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Contract News Update 15

Published: 16 Nov 2012

Smaller and medium-sized contract wins are fundamental to Serco's growth and value creation; in addition to larger wins, this release updates on a broad selection of recent contract awards.

Delivery of the UK's National Citizen Service

Serco's consortium is preferred bidder to deliver the National Citizen Service across six regions in the UK.  Expanding Serco's experience of working in partnership with the voluntary sector, Serco in association with National Youth Agency, UK Youth, Catch 22 and vInspired will offer 16 and 17-year olds from different backgrounds a six-week programme to develop life skills through community activities working with charitable organisations and business leaders.  The estimated combined total value of the contracts over the initial two-year period is approximately £70m.

Community health services for NHS Suffolk

Serco signed in July and commenced operations in October its contract to provide a wide range of community health services for the NHS in Suffolk.  These services include community nursing, specialist nursing, management and operation of community hospitals, speech and language therapy, specialist children's services and community equipment services.  Serco is working with a range of NHS and third sector partners to create a unique model of integrated service delivery.  The three-year contract has a total value of approximately £140m.

Probation services in London

In partnership with the London Probation Trust, Serco has been awarded the first UK contract to operate Community Payback which requires offenders to undertake unpaid work for the community.  The partnership is providing an integrated service to manage the approximate 15,000 offenders who receive non-custodial sentences in London every year.  The four-year contract, which began on 31 October, is valued in total at £38m.

Environmental services for UK local authorities

Serco is preferred bidder to operate a new joint environmental services contract for Wycombe and Chiltern District Councils.  Integrated services include household waste, recycling collections and street cleansing with the joint contract realising operational efficiencies whilst increasing recycling rates across both districts.  The initial seven-year contract is expected to have a value to Serco of approximately £55m.  Serco has also been awarded preferred bidder status for its rebid of waste and recycling services for Canterbury City Council.  Serco has operated environmental services for the council for over 15 years, with the new contract aiming to maximise recycling rates.  The eight-year contract is expected to be valued in total at approximately £40m.

Leisure services in Northern Ireland

Serco has been awarded a new contract as agents to Northern Community Leisure Trust by North Down Borough Council to provide a comprehensive and high quality range of health, leisure, fitness, wellbeing and community-focused services.  The ten-year contract is expected to have a total value of approximately £2m.

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Private sector integrated facilities management

Serco has been chosen as preferred bidder for a new contract to provide integrated facilities management services with leading pharmaceutical company, Pfizer.  Serco will deliver a broad range of services at Pfizer's 16,500sqm cold chain distribution facility at Havant in the UK, including catering, cleaning, reception, mail, laundry, pest control and landscaping for an initial three-year period.  Serco has also secured a one-year extension for its facilities management contract with international professional services firm, Deloitte.  The combined total value of the contracts is approximately £14m.

Support services to UK Royal Air Force

Serco has expanded its Defence Multi-Activity Contracts (MACs) at RAF Northolt and RAF Brize Norton.  Additional services include IT, vehicle maintenance, expanded aircraft handling and the maintenance of two aircraft operating out of the Middle East using Sponsored Reserves.  In addition, Serco is preferred bidder for the rebid of its MAC at RAF Cranwell.  The combined total value of the expansions and rebid, which have two to three-year terms, is approximately £30m.

Systems engineering and technical assistance for a US intelligence agency

Serco has signed an extension to its contract supporting a US intelligence agency.  Serco provides IT architecture, systems and systems engineering, financial management and procurement support, risk management performance assessment and reporting.  The one-year extension is valued at approximately US$100m.

Career transition services for US Army

Serco has secured two expansions to its Army Career Alumni Program (ACAP) contract for the US Army.  Serco's ACAP services include transition and employment assistance counselling at 54 ACAP locations across the United States, Korea, Italy, Kuwait and Germany, along with a virtual counselling and training environment.  Under the program, Serco has served more than 2.3 million active personnel, their families, and members of the Guard and Reserves for over two decades with the expansion extending support to Guard and Reserve members who are not able to visit an ACAP Center for services.  Serco's second expansion includes the addition of over 70 new positions to provide financial planning counsellors at ACAP centres around the world.  The two expansions over the two remaining option years are valued in total at US$54m.

Military vehicle equipment and system upgrades

Serco was awarded a new contract to upgrade Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance (C4ISR) equipment and systems on Mine Resistant Ambush Protected (MRAP) vehicles for the US Air Force, US Army, US Marine Corp and US Navy.  The installation is being carried out on-site in Afghanistan, Kuwait and Qatar, enabling immediate deployment with Serco also providing in-country maintenance support services.  The fifteen-month contract has a nine-month base period and six-month option period with a total value of US$73m.

Parking support services for US municipal agency

Serco has successfully rebid its contract for a range of parking related support services for the San Francisco Municipal Transportation Agency (SFMTA).  Having provided services to SFMTA for over ten years, Serco will continue to operate parking meters including systems and infrastructure support.  Serco will also enhance security and safety by deploying GPS vehicle tracking technology and vehicle security cameras over the five-year contract which has a total value of US$43m.

Support for US Government retirement plan

Serco has secured a follow-on contract with the Federal Retirement Thrift Investment Board (FRTIB).  Under the contract, Serco delivers records management solutions in support of payroll offices, legal processes and timekeeping.  The contract over the next two years, which includes one option year, is valued in total at US$26m.

Patent classification services

Serco has received an extension and expansion on its contract at the US Patent and Trademark Office.  Supporting the implementation of the new Cooperative Patent Classification system as they continue the processing of patent applications, Serco will classify approximately 1,500 applications each day.  The extension over three years is valued in total at US$43m.

Support for DHS Deferred Action for Childhood Arrival initiative

Serco has extended its contract with United States Citizenship and Immigration Services (USCIS) following  an Executive Order issued by President Obama in support of Immigration Qualifications, Deferred Action for Childhood Arrival (DACA).  Serco's long-standing work at USCIS supports this initiative and will manage and process an additional two million records as a result of the Executive Order.  The two-year extension is valued in total at US$25m.

Fleet services support in Florida

Serco has successfully rebid its contract with Seminole County, Florida to provide fleet services support.  Serco has held this contract for 11 years and will continue to perform management and maintenance services for a 2,200 vehicle and equipment fleet.  The five year contract is valued in total at US$20m.

New prison contract in Auckland, New Zealand

In September, Serco's consortium signed a contract to provide and operate the new Wiri prison in Auckland.  Under the design, construct, manage and finance contract, Serco will manage the new 960-place male prison for 25 years once it becomes operational in 2015.  Revenues in the pre-operational phase are expected to total around £2m, with Serco's operating contract from the date of opening anticipated to have revenues of approximately £15m a year.

Airport rail system in Dubai

Serco is exclusive bidder and in negotiations to deliver operations and maintenance services for the new Automated People Mover (APM) rail system at Dubai Airport.  The APM is scheduled to open in 2013 and will link the existing Terminal 3 with the newly constructed A380 terminal.  Broadening Serco's global rail expertise and strengthening the relationship with the Dubai Airports Company where we currently deliver world-class air traffic services, this new four-year contract is expected to be valued in total at around £10m.

Technology Services in the Middle East

Serco has secured an order to provide baggage and personnel scanning systems to the Internal Security Forces of Qatar, providing security at various locations within the state of Qatar for the forthcoming World Environment Conference being held in November and December 2012.  The award value is approximately £2m.

Bus operations in India

Serco has been selected as preferred bidder for its first frontline services contract in India, to operate and maintain the new Bus Rapid Transit Services (BRTS), a dedicated 11.3km bus corridor in the city of Indore in central India.  Serco will operate and maintain a fleet of 50 low-floor air conditioned buses as well as manage the operations depot, drawing on the Group's success in delivering world class transport operations in the UK and Middle East.  The six-year contract is expected to be valued in total at approximately £13m.

Air traffic control services in Kurdistan

Serco has signed a new contract to deliver air traffic control services at Erbil International Airport in Iraqi Kurdistan.  The contract builds on Serco's leading position and history of operating air traffic services throughout the Middle East, including managing Iraqi airspace at Baghdad International Airport.  The initial one-year contract is valued at approximately £7m.

Asset management consulting in Saudi Arabia

Serco has signed two consultancy agreements in the Kingdom of Saudi Arabia.  The contracts with Al-Elm and the Royal Commission for Jubail & Yanbu are for consultancy services over an initial one-year term in relation to asset management strategies to implement operational efficiency processes for building maintenance and infrastructure.

Contact centre services for Australian taxpayers

Serco has successfully renewed its contract with the Australian Tax Office to provide contact centre services to Australian taxpayers, businesses and tax professionals across a diverse range of taxation and superannuation-related issues.  Serco, in partnership with the ATO and other suppliers, will be responsible for providing advice and responding to enquiries relating to tax numbers, refunds, business activity statements, debt management, return submissions and tax information packs.  The renewed contract has an initial five-year term with a total value of approximately £90m.

BPO services for leading life and pensions provider

Serco has signed a contract for an outsourcing partnership that will provide customer contact and support services for AEGON, the leading life and pensions company, marking Serco's entry into this important segment of the financial services market.  Delivering a wide range of services for AEGON's UK-based protection business, Serco will manage all aspects of the customer journey from initial underwriting through to claims processing as well as servicing a small number of closed book policies.  Serco will be responsible for the administration of approximately 500,000 current and closed book policies in total.  The initial ten-year contract is valued in total at around £170m.

Contact centre services for leading European airline

Serco has been awarded a new contract to provide multi-lingual customer contact services for leading European airline easyJet.  Serco will take responsibility for the operation, administration and management of easyJet's multi-channel customer contact, which will be delivered through a blend of near-shore and off-shore provision from Poland and India.  The initial three-year contract has a total value of approximately £18m.

UK National Rail Enquiries service

Serco has successfully renewed its contract to provide a comprehensive range of customer services for the National Rail Enquiries service in the UK.  The contract which has been operated by Serco and the former Intelenet business since 2004 includes Help Point support, customer care, enquiries and complaint handling across a range of channels including voice, email and web chat.  Responding to changing patterns of consumer engagement, this innovative five-year contract is valued in total at approximately £10m.

Customer acquisition services for UK utility

Serco has signed a contract to provide a wide range of customer sales services for British Gas in the UK.  Serco will deliver aspects of customer acquisition activities for energy, domestic appliance and drain care services.  The three-year contract is valued in total at approximately £16m.

Helpline services for UK Department of Health

Serco has signed a new agreement to provide multi-channel contact centre services across a range of public health programmes on behalf of the UK Department of Health.  Combining Serco's experience in the UK health market with Global Services' expertise in complex customer contact, the new contract will provide a number of helplines including NHS Carers, Drinkline, FRANK (the Department of Health drugs helpline), Change4life, Smokefree and NHS Careers.  The three-year contract has a total value of around £15m.

Contact centre services for European media company and UK retailers

Serco has secured two new separate agreements in the UK retail sector to provide services including order line and customer management to two of the UK's most prestigious retailers.  These contracts build on Serco's growing capability in the UK retail market following contract wins with Freemans Grattan Holdings, Ideal Shopping and Shop Direct earlier in the year.  Serco has also signed a contract to transform, expand and operate multiple customer services for a leading European media company.  Services include frontline customer contact, back office and specialist support from an expanded service centre in Teltow, near Berlin, Germany.  The three contracts, which have three to five-year terms have a total combined value of approximately £50m.

HR and Finance services for leading European IT infrastructure service provider

Serco is exclusive bidder for a new contract with a leading European IT infrastructure services provider to provide back office BPO services.  The agreement is expected to deliver significant cost savings across Human Resources and Finance operations, which will be serviced from centres in Poland and India, illustrating Serco Global Services' growing BPO capabilities.  The seven-year contract is expected to be valued in total at approximately £35m.

Switchboard and helpdesk services for major internet service provider

Serco has been selected as exclusive bidder to provide Central Telephony Operator Services (CTOPs) for an international communications company.  Serco will deliver operator and enhanced switchboard services to customers in the UK, as well as internal helpdesk support.  The initial three-year contract is anticipated to have a total value of approximately £10m.

Expanded and new BPO contracts with major telecom providers in India

Serco has extended and expanded its relationship with a leading telecom provider in India for a further three-year term.  Providing contact services and transaction support, the contract which began in 2006 from three delivery centres has expanded to ten today and handles an average 14 million calls and transactions per month.  Serco has also signed a new contract with a further leading telecom provider, where five delivery centres will provide contact services under this new relationship.  These three-year contracts on a combined basis have a total value of approximately £60m.

Complaints handling for the financial services market

Serco has entered a new agreement to support a UK general insurance provider to reduce its backlog of complaints following the closure of its businesses in the US and Ireland.  The contract provides an important reference point for Serco in the UK Financial Services Authority regulated complaints market, and is expected be worth over the initial two-year term approximately £4m.


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