July 13

Serco share price plummets after profit warning

first_img Caitlin Morrison by Taboolaby TaboolaSponsored LinksSponsored LinksPromoted LinksPromoted LinksRelated ArticlesTop 10 Date Night In Movies & Films Of All Time10 Amazing RVs You Won’t Want To Miss8 Surprisingly Simple Ways to Keep Your Liver Healthyby Taboolaby TaboolaSponsored LinksSponsored LinksPromoted LinksPromoted LinksYou May LikeMisterStoryWoman Files For Divorce After Seeing This Photo – Can You See Why?MisterStoryTele Health DaveRemember Pierce Brosnan’s Wife? Take A Deep Breath Before You See What She Looks Like NowTele Health DaveThe No Cost Solar ProgramGet Paid To Install Solar + Tesla Battery For No Cost At Install and Save Thousands.The No Cost Solar ProgramNational Penny For Seniors7 Discounts Seniors Only Get If They AskNational Penny For SeniorsMoneyPailShe Was A Star, Now She Works In ScottsdaleMoneyPailPost FunGreat Songs That Artists Are Now Embarrassed OfPost FunMaternity WeekA Letter From The Devil Written By A Possessed Nun In 1676 Has Been TranslatedMaternity WeekWarped SpeedCan You Name More State Capitals Than A 5th Grader? Find Out Now!Warped SpeedEquity MirrorThey Drained Niagara Falls — They Weren’t Prepared For This Sickening DiscoveryEquity Mirror Serco share price plummets after profit warning whatsapp Share Monday 10 November 2014 8:34 pm Outsourcing firm Serco sent share prices tumbling by almost 33 per cent yesterday, after issuing a profit warning and revealing that it was seeking to raise up to £550m with a rights issue in the first quarter of 2015.  The company announced that its forecast profit for 2014 had been reduced by approximately £20m, now expected to come in at between £130m and £140m. The firm previously announced a profit warning in April of this year, when the board stated that it expected to report a profit of £170m. This was already significantly reduced from the projected range of £220m to £250m profit reported at the time of Serco’s 2013 results. Serco also stated yesterday that contract and balance-sheet reviews had identified likely impairments and onerous contracts totalling around £1.5bn, and said the company is to hold discussions with lenders to negotiate amendments to covenants in place. Rupert Soames, group chief executive, undertook a strategic review of the entire company when he joined the business in May. He stated that Serco had made “rapid progress” with this review in recent weeks.  Soames described yesterday’s ann­ouncement as a “bitter pill”, but added: “It is better for all concerned that we swallow it now and establish a really solid foundation on which to build Serco’s future. “As might be expected, the contract and balance-sheet reviews have encouraged much turning over of stones, and reflects our changing strategy and the latest view of the challenges we face on a few large contracts. These challenges, together with a less pronounced improvement in trading in our second half than we expected, have led us to a more cautious view of 2014 and 2015.” Soames said that Serco’s direction for the future was “clear” – as an international business to government company focusing on justice and im­m­igration, defence, transport, citizen services and healthcare. He commented: “There are a tough couple of years ahead as we make this transition, but it will be worth it.” FACING UP TO PAST MISTAKES■ Serco said it had come to the conclusion that the firm had made “two strategic mis-steps” in recent years. The first was making significant additions to its portfolio, “often into areas that required very different skills”, which had led it to lose “some of its focus” and diluted its operational expertise. ■ The second mistake Serco admitted to was concentrating too much on winning new business with the result that it was now tied in to a number of contracts which are “making large losses”.  ■ Contract reviews have highlighted a “substantial increase in the level of onerous contract provisions”. BEHIND THE DEALANDREW TUSA | BANK OF AMERICA MERRILL LYNCH 1 Andrew Tusa, director corporate broking Europe at Bank of America Merrill Lynch, is advising on Serco’s rights issue. 2 Tusa joined the bank in 2005, and is currently based in its London office. He previously spent nine years at Deutsche Bank, where he was head of corporate governance. 3 He was also chairman of the Financial Services Authority’s Listing Authority Advisory Committee, and served on the steering group of the Financial Reporting Council. Also advising…Tusa has previously advised on placings made by mining firm Centamin and property developer RedRow. In addition he led the team advising on Halford’s £73.2m purchase of Nationwide Autocentres, and worked on Kesa Electrical’s disposal of Comet Group.  whatsapp Show Comments ▼ Tags: Company Serco Grouplast_img

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Posted July 13, 2021 by admin in category "trhouykxc

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