Lon.sec Regulatory News (LSC)

London Security plc

Preliminary Results

FINANCIAL HIGHLIGHTS

Financial highlights of the audited results for the year ended 31 December 2011 compared with the year ended 31 December 2010 are as follows:

·; revenue of £96.3 million (2010: £85.5 million);

·; operating profit before depreciation and amortisation of £24.5 million (2010: £22.7 million);

·; operating profit of £20.8 million (2010: £19.3 million); and

·; profit after income tax of £14.1 million (2010: £13.1 million).

TRADING REVIEW

The financial highlights illustrate that the Group's revenue increased by £10.8 million (12.6%) to £96.3 million and operating profit increased by £1.5 million (7.8%) to £20.8 million. However, these results partially reflect the movement in the Sterling to Euro average exchange rate which has decreased from 1.16 to 1.15. If the 2011 results had been translated at 2010 rates, revenue would have been £95.6 million instead of £96.3 million, (increase of 11.8%).On the same basis operating profit would have been £20.6 million instead of £20.8 million, (increase of 6.7%). This performance is very satisfactory in this difficult trading environment.

Ongoing cost control, cash and working capital management have continued to be priorities for the Group. The Group has continued to focus on its stock levels and capital expenditure. Cost control has been achieved without any adverse impact on the operational structure of the business.

A more detailed review of this year's performance is given in the Operational Review and Financial Review.

ACQUISITIONS

We have continued to acquire further contracts to service fire equipment through smaller acquisitions. It remains a principal aim of the Group to grow through acquisition. Acquisitions are being sought throughout Europe and the Group will invest at the upper end of the price spectrum where an adequate return is envisaged by the Board.

MANAGEMENT AND STAFF

2011 was a year in which the staff performed well and, on your behalf, I would like to express thanks and appreciation for their contribution.

FINANCING

The Group has benefited from the low level of interest rates and has repaid a further £7.3 million of borrowings. These two factors have resulted in a reduction in net interest costs of £0.2 million. Finance costs also move due to pensions and financial instruments although they broadly offset each other.

DIVIDENDS

An interim dividend in respect of 2011 of £0.24 per ordinary share was paid to shareholders on 24 June 2011.

The Board is not recommending the payment of a final dividend in respect of 2011.

Dividend policy continues to be reviewed regularly by the Board.

SHARE BUY-BACK PROGRAMME

As previously announced, the Board continues to believe that shareholder value will be optimised by the purchase by the Company, when appropriate, of its own shares.

During the period under review a total of 39,187 ordinary shares were purchased for cancellation for a total consideration of £573,974.

The Directors confirm that they intend to actively continue to pursue this policy and any shareholder who is considering taking advantage of the share buy-back programme is invited to contact their stockbroker, bank manager, solicitor, accountant or other independent financial adviser authorised under the Financial Services and Markets Act 2000, in order to contact N+1 Brewin LLP who are operating the buyback programme on behalf of the Company.

FUTURE PROSPECTS

Economic growth in the Group's market has been depressed in 2011 resulting from the issues surrounding European sovereign debt and the consequent austerity measures. However, the Group does not operate in the most troubled of the peripheral Eurozone economies. 2011 was a strong year for the Group and although 2012 will be challenging the effect of past and potential acquisitions and our multi-service offering means we are in a strong position. The Board is optimistic for further success in 2012.

ANNUAL GENERAL MEETING

The Annual General Meeting will be held at 10 Bruton Street, 5th Floor, London W1J 6PX on 13 June 2012 at 11am. You will find enclosed a form of proxy for use at that Meeting which you are requested to complete and return in accordance with the instructions on the form. I shall, along with your Directors, look forward to meeting you at that time.

J.G. MURRAY

Chairman

2 May 2012

Consolidated Income StatementFor the year ended 31 December 2011

* Earnings before interest, tax, depreciation, amortisation and impairment charges.

Consolidated statement of comprehensive income

for the year ended 31 December 2011

Consolidated statement of changes in equityfor the year ended 31 December 2011

The merger reserve is not a distributable reserve. The other reserve relates entirely to the effects of changes in foreign currency exchange rates.

Consolidated statement of financial position

1 Earnings per share

The calculation of basic earnings per ordinary share ("EPS") is based on the profit on ordinary activities after taxation of £14,128,000 (2010: £13,082,000) and on 12,265,538 (2010: 12,284,170) ordinary shares, being the weighted average number of ordinary shares in issue during the year.

For diluted EPS, the weighted average number of shares in issue is adjusted to assume conversion of all dilutive potential ordinary shares. There was no difference in the weighted average number of shares used for the calculation of basic and diluted earnings per share as there are no potentially dilutive shares outstanding.

2 This preliminary announcement does not constitute the Company's statutory accounts within the meaning of Section 434 of the Companies Act 2006.

The results for the year ended 31 December 2011 have been extracted from the full accounts of the Group for that year which received an unqualified auditor's report and which have not yet been delivered to the Registrar of Companies. The financial information for the year ended 31 December 2010 is derived from the statutory accounts for that year, which have been delivered to the Registrar of Companies. The report of the auditor on those filed accounts was unqualified. The accounts for the year ended 31 December 2011 and 31 December 2010 did not contain a statement under s498 (1) to (4) of the of the Companies Act 2006 or under s237(1) to (4) of the Companies Act 1985.

This preliminary announcement has been prepared in accordance with International Financial Reporting Standards. The Group will post its annual report and accounts to shareholders on 18 May 2012. A copy of the annual report and accounts can be found on the company's webpage (www.londonsecurity.org).

Enquiries: London Security plc

Richard Pollard

Company Secretary Tel: 01422 372852

N+1 Brewin (NOMAD & Broker)

Sandy Fraser/ Joe Stroud Tel: 0131 529 0272