Serco H1 revenue and profits decline, maintains FY guidance

Shares in public services provider Serco were in the red on Thursday after the group revealed that both revenue and profits had fall in the six months ended 30 June.

Serco said interim revenues had contracted from £2.47bn to £2.35bn, while underlying profits were down 4% year-on-year at £142.0m and reported operating profits slumped 31% to £130.0m.

Despite the H1 profit decline, the FTSE 250-listed group hiked its interim dividend by 18% year-on-year to 1.34p per share and said the remaining £83.0m of its £140.0m share buyback would be completed during H2.

Serco reiterated its full-year guidance as it said its focus on productivity and driving improvement across its portfolio had already "seen good progress at this early stage", with £1.9bn of new wins leaving its order book at a "strong" £13.5bn.

Chief executive Mark Irwin said: " Our focus on productivity and driving improvement across our portfolio has seen good progress at this early stage.

"While mindful of a potential impact internationally from elections in 2024, we are confident about the quality of our pipeline of potential new work to achieve our medium-term growth targets."

As of 1215 BST, Serco shares had slumped 7.05% to 178.0p.

Reporting by Iain Gilbert at Sharecast.com