|Bid||153.30 x 0|
|Ask||153.30 x 0|
|Day's Range||151.60 - 155.40|
|52 Week Range||83.60 - 156.50|
|Beta (3Y Monthly)||0.83|
|PE Ratio (TTM)||34.07|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||106.42|
Employees at a unit of Serco devised a fraud that prevented the British government from learning that a contract the outsourcing group had to monitor offenders was far more profitable than anticipated in the deal terms, according to a court judgment by Justice William Davis. If no individuals are successfully prosecuted, it will be the fifth time that the SFO has obtained admissions of guilt from a group in the form of a DPA but not secured convictions of employees. “[Serco] is a key test for the SFO and will establish whether [director] Lisa Osofsky is learning lessons from these failures and honing the SFO’s skills to actually bring home prosecutions against executives,” said Sue Hawley, executive director of Spotlight on Corruption, a campaign organisation.
Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Serco Group plc...
British public-services outsourcer Serco reported a 29% jump in first-half underlying trading profit driven by its American business and said on Wednesday it was confident of growing faster than the market for the next two years. Profit at Serco, which provides health, security and immigration services to governments, rose to 51 million pounds ($62 million) on revenue that rose 6% at constant currency to 1.48 billion pounds. Serco, which is coming to the end of a restructuring programme, stuck to its full-year guidance given in a trading update at the end of June.
Deloitte and a senior partner have been fined and severely reprimanded for misconduct over the audit of Serco Geografix (SGL), an outsourcer that on Thursday formally settled a six-year criminal investigation into fraud and false accounting. Auditing watchdog The Financial Reporting Council said on Thursday it had fined Deloitte 4.23 million pounds ($5.32 million) and audit engagement partner Helen George 97,000 pounds after they admitted misconduct for audits in 2011 and 2012.
A division of Britain's Serco is close to securing a deal under which it will pay a 19.2 million pound ($24 million) fine that looks to draw a line under a long-running scandal over how it billed for electronic tagging contracts. Serco, one of Britain's largest government contractors, said on Wednesday its Serco Geografix (SGL) unit and the UK Serious Fraud Office (SFO) had reached a Deferred Prosecution Agreement (DPA), the SFO's fifth court-approved corporate plea-bargain since such deals were introduced in 2014. A judge has granted approval in principle for the DPA, which allows a prosecution to be suspended for a defined period if specific conditions are met.
Mid-caps stocks, like Serco Group plc (LON:SRP) with a market capitalization of UK£1.7b, aren’t the focus of most...
Stocks with market capitalization between $2B and $10B, such as Serco Group plc (LON:SRP) with a size of UK£1.7b, do...
(Bloomberg Opinion) -- Serco Group Plc CEO Rupert Soames frequently boasts that the U.K. contracting firm was an early adopter of financial carnage – to stress that the business is now the better for it.Pulling through a crisis five years ago has given Soames the credibility to embark on M&A, and he has had his eye on defense contractor Babcock International Group Plc.Contrast this with construction group Kier Group Plc, which on Monday reminded investors just what financial carnage looks as it unveiled a plan to shrink and cut debt.Government contracting is a potentially attractive business – but when it goes wrong, it can be a disaster. Memories of Carillion Plc’s bankruptcy may still be fresh in investors’ minds. At least Serco shows that these businesses can, eventually, pull through.With the shares at a two-year high, Serco is in the luxurious position of being able to fund deals by selling stock. It has come a long way since 2014’s emergency rights offering. A takeover of Babcock – which has a market value of about 2.5 billion pounds ($3.2 billion) against Serco’s 1.7 billion pounds – would be ambitious and involve issuing stock to Babcock shareholders.The move looks opportunistic: The target’s shares have halved in the last two years, its management is out of favor, and a recent investor day prompted a lukewarm response.The combination would seem to offer more to Serco than to Babcock – unless there were a significant premium to compensate, and the relative size of the businesses would make such a thing hard to engineer.Serco hasn’t been fully rehabilitated; its dividend remains suspended. Babcock, which does pay a dividend, has niche businesses in aerospace and defense with better-than-average margins. Much as its shareholders may admire Soames, a deal would surely dilute the quality of the Babcock business. It’s not hard to see why the target rejected talks following an approach earlier this year.Kier, 10%-owned by beleaguered investor Neil Woodford, is finally doing the same things as Serco did during its crisis – selling assets, changing management and raising equity – albeit in the wrong order. December's 250 million-pound rescue rights offering has already been exhausted and the company is only now just embarking on a radical self-help program. Its market value today is just 178 million pounds.It’s now clear there is much that Kier could have done by way of restructuring before asking shareholders to stump up last year. New CEO Andrew Davies is jettisoning businesses, such is its residential property construction arm, that drain working capital and have few synergies with the core contracting operation, which is focused on infrastructure and highways. The dividend is going altogether, as are 1,200 jobs, largely from corporate center.Kier points to the absence of near-term debt maturities, which should give it some breathing space. But the company appears to be a forced seller and will need to attract competing bids to inject some tension into the sale process.This is an uncomfortable position to be in given the uncertainty around Brexit. The financial strains are now dictating strategy after an aggressive program of expansion by acquisition left the company short of cash.It is possible Kier will pull through, its share price will pick up and that one day Davies, like Soames, will be able to look back and joke about financial carnage. For investors right now, that moment seems an incredibly long way off. As for Serco, its acquisition currency may not yet be tempting enough, and its target’s woes not painful enough, to make a deal with Babcock a reality.To contact the author of this story: Chris Hughes at firstname.lastname@example.orgTo contact the editor responsible for this story: Edward Evans at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Hughes is a Bloomberg Opinion columnist covering deals. He previously worked for Reuters Breakingviews, as well as the Financial Times and the Independent newspaper.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.