G4s Share Discussion Threads

[eipgam] 14/7/2012 19:09

GB... thanks for your thought out comments. I wonder who would get the contracts if not G4S. Companies have overcome much bigger gaffes than this in the recent past, though.

Ammons: Thanks for your lesson in spelling... I always thought it was 'their'

Jon: you need to learn as much about investing as you appear to know about childrens games.... this is a SETS stock.... no market makers. All done on supply and demand.

[grahamburn] 14/7/2012 18:44

No axe to grind, but...........

1) The actual direct immediate costs to P & L and Balance Sheet (remember this is a £7.5 billion turnover outfit) are relatively small. So that aspect should not be overplayed which is probably why the share price has been relatively stable. Indeed, most of their turnover comes from long term contracts which are reasonably secure, even in the public sector.

2) The potential reputational damage is huge, especially as it is unlikely that many public sector bodies will risk the political fallout of giving NEW contracts to the company, at least in the short term. This is a political rather than a commercial issue as the majority of their current public sector contracts seem to be running successfully and smoothly. Even their other ad hoc security related short term contracts (eg Wimbledon et al) haven't raised adverse publicity, though a few malcontents are creeping out of the woodwork as a result of this week's news.

There is also clearly a significant short term risk to the company in the coming week from further poor publicity (eg CEO's appearance before the Home Affairs Select Committee and the Games security itself). How their media and executive personnel respond to these could make or break in the short term.

The investment case for G4S in the recent past has been one of exponential growth potential. That may now grind to a halt, but whether the company will go into reverse is one which will become clearer over the coming weeks and months.

That is what will affect the share price much more.

[jon827] 14/7/2012 18:30

I can't understand why the mm's didn't cut it in half thursday. They must be slippin'

[ammons] 14/7/2012 18:27

Damage done to thier reputation will take a verrrrrrrry long time to repair. As well as the damage to thier balance sheet. Two quid on Monday I wager.

[eipgam] 14/7/2012 16:48

a recent post from our newly resident vulture (and he's calling someone else a nob?)

Jon827 - 13 Jul 2012 - 22:39:53 - 6466 of 6520
pftt, Dungeons and Dragons is gay, War Craft is where its at...

[jon827] 14/7/2012 16:20

Re ceo, he does come across as a bit of a nob :)

[jon827] 14/7/2012 16:18

You would think it'll test 220 again sometime?

[bobp] 14/7/2012 14:42

I agree, once the last athlete is out the knives will be out.Short time...

[shayadfn] 14/7/2012 10:34

time to go short!

[lennonsalive] 14/7/2012 10:06

I cant believe how well the share price has kept it's nose above water, when the companies name is being dragged through the mud. The damage for company rep, will last for years and lose them contracts.

[ammons] 14/7/2012 08:23

Presumeably there will be an RNS about this on Monday.......

[lennonsalive] 13/7/2012 18:43

This Government is worst than the last and that's saying something.

[jon827] 13/7/2012 17:19

the PM is flapping his gums about it now, saying 'there will be consequences'

[jon827] 13/7/2012 16:30

bunch of CROOKS

[jon827] 13/7/2012 15:29

lol, not be the first time :)

it would be a crime if it didn't close negative ytd on the news this week!

[grahamburn] 13/7/2012 15:27

Looks like you might be wrong as of now!

[jon827] 13/7/2012 14:48

id be surprised if this closes above 278 today

[philanderer] 13/7/2012 13:26

Independent newspaper..

Private security company G4S will not be financially penalised for failing to recruit sufficient security guards for the Olympic Games, it emerged last night.

The firm has been accused of letting the country down just two weeks before the Games, with soldiers forced to cancel family holidays to ensure venues are protected. But a senior Government source told The Independent that the contract with G4S did not include a penalty clause.

The revelation appears to contradict a statement by the Home Secretary Theresa May in the House of Commons. She told MPs that while the contract was between G4S and the Games organisers Locog, she understood that there were "penalties within that contract".

A source said that in fact it was a pro-rata agreement where G4S were paid for each extra security guard they supplied – and not penalised if they did not make the overall target. "The person who negotiated the contract should be shot," the source said

[jon827] 13/7/2012 13:07

could harm its chances of securing government contracts in the future......

lol, no sh*t Mr Brandwood!

[eipgam] 13/7/2012 11:25

See last line... (from Citywire)

UBS warns of 'reputational damage' to G4S

Jaime Brandwood, analyst at UBS, has warned that the apparent failure of G4S (G4S.L) to find enough security staff for the Olympics could harm its chances of securing government contracts in the future.

Private security contractor G4S yesterday confirmed that it is struggling to supply the 10,000 guards needed for the games, saying it has 'encountered some delays in progressing applicants through the final stages'. The military has been asked to provide 3,500 extra troops to cover the shortfall.

'For G4S, increasing total UK staff by about 20% on a temporary basis was always going to be a challenge,' Brandwood said. 'The key now, regardless of risk to sales/profits on Olympics work, has to be to avoid reputational damage that could hurt its chances of securing future events work and a fair share of a burgeoning UK govt outsourcing pipeline.'

Brandwood predicted that 'Shares may seem some pressure today on this news', but he retains his 'buy' recommendation nonetheless.

[jon827] 13/7/2012 08:49

it was 50/50 this time yesterday, looks like shorts are building?

[jon827] 13/7/2012 08:35

this is more like it!