Security services company, Serco Plc reported a 62% drop in profits for 2013 after additional costs relating to the security tagging scandal with its UK government contract. The company paid £90.5m to settle claims it charged the government for tagging people who were either dead or in jail. The group paid a further £21m in other indirect costs.
On the positive side, revenue growth was up 5.9% for the group, though the company says outlook remains challenging, highlighting a reduced level of work for Australian immigration.
Ed Casey, Acting Group CEO, said: “We have been through a difficult year and there remains much to be done to ensure the agreed programme of corporate renewal is successfully implemented. However, the work we have completed and the undertakings we have made demonstrate our commitment to achieve this.
“The events of 2013 absorbed management’s focus and, therefore, interrupted the normal process of improving efficiency and developing our business into new areas. Over the second half of 2013 and until the end of January 2014 we were not able to be awarded new contracts by UK Central Government, which also had an impact on the development of our business in certain other sectors.
“Our focus is clear, to ensure that the Group has stable operations, appropriate operational controls and differentiated capabilities to make the most of the breadth of our offering across frontline and middle and back office services, and our referenceability from one country to another. I am confident that these attributes will enable Serco’s return to growth in what remain fundamentally attractive service markets around the world.”
Security services company, Serco Plc reported a 62% drop in profits for 2013 after additional costs relating to the security tagging scandal with its UK government contract. The company paid £90.5m to settle claims it charged the government for tagging people who were either dead or in jail. The group paid a further £21m in other indirect costs.
On the positive side, revenue growth was up 5.9% for the group, though the company says outlook remains challenging, highlighting a reduced level of work for Australian immigration.
Ed Casey, Acting Group CEO, said: “We have been through a difficult year and there remains much to be done to ensure the agreed programme of corporate renewal is successfully implemented. However, the work we have completed and the undertakings we have made demonstrate our commitment to achieve this.
“The events of 2013 absorbed management’s focus and, therefore, interrupted the normal process of improving efficiency and developing our business into new areas. Over the second half of 2013 and until the end of January 2014 we were not able to be awarded new contracts by UK Central Government, which also had an impact on the development of our business in certain other sectors.
“Our focus is clear, to ensure that the Group has stable operations, appropriate operational controls and differentiated capabilities to make the most of the breadth of our offering across frontline and middle and back office services, and our referenceability from one country to another. I am confident that these attributes will enable Serco’s return to growth in what remain fundamentally attractive service markets around the world.”
Related Posts: