G4S Botswana, the country’s biggest security services company has posted improved profit for the past year despite challenging trading space. At the end of December 2015, Profit After Tax (PAT) of the sole listed security sat at P29, 5 million, up marginally when compared to P28, 8 million recorded the year before.
Like most security companies in the mining-rich economy, the BSE-quoted company faces stiff competition from mushrooming players especially in the manned security space, default or late payments by some clients and reduction in business due to muted economic growth. Led by Michael Kampani, the company has been involved in a turnaround strategy that is now bearing fruits, if the balance sheet is a measure to go with. “Revenue growth of 3,8 percent was achieved despite a challenging economic environment,” said a joint statement by long time Chairman, Lebang Mpotokwane and Kampani.
During the period under review, the Gaborone-based company reported that there was notable growth cash solutions, manned security and facilities management. The G4S Facilities Management is a unit, which was bought from Shield Security some few years ago. The directors of the security company said that there was decline in business within the electronic system unit. G4S, which listed in the domestic bourse in 1991,was forced to ‘right size’ the number of alarm monitoring subscriber base for credit reasons.
Earnings Before Taxation (EBT) expanded by 8,8 percent year on year as a result of new business and existing clients. The directors are content that their turnaround strategy is working and they are expecting better profits in future. “Having attained the key objective of consolidating and sustaining the gains made in the turnaround in the previous year, focus will continue towards implementation of productivity and other cost efficiency programs,” said Mpotokwane and Kampani. “Though the market remains challenging, there are good prospects across all products”
On top of the agenda will include improved customers service and a roll out of new products. When Kampani appear before the media this morning (Friday), it will be interesting to know how G4S’s Deposit machine has performed in the period under review. At the stock market, punters did not immediately react to the company’s modest results, as its share price closed the day flat at 363 thebe. Shareholders are smiling that a final dividend of 10,88 thebe has been declared.