LONDON, April 28 British outsourcing firm Serco
said it could materially downgrade its profit
expectations and might have to issue new shares to shore up its
finances after its performance this year had been more
challenging than expected.
Serco had already warned in January that profit in 2014
would be lower than 2013 due to underperforming contracts and
the cost of issues relating to it being found to have
overcharged the UK government on a contract to tag criminals.
"It has now become evident in the light of recent
performance that we may need to reassess the level of risk
implicit in the assumptions underlying our forecasts," Serco
said in a statement on Monday.
"This may in turn require a material downward revision to
expectations, and for us to review the appropriateness of our
financing position. We will, therefore, be consulting with
shareholders regarding the possibility of strengthening the
balance sheet through an equity placing," it added.
The firm said a further announcement would be made this
(Reporting by Neil Maidment)