G4S Botswana, the BSE quoted security solutions outfit, will lay off staff before the end of the year as the struggling company implements the right sizing exercise following the review of structures in line with declining profitability.
The company’s Managing Director, Michael Kampani, said it is still early days, but some roles could be combined while others will be centrally managed in order to achieve cost efficiencies.
“Staff was informed of the company’s intentions through an internal staff meeting and a communiqu├® was also issued to the same effect. This has been followed by consultations with those likely to be affected by the exercise,” he explained.
“We are still in the early stages of the consultation process and therefore (I am) not in a position to confirm the number of employees likely to be affected. This is a complete review of our business structures and may affect all departments,” he added.
Already, over 30 G4S employees have been served with letters of termination of work. The company which operates internationally has access to highly specialised security expertise, including airports, mines, custodial services, hotels, and financial institutions.
The number of redundancies is will rise as more employees are expected to be included in the retrenchment list before end of the year 2013.
“The workers morale is very low currently as a lot of us do not know yet whether we will be retrenched or not,” said one concerned employee, adding that as staff they do not know what criteria management is using to retrench them.
“Some of us were told by word of mouth and later on served with letters indicating we will not be part of the company’s new structure. We were told that by November 15th everything will be finalized.”
The group’s wide range of security services are mainly secure alarm monitoring and response, cash solutions management as well as security technology.
The company’s share price dropped from P5.80 per share as at end of 2012 to a low of P3.30 per share as at November 4th, 2013ÔÇöwhich is a signal that the market is not happy about the company’s performance.
Its total liabilities increased to about P36.4 million from P27.9 million in 2011 and 2012 while Gross Profit declined from an increase of 74 percent in 2010 to a negative 65 percent in 2012, a two year period.
Worse still, G4S’s dividend payout took a dive from 33.38 thebe per share paid out in 2011 to 14.74 thebe per share paid in 2012, therefore the company squeezed business was evident.