LSC London Security Plc

London Security plc

THIS  ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE UK VERSION OF REGULATION (EU) NO 596/2014 WHICH IS PART OF UK LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018, AS AMENDED. UPON THE PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

Final Results for the Year Ended 31 December 2023

Chairman's statement

 J.J. Murray, Chairman

Financial Highlights

Financial highlights of the audited results for the year ended 31 December 2023 compared with the year ended 31 December 2022 are as follows:

•     revenue of £219.7 million (2022: £188.9 million);

•     operating profit of £31.6 million (2022: £27.2 million);

•     profit for the year of £23.3 million (2022: £20.2 million);

•     cash of £32.7 million (2022: £34.0 million);

•     earnings per share for the year of £1.90 (2022: £1.65); and

•     a dividend per share of £1.24 (2022: £0.84).

Trading review

The financial highlights illustrate that the Group's revenue increased by £30.8 million (16.3%) to £219.7 million and operating profit increased by £4.4 million (16.2%) to £31.6 million. These results reflect:

•     the effect of input inflation which our companies initially absorbed, but as it became clear that it was a longer term trend we passed on appropriate price increases to our customers;

•     the positive impact of acquisitions in 2023 and the full year's trading of acquisitions in 2022;

•     improved performance from our service business in continental Europe;

•     continued improvement from newer service offerings (e.g. emergency lights and passive fire protection); and

•     the movement in the Euro to Sterling average exchange rate, which had a positive effect of £3.0 million on reported revenue and £0.5 million on operating profit. A more detailed review of this year's performance is given in the Financial Review and the Strategic Report.

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 prices where an adequate return is envisaged by the Board. In the year under review, the Group acquired two security businesses in Belgium.  The Group has also continued with the acquisition of service contracts from smaller well-established businesses for integration into the Group's existing subsidiaries and has grown its presence in Austria, the Netherlands, the United Kingdom and Germany.

Management and staff

2023 was a year in which the staff performed well and, on behalf of the shareholders, I would like to express thanks and appreciation for their contribution. The Group recognises that we can only achieve our aims with talented and dedicated colleagues who provide outstanding customer service in every area of the business.

Jacques Gaston Murray

Mr. Murray sadly passed away on 7 June 2023. Mr. Murray was appointed to the Board in January 2000, following his acquisition of a controlling interest in the Company, and he has had a prominent role in guiding the Company's successful performance and strategy since that time. The Board would like to place on record its immense appreciation for the many years of service that Mr. Murray dedicated to the Company.

Dividends

An exceptional one-off interim dividend in respect of 2023 of £0.82 per ordinary share was paid to shareholders on 7 December 2023. The Board is recommending the payment of a final dividend in respect of 2023 at the same level as 2022 of £0.42 per ordinary share. This would be paid on 12 July 2024 to shareholders on the register on 14 June 2024 with the shares marked ex-dividend on 13 June 2024.

Future prospects

The markets in which we operate are entering what is likely to be a period of low growth albeit with declining inflation from high levels in 2023. The London Security Group however has a healthy balance sheet, strong cash reserves and a track record for good cash generation. The Board therefore considers that the Group is well placed to weather any downturn. We will also continue to invest in our future and the Group plans to continue to grow through acquisitions.

Annual General Meeting

The Annual General Meeting ("AGM") will be held at 2 Jubilee Way, Elland, West Yorkshire HX5 9DY, on 25 June 2024 at 11.30 am. The Company confirms that shareholders are able to attend in person should they wish to do so. However, we strongly encourage shareholders to vote on all resolutions by completing the enclosed form of proxy for use at that Meeting, which you are requested to return in accordance with the instructions on the form.

J-J. Murray

Chairman

14 May 2024