G4S turnaround strategy delivers higher profits
By Neil Maidment
LONDON (Reuters) - A management overhaul and restructuring helped G4S (GFS.L: Quote) to beat profit forecasts in 2014, marking progress for the world's largest security group after a series of setbacks.
The British firm, trying to recover from contract problems including a high profile failure at the London Olympics in 2012, said on Tuesday underlying operating profit rose 7.9 percent to 424 million pounds ($637 million) last year, ahead of a consensus forecast of 414 million.
Under CEO Ashley Almanza, who took charge in 2013, G4S has shaken up its management and begun cutting costs in areas like IT and procurement.
It has also axed weak businesses to help feed growth in more profitable emerging markets, where 2014 revenue rose 8.9 percent and helped offset weaker trade in continental Europe and Britain.
Almanza maintained a cautious tone on the outlook for a company which runs services from transporting cash to protecting ships from pirates.
"There remains much to be done to realize the full potential of our strategy," he said.
The profit rise was helped by 3.9 percent revenue growth and cost savings that pushed margins up slightly.
Shares rose 3.1 percent to 300.1 pence by 6.15 a.m. EDT, also boosted by a five percent rise in the final dividend to 5.82p per share -- the first increase in 18 months. Continued...