StockMarketWire.com - A joint venture involving outsourcer Serco has been stripped of a contract to provide nuclear warheads after the Ministry of Defence (MoD) moved to effectively renationalise the job.

Serco said that it was informed by the MoD on Friday night that AWE plc, the entity controlling the Atomic Weapons Establishment, will transfer back under the direct control and management of the MoD as from 30 June 2021.

Since 2000, AWE has been managed by AWE Management Limited, in which Serco holds a minority interest of 24.5%. The other shareholders are Lockheed Martin (51%) and Jacobs (24.5%).

Serco said it expects AWE will make a contribution to both its group underlying trading profit and profit after tax of around £17 million in 2020.

The firm added that whilst its budgeting process is yet to be completed and 'the pandemic makes forecasting extremely difficult', assuming a smooth transition of AWE at the end of June 2021 it expects both group underlying trading profit and profit after tax in 2021 to remain broadly in line with current consensus and at similar levels to its expectations for 2020, representing growth of around 35% over 2019.




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