Security Firm Garda World Security Corp. Sees Growth in Cash Handling

MONTREAL -- The founder of Garda World Security Corp. believes the growing provider of security and cash handling services can more than double its annual revenues within the next five years.

Stephan Cretier, Garda's chairman and chief executive, said Tuesday it took him 10 years to reach annual sales of close to $200 million, and he says it should only take five years to reach $500 million, as Garda takes part in a security services industry consolidation.

''We want to take this company and bring it to a new level,'' Cretier said at the Montreal company's annual meeting Tuesday.

Earlier, the company's shares (TSX:GW) jumped 8.6 per cent to a record $9.30, a gain of 74 cents on the Toronto Stock Exchange as it announced first-quarter profits had almost tripled. The shares traded as low as $3.19 during the last year.

Cretier said the company's expansion will come through internal growth as well as through acquisitions. ''We're talking to numerous players,'' Cretier said after the meeting, adding the company would like to make a large initial acquisition in the United States.

Currently, about 55 per cent of sales revenues are from Quebec, and 45 per cent from other provinces.

The first-quarter results released Tuesday include one month's contribution from a contract awarded by the Canadian Air Transportation Security Authority for pre-boarding screening at 18 airports in British Columbia.

Profits for the period ended April 30 reached $3.1 million or 12 cents a share, compared with $1.08 million or four cents per share earned a year earlier.

Revenue soared 44 per cent to $51.9 million from $36 million.

Cretier is calling for annual revenues this fiscal year of $225 million to $240 million, and a net profit of $10 million to $12 million.

He said the current environment is favourable for Garda World, as the security industry is fragmented, coupled with geopolitical uncertainty.

With more than 8,500 employees, Garda works in four main divisions: Armoured cars; physical security, such as air passenger screening; investigation services, like credit checks on prospective employees; and electronic security such as surveillance and access to large buildings.

Cretier, a former baseball umpire who founded the security company in 1995, owns 30 per cent of Garda's shares.

Garda's main competitors are all multinationals: Securicar of England, U.S.-based Brinks and Securitas of Sweden.

The company's shares gained 69 cents Tuesday to close at $9.25.