The board of multi-national security contractor G4S has approved the separation of its Cash Solutions arm from the business, the firm said in its half-yearly results. The company said that it has set in train plans for a demerger of Cash Solutions in the first half of 2020. It reported: “We believe that this will create two strong, focused businesses each with the clear potential to capitalise on market leading positions and to unlock substantial value for customers, employees and shareholders.” It added that since announcing the separation review in December 2018, it has received a number of unsolicited expressions of interest from third parties to acquire parts or all of the cash arm; which it is evaluating.
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G4S Chief Executive Officer Ashley Almanza said: “In the first half of this year, our improving sales performance in both Secure Solutions and Cash Solutions saw the Group deliver underlying revenue growth of 4.7pc. This growth together with new contract wins, supports our medium-term revenue goal of 4-6pc per annum. Our revenue mix continued to improve as our technology-enabled revenues in Secure Solutions grew by 14.8pc across the globe and our North American cash technology revenues grew by 33pc. The Group’s half year performance, sales pipeline, revenue momentum and productivity programmes support a positive outlook.”
Besides, the company ‘will be managing for value or exiting a number of non-core businesses and implementing programmes to deliver further identified operational efficiencies’.
Revenues in Europe were in line with last year, the company reported, ‘as we continued to exercise commercial discipline in our bidding’. The report also noted a significant increase in the net deficit of the UK pension scheme.
The ‘secure solutions’ arm of the company had revenues of £3.21 billion. Revenue for the whole company for the first six months was £3.7bn, up 4.7pc against the same period of last year. While Americas bring in the largest revenue by region, Europe and Middle East revenue was £1.24 billion, a rise of one per cent on the year before. The company share price rose on the news.
