G4S to take fresh £50m hit over Games security fiasco

Click to follow
The Independent Online

Under-fire FTSE 100 security giant G4S will take a £50m hit over its London Olympic failures this week, but chief executive Nick Buckles is resisting pressure to resign over the debacle.

G4S, which could not provide the 10,400 security staff it was contracted to supply for the Games, will count the cost in Tuesday's first-half figures. This is expected to drag earnings before interest, tax, and amortisation – a key profit figure – below £200m after what will be counted as an "exceptional", one-off hit.

However, sales will remain strong, with analysts at UBS expecting a near 7 per cent growth on the first six months of last year to £3.95bn. This is important, because Mr Buckles has retained the backing of prominent shareholders due to the group's hugely successful financial performance during his eight-year reign.

Mr Buckles, pictured, will remain in place until at least the end of an internal review into his and the company's performance during the Olympic fiasco. Big four accountant PricewaterhouseCoopers is undertaking the review.

Another chief executive under pressure this summer, albeit for the different reason of shareholder anger over his pay, is WPP's Sir Martin Sorrell. The advertising empire will announce what are expected to be strong interim numbers on Thursday.

Comments