Serco ups profits forecast as test and trace work soars
Serco PLC (LON:SRP) has raised its profit estimate for this year as it now expects a bigger contribution than previously from the government’s controversial Covid-19 test and trace programme.
In a statement, Serco said that volumes on both its testing and tracing contracts had continued to be strong and it expects demand will continue for longer in the second half than previously anticipated.
As a consequence, Serco said it was raising its forecast for underlying trading profit in 2021 by £15mln, to around £200mln.
The UK’s test and trace system has been heavily criticised for being ineffective, especially when compared with the performance of similar schemes in other countries.
Elsewhere, Serco added that Vivo, a 50/50 joint venture with energy from Engie, had won a £900mln three-year contract from the Ministry of Defence to maintain military bases and buildings in the south-west and Midlands.
VIVO won the contracts for two of the four regions being tendered under Lot 3 of the Future Defence Infrastructure Services (FDIS) programme.
Additional project work is likely to be worth a further £2.5bn over the initial seven-year term, Serco added.
Under the contract, VIVO will maintain more than 200 sites and around 19,000 MOD buildings.