Security giant says Euro exit could badly hit UK workforce
Security firm G4S - which employs more than 1,500 staff across Northern Ireland - has warned that businesses could be hit by the UK's decision to quit the European Union.
Unveiling a significant rise in profits, the world's biggest security services provider said it feared that the country's workforce and economic growth may shrink as a result of Brexit.
"Depending on the nature of the terms of the UK's exit from the EU around the free movement of capital and labour, this could result in a shortage of skills or workforce availability in the UK market", the company said in a statement.
"It is also possible that the continuing period of uncertainty lowers economic growth in both the UK and Europe, which could affect both our customers and our competitors".
Shares in G4S rocketed 18% yesterday after the company reported pre-tax profits up 9.7% to £203m and revenue up 3.2% to £3.5bn, driven by success in winning new contracts worth £1.4bn.
Chief executive Ashley Almanza has been looking to shore up the company's balance sheet by winding down onerous contracts and disposing of loss-making businesses.
To this end, the firm sold seven businesses in the first half of the year, raising £32m. Since 2013, G4S has offloaded 25 businesses, raising a total of £288m.
Mr Almanza said: "Our plans are delivering tangible results. We have much to do to realise the full potential of our strategy which is underpinned by our growth, innovation, productivity and portfolio programmes. Executing these programmes and reducing net debt remain our key priorities."
Last year, G4S invested £3.4m in a new monitoring centre in Belfast which co-ordinates responses to incidents or alarms across the UK.
Although the company expressed concern about the Brexit vote impact, it said that it was "relatively well positioned, with around 80% of revenues outside the UK and minimal cross-border trading".
A G4S spokesman said: "We typically trade within national markets and have very little cross-border trade, so we anticipate that Brexit will have little impact on our ability to trade and grow.
"We don't operate in any of the four biggest eurozone markets of Germany, France, Italy or Spain.
"Although we haven't collected the data formally before, rough estimates would suggest that about 1% of our UK labour force are EU nationals.
"We think it's too early to say what impact a reduction in free movement would have or indeed if it will actually happen, but on the basis of the estimate we would anticipate the impact on the business to be fairly small."
However, a survey by the Bank of England reveals that many UK firms are expecting to put hiring and expansion plans on hold as they brace for a trading hit following the Brexit vote. The report showed a slowdown in business services growth and consumer spending, while firms across all sectors except manufacturing expect turnover to be knocked over the year ahead.
Business services and construction firms appeared the hardest hit, although manufacturers are expecting to see a boost from the weaker value of the pound, according to the Bank of England's report.