GFS.L Share News (GFS)

(Sharecast News) - Security firm G4S, which has agreed to be taken over by US rival Allied Universal Security Services in a £3.8bn deal, said it secured contracts worth £5.5bn last year.

Updating on trading for the 2020 full year, the FTSE 250 firm said it had either won or retained contract with an annual revenue value of £3.0bn, compared to £2.5bn in 2019.

The total contract value associated with the contracts was £5.5bn. "G4S's integrated security strategy continues to differentiate our service offering in key markets and this contributed to an outstanding commercial performance in 2020," the firm said.

G4S provides a range of services for the UK government, from running prisons to managing Covid-19 test centres.

Chief executive Ashley Almanza said: "I'd like to thank my executive team and colleagues across G4S who, in the midst of the global pandemic, delivered a remarkable operating and financial performance."

Fourth-quarter revenues were in line with trends flagged at the nine-month update, while profits before interest, tax and amortisation margins "held up well", G4S said. It ended the year with net debt to earnings before interest, tax, depreciation and amortisation "well within" the target range of 2.0 to 2.5 x.

Cash flow benefited from Covid-19 related payroll and other indirect tax deferrals of around £110m. That will reverse by around £80m in 2021, but will be offset by disposal proceeds of around £100 following the sale of The Brink's Company.

In December, G4S - the world's biggest security firm, with more than 500,000 employees in 80 countries - accepted an improved 245p per share offer from Allied Universal after dismissing an initial approach for undervaluing the business.