Interim Management Statement
Overview – trading and financial performance from 30 June to date and nine months to 30 September 2013
Trends from the first half of 2013 have broadly continued from 30 June to date. Revenue, at constant exchange rates, compared to the same nine month period last year grew by 6.4%1. Profit before interest, tax and amortisation (PBITA) was in line with the same period in 2012.
Trading update - nine months ended 30 September.
Overall organic growth was 4.8%. Growth was 14% in emerging markets and was broadly flat in developed markets. The Group delivered satisfactory organic growth despite challenging market conditions in Europe and lower US federal government spending which has affected our secure solutions and systems businesses in that market.
On 31 October, we agreed the sale of G4S Norway to Nokas AS for a total consideration of £30.5 million including associated cash and debt. Completion is subject to customary closing conditions. G4S Norway provides security and security systems to customers across the country.
As at 30 September the Group was in a significantly stronger financial position following the August share placing and receipt of the disposal proceeds from the sale of our data storage business in Colombia. We expect to receive the proceeds from the disposal of our Canadian Cash business in the fourth quarter. The Group also had access to £960 million of committed, un-utilised facilities.
On 4 November, the SFO notified the company that it opened an investigation into the provision of electronic monitoring services which commenced in April 2005. The company will fully co-operate with this investigation. The company also continues to provide support and full co-operation to the Ministry of Justice on its audit of the electronic monitoring contract and, upon completion of the audit, looks forward to working with the customer to address any differences on this contract. The company is also providing full support and co-operation to the Cabinet Office review of key contracts.
Summary and Outlook
Our emerging markets businesses, which account for more than 40% of group profits, continue to achieve good results. Trading conditions are expected to remain challenging in Europe and the USA during the fourth quarter. The restructuring of our UK & Ireland cash solutions businesses and selected businesses in continental Europe is underway with tangible benefits expected in 2014.
At our Capital Markets presentation today, we will be outlining how the proven expertise and capabilities of our people, coupled with our leading market positions and diverse customer base provide us with the foundation from which to deliver sustainable, profitable growth.
1 – excluding the Olympics contract
A meeting for investors was held in London on 5th November 2013.