Private security company Serco's contracts with the government have blown out by $1.5 billion as the flow of asylum seekers has increased.
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Serco Australia provides immigration detention services and has two contracts with the federal government that have been active since 2009.
But those contracts have ballooned from $323 million four years ago to a record $1.86 billion this year.
Serco in its annual report has welcomed the increase in asylum seekers but says future profits in Australia will depend on the ''country conditions'' in the Middle East and Asia.
Serco's contract for running Australia's detention centres was originally valued at $279 million in 2009. It is now worth $1.67 billion. Its other contract - for housing and immigration transit services - has grown from $44 million in 2009 to $195.4 million this year.
It was updated for the fourth time last month, rising from $94 million to $195.4 million.
Both contracts are subject to confidentiality agreements.
Serco Australia enjoyed a 45 per cent rise in net profit to $59 million in 2011. It has not yet lodged its annual accounts with ASIC disclosing its 2012 profit. But its annual report shows it generated £824 million in revenue in Australia in 2012, up from £660.4 million in 2011.
Serco says its profits in Australia reflect its workload for the Department of Immigration. ''The level of irregular maritime arrivals has increased in 2012, leading to a growth in the number of people in our care,'' its report notes.
''The level of our future activity is still likely to fluctuate based on country conditions in the Middle East and Asia, where most people in our care originate, and the prevailing government policy, speed of visa processing and the application of the Australian government's recent offshore processing legislation.''
An Immigration spokesman said the cost increases in part reflected the larger numbers of asylum seekers detained. On Thursday, 4997 people were being held on the mainland.
A Serco spokesman said: ''When we commenced the contracts in 2009, we were caring for 800 people. We currently look after more than 8000, and employ more than 3000 people in immigration services.''
