FINANCIALS: Capita reveals fall in revenue

Business outsourcing provider Capita has seen revenue fall 6.3% year-on-year, according to H1 2019 results.

The results, released this morning, reveal revenue of £1.85bn, down from £2.012bn, with operating profit of £60.8m, down from £66.7m and profit before tax of £31.2m, down from £42.3m in H1 2018.

The group added the boost to revenue from contract wins, including TfL and a number of smaller gains, was outweighed by contract losses, many of which occurred in 2018, including Prudential and Marsh in Specialist Services and Home Office escorting in government services, which the group chose not to re-bid for. The group also reported a decline in the scope and volume of contracts and transactional revenue in specialist services and IT & networks, which was partly offset by growth in government services from its smart metering contract.

Commenting on the group’s performance, Capita CEO Jon Lewis said the group was now in its second year of a multi-year transformation and remains on track to hit targets set in 2018.

“Having addressed the balance sheet and made disposals last year, we have continued to strengthen the business in 2019. We are beginning to see the benefits from: strengthening our functions; changing the culture and enhancing governance; improving relationships with our clients; recruiting significant talent to key roles; and investing in people and new client propositions.

“We have made significant progress in a short period of time. There is still much work to do but the foundations we are laying now will put us in a position to succeed and grow. There is huge potential for our business as companies invest more in digital transformation. With Capita’s credentials and client-base, the long-term opportunity for growth is significant.”

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