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Contract News Update 17

Date: 14 Nov 2013

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.

Non-clinical support services for NHS Hospital Trust
Serco has signed a contract extension for health enabling services at Derriford hospital in Plymouth.  Serco has provided support services including helpdesk support, housekeeping, portering and catering to the trust since 2009 with the three-year extension to 2019 valued at approximately £40m.

Environmental Services for UK Borough Councils
Serco has extended its contracts with Welwyn Hatfield Borough Council and Breckland Borough Council to continue delivering environmental services.  The extensions, which will see Serco continuing to provide refuse collection, recycling, street cleansing and grounds maintenance services, have a combined total value of approximately £50m over the four-to-six year terms.

Facilities management services for Deloitte
Serco has secured a two-year extension to its contract with Deloitte to provide facilities management services across the company's 23 UK locations.  Serco will continue providing housekeeping, security, engineering and project management services for the professional services company until December 2015. Serco have operated the contract since 2008 and has over 280 people supporting 15,000 Deloitte employees working in 23 buildings across the UK.  The extension, valued at £17m, sees Serco remain the company's single largest service provider.

Emergency planning to Sellafield
Serco has signed a contract with Sellafield Ltd to assist them with the delivery of their Emergency Management Improvement Programme (EMIP).  Sellafield Ltd is responsible for safely delivering decommissioning, reprocessing and nuclear waste management.  The contract will see Serco and its partners Berwicks Consulting and National Nuclear Laboratories, supply Emergency Management Professionals and Technical Advisers to strengthen emergency management arrangements already in place at Sellafield.  The initial three-year framework contract has an option to extend by a further twelve months and has a total value of up to £16m.

Pre-deployment training for the UK's Ministry of Defence
Serco has received a one-year extension to its Contemporary Operating Environment Force (COEFOR) contract.  Under the extension, Serco will continue to support the British Army with critical pre-deployment training such as essential language, culture and operational environment skills.  The one-year extension through to December 2014 is valued at approximately £10m.

Support to the United States Air Force in Europe (USAFE)
Based at RAF Alconbury, the 501st Combat Support Wing (501 CSW) is a USAFE unit that supports both US and NATO missions.  Serco has successfully rebid the transportation, supply and facilities management contract that provides services at Alconbury, Molesworth and Croughton. The contract is valued at approximately £10m over five years.

Ferry services in Stockholm
Serco and its joint venture partner Strömma Turism & Sjöfart AB have been selected to manage and operate one of Stockholm's key ferry service contracts from April 2014.  The 50:50 joint venture will operate four ferries currently carrying over two million passengers annually, combining Serco's international expertise in operating land and sea public transport services and ship maintenance with Stromma's experience of delivering high quality leisure and tourism services throughout Scandinavia.  The eight-year contract has a total value to Serco of approximately £7m.

Data centre support services for EUMETSAT
Serco has been awarded a contract by EUMETSAT to manage the operations of its data centre which holds the archives of all the past, current and future data from its satellites.  Serco already supports the routine production of climate data records and provides helpdesk services to the intergovernmental organisation's external user community.  The five-year framework contract has an estimated value of up to £2.5m.

Marine fire training at Warsash Maritime Academy
Serco's International Fire Training Centre (IFTC) has successfully rebid its contract to deliver fire training to delegates at the Warsash Maritime Academy in Southampton.  The IFTC is internationally renowned for its aviation, off shore and industrial fire training courses and this contract award continues to develop Serco's reputation as a leader in the fire training market.  The five-year contract is valued at £1.2m.

US healthcare eligibility support
In July 2013 Serco began its new contract for the United States Department of Health and Human Services' Centers for Medicare & Medicaid Services (CMS).  Under the contract, Serco is providing processing support for applications submitted for enrolment into a Qualified Health Plan and for insurance affordability programmes.  The contract had an initial one-year base period valued at approximately US$115m.  CMS has now executed Modification 1 to provide funding for additional work under the contract.  Funding has therefore been provided for all base period required tasks to an increased value of US$202m in the first full year.

New US contract wins and task orders for Sea Enterprise and HRsolutions IDIQ
Under the existing Sea Enterprise and HRsolutions IDIQ frameworks, Serco has secured multiple wins, modifications and extensions worth US$127m so far this year.  This includes deploying IT systems for the US Navy and human resource services for the US Army.

Systems engineering and technical assistance for the US intelligence community
Serco has signed an extension to a contract supporting the US intelligence community.  Serco provides IT architecture, systems and systems engineering, financial management and procurement support, risk management performance assessment and reporting.   The five-year extension is valued at approximately US$40m.

VA for Vets Transition Assistance Program
Serco has been awarded a Transition Assistance Program (TAP) subcontract to provide support services to help reduce unemployment among Veterans.  Under the contract for the Department of Veterans Affairs, Serco will provide 100 trained VA benefit briefers at installations across 17 states,  The four-year award has a total estimated value to Serco of US$24m.

Task orders under Alliant IDIQ
Serco has been awarded five task orders this year valued at US$22m under the Alliant IDIQ which provides a full range of integrated information technology solutions to Federal civilian agencies and the Department of Defense.  A key task order win included Systems Integration Solutions for the US Army Defence Ammunition Center (DAC).  The DAC provides ammunition training, explosives safety instruction, and logistics support to Department of Defence military and civilian organizations and personnel. Serco will deliver analysis, design, development, implementation and administration of enterprise-wide training in support of DAC initiatives.

Task orders under US Air Force IDIQ for installation of command and control systems
Serco has been awarded US$24m of task orders in 2013 under the C4I2TSR IDIQ which enables the US Department of Defense and civilian government agencies to procure a full range of support to mission-critical and emergency information technology systems.  These services and products include engineering, systems integration, hardware procurement, software development, technical support, installation testing, operations and maintenance.  Serco is the sole provider under this IDIQ.

Metro operation and maintenance for the Dubai Metro
Serco has signed an extension to its contract with the Dubai Government Roads and Transport Authority (RTA) to continue to operate and maintain the Dubai Metro.  Serco first provided pre-launch consultancy and planning to the RTA from 2007, and began operating and maintaining the service in 2009.  Since opening, Serco has continued to deliver world class safety and operational standards including 99.9% of trains on time while also expanding ridership to over 127 million journeys in the last 12 months.  The five-year extension is valued at approximately £355m with an opportunity to extend for a further two years to 2021.

Facilities management services in the Middle East
Serco has been appointed preferred bidder to provide facilities management services for a new project in the United Arab Emirates.  Support services provided will include estates management, cleaning, helpdesk and waste management.  The six-year contract is expected to have a value of approximately £30m.

Air traffic control services in Iraq
Serco, in cooperation with our Iraqi partner Al Burhan Group, has signed a new contract with the Iraq Civil Aviation Authority (ICAA) to continue providing Air Traffic Control (ATC) services, training and support at Baghdad International Airport.  Serco has been providing these services in Baghdad since 2011 with notable achievements including increasing airspace capacity and the successful training of over 40 new Iraqi controllers.  The new 18-month contract is valued at approximately £24m.

Tramway operation and maintenance in Dubai
Serco has signed a contract with the Dubai Roads and Transport Authority (RTA) to operate the Dubai Tramway which will extend 14.6km alongside Al Sufouh Road and officially launch in November 2014. Serco was selected for its experience in operating and maintaining a number of metro and rail lines across Europe and Australia and the contract win extends Serco's successful partnership with RTA. The contract has a total value of £18m and will see Serco operate the tram for five years, preceded by an initial 15-month period of preparation covering the recruitment and training of employees.

Integrated travel services in the Australian resources sector
Serco has signed a contract to manage an integrated travel service including air and bus services to Thiess Pty Ltd.  The new contract will see Serco work with its partners to provide a fully integrated service supporting Thiess and its employees as part of the Queensland Curtis LNG Upstream Project, one of Australia's largest capital projects that will supply up to 12 million tonnes of LNG per annum.  The initial 11-month contract has an expected value to Serco of approximately £12m.

Air traffic control services in Qatar
Serco has been awarded by the Qatar Civil Aviation Authority a new framework contract to supply air traffic control services for the newly built Hamad International Airport (HIA) in Doha, which opens in 2014 and will support significant growth in air traffic volumes.  The framework contract is expected to have an initial value of approximately £4m over five years.

Employment support in the Kingdom of Saudi Arabia
Serco has signed a contract to work in partnership with the Human Resources Development Fund (HRDF), part of the Ministry of Labour in the Kingdom of Saudi Arabia.  Serco will provide support and training to a network of private Recruitment Offices across KSA to help them deliver HRDF programs more efficiently and effectively, thus enabling Saudi citizens to enter and sustain employment in the private sector, reducing unemployment rate.  The contract is for a period of 15 months and has a value to Serco of approximately £1.5m.

Procurement, finance and accounting services for NHS Hospital Trust
Serco has signed a contract with a large NHS Hospital Trust to provide strategic procurement and finance and accounting services.  The contract includes the transfer of the Trust's finance and accounting systems to Serco's Anglia Support Partnership's shared service platform.  The four-year contract builds on Serco's existing relationship with the Trust and is expected to generate revenue of approximately £112m.

Customer services support for leading US credit bureau
Serco has successfully rebid its contract with a leading US credit bureau to provide customer services for mortgage-related queries and other consumer areas.  The five-year contract has a total contract value of approximately £14m.

Adult social telecare service for Hertfordshire County Council
Serco has expanded the services provided to Hertfordshire County Council, where we have been appointed to deliver a pioneering new Telecare service for adults in receipt of social care. The 'Hertfordshire Telecare Service' went live on 2 September, with the first installations of technology designed to support people to live safely and independently at home.  The new service is complemented by a response service provided by the British Red Cross to ensure action is taken if a sensor or alarm is triggered.  This additional service is expected to have an initial value of £12m over five years, with the potential for further growth as the service is extended to provide wider support.

Revenue cycle management for a US healthcare company
Serco has signed a contract with a US healthcare company to provide a host of skilled revenue cycle services including claims management reconciliation and processing. The four-year contract is valued at approximately £6m.

European Regional Development Fund and Connecting Cheshire Superfast Broadband project
Cheshire East Council has appointed Serco to deliver a Superfast Broadband initiative to help businesses across Cheshire and Warrington improve their productivity and to grow.  The contract, which runs for 22 months, is valued at £1.6m and builds on Serco's successful delivery of similar projects in South West England.

ICT support and contact centre services for UK councils
Serco has been awarded new and expanded existing contracts for a number of UK councils for the provision of ICT and customer services.  For Thurrock Council, Serco has been awarded a two-year contract valued at approximately £3m to deliver additional ICT support for the council's New Ways of Working initiative as part of its wider transformation programme.  For Hull City Council, Serco has signed a new contract for the provision of contact centre services, primarily telephony support for customers through the 300 300 Contact Centre.  The 300 300 number deals with enquiries relating to council tax and other benefits, theatre bookings, social care requirements, school admissions, and other general enquiries.  Serco has also added supplementary operations to a contract with a further city council.  The additional activity, which has a total contract value of £4m, includes HR, payroll and expanded ICT services.

Multiple smaller contract awards for BPO services
In addition to the above, Serco Global Services has continued to secure multiple smaller contracts across our BPO service lines.  These include a three-year contract to provide a new customer complaints centre for an Indian power company, numerous human resource outsourcing awards in the telecom and financial services sectors and a two-year CRM contract for a real estate company in the United Arab Emirates.

For further information please contact Serco:
Stuart Ford, Head of Investor Relations T +44 (0) 1256 386 227
Marcus De Ville, Head of Media Relations T +44 (0) 1256 386 226

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Last Updated: 14 Nov 2013