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LONDON Dec 7 British outsourcing firm Serco mentioned on Monday it expected revenue and trading profit to fall in 2016, due to the sale of its offshore contact centre company and a number of lost contracts.
The company, battling to recover from a string of contract issues and scandals, mentioned it now expected revenue of about 2.8 billion pounds ($ 4.two billion) and underlying trading profit of around 50 million pounds in 2016.
Analysts had anticipated income to come in at two.9 million pounds subsequent year, according to Reuters information.
The company mentioned the sale of its offshore get in touch with centre organization would minimize 2016 revenue by 300 million pounds. It agreed to sell the enterprise to private equity firm Blackstone for 250 million pounds in September.
Serco has suffered over the past couple of years, following problems with government contracts that integrated overcharging the British government for monitoring criminals and escalating fees on a deal to give accommodation to UK asylum seekers.
Nonetheless, it mentioned underlying trading profit in 2015 was most likely to come in at 95 million pounds, ahead of its preceding guidance of 90 million, due to the renegotiation of some loss-producing contracts and improved operational overall performance.
Income was estimated in line with its prior guidance of about three.five billion pounds.
“We said that we anticipated 2016 to be a further challenging year,” said Chief Executive Rupert Soames in a statement.
“We nonetheless anticipate this to be the case, caused in element by continued attrition of the contract base, and in portion by the BPO (offshore contact centre) disposal.” (Reporting by Li-mei Hoang Editing by Louise Heavens and Mark Potter)