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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| G4s Plc | LSE:GFS | London | Ordinary Share | GB00B01FLG62 | ORD 25P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 244.80 | 245.00 | 245.10 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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TIDMGFS
13 March 2012
G4S plc
Preliminary results for the year ended 31 December 2011
Developing markets and outsourcing trends continuing to drive growth
2011 2010 Change
=-----------------------------------------------------------
Turnover GBP7,522m GBP7,181m* +4.7%
=-----------------------------------------------------------
Organic growth +4.5% +2.1% -
=-----------------------------------------------------------
PBITA GBP531m GBP520m* +2.1%
=-----------------------------------------------------------
Operating margin 7.1% 7.2%* -
=-----------------------------------------------------------
Adjusted EPS 22.8p 21.6p* +6%
=-----------------------------------------------------------
Recommended total dividend per share 8.53p 7.90p +8%
* at constant exchange rates and adjusted for discontinued businesses
Sales up 4.7% (with 4.5% organic growth) to GBP7,522 million. Adjusted EPS up 6%
to 22.8p
* Developing markets revenue of GBP2.2bn (30% of group total and targeting 50%
by 2019) with organic growth of 9%
* Achieved cash conversion target of 85%
Security remains core to our global strategy and continues to provide growth
opportunities
* G4S has a proven track record in delivering strong performances in security
across a number of customer sectors, particularly where security and safety
risks are a strategic threat
* Increasing trend from government and commercial customers to outsource,
reshape and embrace innovative, cost reducing, integrated security
solutions
* Will take advantage of trends for integrated facilities services in suitable
markets - for example the UK government sector
* In large developing markets we will expand beyond security where the market
opportunity is large and there is significant growth potential - for
example, Brazil, India and China
Small/medium sized acquisitions a key component to deliver strategic objectives
* Expected acquisition spend of around GBP200m in 2012 with focus on developing
markets
Continued focus on business improvement
* Establishment of service excellence centres for all core services - manned
security, cash solutions and care & justice services
* Continued investment in sales and business development processes to continue
to drive growth
* Cash solutions division (comprising seven cash solutions businesses) now
integrated into the regional structure
* More active divestment planned of non-core or under-performing businesses
* Overhead review to ensure organisational design is aligned to strategy and
economic environment
Nick Buckles, Chief Executive Officer, commented:
"Today we have announced our seventh consecutive year of underlying revenue,
PBITA and dividend growth since G4S was formed in 2004. The business has
performed well despite continued global economic uncertainty and has good
trading momentum. We have delivered further strong organic growth of 9% in
developing markets (30% of revenue and 34% of PBITA).
Looking forward, we are encouraged by the performance and outlook for our US
commercial and the UK government and commercial businesses. However, the outlook
for our developed markets cash solutions and Continental European secure
solutions businesses remains muted and we continue to focus on cost base
control. More generally, we won and mobilised a number of significant contracts
in 2011 and expect outsourcing trends to continue. Overall, we are confident
about the outlook for 2012 when we expect to deliver organic revenue growth
higher than 2011 together with the additional contribution from the London 2012
Olympic and Paralympic Games contract. This confidence is underlined by the 8%
increase in our dividend."
For further enquiries, please contact: +44 (0) 1293 554400
Nick Buckles Chief Executive Officer
Trevor Dighton Chief Financial Officer
Helen Parris Director of Investor Relations
Media enquiries:
Adam Mynott Director of Media Relations +44 (0)
1293 554400
John Sunnucks Tulchan Group +44 (0)
20 7353 4200
David Allchurch Tulchan Group +44 (0)
20 7353 4200
High resolution images are available for the media to view and download free of
charge fromwww.vismedia.co.uk.
Notes to Editors:
G4S is the world's leading international security solutions group, which
specialises in outsourced business processes in sectors where security and
safety risks are considered a strategic threat.
G4S is the largest employer quoted on the London Stock Exchange and has a
secondary stock exchange listing in Copenhagen. G4S has operations in more than
125 countries and 657,000 employees. For more information on G4S,
visitwww.g4s.com.
Presentation of Results:
A presentation to investors and analysts is taking place today at 0830hrs at the
London Stock Exchange.
Webcast
http://view-w.tv/p/707-803-10460/en
Telephone Dial-in Facility
The details for the telephone dial-in facility are as follows:-
Standard International Access: +44 (0) 20 3003 2666
UK Toll Free: 0808 109 0700
USA Toll Free: 1 866 966 5335
DK Toll Free: 8088 8649
Password: G4S
Replay Details
To listen to a replay of the presentation which will be available for 7 days
after the event, here are the details:
Standard International Access: +44 (0) 20 8196 1998
UK Toll Free: 0800 633 8453
USA Toll Free: 1 866 583 1035
DK Toll Free: 8088 7109
Access PIN: 6212562
Annual Report & Accounts
The company's annual report and accounts is due to be published week commencing
16 April 2012
Capital Markets Day
G4S will hold a Capital Markets Day in London on 22 May 2012
Annual General Meeting
The company's annual general meeting will be held in London on 7 June 2012
FINANCIAL SUMMARY
Results
The results which follow have been prepared under International Financial
Reporting Standards, as adopted by the European Union (adopted IFRSs).
Group Turnover
+-----------------------------------+-----+-----+
|Turnover of Continuing Businesses |2011 |2010 |
| | | |
| | GBPm| GBPm|
+-----------------------------------+-----+-----+
|Turnover at constant exchange rates|7,522|7,181|
+-----------------------------------+-----+-----+
|Exchange difference | -| 77|
+-----------------------------------+-----+-----+
|Total continuing business turnover |7,522|7,258|
+-----------------------------------+-----+-----+
Turnover increased by 3.6% to GBP7,522 million or by 4.7% at constant exchange
rates. Organic turnover growth was 4.5%.
+----------------+------+-------------+----------------+-----------------+-----+
|Organic Turnover|Europe|North America| Developed | Developing |Total|
|Growth * | | | Markets | Markets | |
+----------------+------+-------------+----------------+-----------------+-----+
|Secure solutions| 4%| 3%| 4%| 9%| 5%|
+----------------+------+-------------+----------------+-----------------+-----+
|Cash solutions | -1%| -1%| -1%| 9%| 2%|
+----------------+------+-------------+----------------+-----------------+-----+
|Total | 3%| 2%| 3%| 9%| 5%|
+----------------+------+-------------+----------------+-----------------+-----+
* Calculated to exclude acquisitions and disposals, and at constant exchange
rates
Group Profit
+---------------------------------------+-----+----+
|PBITA * of Continuing Businesses |2011 |2010|
| | | |
| | GBPm| GBPm|
+---------------------------------------+-----+----+
|PBITA at constant exchange rates | 531| 520|
+---------------------------------------+-----+----+
|Exchange difference | -| 10|
+---------------------------------------+-----+----+
|Total continuing business PBITA | 531| 530|
+---------------------------------------+-----+----+
|PBITA margin at constant exchange rates| 7.1%|7.2%|
+---------------------------------------+-----+----+
* PBITA is defined as profit before interest, taxation, amortisation and
impairment of acquisition-related intangible assets, acquisition-related costs
and aborted acquisition and legal settlement costs
PBITA increased by GBP11million to GBP531million or by 2.1% at constant exchange
rates. The PBITA margin was 7.1%.
Cash Flow and Financing
+--------------------------------------------------+-----+-----+
|Cash Flow |2011 |2010 |
| | | |
| | GBPm| GBPm|
+--------------------------------------------------+-----+-----+
|Operating cash flow | 449| 455|
+--------------------------------------------------+-----+-----+
|Operating cash flow / PBITA (excluding associates)| 85%| 87%|
+--------------------------------------------------+-----+-----+
Operating cash flow, as analysed on page 25, was GBP449 million in the period,
representing 85% of PBITA. Net cash invested in current year acquistions was
GBP130 million. Net debt at the end of the period, as analysed on page 24, was
GBP1,616 million (December 2010: GBP1,426m).
Adjusted earnings per share
+-----------------------------------+-----+------------------------------+-----+
|Adjusted earnings per share | 2011| 2010 at constant exchange| 2010|
| | | rates| |
| | | | |
| | | | |
| | GBPm| GBPm| GBPm|
+-----------------------------------+-----+------------------------------+-----+
|PBITA from continuing operations | 531| 520| 530|
+-----------------------------------+-----+------------------------------+-----+
|Interest (before pensions) | (99)| (96)| (97)|
+-----------------------------------+-----+------------------------------+-----+
|Tax | (94)| (99)|(103)|
+-----------------------------------+-----+------------------------------+-----+
|Minorities | (17)| (22)| (22)|
+-----------------------------------+-----+------------------------------+-----+
|Adjusted profit attributable to | 321| 303| 308|
|shareholders | | | |
+-----------------------------------+-----+------------------------------+-----+
|Average number of shares (m) |1,405| 1,406|1,406|
+-----------------------------------+-----+------------------------------+-----+
|Adjusted EPS (p) |22.8p| 21.6p|21.9p|
+-----------------------------------+-----+------------------------------+-----+
Adjusted earnings per share, reconciled to basic earnings per share on page 23,
increased by 4%, or by 6% at constant exchange rates.
BUSINESS ANALYSIS
Secure solutions
+---------------------------+-----------+-----------+-----------+--------------+
| | Turnover | PBITA | Margins |Organic Growth|
| | | | | |
| | GBPm | GBPm | | |
| +-----+-----+-----+-----+-----+-----+--------------+
|* At constant exchange |2011 |2010 |2011 |2010 |2011 |2010 | 2011 |
|rates | | | | | | | |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Europe * |2,727|2,608| 200| 179|7.3% |6.9% | 4% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|North America * |1,652|1,613| 89| 92|5.4% |5.7% | 3% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Developing Markets * |1,842|1,671| 148| 139|8.0% |8.3% | 9% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Total secure solutions * |6,221|5,892| 437| 410|7.0% |7.0% | 5% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Exchange differences | -| 76| -| 9|
+---------------------------+-----+-----+-----+-----+
|At actual exchange rates |6,221|5,968| 437| 419|
+---------------------------+-----+-----+-----+-----+
The secure solutions business continued its strong performance with good organic
growth of 5%. Margins were maintained overall at 7%.
Europe
+---------------------------+-----------+-----------+-----------+--------------+
| | Turnover | PBITA | Margins |Organic Growth|
| | | | | |
| | GBPm | GBPm | | |
| +-----+-----+-----+-----+-----+-----+--------------+
|* At constant exchange |2011 |2010 |2011 |2010 |2011 |2010 | 2011 |
|rates | | | | | | | |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|UK & Ireland * |1,252|1,177| 119| 103|9.5% |8.8% | 5% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Continental Europe * |1,475|1,431| 81| 76|5.5% |5.3% | 3% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Total Europe * |2,727|2,608| 200| 179|7.3% |6.9% | 4% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
Organic growth in Europe was 4% and margins at 7.3% were higher than the
previous year, due mainly to the turnaround of the business in Ireland. With a
large number of contracts being mobilised in the UK in the first half of 2012 we
would expect the margin in the first six months to be lower compared to the same
period in 2011 but to recover for the full year 2012.
There was good organic growth of 5% in the UK & Ireland and margins improved as
a result of the continued strong performance of the UK commercial and government
businesses, and an improved performance in Ireland.
The improvement in the UK business performance was a result of a number of major
government contract wins and extensions such as:
* Taking over the national security contract for the Department for Work and
Pensions which was mobilised on 1 January 2011
* Strong growth in the level of services provided for the London 2012 Olympic
and Paralympic Games. G4S commenced its security operations for The London
Organising Committee of the Olympic and Paralympic Games (LOCOG) in March
2011 and will provide security services at the majority of the Olympic and
Paralympic venues across the country, as well as at many non-competition
venues and at LOCOG's test events, in the build up to and during the Games
over the coming year.
* Delivery of welfare-to-work services in three UK regions - this contract,
which was mobilised on 1 June 2011, has performed in line with our
expectations
* Two public to private prisons - HMP Birmingham (transferred successfully to
G4S In October 2011) and the new HMP Oakwood (planning is underway to open
in April 2012)
* Facilities services contracts at City Hospitals Sunderland and Liverpool
Women's Hospital
During 2011, G4S was also successful in winning a number of significant
government outsourcing contracts such as:
* Integrated facilities services for the Ministry of Justice for more than
340 court buildings across the Midlands, Wales and the North of England from
1 February for five years
* The provision of transport and accommodation for asylum applicants for the
UK Border Agency for two regions - the Midlands and the East of England and
the North East, Yorkshire and Humberside
* Prisoner escorting services for the Scottish Prison Service which was
mobilised on 10 January 2012
* Outsourcing services for Lincolnshire Police - the first contract of its
kind to be awarded by a British Police Authority and includes a framework
agreement for ten other police forces - this commences in May 2012.
The pipeline of UK government outsourcing opportunities remains strong
particularly in areas such as prisons, police, health and the Department for
Work and Pensions.
The UK commercial business grew strongly and contracts won included a number of
significant smart meter installation contracts for the major utility providers
and insurance claims investigations for Aviva. Major contract extensions
included manned security for RBS and Virgin Atlantic and G4S became preferred
bidder for its first large commercial facilities services contract in the UK,
for General Dynamics's UK sites.
G4S recently completed the acquisition of Chubb Emergency Response, one of the
UK's leading key holding and response services, covering over 7,000 customers
across 22,000 locations via a network of 28 dedicated offices and 247 employees.
The acquisition significantly strengthens the strategic development plans of
G4S's existing Monitoring & Response capability.
Trading conditions in Ireland remained challenging in 2011 but underlying
trading was helped by a cost reduction plan. G4S Ireland broadened its expertise
into areas such as safety, security systems, alarm monitoring and patrol and
response through two acquisitions in 2011.
The Continental Europe region performed well against an uncertain economic
backdrop and has continued to gain market share with its solutions strategy
outperforming single service providers. Overall organic growth was 3% as a
result of price increases in some markets and a revised contract mix which
improved margins to 5.5%. Revenues for the security systems business, which
accounts for around 25% of Continental European secure solutions revenues, were
flat. The group divested its home alarms business in Norway.
There were some notable strong performances in the region - in Belgium we were
successful at winning the Brussels airport security contract for up to five
years from February 2011 and security for the European Commission building from
April 2011. In Sweden, G4S won the contract for the Swedish Parliament
Administration from March 2011 and Volvo from April 2012 for three years.
In Greece, G4S was awarded the US Embassy contract in Athens. The secure
solutions business was affected by the impact of the economic crisis, which was
partly offset by a strong performance in cash solutions (see page 11).
In Israel, G4S is the preferred bidder for a PFI police training academy which
has a 25 year contract term and G4S began two immigration accommodation
contracts in Cyprus in March and April.
Following significant revenue reductions in 2010, organic growth in most Eastern
European markets is stabilising to a low single-digit level.
North America
+---------------------------+-----------+-----------+-----------+--------------+
| | Turnover | PBITA | Margins |Organic Growth|
| | | | | |
| | GBPm | GBPm | | |
| +-----+-----+-----+-----+-----+-----+--------------+
|* At constant exchange |2011 |2010 |2011 |2010 |2011 |2010 | 2011 |
|rates | | | | | | | |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|North America * |1,652|1,613| 89 | 92 |5.4% |5.7% | 3% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
Organic growth in North America was good at 3% and margins were slightly lower
due to the performance of the US government business where revenues were down
8% and margins were lower compared to the prior year. The US government
business has been impacted by the significant reduction in federal funding
levels.
In the United States growth in the commercial sector was strong, particularly in
the financial institution, compliance and investigations and petrochemical
sectors. The outlook for new US federal government work in the short term
continues to be subdued. State and local governments are also under financial
pressure, but we continue to see some level of outsourcing focused on the more
effective delivery of public services.
Recent contract awards include work in the healthcare, energy, chemical,
manufacturing, federal government and retail sectors. G4S commenced the
provision of security solutions for a major automotive company from January
1, 2012 valued at $70m per annum for three years. The group's largest
commercial contract with Bank of America has been extended until 2014 and G4S
North America has been awarded a secure solutions contract with Google for its
locations in the United States and data centres in Belgium and Finland. The US
systems business performed well with a number of systems integration projects
for Tampa Airport, Iberdrola, and the Port of Tacoma.
We are confident that organic growth in 2012 will be stronger than in 2011
following the large contract wins and contract expansions during the final
quarter of 2011 and the first quarter of 2012.
In Canada, the organic growth rate was 7% assisted by the CATSA aviation
security contract which started on 1 November. The contract is for security at
20 airports in the Pacific region of Canada and has projected revenue of more
than CAD$ 400million over the initial five-year term.
Developing Markets
+---------------------------+-----------+-----------+-----------+--------------+
| | Turnover | PBITA | Margins |Organic Growth|
| | | | | |
| | GBPm | GBPm | | |
| +-----+-----+-----+-----+-----+-----+--------------+
|* At constant exchange |2011 |2010 |2011 |2010 |2011 |2010 | 2011 |
|rates | | | | | | | |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Asia * | 657| 597| 37| 39|5.6% |6.5% | 10% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Middle East * | 410| 413| 43| 44|10.5%|10.7%| -1% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Africa * | 348| 318| 34| 32|9.8% |10.1%| 8% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Latin America & Caribbean *| 427| 343| 34| 24|8.0% |7.0% | 20% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Total Developing Markets * |1,842|1,671| 148| 139|8.0% |8.3% | 9% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
In Developing Markets, organic growth was excellent at 9% with strong margins,
albeit slightly lower than the prior year.
Organic growth in Asia was 10% and margins were 5.6% due to a number of factors
including bidding costs and floods in Thailand. There was strong organic
revenue growth in Hong Kong and Indonesia. India, the largest market in the
region, achieved a good performance with double-digit revenue growth. Our risk
consulting business delivered a good performance helped by our advisory services
to a retailer developing its footprint in China.
In the Middle East, there was double digit organic growth (excluding Iraq) - an
excellent performance across the region. Qatar and Egypt performed particularly
strongly, mainly as a result of the new airport contract in Qatar. In Iraq, as
we had expected, the work for the US forces contract has come to an end and
commercial work for oil and gas companies has taken longer than expected to be
mobilised which had a short term impact on margins.
The US Embassy contract in Kabul, Afghanistan is now expected to continue until
at least the summer of 2012. The decision has been made to exit the UK managed
risk assessment business operating in Afghanistan. In UAE, the business is being
challenged by a shortage of labour supply and the general business environment
in Dubai which has impacted our security systems business, but was successful at
winning contracts such as Dubai Airport and in event security.
Africa performed well with organic growth of 8% and margins of 9.8%, helped by
strong performances in Djibouti, Morocco, Tanzania and Guinea. The business in
South Africa continued to be challenged by difficult macro-economic conditions.
G4S has a unique network of operations in Africa which provides an excellent
platform to support our global clients working in Africa and in key sectors such
as oil and gas, ports and mining and there is currently a strong contract
pipeline across the region.
The Latin America and Caribbean region has performed well as a result of strong
performances across all countries. We have also had a number of strategic
contract wins, for example in the pharmaceutical and mining sectors. Overall for
the region, organic growth was 20% and margins improved to 8.0%.
We are in the process of extending our presence in Brazil and recently acquired
a facilities services company. We will continue to build our presence in Brazil
so that we are positioned to become a key player in this important strategic
market.
Cash Solutions
+---------------------------+-----------+-----------+-----------+--------------+
| | Turnover | PBITA | Margins |Organic Growth|
| | | | | |
| | GBPm | GBPm | | |
| +-----+-----+-----+-----+-----+-----+--------------+
|* At constant exchange |2011 |2010 |2011 |2010 |2011 |2010 | 2011 |
|rates | | | | | | | |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Europe * | 817| 835| 87| 103|10.6%|12.3%| -1% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|North America * | 106| 108| 2| 4|1.9% |3.7% | -1% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Developing Markets * | 378| 346| 48| 44|12.7%|12.7%| 9% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Total Cash Solutions * |1,301|1,289| 137| 151|10.5%|11.7%| 2% |
+---------------------------+-----+-----+-----+-----+-----+-----+--------------+
|Exchange differences | -| 1| -| 1|
+---------------------------+-----+-----+-----+-----+
|At actual exchange rates |1,301|1,290| 137| 152|
+---------------------------+-----+-----+-----+-----+
The cash solutions business continued to face a sustained period of low interest
rates which has continued to result in some service reductions. Overall organic
growth was 2% but margins have declined due to service reductions and lost
contracts in the UK.
Organic growth in Europe was a decline of 1% with additional work in Belgium
being offset by a decline in the UK. In the UK & Ireland, as a result of the
loss of two ATM contracts, the cash solutions business saw revenues decline by
7%. This impacted the second half of 2011 and will continue to impact the first
half of 2012. Organic growth and margins should improve in the second half with
the start-up of new contracts for financial institutions, Northern Rail, Accor
and the M6 Toll, together with a good pipeline of other opportunities. In
Ireland, the business benefited from the provision of cash outsourcing for An
Post (post office) pension payments in 2011.
CASH360 is now a proven retail cash management solution, with almost 1,000 in-
store solutions within retailers in nine countries across Europe, Africa and
North America. Major customers who have implemented CASH360 in the last twelve
months include TGI Friday's, Center Parcs, Bofrost and Hema.
In Sweden, the cash solutions business was put up for sale and classified as a
discontinued business and was subsequently sold in February 2012. In Romania,
following the termination of the work for the state post office, the cost base
has been actively reduced.
G4Si, the international valuables transportation business, achieved another
strong performance, with double digit organic growth supported by higher
commodity prices.
Elsewhere in Continental Europe, organic growth was affected by a reduction in
cash transportation and ATM services but strong growth was achieved in Belgium,
where a number of bank contracts have been won, and in Greece helped by
increased cash in circulation as consumers hold on to their cash due to economic
uncertainty.
In North America, the business in Canada was impacted negatively by the partial
loss of the Bank of Montreal contract.
Organic growth in Developing Markets was good at 9% but margins were affected by
one-off costs relating to the floods in Thailand which reduced our ability to
deliver services in the region and a King's decree in Saudi Arabia awarding an
extra month's salary to employees. A further negative impact was the increased
competition and attack losses in South Africa. Excellent growth and strong
margins were achieved in Kuwait, Indonesia and Malaysia.
STRATEGIC DEVELOPMENT
Our strategy is to differentiate ourselves in our markets by using our expertise
to drive outsourcing and to minimise commoditisation of traditional security
services. We see strong evidence of this strategy delivering enhanced growth
opportunities for the group by:
* Capitalising on the structural growth opportunity of increased demand
for outsourcing by delivering innovative, cost reducing, tailor-made
solutions to customers as they re-shape their businesses in response to
economic pressures, regulation and compliance requirements
* Focusing the group on attractive global markets and sectors where
security is a key consideration
* Increasing global reach - G4S has a broad international presence and
unique developing markets exposure. We can export our government
expertise into new countries, drive outsourcing of cash solutions in
developing markets and develop secure solutions for multi-national
customers across numerous countries
* Building on strong organic growth through security-focused acquisitions
in developing markets where we can extend our market share or enter new
high growth sectors. We expect to spend around GBP200 million each year on
acquisitions out of free cash flow
At the same time, it is essential that the organisational design is aligned to
deliver the strategy and that we keep costs under control. We are creating a
number of service excellence centres to work with G4S country operations
globally to focus on operational efficiency, service standards, and development
of technology to support service delivery and sharing best practice across our
main service lines.
OTHER FINANCIAL ISSUES
Acquisitions and divestments
The group invested a total of GBP137m on acquisitions in 2011 which have added new
capabilities to the group and will support the implementation of the strategy.
Acquisitions included:
* Guidance Limited - offender monitoring technology operations
* The Cotswold Group Limited - the UK's market leader in surveillance, fraud
analytics, intelligence and investigations services
* Chubb Emergency Response - one of the UK's leading key holding and response
services
* Brazil - a facilities services business
In addition we purchased the remaining non-controlling interest in our security
business in Turkey.
During the year we incurred aborted acquisition and legal settlement costs of
GBP55m. The aborted acquisition costs related to the proposed acquisition of ISS
A/S which was terminated on 1 November 2011 and included debt finance
underwriting fees, financing and hedging costs.
Our acquisition strategy will continue to focus on niche opportunities which
will both help to deliver our strategic objectives and meet our financial
performance criteria. We expect to invest around GBP200m in acquisitions in 2012
and will be more active in our divestment strategy where businesses are not in
line with the group's strategy or where an alternative parent could add or drive
more value from a business.
During the year we disposed of our Norwegian consumer alarms business and
subsequent to the year end we disposed of our Swedish cash business.
Financing and interest
We have a prudent approach to our balance sheet whilst maintaining the
flexibility to pursue acquisitions when appropriate. G4S has a long term stable
credit rating of BBB granted by Standard & Poor's in March 2009 and has a
diverse range of finance providers. Our aim is to maintain our credit rating of
BBB and maintain a net debt to EBITDA ratio of around 2 to 2.5 times. The group
is currently well financed and the maturity profile is very healthy. Borrowings
are principally in pounds sterling, US dollars and euros reflecting the
geographies of significant operational assets and profits.
Our main sources of finance and their rates are set out below:
(i) A GBP1.1bn multicurrency revolving credit facility provided by a consortium of
lending banks at a margin of 0.80% over Libor and maturing on 10 March 2016.
(ii) A Euro 575m revolving credit facility provided by four banks at a margin of
1.20% over LIBOR and maturing 6 June 2012 with the right to extend for a further
six months at the group's option. This facility has not been drawn.
(iii) A $550m private placement of notes on 1 March 2007, which mature at
various dates between 2014 and 2022, and bear interest at rates between 5.77%
and 6.06%.
(iv) A $514m and GBP69m private placement of notes on 15 July 2008, which mature
at various dates between 2013 and 2020 and bear interest at rates between 6.09%
and 7.56%.
(v) A GBP350m Public Note issued on 13 May 2009 bearing an interest rate of
7.75%, maturing 13 May 2019.
At 31 December 2011 the group had uncommitted facilities of GBP706m.
As of 31 December 2011, net debt was GBP1,616m. Our headroom was GBP767m at the year
end. We have sufficient borrowing capacity to finance its current investment
plans.
Net interest payable on net debt was GBP99m. This is a net increase of 5% over the
2010 cost of GBP94m, due principally to the increase in the group's average cost
of debt.
Our average cost of gross borrowings during 2011 was 4.9% compared to 4.8% in
2010. The group expects that the average cost of gross borrowings for 2012 will
be slightly higher than for 2011.
Also included within financing is other interest costs of GBPnil (2010: GBP3m) and
net income of GBP3m (2010: expense of GBP6m) in respect of movements in the group's
retirement benefit obligations.
Taxation
The effective tax rate for the year on adjusted earnings was 22%, compared to
24% for 2010. The cash tax rate is 18.5% compared to 20% in 2010. Our target is
to maintain the effective tax rate. This will be supported by the gradual
reduction in UK corporation tax rates, the ongoing rationalisation of the group
legal structure and the elimination of fiscal inefficiencies.
Retirement benefit obligations
The group's funding shortfall on funded defined retirement benefit schemes, on
the valuation basis specified in IAS19 Employee Benefits, was GBP295m before tax
or GBP212m after tax (31 December 2010: GBP265m and GBP191m respectively). The main
scheme is in the UK. The latest full actuarial valuations were undertaken at 5
April 2009 in respect of all three sections of the UK scheme. However, all
actuarial assumptions were reviewed and updated as at 31 December 2011.
The net pension obligation has increased by GBP30m since 31 December 2010 due
mainly to a net actuarial loss as a result of the decrease in the discount rate
used from 5.5% to 5.0%, although this was offset partly by an increase in
inflation assumptions. Additional company contributions of GBP40m were paid into
the schemes, including GBP6m relating to the closure of the Irish pension scheme.
We believe that, over the very long term in which retirement benefits become
payable, investment returns should eliminate the deficit reported in the schemes
in respect of past service liabilities. However, in recognition of the
regulatory obligations upon pension fund trustees to address reported deficits,
the group's deficit recovery plan will see cash contributions made to the scheme
of approximately GBP35m in 2012 with modest annual increments thereafter.
During the year the group has closed the UK scheme to future accrual which will
limit the future growth in liabilities. Existing members retain their benefits
accrued to-date and have been offered the opportunity to transfer to a new
defined contribution scheme for future pension benefits.
Dividend
The board recommends a final dividend of 5.11p per share (DKK 0.4544). This
represents an increase of 8.0% on the final dividend for 2010. The interim
dividend was 3.42p per share (DKK 0.2928) and the total dividend, if approved,
will be 8.53p per share (DKK 0.7472), representing an increase of 8.0% on the
total dividend for 2010.
The group expects to continue to increase dividends broadly in line with
normalised adjusted earnings.
REVIEW AND OUTLOOK
Despite ongoing economic uncertainty in 2011, the business has performed well
and has good trading momentum which we expect to continue.
We have had some significant contract wins in the last year which demonstrate
the outsourcing model, particularly in the public sector in the UK, is
delivering real benefit to the group. We expect these outsourcing trends to
continue and will focus on bidding and winning an increasing proportion of
larger, more complex contracts.
2012 will be a year of mobilisation across a broad range of complex contracts
and delivery of the security requirements of the London 2012 Olympic and
Paralympic Games - a unique opportunity for us to showcase our large scale
security capabilities.
Contract phasing and mobilisation may impact margins in the short term, but we
expect margins to recover for the full year. We will continue to build on our
successes and we remain confident about the outlook for 2012 when we expect to
deliver an improved organic revenue growth performance whilst continuing to
maintain our discipline on margins for the full year and on meeting our cash
generation targets.
13 March 2012
G4S plc
Preliminary results announcement
For the year ended 31 December 2011
Consolidated income statement
For the year ended 31 December 2011
2011 2010
Notes GBPm GBPm
=-------------------------------------------------------------------------------
Continuing operations
Revenue 2 7,522 7,258
=-------------------------------------------------------------------------------
Profit from operations before amortisation and impairment of
acquisition-related intangible assets and share of profit
from associates and exceptional items 528 525
Share of profit from associates 3 5
=-------------------------------------------------------------------------------
Profit from operations before amortisation and impairment of
acquisition-related intangible assets and exceptional items
(PBITA) 1 531 530
Amortisation and impairment of acquisition-related
intangible assets (99) (88)
Acquisition-related costs (2) (4)
Aborted acquisition and legal settlement costs (55) -
=-------------------------------------------------------------------------------
Profit from operations before interest and taxation (PBIT) 1, 2 375 438
Finance income 6 111 98
Finance costs 7 (207) (201)
=-------------------------------------------------------------------------------
Profit before taxation (PBT) 279 335
Taxation:
+------------------------------------------------------------------------------+
|- Before amortisation and impairment of acquisition-related |
|intangible assets and exceptional items (95) (101)|
| |
|- On amortisation of acquisition-related intangible assets 25 25|
| |
|- On acquisition-related costs 1 1|
| |
|- On aborted acquisition and legal settlement costs 13 -|
+------------------------------------------------------------------------------+
(56) (75)
=-------------------------------------------------------------------------------
Profit after taxation 223 260
Loss from discontinued operations 4 (25) (15)
=-------------------------------------------------------------------------------
Profit for the year 198 245
=-------------------------------------------------------------------------------
Attributable to:
Equity holders of the parent 181 223
Non-controlling interests 17 22
=-------------------------------------------------------------------------------
Profit for the year 198 245
=-------------------------------------------------------------------------------
Earnings per share attributable to equity shareholders of
the parent 10
For profit from continuing operations:
Basic and diluted 14.7p 16.9p
For profit from continuing and discontinued operations:
Basic and diluted 12.9p 15.9p
=-------------------------------------------------------------------------------
+------------------------------------------------------------------------------+
|Dividends declared and proposed in respect of the year 9 |
| |
| |
| |
|Interim dividend of 3.42p per share (2010:3.17p) 48 45|
| |
|Final dividend of 5.11p per share (2010: 4.73p) 72 66|
+------------------------------------------------------------------------------+
|Total dividend of 8.53p per share (2010: 7.90p) 120 111|
+------------------------------------------------------------------------------+
Consolidated statement of comprehensive income
For the year ended 31 December 2011
2011 2010
GBPm GBPm
=-------------------------------------------------------------------------
Profit for the year 198 245
Other comprehensive income
Exchange differences on translation of foreign operations (65) 41
Change in fair value of cash flow hedging financial instruments 8 15
Actuarial (losses)/gains on defined retirement benefit schemes (73) 15
Tax on items taken directly to equity 9 (11)
=-------------------------------------------------------------------------
Other comprehensive income, net of tax (121) 60
=-------------------------------------------------------------------------
Total comprehensive income for the year 77 305
=-------------------------------------------------------------------------
Attributable to:
Equity holders of the parent 62 283
Non-controlling interests 15 22
=-------------------------------------------------------------------------
Total comprehensive income for the year 77 305
=-------------------------------------------------------------------------
Consolidated statement of changes in equity
For the year ended 31 December 2011
Reserve
Share Share Retained Hedging Translation Merger own
capital premium earnings reserve reserve reserve shares Total
2010 2010 2010 2010 2010 2010 2010 2010
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
=-------------------------------------------------------------------------------
At beginning
of year 353 258 295 (43) 130 426 (12) 1,407
Total
comprehensive
income
attributable
to equity
shareholders
of the parent - - 238 11 34 - - 283
Dividends
declared - - (103) - - - - (103)
Own shares
purchased - - - - - - (10) (10)
Own shares
awarded - - (10) - - - 10 -
Transactions
with non-
controlling
interests - - (7) - - - - (7)
Equity-
settled
transactions - - 7 - - - - 7
=-------------------------------------------------------------------------------
At end of
year 353 258 420 (32) 164 426 (12) 1,577
=-------------------------------------------------------------------------------
Reserve
Share Share Retained Hedging Translation Merger own
capital premium earnings reserve reserve reserve shares Total
2011 2011 2011 2011 2011 2011 2011 2011
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
=-------------------------------------------------------------------------------
At beginning
of year 353 258 420 (32) 164 426 (12) 1,577
Total
comprehensive
income
attributable
to equity
shareholders
of the parent - - 110 6 (54) - - 62
Dividends
declared - - (114) - - - - (114)
Own shares
purchased - - - - - - (13) (13)
Own shares
awarded - - (9) - - - 9 -
Transactions
with non-
controlling
interests - - (19) - - - - (19)
Equity-
settled
transactions - - 1 - - - - 1
=-------------------------------------------------------------------------------
At end of
year 353 258 389 (26) 110 426 (16) 1,494
=-------------------------------------------------------------------------------
Consolidated statement of financial position
At 31 December 2011
2011 2010
Notes GBPm GBPm
=-------------------------------------------------------------------------------
ASSETS
Non-current assets
Goodwill 2,196 2,159
Other acquisition-related intangible assets 264 285
Other intangible assets 87 71
Property, plant and equipment 532 576
Investment in associates 9 10
Trade and other receivables 162 138
Deferred tax assets 157 161
=-------------------------------------------------------------------------------
3,407 3,400
=-------------------------------------------------------------------------------
Current assets
Inventories 123 84
Investments 70 82
Trade and other receivables 1,547 1,460
Cash and cash equivalents 433 351
Assets classified as held for sale 11 35 -
=-------------------------------------------------------------------------------
2,208 1,977
=-------------------------------------------------------------------------------
Total assets 5,615 5,377
=-------------------------------------------------------------------------------
LIABILITIES
Current liabilities
Bank overdrafts (53) (45)
Bank loans (47) (113)
Obligations under finance leases (16) (21)
Trade and other payables (1,244) (1,210)
Current tax liabilities (48) (58)
Provisions (30) (33)
Liabilities associated with assets classified as held for
sale 11 (29) -
=-------------------------------------------------------------------------------
(1,467) (1,480)
=-------------------------------------------------------------------------------
Non-current liabilities
Bank loans (885) (574)
Loan notes (1,180) (1,153)
Obligations under finance leases (48) (49)
Trade and other payables (19) (48)
Retirement benefit obligations (344) (306)
Provisions (38) (46)
Deferred tax liabilities (90) (98)
=-------------------------------------------------------------------------------
(2,604) (2,274)
=-------------------------------------------------------------------------------
Total liabilities (4,071) (3,754)
=-------------------------------------------------------------------------------
Net assets 1,544 1,623
=-------------------------------------------------------------------------------
EQUITY
Share capital 353 353
Share premium and reserves 1,141 1,224
=-------------------------------------------------------------------------------
Equity attributable to equity holders of the parent 1,494 1,577
Non-controlling interests 50 46
=-------------------------------------------------------------------------------
Total equity 1,544 1,623
=-------------------------------------------------------------------------------
Consolidated statement of cash flows
For the year ended 31 December 2011
2011 2010
Notes GBPm GBPm
=-------------------------------------------------------------------------------
Profit before taxation 279 335
Adjustments for:
Finance income (111) (98)
Finance costs 207 201
Depreciation of property, plant and equipment 125 127
Amortisation and impairment of acquisition-related intangible
assets 99 88
Amortisation of other intangible assets 18 16
Acquisition-related expenses 2 4
Profit on disposal of property, plant and equipment and
intangible assets other than acquisition-related (11) (16)
Profit on disposal of subsidiaries (33) (8)
Share of profit from associates (3) (5)
Equity-settled transactions 1 7
=-------------------------------------------------------------------------------
Operating cash flow before movements in working capital 573 651
Increase in inventories (20) (1)
Increase in receivables (117) (81)
Increase in payables 71 45
Decrease in provisions (7) (32)
Decrease in retirement benefit obligations (40) (40)
=-------------------------------------------------------------------------------
Net cash flow from operating activities of continuing
operations 460 542
Net cash used by operating activities of discontinued
operations (8) (8)
=-------------------------------------------------------------------------------
Cash generated by operations 452 534
Tax paid (80) (86)
=-------------------------------------------------------------------------------
Net cash flow from operating activities 372 448
=-------------------------------------------------------------------------------
Investing activities
Interest received 17 11
Cash flow from associates 4 3
Purchases of property, plant and equipment and intangible
assets other than acquisition-related (173) (179)
Proceeds on disposal of property, plant and equipment and
intangible assets other than acquisition-related 31 40
Acquisition of subsidiaries (165) (59)
Net cash balances acquired 6 7
Disposal of subsidiaries 37 9
Sale of investments 10 5
Own shares purchased (13) (10)
=-------------------------------------------------------------------------------
Net cash used in investing activities (246) (173)
=-------------------------------------------------------------------------------
Financing activities
Dividends paid to non-controlling interests (10) (12)
Dividends paid to equity shareholders of the parent (114) (103)
Other net movement in borrowings 239 (18)
Transactions with non-controlling interests (18) (3)
Interest paid (119) (105)
Repayment of obligations under finance leases (17) (20)
=-------------------------------------------------------------------------------
Net cash flow from financing activities (39) (261)
=-------------------------------------------------------------------------------
Net increase in cash, cash equivalents and bank overdrafts 12 87 14
Cash, cash equivalents and bank overdrafts at the beginning of
the year 306 291
Effect of foreign exchange rate fluctuations on cash held (23) 1
=-------------------------------------------------------------------------------
Cash, cash equivalents and bank overdrafts at the end of the
year 370 306
=-------------------------------------------------------------------------------
1) Basis of preparation and accounting policies
The financial information set out above does not constitute the company's
statutory accounts for the years ended 31 December 2011 or 2010. Statutory
accounts for 2010 have been delivered to the registrar of companies, and those
for 2011 will be delivered in due course. The auditors have reported on those
accounts; their reports were (i) unqualified, (ii) did not include references to
any matters to which the auditors drew attention by way of emphasis without
qualifying their reports and (iii) did not contain a statement under section
498(2) or (3) of the Companies Act 2006.
The comparative income statement for the year ended 31 December 2010 has been
re-presented for operations qualifying as discontinued during the current year.
Revenue from continuing operations has been reduced by GBP139m and PBT has been
increased by GBP5m compared to the figures published previously. Further details
of discontinued operations are presented within note 4. In addition, the
comparative consolidated statement of financial position as at 31 December 2010
has been restated to reflect the completion during 2011 of the initial
accounting in respect of acquisitions made during 2010. Adjustments made to the
provisional calculation of the fair values of assets and liabilities acquired
amount to GBP12m, with an equivalent increase in the reported value of goodwill.
The prior year balance sheet has been restated to reflect the reclassification
of the entire retirement benefits obligation within non-current liabilities to
bring the disclosure in line with the group's peers and to more appropriately
reflect the nature of the obligation.
2) Operating segments
The group operates in two core product areas: secure solutions and cash
solutions which represent the group's reportable segments. For each of the
reportable segments, the group's CEO (the chief operating decision maker)
reviews internal management reports on a regular basis. The group operates on a
worldwide basis and derives a substantial proportion of its revenue, PBITA and
PBIT from each of the following geographical regions: Europe (comprising the
United Kingdom and Ireland, and Continental Europe), North America, and
Developing Markets (comprising the Middle East and Gulf States, Latin America
and the Caribbean, Africa, and Asia Pacific).
Segment information for continuing operations is presented below:
2011 2010
Revenue by reportable segment GBPm GBPm
=----------------------------------------------------
Secure Solutions
+---------------------------------------------------+
| UK and Ireland 1,252 1,179|
| |
| Continental Europe 1,475 1,404|
+---------------------------------------------------+
Europe 2,727 2,583
North America 1,652 1,676
+---------------------------------------------------+
| Middle East and Gulf States 410 426|
| |
| Latin America and the Caribbean 427 351|
| |
| Africa 348 332|
| |
| Asia Pacific 657 600|
+---------------------------------------------------+
Developing Markets 1,842 1,709
=----------------------------------------------------
Total Secure Solutions 6,221 5,968
=----------------------------------------------------
Cash Solutions
Europe 817 831
North America 106 106
Developing Markets 378 353
=----------------------------------------------------
Total Cash Solutions 1,301 1,290
=----------------------------------------------------
Total revenue 7,522 7,258
=----------------------------------------------------
2) Operating segments (continued)
Revenue by geographical area 2011 2010
GBPm GBPm
=--------------------------------------------------
Europe 3,544 3,414
North America 1,758 1,782
Developing Markets 2,220 2,062
=--------------------------------------------------
Total revenue 7,522 7,258
=--------------------------------------------------
PBITA by reportable segment 2011 2010
GBPm GBPm
=--------------------------------------------------
Secure Solutions
+-------------------------------------------------+
| UK and Ireland 119 103|
| |
| Continental Europe 81 77|
+-------------------------------------------------+
Europe 200 180
North America 89 96
+-------------------------------------------------+
| Middle East and Gulf States 43 45|
| |
| Latin America and the Caribbean 34 25|
| |
| Africa 34 34|
| |
| Asia Pacific 37 39|
+-------------------------------------------------+
Developing Markets 148 143
=--------------------------------------------------
Total Secure Solutions 437 419
=--------------------------------------------------
Cash Solutions
Europe 87 103
North America 2 4
Developing Markets 48 45
=--------------------------------------------------
Total Cash Solutions 137 152
=--------------------------------------------------
Total PBITA before head office costs 574 571
Head office costs (43) (41)
=--------------------------------------------------
Total PBITA 531 530
=--------------------------------------------------
PBITA by geographical area
Europe 287 283
North America 91 100
Developing Markets 196 188
=--------------------------------------------------
Total PBITA before head office costs 574 571
Head office costs (43) (41)
=--------------------------------------------------
Total PBITA 531 530
=--------------------------------------------------
Result by reportable segment 2011 2010
GBPm GBPm
=-----------------------------------------------------------------------------
Total PBITA 531 530
Acquisition-related costs (2) (4)
Amortisation and impairment of acquisition-related intangible assets (99) (88)
Aborted acquisition and legal settlement costs (55) -
=-----------------------------------------------------------------------------
Total PBIT 375 438
=-----------------------------------------------------------------------------
Secure Solutions 360 354
Cash Solutions 113 125
Head office costs (43) (41)
Aborted acquisition and legal settlement costs (55) -
=-----------------------------------------------------------------------------
Total PBIT 375 438
=-----------------------------------------------------------------------------
3) Profit from operations before interest and taxation (PBIT)
The income statement can be analysed as follows:
Continuing operations 2011 2010
GBPm GBPm
=----------------------------------------------
Revenue 7,522 7,258
Cost of sales (5,924) (5,695)
=----------------------------------------------
Gross profit 1,598 1,563
Administration expenses (1,226) (1,130)
Share of profit from associates 3 5
=----------------------------------------------
PBIT 375 438
=----------------------------------------------
Included within administration expenses is GBP86m (2010: GBP88m) of amortisation of
acquisition-related intangible assets and a GBP13m goodwill impairment charge
(2010: GBPnil) relating to the group's businesses in Greece, GBP2m (2010: GBP4m) of
acquisition-related expenses and GBP55m (2010: GBPnil) of aborted acquisition and
legal settlement costs. The aborted acquisition costs include debt finance
underwriting fees, financing and hedging costs that arose on the proposed
acquisition of ISS A/S which was terminated on 1 November 2011.
4) Discontinued operations
Operations qualifying as discontinued in 2011 included; the cash solutions
business in Sweden, which was disposed of on 27 February 2012; the secure
solutions business in Russia, and the UK risk assessment business in
Afghanistan. No businesses became qualified as discontinued in 2010.
5) Acquisitions
The group undertook a number of acquisitions in the year. The total fair value
of net assets acquired amounted to GBP52m which included the recognition of GBP65m
of acquisition-related intangible assets, generating goodwill of GBP85m, satisfied
by a total consideration of GBP137m, of which GBP130m has been paid in the year.
Related costs of GBP2m were incurred and charged to the income statement.
Principal acquisitions in subsidiary undertakings include the purchase of the
entire share capital of Munt Centrale B.V., a coin management service company
based in the Netherlands, The Cotswold Group Limited, the UK's market leader in
surveillance, fraud analytics, intelligence and investigations services, and a
facilities services business in Brazil.
The group also acquired the offender monitoring technology operations of
Guidance Limited and customer contracts from Chubb Group Security Limited.
In addition, the group completed the non-controlling interest buy-out of its
Turkish security business.
6) Finance income
2011 2010
GBPm GBPm
=--------------------------------------------------------------------
Interest income on cash, cash equivalents and investments 10 8
Other interest income 8 3
Expected return on defined retirement benefit scheme assets 93 87
=--------------------------------------------------------------------
Total finance income 111 98
=--------------------------------------------------------------------
7) Finance costs
2011 2010
GBPm GBPm
=----------------------------------------------------------------
Interest on bank overdrafts, loans and loan notes 105 96
Interest on obligations under finance leases 4 6
Other interest charges 8 6
=----------------------------------------------------------------
Total group borrowing costs 117 108
Finance costs on defined retirement benefit obligations 90 93
=----------------------------------------------------------------
Total finance costs 207 201
=----------------------------------------------------------------
8) Taxation
2011 2010
GBPm GBPm
=----------------------------------------------
Current taxation expense (66) (85)
Deferred taxation credit 10 10
=----------------------------------------------
Total income tax expense for the year (56) (75)
=----------------------------------------------
9) Dividends
Pence DKK 2011 2010
per share per share GBPm GBPm
=-------------------------------------------------------------------------------
Amounts recognised as distributions to equity
holders of the parent in the year
Final dividend for the year ended 31 December 4.16 0.3408
2009 - 58
Interim dividend for the six months ended 30 June 3.17 0.2877
2010 - 45
Final dividend for the year ended 31 December 4.73 0.4082
2010 66 -
Interim dividend for the six months ended 30 June 3.42 0.2928
2011 48 -
=-------------------------------------------------------------------------------
114 103
=-------------------------------------------------------------------------------
Proposed final dividend for the year ended 31 5.11 0.4544
December 2011 72
=---------------------------------------------------------------------------
The proposed final dividend is subject to approval by shareholders at the Annual
General Meeting. If so approved, it will be paid on 15 June 2012 to shareholders
who are on the register on 11 May 2012. The exchange rate used to translate it
into Danish kroner is that at 12 March 2012.
10) Earnings/(loss) per share attributable to equity shareholders of the parent
2011 2010
GBPm GBPm
=-------------------------------------------------------------------------------
From continuing and discontinued operations
Earnings
Profit for the year attributable to equity holders of the parent 181 223
=-------------------------------------------------------------------------------
Number of shares (m)
Weighted average number of ordinary shares 1,405 1,406
=-------------------------------------------------------------------------------
Earnings per share from continuing and discontinued operations
(pence)
Basic and diluted 12.9p 15.9p
=-------------------------------------------------------------------------------
From continuing operations
Earnings
Profit for the year attributable to equity holders of the parent 181 223
Adjustment to exclude loss for the year from discontinued
operations (net of tax) 25 15
=-------------------------------------------------------------------------------
Profit from continuing operations 206 238
=-------------------------------------------------------------------------------
Earnings per share from continuing operations (pence)
Basic and diluted 14.7p 16.9p
=-------------------------------------------------------------------------------
From discontinued operations
Loss per share from discontinued operations (pence)
Basic and diluted (1.8)p (1.1)p
=-------------------------------------------------------------------------------
From adjusted earnings
Earnings
Profit from continuing operations 206 238
Adjustment to exclude net retirement benefit finance
(income)/expense (net of tax) (2) 4
Adjustment to exclude amortisation and impairment of acquisition-
related intangible assets (net of tax) 74 63
Adjustment to exclude acquisition-related expenses (net of tax) 1 3
Adjustment to exclude aborted acquisition and legal settlement
costs (net of tax) 42 -
=-------------------------------------------------------------------------------
Adjusted profit for the year attributable to equity holders of the
parent 321 308
=-------------------------------------------------------------------------------
Weighted average number of ordinary shares (m) 1,405 1,406
Adjusted earnings per share (pence) 22.8p 21.9p
=-------------------------------------------------------------------------------
In the opinion of the directors the earnings per share figure of most use to
shareholders is that which is adjusted. This figure better allows the assessment
of operational performance, the analysis of trends over time, the comparison of
different businesses and the projection of future earnings.
11) Disposal groups classified as held for sale
At 31 December 2011, disposal groups classified as held for sale primarily
comprised the assets and liabilities associated with the cash solutions business
in Sweden, which was disposed of on 27 February 2012 and the UK risk assessment
services business in Afghanistan.
At 31 December 2010 there were no disposal groups classified as held for sale.
12) Analysis of net debt
A reconciliation of net debt to amounts in the consolidated balance sheet is
presented below:
2011 2010
GBPm GBPm
=-------------------------------------------------------------------------------
Cash and cash equivalents 433 351
Investments 70 82
Net cash and overdrafts included within disposal groups
classified as held for sale (10) -
Bank overdrafts (53) (45)
Bank loans (932) (687)
Loan notes (1,180) (1,153)
Fair value of loan note derivative financial instruments 120 96
Obligations under finance leases (64) (70)
=-------------------------------------------------------------------------------
Total net debt (1,616) (1,426)
=-------------------------------------------------------------------------------
An analysis of movements in net debt in the year is presented below:
2011 2010
GBPm GBPm
=-------------------------------------------------------------------------------
Increase in cash, cash equivalents and bank overdrafts per
consolidated cash flow statement 87 14
Sale of investments (10) (5)
Increase in debt and lease financing (222) 38
=-------------------------------------------------------------------------------
Change in net debt resulting from cash flows (145) 47
Borrowings acquired with subsidiaries (5) (4)
Net additions to finance leases (11) (9)
=-------------------------------------------------------------------------------
Movement in net debt in the year (161) 34
Translation adjustments (29) (27)
Net debt at the beginning of the year (1,426) (1,433)
=-------------------------------------------------------------------------------
Net debt at the end of the year (1,616) (1,426)
=-------------------------------------------------------------------------------
Non GAAP measure - cash flow
The directors consider it is of assistance to shareholders to present an
analysis of the group's operating cash flow in accordance with the way in which
the group is managed, together with a reconciliation of that cash flow to the
net cash flow from operating activities as presented in the consolidated cash
flow statement.
Operating cash flow
For the year ended 31 December 2011
2011 2010
GBPm GBPm
=-------------------------------------------------------------------------------
PBITA before share of profit from associates (group PBITA) 528 525
Depreciation, amortisation and profit on disposal of fixed assets 132 127
Movement in working capital and provisions (73) (68)
Net cash flow from capital expenditure (138) (129)
=-------------------------------------------------------------------------------
Operating cash flow 449 455
=-------------------------------------------------------------------------------
Reconciliation of operating cash flows 2011 2010
GBPm GBPm
=-------------------------------------------------------------------------------
Net cash flow from operating activities per consolidated cash flow 372 448
statement
Add back exceptional items and discontinued operations 95 17
Net cash flow from capital expenditure (138) (129)
Add-back additional pension contributions 40 33
Add-back tax paid 80 86
=-------------------------------------------------------------------------------
Operating cash flow 449 455
=-------------------------------------------------------------------------------
Prelim Announcement:
http://hugin.info/141489/R/1593398/501350.pdf
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: G4S plc UK DK via Thomson Reuters ONE
[HUG#1593398]
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