Yahoo Finance Serco hands frontline staff £100 bonus as profits roll in from Covid-19 and immigration work
Test and trace operator Serco is set to hand 52,000 frontline staff a bonus of £100 to reflect their hard work during the pandemic.
The outsourcer and major government contractor said today that staff around the world would be given the payment. The company will also make a “significant” donation to the Serco People Fund, which provides “cash and other support to colleagues who would benefit from a little extra help at this difficult time”.
Taken together, the bonuses and donation total £10 million.
News of the payouts came as Serco upgraded forecasts for full-year profits and revenues thanks in part to Covid-19 work running for longer than it had first anticipated.
Serco said it now expects revenue to be £4.4 billion for the year and underlying profits to be no less than £225 million. In August, the company had guided revenue of £4.3 billion for the full year and underlying profit of £200 million.
The outsourcer and major government contractor said the upgrade reflected the fact that “volumes of work related to Covid-19... have been higher, and have continued for longer, than we anticipated.”
Serco has won major government contracts to support the Covid-19 response in the UK and Australia, including providing call handlers for NHS Test and Trace, and running 20% of testing centres in the UK.
Performance has also been buoyed by immigration contracts in the UK and Australia. The company runs asylum seeker housing in the North West and the Midlands. Covid-19 has led to a backlog in processing asylum applications, meaning housing has been required for longer.
Healthcare insurance eligibility checks in the US are doing well for Serco too after President Biden decided to extend the eligibility check window. And deals that were expected to close in 2022 now look destined to complete this year. Sales growth forecasts for the year were upgraded from 6% to 10%.
While 2021 looks set to be better-than-expected, Serco said 2022 was likely to be in line with analyst forecasts.
“We expect 2022 to see much lower demand for Covid-19 related services, partially offset by the impact of new work secured in 2021 and growth in our core non-Covid-19 related business,” the company said.
Shares rose 3.1p to 133.9p.
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