Serco in a dive as it fails to damp fires of another scandal
Shares in FTSE 100 outsourcing giant Serco plummeted 11 per cent yesterday as its chief executive Christopher Hyman failed to convince investors that the scandal-engulfed group can rebuild its relationship with the Government.
Mr Hyman pledged to "put right any issues" at Serco having referred some employees to the police on Wednesday after irregularities were discovered on records kept for its £285m prisoner-escorting contract with the Ministry of Justice.
This follows allegations that Serco and security group G4S had overcharged the taxpayer by £50m on claiming to have electronically tagged offenders who turned out to have been in custody or who were even dead.
Coupled with poor half-year results that saw a 2.6 per cent fall in pre-tax profit to £106.1m, Serco's woes saw investors flee the stock. The shares fell 68p to 538.5p.
The public sector is Serco's most important customer, as it runs everything for local and central government from Ofsted inspections to London's "Boris bike" hire scheme. However, Serco is blocked from winning government contracts until the group can prove it has improved its internal controls. Mr Hyman said: "Serco has … agreed with the MoJ to initiate a programme of change and corporate renewal designed to increase the voice of our customer in our organisation and strengthen Serco's systems."
Westhouse Securities analyst Michael Donnelly said: "The main investment point… will be what else is going to come to light as the government continues its investigation into Serco's contract portfolio."
...and it wasn't caused by an asteroid crash, as first thought
- 1 Snoop Dogg and Jared Leto buy a stake in Reddit as A-list invests $50m
- 2 Prince held a Facebook Q&A and this is the only question he answered...
- 3 35,000 walrus gather on north-west Alaska beach 'for a rest'
- 4 Brad Pitt, on the moment he completely lost his temper with Clint Eastwood's son
- 5 A teacher speaks out: 'I'm effectively being forced out of a career that I wanted to love'
Stella McCartney apologises over controversial 'very ill' model picture on Instagram
Snoop Dogg and Jared Leto buy a stake in Reddit as A-list invests $50m
Prince held a Facebook Q&A and this is the only question he answered...
Brad Pitt, on the moment he completely lost his temper with Clint Eastwood's son
Cheryl Cole named 'the most dangerous celebrity' on the internet
Former Tory donor Arron Banks ups his Ukip donation to £1million following William Hague 'nobody' comment
Exclusive: 'Putin's Russia has been my biggest regret,' says Nato's outgoing Secretary General
The Osborne Ultimatum: Chancellor’s benefits freeze bombshell will affect ten million households
There’s no excuse for Dave Lee Travis’s behaviour, but we need to keep a sense of proportion
Should gay sex be illegal? 16% of Britons think so
Mark Reckless becomes second Tory MP to defect to Ukip in a month
- < Previous
- Next >
iJobs Money & Business
£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...
NEGOTIABLE: Austen Lloyd: TRUST ACCOUNTANT - KENTIf you are a Chartered Accou...
£18000 - £20000 per annum + OTE £30000: SThree: SThree are a global FTSE 250 b...
Highly Competitive Salary: Austen Lloyd: CITY - Law Costs Draftsperson - NICHE...