The failure of G4S to deliver on its contract for the London 2012 Olympic Games is expected to cost the security company £50 million.

The figure is at the top end of the scale predicted by G4S and was announced on Tuesday as the company revealed its financial results for the half-year ending June 30, 2012. G4S provided London 2012 organisers with a major challenge when it conceded that it would be unable to supply enough trained security staff with just weeks remaining until the start of the Games.

The Games contract was worth £284 million to G4S and included the supply of 10,400 security guards to 100 Olympic sites across the UK. However, the British government was forced to enlist additional military personnel to plug the gap left by G4S’ failings. G4S said the final contract loss will be impacted by the actual cost of the military and police deployment and by the outcome of negotiations in respect of potential penalties and contractual liabilities, but maintained that the Paralympic Games will be delivered according to the terms of its contract.

“The Paralympic Games begin on 29th August and we continue to work with our partners to ensure that the Games are safe and secure,” the company said in a statement. “We are confident that we have an assured security workforce for the Paralympic Games and do not anticipate any workforce shortfall issues to arise. A board review of the contract has commenced with the assistance of PwC (PricewaterhouseCoopers). The review will cover all aspects of the contract including the key expected deliverables of the contract, the actual contract performance, execution issues and timings and why failures were not identified in a more timely manner. We expect the review findings to be made available to the board during the second half of September.”

Along with the loss arising from the London 2012 contract, G4S said that half-year pre-tax profits had fallen from £151 million to £61 million. The company’s chief executive, Nick Buckles, has come under heavy fire over the failure to deliver and is next month due to appear before MPs a second time to discuss the Olympics contract. He said: “We were deeply disappointed that we had significant issues with the London 2012 Olympics contract and are very grateful to the military and the police for their support in helping us to deliver a safe and secure Games.”

By Matt Cutler