**Serco Group PLC Pre-Close Trading Update: Strong 2025 Performance and Positive Outlook for 2026**
Serco Group PLC, a leading international provider of critical government services, released its 2025 trading update and 2026 guidance on December 17, 2025, highlighting robust performance and optimistic momentum.
**2025 Highlights**
**Revenue:** ~£4.9 billionup 3% at constant currencyincluding 1% organic growthdriven by defencejusticeand citizen services.
**Underlying Operating Profit** ~£270 million, with a 5.5% margin, exceeding prior guidance due to productivity improvements and contract performance.
**Free Cash Flow** Increased guidance to £170 million, with leverage at 0.9x net debt to EBITDA.
**Order Intake** ~£5.5 billion, with a book-to-bill ratio of at least 110%, predominantly in defence (two-thirds of awards).
**Pipeline** Expanded to a decade-high, reflecting strong demand for critical services in complex environments.
**Portfolio Development** Successful integration of MT&S acquisition, disposal of Hong Kong business, and mobilization of Mubadala joint venture in the Middle East.
**Operational Excellence** 20% reduction in safety incidents, fewer lost days, improved attrition, and strong colleague engagement.
**Shareholder Returns** Completed £50 million share buyback, totaling £390 million returned to shareholders since 2021.
**2026 Guidance**
**Revenue:** ~£5.0 billionwith improved organic growth of ~3%led by defencejusticeand citizen services.
**Underlying Operating Profit** ~£300 million, with a 6.0% margin, driven by contract ramp-ups, MT&S integration, and productivity gains.
**Financial Position** Adjusted net debt expected to reduce to ~£150 million, with trading cash conversion in line with the 80% medium-term target.
**Strategic Progress**
Strengthened leadership with new CEOs for North America and UK & Europe, enhancing international growth focus.
Major contract wins, including HMP Dovegate retention, Canada’s Future Aircrew Training Programme, and justice transport services in Victoria, Australia.
**CEO Comment**
Anthony Kirby emphasized Serco’s strategic and operational progress, highlighting the global demand for its services, particularly in defence, and the company’s robust financial and operational position.
**Conclusion**
Serco’s 2025 performance exceeded expectations, and its 2026 outlook remains positive, underpinned by strong market demand, operational excellence, and strategic portfolio enhancements. The company is well-positioned for sustainable growth in the government services sector.