Securicor loss doubles to £25m
Securicor, the cash services, security and private prisons group, yesterday reported a doubling in losses after taking a £81m charge to cover write-downs in various parts of the business.
However, shares in the company closed 3 per cent higher after it increased its dividend payment by a bigger-than-expected 28 per cent.
The pre-tax loss for the year to the end of September increased to £24.6m from £12.8m in the previous 12 months, on sales up by a quarter to £1.4bn. Excluding exceptional items and goodwill write-offs, profits rose by 73 per cent to £67.8m.
The biggest of the write-downs, totalling £37.1m, relates to Securicor's US aviation security business, Argenbright Security. The write-down follows the Bush administration's decision to hand airport security over to government agencies in the wake of 11 September. Argenbright provided security at Newark and Washington Dulles airports where two of the hijacked planes took off from.
Securicor has taken a further £36m asset impairment charge at its information systems division which is close to being sold off. The business provides computer and communication equipment and training to emergency services and local authorities.
The write-off relates to the cost of developing software for a police information system. There is further write-off of £5.7m relating to the group's internet security business, SafeDoor. Nick Buckles, Securicor's chief executive, said the group had so far received about 25 lawsuits arising out of the US terrorist attacks but that it had substantial insurance cover.
Mr Buckles also said Securicor was looking for a buyer for its 50 per cent stake in a distribution business owned jointly with Deutsche Post. He said the German group would be an obvious buyer for the stake, worth an estimated £100m.
Securicor's UK division turned in another strong performance, with operating profits rising 10 per cent to £54m on turnover of £538m.
The increase in the dividend takes the payout for the year to 2.11p. Mr Buckles said the board had taken the view that it was the right time to lift the dividend into line with the rest of the market.
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