Service provider and logistics giant Serco Group Plc (LON:SRP) announced on Monday that it would lose its stake in the management of the establishment of atomic weapons, which is responsible for supply and maintenance of the UK’s nuclear warheads.
The AWE PLC Consortium, consisting of Serco (24.5%), Lockheed Martin (51%) and Jacobs (24.5%), has been notified by the Ministry of Defense of direct management of mods and control of the establishment of atomic weapons under control from June 30, 2021.
The news comes after Serco and its consortium partners managed nuclear weapons agencies since 2000, and the company’s statement read:
The company added that it hopes to contribute to the foundation’s trade and post-tax profits of around £17 million in 2020.
“Our budgeting process is not yet complete and we expect both 2021 tax and post-tax tax and profits to line up at similar levels as our 2020 forecast, assuming that the pandemic is envisaging a smooth transition of adoration at the end of June 2021.
This news follows something like a 2020 mix for the company. The UK government’s tests and trace growth and profitable contracts are considered positive, but their reputation for UK consumers doesn’t seem to move on a positive trajectory, and today’s nuclear weapons management development is taking one contract from the company’s roster.
Following the update, Serco’s shares fell more than 13% at one point, but moved around 113% between 112p and 113p for most of the day on Monday. The current price is around 58% under the analyst’s target of 178.38pa stake, higher than Nadir in March.
MarketBeat has a P/E ratio of 11.50, while Hargreaves Lansdown is 19.79. Both have an average of below 26.03 for the service sector. Analysts currently have a consensus “buy” stance on equities, but the MarketBeat community gives it a 70.98% “underperformance” rating.
