Serco celebrates £100m contract extension to run capital’s Light Railway

OUTSOURCING group Serco said yesterday it had won a £100m contract extension to run London’s Docklands Light Railway.

The DLR, which carried 7.2 million passengers during the London Olympics last year, has been maintained, operated and marketed by Serco since 1997. The group, which also runs prisons and air traffic control centres around the world, said the extension would run from April 2013 to September 2014. “It’s worth about 1.4 per cent of total group revenue so its a small positive,” Numis analyst Mike Murphy said.

David Brockton, an analyst from Espirito Santo, noted last week that another material renewal for the group this year will be its electronic tagging contract with the government.

Hide Ad
Hide Ad

Serco is also still in the running for two UK prison management contracts after several were pulled back by the government in November, a move that prompted analyst uncertainty over Britain’s plans to outsource public services to private companies.

Christopher Hyman, chief executive of Serco Group, said: “We are delighted that our performance has been recognised with this 18-month extension of the DLR contract.

“We have a strong track record of delivering high quality rail services in the UK and internationally, with our award-winning services recognised for their high levels of performance, punctuality and passenger care.”

DLR director Jonathan Fox said: “I am pleased to announce the extension of this contract and the continuation of a successful working partnership that has seen the DLR expand its network, increase its capacity by 50 per cent and successfully meet the challenge of the Olympics, when the network carried more than 100 per cent more customers than normal.”

Hide Ad
Hide Ad

Serco has a range of contracts across Yorkshire. Together with Abellio, it also owns half of Northern Rail, the local train service which spans the Pennines. It won an extension to the franchise until 2014.

Last year it won a £55m, 10-year contract to run shopping giant Freemans Grattan Holdings’ Sheffield call centre. And Serco also runs HMP Doncaster and its Young Offenders’ Institution.

Related topics: