Serco Group plc (SCGPY,SRP.L), a provider of public services to governments, announced that it now expects underlying operating profit for fiscal year 2025 to be about 270 million pounds, compared with 274 million pounds in 2024. This figure is ahead of previous guidance of approximately 260 million pounds and includes an estimated currency translation headwind of around 6 million pounds.
The company still expects revenues of approximately 4.9 billion pounds in 2025, compared with 4.8 billion pounds in 2024. This represents a 2% increase year-on-year, or 3% on a constant currency basis, including organic growth of 1%. The growth is driven by new and expanded contracts in defense, justice, and citizen services, which more than offset reduced revenues from immigration activities. In addition, the part-year impact of the acquisition of MT&S is expected to contribute around 2%.Free cash flow remains strong and is expected to be about 170 million pounds for 2025. The Board will review the Group's capital position at the full year in line with its capital allocation priorities.
Looking ahead to fiscal year 2026, Serco anticipates revenues of around 5.0 billion pounds, with organic revenue growth expected to rise to approximately 3%. This forecast excludes the full-year impact of the MT&S acquisition, the disposal of Hong Kong operations, and the transfer of certain contracts to the Mubadala joint venture in the Middle East.
Underlying operating profit for 2026 is expected to increase to around 300 million pounds. The improvement reflects the full-year contribution from MT&S, contract ramp-ups, and initiatives to enhance productivity and efficiency across the portfolio, partially offset by lower immigration activities. This supports margin guidance of approximately 6.0%, which is at the top end of Serco's medium-term target range of 5%-6%.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.