Above group average margins
Consolidated markets
Very high G4S competitive expertise
Cost base – fixed in short term





Loomis
Brinks
Prosegur
Garda
Technology companies
Market Participants




Key Characteristics
Cash Solutions
Long Term Growth Drivers
 Cash usage trends in economic
downturns
 Long term contracts / relationships
 G4S integral part of customer process
Defensive Qualities
Development phases of the cash cycle
Role and strategy of Central Banks
Increased willingness to outsource
Product innovation - End to end ATM
management, CASH360, etc
 High single digit market growth




Market Characteristics
1
Ken Niven
Cash Solutions - Divisional President
Cash Solutions
Central/South America
Barbados
Colombia
Costa Rica
Dominican Republic
Ecuador
Grenada
Peru
Paraguay
St Lucia
Trinidad & Tobago
North America
Canada
Africa
Botswana
Kenya
Morocco
Malawi
Namibia
Tanzania
Uganda
Zambia
Mozambique
South Africa
Lesotho
DRC
Middle East
Bahrain
Jordan
Kuwait
Lebanon
Pakistan
Qatar
Saudi Arabia
UAE
Bangladesh
Asia Pacific
C b di
Cambodia
Nepal
Bangladesh
Brunei
China
Guam
Hong Kong
Indonesia
India
Macau
Malaysia
Papua New Guinea
Taiwan
Thailand
Europe
Belgium, Bulgaria, Cyprus, Czech Republic, Estonia,
Finland, Greece, Hungary, Ireland, Latvia, Lithuania,
Luxembourg, Malta, Netherlands, Offshore(3),
Poland, Romania, Serbia, Slovakia, Slovenia,
Sweden, Turkey, United Kingdom
G4S Cash Solutions
3
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

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


£1.3 bn revenue
11.4% PBITA margin
15% PBITA CAGR
last five years
72 countries
45,000 employees
9,500 vehicles
600 Cash
management
locations
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0
*As published
2005
866
6.2%
2006
873
7.6%
2007
987
10.6%
2008
1,201
12.5%
Turnover and organic growth (£m)*
G4S Cash Solutions
2009
4.7%
1,341
0%
3%
6%
9%
12%
15%
4
11.4%
+0.1%
PBITA Margin
Margin
FY08
-1.3%
4.7%
84.8
0.1%
1,793.9
Brinks
+0.4%
7.0%
72.6
-3.0%
1,039.8
Loomis
31st December exchange rates used: 1 GBP = SEK 11.53; US$1.61
*Brinks: ‘adjusted’ results, excluding 2009 ‘one-offs’
vs
152.4
PBITA
%
4.7%
1,341.2
Organic Growth
Turnover
£m
Cash Solutions
Brinks
G4S
Loomis
8%
Garda
15%
12%
Prosegur
4%
42%
19%
Others
Global Cash Market Shares – Top Players
12 months ended 31 December 2009
G4S versus Competition
5
(£)) Millions
2006
2007
2008
Source: Bank of England
Value of notes in circulation (£ millions)
0
2005
-
2004
1000
5,000
2003
2000
10,000
4000
5000
6000
7000
8000
9000
3000
2002
CAGR +7.6%
10000
2002
2003
2005
2006
2007
2008
Source: European Central Bank
Value of notes in circulation (€ millions)
2004
CAGR + 14.6%
2009
Value of Euro notes in circulation 2002 - 2009
15,000
20,000
25,000
30,000
35,000
40,000
45,000
50,000
Value of GBP Notes in Circulation 2002- 2008
Value of GBP & Euro notes in
circulation
(€) Milliions
6
Manned
security
Cash
transportation
Market development
Cash
processing
ATM replenishment
Increase Revenues and increase PBITA
Outsourcing
solutions
Cash cycle management
 ATM
 Cash centres
 Forecasting
 Retail solutions
ATM repair and
maintenance
Cash Market Development
7
ATM
replenishment
Basic
transportation
and grow branch
network
 Financial
Sector
 Retail Sector
Outsourcing
g
Solutions
ATM repair and
maintenance
Cash counting
in transportation
branches
Cash Market Development
8
ATM repair and maintenance
 Introduction of technical services based on ATM
knowledge
ATM replenishment
 Support of ATM’s not positioned at bank
branches
Cash counting
 Process retail deposits of transportation hubs –
co location efficiency benefits
co-location
Basic secure transportation
 Migrate from bank and government operated
secure transportation
Evolving the Cash Product
Cash Market Development
9
Cash Cycle Management
 Cash centre outsourcing
 ATM network outsourcing
 Cash forecasting
Retail Solutions
 Outsource retail store cash
offices
 Real time cash balance
information
 Secure environment
Outsourcing Solutions
Cash Market Development
10
Cash management
companies
Security regulations
Commercial banking structure
Central bank infrastructure
Government structure
Factors that impact cash market
characteristics
11
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central vs decentralised
many central bank branches or a few strategic locations?
national banks or many regional players?
result in fragmented cash markets

Police carrying weapons usually results in armed cash crews
 Strategy of government on required levels of secure transport
regulation
Security regulation

Regional bank infrastructure

Commercial banking structure

Central bank strategy and infrastructure

Government structure and strategy :
No two markets are the same
National Cash Market Drivers
12



Central banks moving towards
less intervention and more
currency management
outsourcing
Low intervention and increased
outsourcing
Few cash branches
High control
Many cash branches
Central bank view on need to
closely control physical cash
Central bank infrastructure
Central Bank Strategy
Two Key Drivers
•
•


Low investment
Lower crewing levels


Operating centres
Vehicles
Technology increasingly a basis
for regulation


Armed
A
d crews generally
ll mean
lower operating costs
“light touch or detailed
requirements / regulations”
Some countries reluctant to
permit private security
Government intent to regulate?
Security Regulation
National Cash Markets
13
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Since 2008 Ireland has invested in a multimillion pound new build infrastructure with
eight branches and a new purpose built
control centre .
One third of the vehicle fleet has been
renewed during the same period.
Th b
The
branches
h iincorporate an ““onion
i – ring”
i ”
defence strategy with fences, detection
systems and layered internal design.
Since 2008 attacks have halved
End to End systems will follow later this
year following the introduction of the
Private Security Authority (PSA) minimum
standards in 2009.
Ireland
Benefit of technology solutions
14
1995
1996
1997
1998
1999
2000
2001
2002
Product revenues - UK
2003
2004
2005
2006
2007
2008
2009
Development of a Cash market
Other
15
ATM
29%
Cash Centres
13%
Retail 360
<1%
Revenue Split 2009
Other
4%
UK Cash Solutions
Secure
Transport
54%
16


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
£4bn
£12bn
£33bn
(2009 £49bn 8% yoy)
Cash note distribution delegated to commercial banks : interest
relief through Note Held To Order scheme (NHTO)
Cash in circulation 1970
1980
2000
Original market entry manned security
Extension into cash transportation, then counting retail deposits
G4S developed nationwide cash services leadership : No. 1
ATM’s rolled out in 1970’s and 1980’s
M j cash
Major
h llogistics
i ti challenge
h ll
ffor central
t lb
bank
k
Sustainable Development of a Large
Cash Market : UK Example
17
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
Commercial banks created networks of non-core centres to fitness
sort and counterfeit check for central bank
Note Circulation Scheme replaced NHTO in 2001 – tighter controls
and increased efficiency
Significant outsourcing in following three years
UK bank processing centres now outsourced with exception of
one major
G4S only commercial cash management organisation providing
outsourcing processing solutions
Sustainable Development of a Large
Cash Market: UK Example cont’d
18
R t il
Retailers
Fitness sort
Cash count,
reconciliation,
counterfeit
d t ti
detection
OUTBOUND CASH
 Outbound logistics – highly efficient
 Inbound logistics – material efficiencies yet to be released
 Launch of Cash 360 retailer outsourcing
R t il
Retailers
Retailers
INBOUND CASH
Next Steps in Market Development
ATM’s
Banks
Sustainable Development of Cash Markets
19
16
3
Depicts countries with G4S Cash Solutions
Secure transport
2
12
3
3
6
3
ATM Replenishment
Counting
1
3
2
1
1
ATM Maintenance
Partial FI outsource and retail solution
Fully outsourced solutions
Global Opportunity
G4S Cash Solutions
Increasing com
mplexity
Market position
1
53
39
38
21
21
8
20


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
New Markets 12%
Developed markets 2.7%
Central banks moving to delegated distribution models
ATM outsource solutions – e.g. Standard Chartered
Best practice transfer – all New Markets regions have cash
solutions specialists
Growing cash solutions consultancy to position for growth


Significant, sustainable solutions opportunities in New Markets and
developed markets


Five year CAGR 11.6%
Growth in 2009
Growth through Solutions
Summary
21