London · Delayed Price · Currency is GBP · Price in GBX Serco Group Earnings Call Transcripts
Fiscal Year 2025
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Delivered strong 2025 results with 3% revenue growth, robust margins, and high cash conversion. Strategic focus on defense, justice, and citizen services drove record pipeline and order intake, with 2026 guidance indicating continued growth and margin expansion.
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Revenue grew 5% year-over-year to £2.4 billion, with strong organic growth and a robust order intake, especially in defense, now over 40% of revenue. Margins and cash flow remain strong, with guidance reaffirmed and a focus on operational excellence and disciplined capital allocation.
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The acquisition of a leading U.S. defense business for $327 million enhances technology-enabled training and space capabilities, expands the customer base, and is expected to deliver strong financial returns and cost synergies. Integration is supported by cultural fit and experienced management, with significant growth opportunities in the U.S. and internationally.
Fiscal Year 2024
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Strong 2024 results featured higher margins, robust cash flow, and major contract wins, especially in defense and U.S. markets. Guidance for 2025 anticipates stable revenue, slight profit reduction due to cost pressures, and continued investment in growth and efficiency.
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Upgraded full-year profit guidance to £270 million, with strong H2 margin and cash flow expected. Segment performance mixed, but margin improvement and new contract wins drive confidence. Capital allocation remains disciplined, with continued buybacks and dividend growth.