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Contract News Update

Date: 12 May 2009

Smaller and medium-sized contract wins are fundamental to Serco's growth and value creation, and this release updates on a selection of our wins so far in 2009. Further details on Serco's recent ID/IQ contract awards in the US are also included in this update.

Ofsted inspections
Serco has been awarded a new six year contract by Ofsted, due to start in September and valued at around £55m, to run inspection services for the Midlands region of England. The region accounts for a third of all education based organisations in England, and the contract covers schools, further education colleges, and work-based learning organisations. Serco will improve the delivery of inspection services by drawing on its wider Group capabilities to introduce innovative IT systems and processes to drive more effective inspections, and will increase the use of current practitioners, including existing and recent head teachers and other senior educational staff.

Electronic Monitoring: UK
Serco has been awarded a two-year extension to its contract to provide Electronic Monitoring in England and Wales by the UK Ministry of Justice.  This extends the contract to March 2012 and has secured additional revenue for Serco of around £70m.

Electronic Monitoring: Poland
Serco has won a five-year contract valued at over £7m to provide electronic monitoring equipment into Poland.  The contract makes Serco the sole provider of electronic monitoring equipment to Comp Safe Support, Poland's selected prime contractor, and offers the potential for Serco to build further business in Poland and elsewhere in Eastern Europe.

Airbus Integrated Services
Serco has been awarded a contract with Airbus for the management and provision of a range of integrated services at their Filton and Broughton sites. This contract includes Broughton as a new site and brings together new services, almost doubling our business with Airbus. The contract includes the provision of fire and rescue, reception, security, cleaning, transport and waste management services, and similar services to GKN facilities on these sites, and is valued at around £40m over four years. 
Charnwood Environmental Services
Serco has been awarded a new contract to provide environmental, recycling and streetscene services to Charnwood Borough Council in Leicestershire. The contract value is around £35m for a minimum period of seven years with potential for negotiating an extension. The contract will commence in August 2009.

Melbourne Open Spaces
Serco has been providing facilities management and maintenance for the City of Melbourne Council parks and gardens since 1995. The contract has now been extended for another five years and expanded. Serco has also won a new, five year contract for the provision of open space facilities management services in Docklands, Melbourne, and has extended its grounds maintenance contract with the University of Melbourne for a further two years. Together, these contracts are valued at approximately £12m.

Sirius Real Estate
Serco's business in Germany has been appointed Preferred Bidder by Sirius Real Estate, an AIM listed owner of business parks and industrial sites across Germany, on a £5 million per annum rolling contract to provide facilities management services at four sites in the south-western region of Germany from July 2009. Serco's focus is on programme management with a large proportion of the activities being undertaken by third party sub-contractors.

Support for Business
The South West Regional Development Agency (SWRDA) has awarded Serco an additional £14.25 million over five years to lead on the delivery of enhanced Business Link services in the South West for all areas excluding Cornwall, which is covered by a separate agreement.  This intensification and diversification of the service is funded jointly by the RDA and the EU's European Regional Development Fund. SWRDA has also awarded Serco a contract worth approximately £2.5 million over five years to provide resource efficiency advice for businesses in the rural economy.  
European Space Agency
Serco has been selected by the European Space Agency to provide Engineering and Technical Management services for its Earth Observation programme, the Global Monitoring for Environment and Security (GMES). The contract is to support the Agency in the definition and procurement of the ground systems used to process the data generated by the instruments on board the GMES satellites of the first 3 missions of the programme, the Sentinel 1, 2 & 3 satellites. This contract also embraces a dedicated service for the provision of coordinated access to the GMES data to the user community for scientific analysis. The contract has an approved budget of Euro22m over 5 years.

Earth Observation Exploitation and Application Project Activities at ESRIN
Serco has successfully renewed its contract for the Support to Earth Observation Exploitation and Application Project Activities at ESRIN, the European Space Agency's European Space Research Institute. The contract has a duration of three years with an option to extend for a further two, which would bring the total contract value to approximately Euro12.5m.

Cryogenics Contract at CERN
Serco has won a contract for the Provision of Maintenance Services for the Cryogenic Installations and Equipment at CERN. CERN, home of the Large Hadron Collider (LHC), is the European Centre for Nuclear Research based near Geneva on the border of Switzerland and France. Serco has worked for CERN since 1993 and currently provides IT Services, Industrial Support and Cryogenic Operations Support and has more than 100 employees on site. CERN has awarded this service contract to Serco for a firm initial period of three years with the potential of four, one year, extensions. The total value of this contract is Euro20M over the full seven years.

Ministry of Defence Mobile Underwater Target Support
Serco has been awarded an extension to its contract to support, operate and maintain the UK Ministry of Defence's mobile underwater targets at the British Underwater Test and Evaluation Centre, Kyle of Lochalsh, Scotland, and Weymouth, Dorset.  Mobile underwater targets are used when training submarine crews on the use of the Spearfish torpedo by simulating a realistic submarine target.  The contract extension is valued at up to £7.3m over 4.5 years.

NATO support contract
Serco has been awarded a new £3.1m contract by NATO's Consultation, Command and Control Agency. Under the contract, Serco will provide support to NATO's initiative to improve data and voice communications links between operating units from the various member states, particularly important in enabling NATO to fulfil its mission in Afghanistan. The contract includes systems integration and engineering activities on 24 vehicles and trailers, and various mobile command and control units, and Serco will be responsible for the integration of systems and hardware, supply chain management and engineering. 

The US General Services Administration (GSA) has awarded Serco the Alliant Government Wide Acquisition contract. Alliant is an indefinite delivery/indefinite quantity (ID/IQ) contract vehicle through which Serco, as one of a number of award winners, will have the opportunity to compete on task orders for integrated Information Technology solutions. The contract has a ceiling value of $50 billion over a five-year base period and one five-year option period, and contains three major components: Infrastructure, Application Services, and IT Management.

US Army Simulation and Training IDIQ (STOC II)
Serco has been awarded the US Army Program Executive Office for Simulation, Training and Instrumentation (PEO STRI) Omnibus Contract (STOC II). STOC II is multiple award, indefinite delivery/indefinite quantity (ID/IQ) contract vehicle with a ceiling value of $17.5 billion over a ten year period. This new contract provides Serco, as one of a number of award winners, the opportunity to compete for task orders supporting US Army and other federal organisations using a wide range of advanced technology capabilities in the areas of simulation and training.

US Army Access Cards
Serco has renewed its contract to provide access card services for the US Army at around 70 locations around the world, issuing approximately 1.1m identification and access cards annually. The contract, which Serco has held since 2001, is valued at US$9.4m over one year. 
US Air Force Support - BAE Systems
Serco has renewed its contract with BAE Systems to support the US Air Force in providing Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance (C4ISR) engineering to the intelligence community. The contract is valued at US$8m over 3 years.

Aeronautical contracts for Abu Dhabi Airports Company and Ras Al Khaimah International Airport
Serco has been awarded on rebid a contract for the provision of Air Traffic Control and Electronic Engineering services at Abu Dhabi International Airport, Al Ain International Airport, and City Airport at Bateen as well as two additional satellite airports in the Emirate of Abu Dhabi. Valued at over £24m for two years, the contract commenced in April 2009. Serco has also been successful in the rebid for the provision of Air Traffic Control services for Ras Al Khaimah's International Airport, which has a value of over £1.5m for one year.

National Nuclear Laboratory
A consortium of Serco, Battelle and The University of Manchester has been awarded a new contract to run the UK National Nuclear Laboratory (NNL). The objectives are for NNL to become an international centre of excellence in nuclear research, to play a central role in cleaning up the UK's nuclear waste legacy and to contribute to the programme of nuclear new build.  Depending on performance, the contract is valued at around £10m revenue over an initial three year period, with two further option years.

Serco in the Media

There are many stories reported by the media around the world about the positive contribution that Serco's people and services are making.

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Last Updated: 12 May 2009