Serco keeps guidance intact

29th Jun 2010 07:07

Outsourcing specialist Serco remains on track to meet guidance given in May, although it gave no clue as to the possible impact of spending cuts announced in last week's Budget."We remain on track to deliver our financial guidance for 2010, which is for continued strong organic revenue growth and further progress this year towards our 2012 margin guidance," it said in a statement Tuesday.The firm, which runs London's Docklands Light Railway and prison vans, estimates that by the end of 2012, revenue will increase to about £5bn and adjusted operating profit margin to 6.3%.Expectations are fuelled by "our high revenue visibility and substantial order book, recent new contract starts, continued expansion of scope and scale in our existing contracts, and a full year contribution from a number of major contracts which started during 2009".In a sales pitch to the new coalition government, Serco said it is "well positioned to help our customers around the world address the significant financial and operational challenges they face". "The opportunities we see to improve productivity and achieve significant efficiencies for them in the delivery of front-line essential services, across both existing and new markets, continue to give us confidence in our prospects for the future."Profit before tax jumped almost a third in 2009 to £177.1m on revenue up 27%, or 21% excluding currency, to £3.97bn. Civil Government sales grew by 38% to £1.56bn, representing 39% of group revenue, while defence revenue grew 30% to £1.02bn, about 26% of overall sales. Results for the six months ended 30 June are due on 25 August.