28 June 2013
Ahead of Serco Group plc entering its close period for the half-year ending 30
June 2013, and following the recent Interim Management Statement released on 15
May 2013, we will be holding our customary pre-close meetings with analysts
over the coming days. No new material information will be disclosed. The Group
is on track to meet expectations for 2013: for the full year, we expect a
modest improvement in the rate of organic revenue growth and the Adjusted
operating margin to be broadly maintained around the level achieved in 2012. We
remain confident in the ongoing resilience, overall outlook and future growth
prospects for the Group.
For the first half of 2013, we expect to report strong organic revenue growth
ahead of our expectations. This is driven in part by last year's record level
of contract awards, many of which only started part way through last year,
together with additional revenue from certain volume-related and project-based
work. The effect of last year's acquisitions and disposals has a broadly
neutral impact on total revenue growth.
Supporting the strong pipeline and market opportunities in the Global Services
division, the level of investment in contract bidding and new market
development activity has increased. Including the effect of this, a small
reduction in the Adjusted operating margin for the Group as a whole is
anticipated for the first half of 2013. The comparable period's Adjusted
operating margin, before the reorganisation costs incurred in 2012, was 5.9%.
The net effect of stronger revenue growth and the small reduction in Adjusted
operating margin is expected to result in an Adjusted operating profit for the
half-year that is in line with our original expectations.
Driven principally by the incremental working capital investment that is
supporting BPO growth as previously disclosed, the phasing of free cash
generation over the course of 2013 is anticipated to be broadly similar to the
prior financial year.
Serco will release its half-year results on Thursday 29August 2013. As
previously described, our reporting will now reflect the changes to accounting
standards IAS19 and IFRS11. Neither of these have a material impact on the
Group's reported earnings. A restatement of the 2012 financial year (as
previously provided) and the first half of 2012 is published today on
For further information please contact Serco:
Stuart Ford, Head of Investor Relations T +44 (0) 1256 386 227
Marcus De Ville, Head of Media Relations T +44 (0) 1256 386 226
Serco is a FTSE 100 international service company, which combines commercial
know-how with a deep public service ethos.
Around the world, we improve essential services by managing people, processes,
technology and assets more effectively. We advise policy makers, design
innovative solutions, integrate systems and - most of all - deliver to the
Serco supports governments, agencies and companies who seek a trusted partner
with a solid track record of providing assured service excellence. Our people
offer operational, management and consulting expertise in the aviation, BPO,
defence, education, environmental services, facilities management, health, home
affairs, information and communications technology, knowledge services, local
government, science and nuclear, transport, welfare to work and the commercial
More information can be found at www.serco.com
-0- Jun/28/2013 06:00 GMT
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