Securicor PLC preliminary announcement

Securicor PLC continues to refocus its business as it strives
to become one of the top three security services providers worldwide, said chief
executive Roger Wiggs.
Following the sale of its wireless activities in the US, the group is still
planning to dispose its 50 pct shareholding in the distribution businesses Omega
Express and Omega Logistics, which contributed 338.9 mln stg to Securicor’s
turnover in the past financial year to Sept 30.
“We are continuing to manage our distribution business to optimise
operations with a view to a sale,” finance director Chris Shirtcliffe explained.
Deutsche Post AG holds the other 50 pct stake in the distribution
operations, which it bought from Securicor. Under a 6-year agreement it with
Securicor reached at the time of the purchase, the German postal services
operator is required to buy Securicor’s other half of the share at a fair price.
The agreement with Securicor will expire in around three years, and should
Securicor sell its stake before then, it faces the problem of degrouping tax.
Wiggs said that proceeds from the disposal of the distribution business will
go towards financing the group’s strategic refocussing which, he hopes, will
result in Securicor’s turnover from its core operations rising to around 2 bln
stg.
“We believe that over the next three years we need to get to about 2 bln stg
turnover in terms of reaching a top three position (among the world’s security
services providers),” he said in a conference call with reporters.
He was speaking after the group unveiled a 16 pct rise in year to Sept 30
pretax profit from ongoing operations before goodwill and development costs for
its e-commerce venture to 64 mln stg on turnover of 1.102 mln stg.
As part of the group’s plans to refocus, Securicor is also seeking to merge
its former Securicor information systems business with its custodial business,
as well as announcing today that it is buying the remaining 50 pct share in JS
Holdings Ltd from Jardine Pacific Holdings Ltd for 33 mln usd. The acquisition
is subject to shareholder and regulatory approval.
In the past financial year, Securicor’s Security unit saw pretax profit
before interest and goodwill increase by 37.5 pct to 74.0 mln stg on turnover of
1.093 bln stg, up from 620.4 mln previously.
Turning to its US operations, Securicor reiterated that it will wind down
Argenbright’s aviation related business following the US government’s decision
to make all airport baggage screeners federal employees in a bid to improve
security after the Sept 11 attacks.
As previously announced, the portion of the goodwill attaching to the US
aviation passenger screening business is unlikely to exceed 35 mln stg.
Securicor said the US government’s decision was a setback, but emphasised
that its core Security unit is well positioned for continued growth.
The security services provider declared a full-year dividend of 1.65 pence,
up 10 pct on last year.