Capita 11 months Adj. Falling income; Confirms FY24 vision and sees stable revenue in FY25

LONDON (dpa-AFX) – Capita Plc (CPI.L), a business process outsourcing and professional services company, reported on Tuesday a decline of around 8% in adjusted revenue over the eleven months closed November 30.

For fiscal 2024, the company continues to expect adjusted operating profit margin to increase by approximately 50 basis points, largely driven by cost reduction initiatives.

Capita said its board was increasingly confident in achieving its medium-term operating margin target of 6 to 8 percent.

Capita further said it expects revenue to be broadly stable in 2025 as it continues to exit businesses, which are either low margin or where it has a limited right to earn.

In its trading and operational update, the company said Capita Public Service’s adjusted revenue fell 0.9 per cent over the eleven months.

Capita Experience’s adjusted revenue declined by 16.3 percent and the Contact Center business by 18.5 percent.

Pension Solutions grew 6.7 per cent, reflecting volume growth across a number of clients, including PIC and Rothesay, as well as the benefits of indexing.

Revenue from regulated services, including closed-book life and pension insurance, fell by 25.8 percent.

As previously announced, the first priority of the company’s ongoing transformation is to improve operating margin, which will in turn generate free cash flow and adjusted revenue growth.

The company increased its cost-cutting target to £250m, up from £160m.