Results for the six months ended 30 june 2017

  • 09 Aug 2017 07:02
G4S announces businesses revenue growth of 6.2% and earnings growth of 7.6%. 
2017 Half Year Results Infographic

"G4S Chief Executive Officer Ashley Almanza said, “In the first half of 2017 our continuing businesses delivered revenue growth of 6.2% and earnings growth of 7.6%."

We continue to invest in strengthening our sales operations and in new products and services for our customers and these investments have materially improved our sales pipeline which supports our medium term aim of growing revenues by an average of around 4-6% per annum. Our well established productivity programme provides increased confidence in the Group’s ability to deliver recurring operating and financing efficiencies of £90 million to £100 million by 2020. We believe that this combination of investment, growth and productivity will deliver strong growth in the Group’s earningsa and operating cash flow.”
 
Operational and financial highlights: 

  • Sales pipeline: £7.0 billion annual contract value
  • Revenue +6.2%a with growth across all regions except Middle East & India 
  • Operating cash flowa,c £192 million (2016: £277 million); weighted to H2 2017 in line with guidance
  • Net debt to EBITDA improved to 2.7x (30 June 2016: 3.3x); expect 2.5x or lower by year end
  • Continuing EPS 8.3p +7.8% (2016: 7.7p); statutory EPS 9.7p +115.6% (2016: 4.5p)
  • Interim dividend 3.59p (2016: 3.59p)

Group results


Continuing Businessesa

Constant Rates

Statutory Resultsb

Actual Rates


2017

2016

%

2017

2016

%

Revenue

£3,715m

£3,497m

+6.2

£3,972m

£3,532m

+12.5

PBITA

£235m

£222m

+5.9

£237m

£203m

+16.7

Earnings

£128m

£119m

+7.6

£150m

£69m

+117.4

Earnings Per Share

8.3p

7.7p

+7.8

9.7p

4.5p

+115.6

Operating Cash Flowc

£192m

£277m

-30.7

£170m

£273m

-37.7

a Results from continuing businesses, presented at constant exchange rates other than for operating cash flow, exclude results from businesses identified for sale or closure and onerous contracts. The basis of preparation of results of continuing businesses and an explanation of Alternative Performance Measures is on page 3.  

b See page 19 for the basis of preparation of statutory results. Statutory earnings represent profit attributable to equity shareholders of G4S plc. Statutory operating cash flow is net cash flow from operating activities of continuing operations.

c Operating cash flow is stated after pension deficit contributions of £20 million (2016: £24 million) and 2016 amounts are presented at actual 2016 exchange rates. Operating cash flow from continuing businesses is reconciled to the Group movements in net debt on page 30.

G4S strategy and investment proposition

G4S is the world’s leading, global integrated security company, providing security and related services across six continents. 

Our strategy addresses the positive, global demand outlook for security services and our enduring strategic aim is to demonstrate the values and performance that make G4S the company of choice for customers, employees and shareholders. We aim to do this by designing innovative solutions, by delivering outstanding service to our customers, by providing engaging and rewarding work for employees and by generating sustainable growth in returns for our shareholders. These aims are underpinned by the key programmes in our strategic plan:

  • People and Values
  • Growth and Innovation 
  • Customer Service Excellence
  • Productivity and Operational Excellence 
  • Financial and Commercial Discipline

The Group has two business segments: Secure Solutions and Cash Solutions. Security and safety are critical to our success in both segments.

Secure Solutions: we design, market and deliver a wide range of security and related services and our global business provides valuable access to a highly diversified customer base in markets around the world. Our security services range from static manned security to highly sophisticated, integrated solutions. Our scale and focus on productivity supports our cost competitiveness and our sustained investment in professional staff, technology, software and systems enables us to provide valuable and integrated solutions for our customers. 

Cash Solutions: we transport, process, recycle, securely store and manage cash and we provide secure international logistics for cash and valuables. We invest in technology and know-how and develop and sell proprietary cash management systems which combine skilled professionals with software, hardware and operational support in an integrated managed service. We operate around the globe, focussing on markets where we are able to build and sustain a material market share in our key service offerings.
G4S’s investment proposition is to deliver sustainable growth in earnings, cash flows and dividends.
 
Outlook 

G4S Group Chief Executive Officer, Ashley Almanza, commented: 

We continued to make substantial progress with G4S’s transformation and this provides increased confidence in the Group’s prospects.

The scale and quality of our pipeline is materially improved and this, together with our on-going investment in sales operations and new products and services, provides stronger support for our organic growth plans. During the second half of 2017, our growth programme will focus on consolidating contract wins made over the past year and on converting attractive opportunities in our pipeline. We expect full year revenue growth in 2017 to be broadly in line with our medium term aim of 4-6% and we anticipate continued growth in 2018.

We have a well-established productivity programme which we believe will deliver recurring operating and financing efficiencies of £90 million to £100 million by 2020. Depending on the scale and quality of new organic growth opportunities, a portion of the productivity gains will be re-invested in growth.

We have a stronger balance sheet and with a continued focus on cash flow we are on track to reach net debt/EBITDA of 2.5x or lower by the year end. 

We believe that the combination of investment, growth and productivity that underpins our plans will deliver strong growth in the Group’s earningsa and operating cash flow.”

Read the full announcement here

Presentation of Results:

G4S plc will be holding its 2017 Half Year Results Presentation to institutional investors and analysts on Wednesday 9th August at 09.00am UK time.

There will also be a video webcast and telephone dial in facility of the presentation on the day.  To register for the webcast please paste the link below into your browser and follow the on-screen instructions.
 
Webcast

http://view-w.tv/707-803-18618/en

Please note there will also be a telephone dial-in facility for this event, the call details are below:

Standard International Access : +44 (0) 20 3003 2666
UK Toll Free : 0808 109 0700
Copenhagen : +45 3272 9273
Denmark Toll Free : 8088 8649
New York : +1 212 999 6659
USA Toll Free : 1 866 966 5335

Password: G4S

Dividend payment information
2017 interim dividend:

Ex-dividend date –   31 August 2017
Last day to elect for DKK – 31 August 2017
Record date – 1 September 2017
Last day for DRIP elections – 18 September 2017
Pay date – 13 October 2017

Financial Calendar
November 2017 - Q3 2017 Trading update
 

^