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2009 Full Year Results

Date: 26 Feb 2010

Strong performance and attractive markets

Serco Group plc - 2009 Results

2009
2008
% change
Revenue
£3,970m
£3,124m
27.1%
Adjusted operating profit
£229.7m
£165.2m
39.0%
Operating profit
£212.1m
£156.1m
36.0%
Adjusted earnings per share
29.53p
22.20p
33.0%
Earnings per share
26.76p
20.49p
30.6%
Dividend per share
6.25p
5.00p
25.0%
Group free cash flow
£137.3m
£94.2m
45.8%

Strong operational performance and growth; awarded contracts valued at £5.8bn

  • Signed contracts valued at £4.5bn and appointed preferred bidder for £1.3bn of contracts
  • Further strengthened business portfolio and extended capabilities into new growth markets
  • Delivered strong operational performance and successfully launched major new contracts
  • Built strong platform for growth in US through excellent progress on integration of SI acquisition
  • Maintained high win rates of one in two new bids and 90% of rebids

Strong financial performance

  • Revenue grew by 27.1%; 20.8% excluding currency; 10.2% excluding SI and currency
  • Adjusted operating profit margin increase of 50bps; 45bps excluding currency; 27bps excluding SI and currency
  • Group free cash flow increased by 45.8% to £137.3m

Excellent revenue visibility supported by long-term contracts and substantial £17.1bn order book

  • Order book of £17.1bn at 31 December 2009 (£16.3bn at 31 December 2008)
  • Visibility of 91% of planned revenue for 2010, 76% for 2011 and 64% for 2012

Well positioned to support customers with our transformational capabilities

  • Global economic environment driving demand in existing and new markets
  • Significant opportunities to address customers' needs through our growing capabilities and deep public service ethos
  • Strong track record of transforming efficiency and productivity in essential public services

Outlook reflects high visibility, selective bidding strategy, and £28bn opportunity pipeline

  • Continue to expect an increase in revenue to approximately £5bn and in Adjusted operating profit margin to approximately 6.3% by the end of 2012*
  • In 2010, expect continued strong organic revenue growth and further progress towards our 2012 margin guidance
    * excluding material acquisitions, disposals and currency effects, based on 2008 exchange rates

Christopher Hyman, Chief Executive of Serco Group plc, said: "Serco delivered a very strong performance in 2009, and has entered 2010 with a record order book and significant opportunities in the UK and internationally. Fiscal pressures are increasing in all of our global markets, presenting ever greater opportunities for the efficient delivery of essential services. The breadth of our capabilities, and our track record, enables us to be selective in pursuing the best opportunities to deliver results for all of our stakeholders."

Note: Adjusted operating profit and Adjusted earnings per share shown above are before amortisation of acquired intangibles as shown on the face of the Group's consolidated income statement and the accompanying notes. Group free cash flow is free cash flow from subsidiaries and dividends received from joint ventures and is reconciled in Section 3 of the Finance Review.

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Last Updated: 26 Feb 2010