Serco's revenue growth driven by performance in the Americas
Serco on Wednesday reported that it enjoyed interim underlying profit and revenue growth following strong performances in the Americas and the Asia Pacific region.
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The outsourcer said revenue came in at £1.5bn for the six month period ended 30 June, up 6% against the same period last year at constant currency, while underlying trading profit increased by 35% to £50.6m.
However, total interim profit before tax slid by 74% to £6.7m as a government charge and restructuring costs drove exceptional charges up from £11.6m to £31.1m.
Revenue from the Americas increased by 22% to £372.3m after a significant increase in task order volumes of the FTSE 250-listed company's ship & shore modernisation work for the US Navy, while the contribution from Asia Pacific climbed 6% to £279.7m following the expansion of citizen services operations in the region.
Rupert Soames, chief executive of Serco, said: "Following a strong 2018, which marked an inflection point for Serco after several years of decline, we are reporting another good performance in the first half of 2019 with Underlying Trading Profit and margin well up on the first half of last year. Order intake so far this year has been very strong at over £3bn, already exceeding our revenue forecast for the whole of 2019."
Order intake for the period stood at £3.3bn, driven by major deals relating to asylum accommodation and support services in the UK and for defence healthcare provision in Australia, taking Serco's total order book value to £14.0bn from £12.0bn at the beginning of the year.
Full-year guidance remained unchanged, with Serco still expecting revenue of around £3.0bn and an underlying trading profit of £105.0m, though the company added that second half trading will be particularly sensitive to continued successful progress in mobilising and transitioning large new contracts.
Serco's shares were up 4.58% at 146.20p at 1122 BST.