Serco Group PLC £450m contract for Northern Isles Ferry Services (0954N)
September 20 2019 - 3:05AM
UK Regulatory
TIDMSRP
RNS Number : 0954N
Serco Group PLC
20 September 2019
Serco awarded GBP450m contract for Northern Isles Ferry
Services
20 September 2019
Serco Group plc
LEI: 549300PT2CIHYN5GWJ21
Serco Group plc ('Serco' or 'the Group'), the international
service company, has been selected as preferred bidder to continue
managing and operating the lifeline Northern Isles Ferry Services
for passengers and freight between the Scottish mainland and the
Orkney Islands and Shetland Islands, providing essential access and
supplies for the islanders. The outcome of the tender was announced
by the Minister for Energy, Connectivity and the Islands to The
Scottish Parliament this morning.
There is currently a mandatory standstill period following the
appointment decision. The new contract will ensure continuity of
service, is anticipated to start in the fourth quarter and has a
total estimated revenue value to Serco of approximately GBP450m
over the initial six-year term. There is an option for Scottish
Ministers to extend the contract for a further two years, valued at
a further GBP160m.
Serco will build on the strengths and experience gained over the
past seven years of operating the NorthLink Ferries franchise. Key
features and improvements will include:
-- continuing to undertake the planned maintenance and dry
docking of the vessels in Scotland, to ensure strong levels of
resilience with reduced time away from service;
-- improvement of the terminal facilities at Hatston, Kirkwall
in the Orkney Islands, and enhanced passenger information systems
at all the terminals;
-- a new smart ticketing system for foot passengers;
-- a new demand analysis and forecasting model to inform and
improve accuracy and confidence in passenger and freight
requirements; and
-- a new 'Green Travel' campaign aimed at customers and
employees, together with a new Carbon Reduction strategy to reduce
emissions.
Rupert Soames, Serco Group Chief Executive, said: "We are
delighted to have been awarded this contract by Scottish Ministers.
We are very proud of our track record over the past seven years,
during which time we have improved almost every aspect of the
lifeline service for the communities and businesses of the Northern
Isles, while also reducing materially the annual subsidy and
thereby reducing the burden on the Scottish taxpayer. We look
forward to further improving the service in the coming years."
Since Serco first began managing the service in 2012, all
aspects have been improved in terms of customer satisfaction,
reliability, safety and community support. Passenger numbers have
increased by 18%, vehicle traffic by 38% and freight volumes by
24%. Reliability performance is 99.97%. Employment of people from
the local communities has increased by 18% and Serco NorthLink
Ferries is the first Scottish ferry company to achieve Investors in
People Gold rating. Furthermore, Serco sources over 80% of food,
beverage and retail services from within a 50-mile radius of the
operating ports, an increase from 12% since 2012. Since 2013 the
vessels have undergone significant upgrade and improvement
including: new and additional reclining pod seats; upgraded premium
cabin facilities; new locally sourced Glencraft mattresses for all
cabins; and the new Magnus lounge and shower facilities for those
not travelling in a cabin.
Ends
For further information please contact Serco:
Stuart Ford, Head of Investor Relations T +44 (0) 7738 894
788
Marcus De Ville, Head of Media Relations T +44 (0) 7738 898
550
About Serco
Serco is a leading provider of public services. Our customers
are governments or others operating in the public sector. We gain
scale, expertise and diversification by operating internationally
across five sectors and four geographies: Defence, Justice &
Immigration, Transport, Health and Citizen Services, delivered in
UK & Europe, North America, Asia Pacific and the Middle
East.
More information can be found at www.serco.com
Forward-looking statements
This announcement contains statements which are, or may be
deemed to be, "forward-looking statements" which are prospective in
nature. All statements other than statements of historical fact are
forward-looking statements. Generally, words such as "expect",
"anticipate", "may", "could", "should", "will", "aspire", "aim",
"plan", "target", "goal", "ambition", "intend" and similar
expressions identify forward-looking statements. By their nature,
these forward-looking statements are subject to a number of known
and unknown risks, uncertainties and contingencies, and actual
results and events could differ materially from those currently
being anticipated as reflected in such statements. Factors which
may cause future outcomes to differ from those foreseen or implied
in forward-looking statements include, but are not limited to:
general economic conditions and business conditions in Serco's
markets; contracts awarded to Serco; customers' acceptance of
Serco's products and services; operational problems; the actions of
competitors, trading partners, creditors, rating agencies and
others; the success or otherwise of partnering; changes in laws and
governmental regulations; regulatory or legal actions, including
the types of enforcement action pursued and the nature of remedies
sought or imposed; the receipt of relevant third party and/or
regulatory approvals; exchange rate fluctuations; the development
and use of new technology; changes in public expectations and other
changes to business conditions; wars and acts of terrorism; and
cyber-attacks. Many of these factors are beyond Serco's control or
influence. These forward-looking statements speak only as of the
date of this announcement and have not been audited or otherwise
independently verified. Past performance should not be taken as an
indication or guarantee of future results and no representation or
warranty, express or implied, is made regarding future performance.
Except as required by any applicable law or regulation, Serco
expressly disclaims any obligation or undertaking to release
publicly any updates or revisions to any forward looking statements
contained in this announcement to reflect any change in Serco's
expectations or any change in events, conditions or circumstances
on which any such statement is based after the date of this
announcement, or to keep current any other information contained in
this announcement. Accordingly, undue reliance should not be placed
on the forward-looking statements.
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END
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