As you may know, ArmorGroup International (OTC:AMGPF) reported unaudited preliminary results for 2006 last week. The company achieved strong revenue growth driven by successes in diversifying its business.
The overall positive performance was offset by the lack of US and Iraqi funding for training, which led to the underutilization of ArmorGroup's Iraq training facility -- which lowered the year's profit.
Still, ArmorGroup's business in Iraq grew. And the really good news is that growth in Afghanistan, Africa and South America increased by 107%.
Moreover, Iraq accounted for 49% of revenues in 2006, down from 59% in 2005. Progress in diversifying away from Iraq -- while growing the business there -- is being made.
Company management believes the private security business is coming of age. They have reason for optimism. Research company AMR International estimates the private security business grew 8% last year to become a $2.6 billion industry -- with the majority of growth outside of Iraq.
Anyone buying or selling this stock needs to be careful. One day last week it traded more than a million shares in London. Then another day it traded just over 5,000 shares.