G4S share price slides even as group posts rise in profits

Company leaves dividend unchanged

G4S share price slides even as group posts rise in profits

Shares in G4S (LON:GFS) have lost nearly five percent in London this morning, even as the company revealed that its profits had climbed in the first half of the year. The FTSE 100 security group, however, decided to keep its dividend unchanged.

As of 09:22 BST, G4S’ share price had lost 4.96 percent to 314.20p, underperforming the broader market selloff which has seen the benchmark FTSE 100 index fall 0.81 percent to 7,481.98 points. The group’s shares have added more than 60 percent to their value over the past year, and are up by just under 34 percent in the year-to-date.

G4S announced in a statement this morning that its revenue had climbed 6.2 percent to £3.7 billion in the six months ended June 30, with the group seeing growth across all regions except Middle East & India. The company further delivered earnings of £128 million, up 7.6 percent year-on-year. Despite the improved results, G4S maintained its interim dividend unchanged at 3.59p.

“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,” the group’s chief executive Ashley Almanza commented in the statement, adding that the company was confident that it would deliver recurring operating and financing efficiencies of between £90 million and £100 million by the end of the decade.

The results come as G4S has been offloading businesses to shore up its balance sheet amid losses from British government contracts.

Almanza noted today that during the second half of the year, the company’s “growth programme will focus on consolidating contract wins made over the past year and on converting attractive opportunities in our pipeline”. G4S expects full-year revenue growth to be broadly in line with its medium-term aim of between four percent and six percent, and forecasts continued growth next year. 

As of 09:44 BST, Wednesday, 09 August, G4S plc share price is 312.30p.

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