Capita profits hit by business exits
The group said reported pre-tax profits sunk 26% to £28 million in the six months to the end of June, down from £37 million for 2016.
Capita has seen half-year profits fall as the outsourcing giant was hit by moves to offload unwanted businesses.
The group said reported pre-tax profits sunk by 26% to £28 million in the six months to the end of June, down from £37 million for 2016.
It was driven by an exit from its specialist recruitment arm and part of its Capita Europe business, while its events operation was shut down.
However, underlying pre-tax profits made for brighter reading, lifting 46% to £195 million, thanks in part to a £16 million boost from reorganising a contract with the Ministry of Defence.
Underlying revenues eased back 3% to £2.1 billion, with weak real estate and the part loss of a Civil Service Learning contract being offset by a new deal with Tesco Mobile and the expansion of Department for Work and Pensions PIP assessments.
Interim chief executive Nick Greatorex said: “In the first half of 2017, we made good progress on executing the plans laid out at the end of last year to reposition the group: we announced the sale of our asset services businesses, completed the disposal of our specialist recruitment business and commenced a number of cost initiatives.
“We remain confident that these actions are making Capita a simpler business, well positioned for the future under new leadership.”
The FTSE 250 firm said the £888 million sale of its asset services business to Link Group was on track to be completed by the fourth quarter of this year.
It said efforts to drive down costs – including cutting staff, moving some IT operations abroad and making its property estate more efficient – would benefit the firm to the tune of £57 million by the end of next year.