Capita Plc, a British business process outsourcing and services provider, has reported a first-half loss before tax of £67.9 million. This loss is in stark contrast to the £0.1 million profit the company recorded in the same period last year. Loss per share was reported at 5.06 pence, compared to earnings of 1.10 pence per share in the previous year.
The company attributes this significant loss to several factors, including business exits, non-core Portfolio goodwill impairment, and costs associated with a cyber incident that occurred during the reporting period. Despite this challenging financial performance, Capita did experience some positive developments. Adjusted profit before tax increased by 34 percent to £33.1 million, and adjusted earnings per share amounted to 3.34 pence.
However, total revenue declined by 3 percent to £1.48 billion compared to the previous year’s figure of £1.52 billion. On a positive note, adjusted revenue increased by 6 percent to £1.40 billion, driven by underlying trading growth and one-off benefits from the Experience division’s transition from the Virgin Media O2 contract and a commercial settlement.
Looking ahead, Capita remains confident that it will meet its full-year expectations and anticipates an acceleration in financial performance by 2023. The company aims to double its Group EBIT margin over the medium term, supported by cost savings of £40 million by the end of 2024.
Jon Lewis, Chief Executive Officer of Capita, expressed satisfaction with the company’s strategy, emphasizing its focus on two core, growing markets. Lewis highlighted Capita’s increased adjusted revenue growth, improved profitability, and successful acquisition of new clients. He reiterated the company’s commitment to fulfilling its full-year expectations.
In conclusion, Capita Plc has reported a significant loss in the first half of the year but remains optimistic about its future financial performance. The company’s strategic focus on core markets and its ability to secure new clients are seen as positive indicators for the future. Capita is on track to meet its goals and expects an improvement in financial performance by 2023.
