Serco Group (LSE:SRP), the international provider of critical government services, reiterated its full-year guidance in a pre-close trading update on 25 June, pointing to a resilient first half despite continued procurement delays in North America.
First-half revenue is expected at around £2.5bn, up approximately 3% year-on-year, with organic growth of around 1% after a around 2% net contribution from acquisitions and disposals.
Underlying operating profit is forecast at around £155m for the half, up approximately 6% year-on-year, with margins progressing above 6% through productivity improvements and revenue mix effects.
Full-year guidance is unchanged: revenue of around £5bn with organic growth of around 3%, and underlying operating profit of approximately £300m, representing a margin of around 6% and around 10% higher than the £272m reported in 2025.
Strong performance in UK and Europe, driven by Defence and Justice contract mobilisations, and order intake of over £500m in Asia Pacific were highlighted as bright spots, while US procurement delays that emerged in late 2025 carried into the first half, though the North American pipeline expanded to £12.5bn.
"While procurement delays in the US have continued into the first half, we remain confident in the structural drivers of demand," said chief executive Anthony Kirby.
Free cash flow of approximately £160m is expected for the full year, with adjusted net debt forecast to fall to around £165m by year-end from approximately £250m at end-June.
Serco also disclosed that its North America divisional chief executive, Michael LaRouche, plans to leave to take up a role at an international business with a US listing, with succession well underway.
