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Serco stems its gigantic losses, shrinks 2015's to a mere £70m
CEO (Winston Churchill's grandson) says plan has 'survived first enemy contact'
Outsourcer Serco has stemmed the flow of its haemorrhaging profits, posting a loss of £69.4m in 2015, down from £991m last year.
The outsourcer is currently in the middle of a major strategic turnaround. In a statement clearly channelling the spirit of his grandad, Winston Churchill, Serco chief exec Rupert Soames said: "Our plan has survived first contact with the enemy."
John O'Brien, analyst at TechMarketView, noted that while Serco's "results themselves don’t look particularly impressive" compared with where it was a year ago "things are looking up".
He said: "There’s clearly much work to be done over the next two years, to get the business where it needs to be to start competing to win - and grow revenues - again. But it is encouraging that significant progress has been made earlier than expected. All credit to the new management."
Meanwhile everyone's favourite outsourcer Capita posted a bump in profits of nine per cent to £112m for its full-year 2014, on sales up seven per cent to £4.7bn.
Despite Capita's headline results, the company growth is mainly coming from its aggressive acquisitions, said O'Brien.
He said: "Capita has so far won just £251m worth of contracts year to date vs. £1.1bn this time last year. The pipeline is also down at £4.7bn vs. £5.1bn.
"Acquisitions are going to remain a key lever for Capita’s growth. German customer management player Avocis, Capita’s largest ever acquisition, is for instance performing well, and we understand should provide a solid base for future organic growth in the region.
"Meanwhile, Capita spent £402m over the past year acquiring 17 businesses."
Yesterday Atos posted an increase of net income of 53 per cent to €406m (£320m) on revenue up 19 per cent to €10.6bn (£8.4bn). ®