LSC London Security Plc

London Security PLC

(the "Group" or "Company")

Interim results for the six months ended 30 June 2024

Chairman's statement

J-J. Murray, Chairman

Financial highlights

•     Revenue £110.9m (2023: £108.8m)

•     Operating profit £13.4m (2023: £13.7m)

•     Earnings per share 78.4p (2023: 81.0p)

Trading

The financial highlights illustrate that the Group's revenue increased by £2.1 million (1.9%) to £110.9 million.

Operating profit decreased by £0.3 million (2.2%) to £13.4 million.

These results include the adverse movement in the Euro to Sterling average exchange rate, which has increased from 1.15 to 1.17. If the 2024 results from the European subsidiaries had been translated at 2023 rates, revenue would have been £113.2 million instead of £110.9 million, which would represent an increase of 4.0% on the prior year. On the same basis, operating profit would have been £13.7 million instead of £13.4 million, stable compared to 2023.

The first six months of 2024 were a period of consolidation for the Group following the 26% increase in operating profit that was enjoyed in 2023. Whilst operating profit is broadly stable versus 2023, this still represents a 23% increase on 2022.

The core servicing business remains very consistent with a slight fall in special projects, the instance of which is unpredictable.

Although inflation has moderated since last year, we continue to experience upward input price pressures. These supply price increases have been passed on to our customers where possible. Interest rates which were increased to combat inflation remain high and are depressing growth and reducing our customers' appetite to invest. All the countries in which we operate are experiencing low or no growth.

Acquisitions

In the six months to the end of June 2024, the Group strengthened its presence in Belgium, the Netherlands, Germany, Austria, Luxembourg and France through the acquisition of service contracts to be integrated into the Group's existing subsidiaries. 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.

Cash and financing

The Group's cash balance as at 30 June 2024 was £39.5 million. This is an increase of £6.8 million on the 31 December 2023 balance of £32.7 million.

Prospects

Cash management is a key consideration in difficult economic times. The London Security Group has a healthy balance sheet, strong cash reserves and a track record for good cash generation. The Board therefore considers that with its strong balance sheet and material net cash position the Group is well placed to cope with a period of low growth.

Dividends

A final dividend in respect of 2023 of £0.42 per ordinary share was paid to shareholders on 12 July 2024.

J-J. Murray

Chairman

13 September 2024

Consolidated income statement

for the six months ended 30 June 2024

The above are all as a result of continuing operations.

Consolidated statement of comprehensive income

for the six months ended 30 June 2024

Consolidated statement of changes in equity

for the six months ended 30 June 2024

Consolidated statement of financial position

as at 30 June 2024

Consolidated statement of cash flow

for the six months ended 30 June 2024

Notes to the financial statements

for the six months ended 30 June 2024

1 Nature of information

The financial information contained in this Interim Statement has been neither audited nor reviewed by the auditor and does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The financial information for the six months ended 30 June 2024 has been prepared applying the accounting policies and presentation that were applied in the preparation of the Group's published consolidated financial statements for the year ended 31 December 2023. The principal risks and uncertainties as disclosed in the year end accounts are considered to be consistent with those that are still applicable now.

Comparative figures for the year ended 31 December 2023 have been extracted from the statutory accounts for the year ended 31 December 2023, which have been delivered to the Registrar of Companies. The Independent Auditor's Report on those accounts was unqualified and did not contain an emphasis of matter paragraph or any statement under Section 498 of the Companies Act 2006.

2 Basis of preparation

The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities and income and expense. Actual results may differ from these estimates.

3 Earnings per share

The calculation of basic earnings per ordinary share is based on the profit on ordinary activities after taxation of £9,590,000 (2023: £9,935,000) and on 12,259,877 (2023: 12,260,684) ordinary shares, being the weighted average number of ordinary shares in issue during the period.

For diluted earnings per ordinary share, the weighted average number of shares in issue is adjusted to assume conversion of all potentially dilutive 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.

4 Actuarial valuation of the pension scheme

As permitted under IAS 19 the Group has not prepared an actuarial valuation of the pension scheme assets and liabilities for the Interim Statement 2024. In accordance with IAS 19 such a valuation will be prepared for the purposes of the Group's Annual Report and Accounts 2024.

For further information, please contact:

London Security plc

Richard Pollard

Company Secretary                                                                                                            Tel : 01422 372852

Zeus Capital Limited

Chris Fielding / Sarah Mather                                                                                           Tel : 0203 829 5000