Serco shares climbed 4.7% to 254.11p following publication of the company's half-year results for the first six months of 2026. Investors responded positively to a set of metrics that showed revenue growth, margin improvement and a reaffirmation of full-year guidance.
The group reported H1 revenue of approximately approximately .5 billion, up around 3% year-on-year, with underlying operating profit of approximately approximately approximately approximately approximately 155 million - roughly 6% ahead of the same period in 2025.
The operating margin advanced above 6%, moving to the upper end of Serco's medium-term target range of 5-6%.
Management left its full-year guidance unchanged. The company reiterated expectations for full-year revenue of approximately approximately 5 billion, with organic growth of around 3%, and an underlying operating profit target of approximately 300 million. Management described the maintained guidance as a signal of confidence in the group's trajectory despite acknowledging headwinds.
CEO Anthony Kirby said the group had delivered a good first half. He highlighted revenue and margin increases, citing particularly strong organic growth in the UK and Europe, together with progress in the Asia Pacific business. The contract pipeline expanded to approximately 12.5 billion, and the group continued its share buyback programme, which management said supported shareholder returns.
Market conditions provided a helpful backdrop to Serco's share move. The FTSE 100 was positioned for gains on the session, buoyed by robust corporate earnings across multiple index constituents and by what the company described as easing investor concerns around global inflation and geopolitical risk. The FTSE 250, where Serco is listed, had been trading near record highs in the previous session, reflecting investor appetite for UK-focused industrials and services names.
Taken together, the in-line to marginally better half-year performance, the unchanged full-year profit outlook, a larger contract pipeline and the ongoing buyback programme combined with constructive market sentiment to drive the rally. Shares opened the day at 243.4p and reached a session high of 257p before settling around 254.11p.
Summary
Serco reported H1 2026 revenue of about 2.5 billion, underlying operating profit of roughly 155 million, and an operating margin above 6%. Management maintained full-year guidance targeting approximately 5 billion in revenue and roughly 300 million in underlying operating profit. A larger contract pipeline and continuing buybacks added to investor support, helping the stock rise during the trading session.