The boss of British outsourcer Serco said he was confident the sweeping changes he was making would restore the fortunes of the firm after a disastrous first half of the year when profits plunged 59 per cent.

The company reported lower-then-expected debt and stuck to its 2014 profit forecast – a rare event after three downgrades – but warned the guidance depended on it cutting costs, fixing failing contracts and no new problems.

Serco’s share price has almost halved in a year after it was hit by a six-month ban on new UK government work in July 2013 for overcharging on a tagging contract, while a raft of other deals have hit problems, forcing the firm to raise cash and begin costly reviews and restructuring. Chief executive Rupert Soames joined from Aggreko in May to lead a company’s recovery. – (Reuters)