SERCO has said it expects profits to exceed expectations in 2020 as a result of the uptick in work since the global pandemic.

Updating the London Stock Exchange in an unexpected announcement, the company said the excess profits could now be returned to shareholders, with a consultation on dividend payments under way.

The announcement comes a day after NHS Test and Trace, run by Serco, recorded its worst ever week for contact tracing as cases of coronavirus continue to rise.

The company, run by CEO Rupert Soames, said it had achieved strong revenue growth in the three months from July, highlighting extensions to contracts to provide test sites and call handlers.

READ MORE: Test and Trace: 15% trust private firm to run English system

Bosses said this was "an indication of our customer's satisfaction with the quality of work we have delivered" as part of the £12 billion committed by the Government to the system.

The company added: "We have also seen increases in the number of asylum seekers we are looking after on behalf of the Home Office, and our new Prisoner Escorting contract has been successfully mobilised.

"We have now secured an extension to the Emergency Measures Agreement on the Caledonian Sleepers to the end of the year."

It expects a trading profit, before any one-off costs, of between £160 million and £165m, compared with previous estimates of £135m to £150m.

Full-year revenue is expected to be around £3.9 billion - up from £3.7bn previously predicted.

New data this week showed 62.6% of close contacts of people who tested positive for Covid-19 in England were reached through the system in the week ending October 7.

This was the lowest weekly percentage since Test and Trace began, and is down from 69.5% the previous week.

For cases handled by local health protection teams, 97.7% of contacts were reached and asked to self-isolate in the week to October 7.

For those handled either online or by call centres, 57.6% of close contacts were reached and asked to self-isolate.

The way the system operates has been the subject of a political storm, with Labour highly critical of the use of outsourcers and calling for Serco to be ditched from the operation.

READ MORE: Serco CEO under fire for 'outrageous' lockdown trip to Inverness

Labour's Rachel Reeves said this week: “It’s failing to reach people who have come into contact with someone with the virus, it’s not getting information to local councils who need need to act on it and it’s wasting hundreds of millions of pounds worth of taxpayers’ money that could be spent on a local response using local expertise.” 

Polls have found a majority of people in England want Test and Trace to be operated by local health teams.

A survey from July found just 15% of people think a private firm should be in charge of coronavirus contact tracing systems.