Sept. 25 (Bloomberg) -- Smiths Group Plc, the maker of airport security equipment, may benefit as the U.K. tries to double security exports that last year were worth 2.6 billion pounds ($4.2 billion) on the heels of the London Olympic Games.
“The global export market is about 62 billion pounds. So far the U.K. has a pretty small share, which is why we think there is huge scope to do more,” Simon Everest, head of the U.K. Trade & Investment’s Defense & Security Organisation said in an interview. The U.K. has a 20 percent market share on global defense exports and would like security sales overseas to reach similar levels.
The government has been trying to push exports to help sustain domestic manufacturing at a time of shrinking outlays at home. Britain’s security industry employs around 165,000 workers and exports reached 2.6 billion pounds last year, according to the U.K. Trade and Investment agency. Global security spending is expected to reach 330 billion pounds by 2015, the U.K. projects.
The London games were used to showcase British companies from those involved in planning event security --including venue design -- to providing border check equipment. The U.K. sees around 1.5 billion pounds in contracts up for grabs between the Sochi winter games in Russia in 2014 and the Rio de Janeiro Olympics in 2016.
By the time of the next summer Olympic Games, security exports should top 6 billion pounds, Everest said. To help, the U.K. government devoted one day during its London Olympics hosting activities focused on Brazil.
Security provisions for the London Olympic and Paralympic games were overshadowed by the failure of G4S Plc to provide enough staff, forcing the government to deploy troops for extra protection. Everest said however that the games were a success story overall, with no incidents and little intrusion of security procedures into sport activities.
Smiths Group, based in London, is looking at business opportunities with Brazil’s two large events, the company said in an e-mailed statement. The company had pulled out of bidding for the London games, citing onerous conditions associated with the process.
G4S Chief Executive Officer Nick Buckles has said the company would not bid on the security contract for the 2014 soccer World Cup in Brazil or the Rio games two years later. The company still sees scope to win some security consultancy work related to those events.
Meeting the U.K.’s target for growth in security exports will also require sustained increases in cybersecurity related exports. Those represented about a third of the total last year.
“Cybersecurity is absolutely the biggest growth area,” Everest said in the Sept. 20 interview, showing annual sales increases of 15 percent.
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