Serco profits buoyed by government Covid contracts

Serco has posted a 25 per cent jump in full-year pre-tax profit, driven by its support for governments in their response to Covid-19 and a rebound in its leisure and transport businesses.

The London-listed outsourcer, which runs Covid testing sites in England and Ireland, on Thursday reported pre-tax profit of £192.2mn in 2021, up from £153.3mn the previous year. Revenue rose 14 per cent year on year to £4.4bn.

The group increased its final dividend 15 per cent year on year to 1.61p, and said it was launching a £90mn share buyback.

“Serco delivered an outstanding financial and operational performance across the world in the face of constant challenge and disruption,” said Rupert Soames, chief executive.

“Being a contract manager or team leader, responsible for the daily delivery of vital public services, is never an easy job, but 2021 was the toughest operational environment I have seen,” he added.

Serco said its support to governments following the spread of Covid provided a “short-term uplift to revenues and profits” and generated “an enduring legacy of a much more capable and efficient organisation, strong customer relationships and lower debt”.

The group, which manages prisons, rail and defence services for governments worldwide, also highlighted its operations in Canada, where it was helping clear a backlog of driving tests that stood at 500,000 in November.

Serco shares were down 3 per cent at 125.6p at midday on Thursday.

Source Article

Next Post

Chancellor calls for ‘culture of enterprise’ as he sets out vision for UK economy

Tax reforms to boost business investment and encourage companies to spend on training and research and development will be priorities for UK fiscal policy, Rishi Sunak said on Thursday as he pledged to limit state intervention in the economy and “foster a new culture of enterprise”. In a speech designed […]