Serco expects profits to soar
OUTSOURCING giant Serco has said it expects profits to exceed expectations in 2020 as a result of the uptick in work since the global pandemic.
Updating the London Stock Exchange in an unexpected announcement, the company said the excess profits could now be returned to shareholders, with a consultation on dividend payments under way.
The company, which is one of the largest companies involved in the UK Government’s Test and
Trace scheme, said it had achieved strong revenue growth in the three months from July, highlighting extensions to contracts to provide test sites and call handlers.
Bosses said this was “an indication of our customers’ satisfaction with the quality of work we have delivered” as part of the £ 12billion committed by the Government to the system.
The company added: “We have also seen increases in the number of asylum seekers we are looking after on behalf of the Home Office, and our new Prisoner Escorting contract has been successfully mobilised.
“We have now secured an extension to the Emergency Measures Agreement on the [ Serco- managed] Caledonian Sleepers to the end of the year.”
It expects a trading profit, before any one- off costs, of between £ 160million and £ 165million, compared with the previous estimates of £ 135million to £ 150million.
Full- year revenue is expected to be around £ 3.9billion – up from £ 3.7billion previously predicted.
The announcement comes a day after NHS Test and Trace recorded its worst ever week for contact tracing as cases of coronavirus continue to rise.
It is understood senior Government officials have expressed concern that Test and Trace could become “overwhelmed” if case numbers get too high.
New data showed 62.6 per cent of close contacts of people who tested positive for Covid- 19 in England were reached through the system in the week ending October 7.
This was the lowest weekly percentage since Test and Trace began, and is down from 69.5 per cent the previous week.
‘ Our growth is an indication of our customers’ satisfaction’