is generating positive cash flow for the first time in 2026.
Negative Points
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EBITDA declined 1.7% year-on-year to EUR254 million, with EBITDA margin contracting to 6.4% from 7.0% due to business mix and macroeconomic pressures.
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Prosegur Cash EBITDA fell 2.4% year-on-year, impacted by consumption pressures in Argentina and lower global passenger traffic affecting the foreign exchange business.
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Security operating cash flow dropped to EUR15 million from EUR31 million, due to higher working capital requirements from strong US volume growth.
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Alarms churn increased year-on-year, reaching 14% overall, largely due to Argentina's macroeconomic environment, and acquisition margins remain under pressure.
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Net debt stood at EUR1,386 million with a leverage ratio of 2.4x EBITDA, and total net cash flow was negative EUR29 million, though improved from negative EUR44 million.
Q & A Highlights
Q: What are the revenue and margin targets for the new Prosegur Technology and Defense division, and will it be reported separately? A: CFO Mayte Rodriguez said the existing technology area generates around EUR400 million in annual revenues, and with the new defense business the combined division aims to reach around EUR500 million by 2027. Margins should be similar to the current pure technology business, at a high single-digit level. The division will not be reported as a separate segment in results presentations, though more detail may be provided once budgets and the new strategic plan are finalized. Manuel Rodriguez, who built the technology business, will lead the new area.
Q: What capital allocation and project size should investors expect for the Technology and Defense division? A: CFO Mayte Rodriguez said the company expects to invest in the new division, including taking stakes in startups or forming partnerships to accelerate solutions. She indicated an investment range of roughly EUR10 million to EUR30 million per project. Prosegur's 50 years of security experience, including many employees with military and police backgrounds, is seen as a key reference and competitive advantage in positioning for defense contracts.
Q: When do you expect KPIs in the alarms business to improve, particularly given the impact of Argentina? A: CFO Mayte Rodriguez said Argentina's macroeconomy is heavily impacting all three business lines, including alarms, security and cash. Churn stands at 14%, but excluding Argentina it is a more normalized 12%-plus. She described 2026 as a transition year due to strategic changes and said 2027 should see improvement across most KPIs, including service margin, foreign exchange and growth. Acquisition margin will be the hardest to improve given continued investment in products and marketing.
Q: Would Prosegur consider carving out its alarms business given recent sector consolidation and take-private deals? A: CFO Mayte Rodriguez said the alarms business is "in fashion" with many players taking action, but Prosegur's focus remains unchanged: growing Movistar Prosegur Alarmas to 1 million connections by 2030 and pursuing high-quality growth in the rest of the world. She stated the company is not considering any carve-out.
Q: What is the status of the planned sale of the Telefonica stake? A: CFO Mayte Rodriguez said she still wants to sell the stake and would prefer to redeploy that capital into areas such as defense, new products or the cash transformation. However, the share price has dropped due to issues including Lula-related matters, so the company will wait before selling.
Q: Why did depreciation increase meaningfully in the third quarter? A: CFO Mayte Rodriguez attributed the increase to two factors: higher investment in new products and assets that are now being depreciated following strong growth last year, and exceptional accelerated depreciation on alarm assets tied to customers removed from the portfolio due to insolvency. The company is working to reuse those alarms for other customers but, under internal policy, books them as zero-cost assets. The portfolio cleanup impact has largely been taken and should not be significant in the fourth quarter.
Q: What drove the improvement in operating cash flow and free cash flow in the first nine months? A: CFO Mayte Rodriguez said operating cash flow rose 11% to EUR135 million, driven by more selective, higher-quality growth in alarms that reduced cash consumption, greater tax efficiency, and sound working capital management in cash that offset higher US security volumes. CapEx fell to EUR115 million from EUR124 million, and free cash flow improved to EUR19 million from negative EUR2 million. Net debt stood at EUR1,386 million, with a net debt to EBITDA ratio of 2.4 times.
Q: What is the outlook for Movistar Prosegur Alarmas and the broader alarms business? A: CFO Mayte Rodriguez said MPA surpassed 650,000 customers, up about 30% since 2024, placing it among the top 10 alarm providers globally on a single-country basis. 2026 marks the first year of positive cash flow while growing. With Spanish alarm penetration at around 12%, the ambition is to sustain annual growth of around 10% through 2030 and reach approximately 1 million customers in Spain by the end of the decade. The recently launched Smart Lock is expected to support customer growth and churn reduction.
Q: How did the Security division perform, particularly in the US, and what is the margin trend? A: IR Director Cristina Casado said Security revenues rose 9.8% to EUR2,137 million on 8.8% organic growth, led by the US and Iberia with a positive contribution from Colombia. US organic growth reached 32%, making it the second-largest contributor to security revenues. EBITDA grew 9% to EUR72 million, with the quarterly margin improving to 3.8% in Q3 from 3.6% in Q2 and 2.8% in Q1. Operating cash flow fell to EUR15 million due to higher US working capital and tax payments, but would have been broadly flat on a pro forma basis excluding the US volume impact.
Q: How did Prosegur Cash perform and what is the progress of its transformation? A: IR Director Cristina Casado said Cash sales reached EUR1,510 million, up 1.4% with 2.6% organic growth, accelerating to 5.3% in Q3. Transformation products represented 36.2% of revenues. EBITDA was EUR160 million with a 10.6% margin versus 11.0% a year ago, reflecting Argentina consumption pressures and lower global passenger traffic affecting foreign exchange. Operating cash flow rose 9.3% to EUR119 million on disciplined working capital management and lower cash tax outflows.
Q: What drove the increase in consolidated net profit despite the EBITDA decline? A: CFO Mayte Rodriguez said revenues rose 7.5% to EUR3.9 billion on 7% organic growth, while EBITDA fell 1.7% to EUR254 million with a 6.4% margin versus 7.0%, reflecting Argentina pressures, lower global passenger traffic and a mix shift toward lower-margin Security. However, the effective tax rate fell almost 400 basis points to 41% from 45% on tax optimization and a more favorable geographic earnings mix, helping net profit rise 5.6% to EUR87 million. S&P reaffirmed the BBB rating and upgraded
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
