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Outsourcer Capita swings to profit, expects annual sales growth

By Reuters

– Capita Plc on Friday swung to a first-half profit, helped by cost cuts and several new contracts that safeguarded the British outsourcer against a pandemic hit, as the company said it was on track to deliver organic revenue growth in 2021.

The company that provides consulting and digital services to public and private sectors said the total value of contracts jumped by 70% to 2.58 billion pounds ($3.59 billion) in the six months to June 30.

Capita launched a recovery plan in March after the crisis disrupted its previous push to return to sustained profit and growth. Britain’s outsourcing sector overall has also struggled in recent years which forced many firms to rethink operations.

“We have continued to deliver a good operational performance, won significant new business and have a strong pipeline of opportunities to come in the second half,” Chief Executive Officer Jon Lewis said.

Half-yearly adjusted pretax profit stood at 45.3 million pounds, compared to a loss of 11.1 million pounds a year earlier, Capita said, adding that revenue was roughly flat at 1.58 billion pounds.

The London-listed company, which also cut net debt, maintained that it was on track to deliver sustainable free cash flow in 2022.

($1 = 0.7184 pounds)