(Alliance News) - G4S PLC on Friday said it will separate its cash management division in the first half of 2020 as part of a previously announced business review.
The company, which also provides security services, reported a 3.8% rise in revenue for the six months to June-end, but profit fell on disposals, onerous contracts, exchange rate movements, restructuring and separation costs and impairment charges.
Shares in G4S were up 4.4% at 191.70 pence in London, one of the top performers in the FTSE 250 index.
The company said it has received a number of unnsolicited interest from third parties to acquire parts or all of the Cash Solutions operation, which fills ATM machines and transports cash for businesses.
The G4S board will continue to evaluate proposals alongside the implementation of demerger plans, although no assurance can be provided at this stage that any third party proposals will lead to a transaction, the company added.
"We believe that this will create two strong, focused businesses each with the clear potential to capitalise on market leading positions and to unlock substantial value for customers, shareholders and employees," said Chief Executive Officer Ashley Almanza, the cash handling outfit and the remaining security services business.
G4S recorded pretax profit of GBP108 million for first half of 2019, down 21% on GBP137 million recorded in the year-ago period.
Revenue increased to GBP3.81 billion from GBP3.67 billion, with the security division recording revenue of GBP3.27 billion versus GBP3.11 billion and the cash business posting GBP535 million versus GBP561 million.
Adjusted profit before interest, taxes and amortisation increased to GBP234 million from GBP224 million.
"The group’s first half performance, sales pipeline, revenue momentum and productivity programmes support a positive outlook. We are now implementing our plans to separate Cash Solutions from the group and we expect that this separation will deliver material benefits to customers, shareholders and employees," Almanza added.
The company declared an unchanged interim dividend of 3.59 pence per share.
