Capita ‘on track’ with £160m cost-cutting plan as it swings to profit
Last year, the company announced a major cost-reducing plan which included around 900 job cuts.
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Your support makes all the difference.Capita has swung to a profit as the outsourcing giant said it is “on track” with cost-cutting plans.
The major contractor for the Government and local authorities said it was pressing ahead with a “rapid” cost-cutting plan late last year, with cuts to around 900 jobs.
On Friday, the firm told investors it has taken action to cut around £100 million as part of a £160 million cost-saving target by June 2025.
We have much more to do, but I am pleased that Capita is making encouraging progress in its journey to deliver its medium-term financial targets
Adolfo Hernandez, chief executive officer of the group, said it has made “encouraging progress” in its transformation plan.
It came as Capita reported a pre-tax profit of £60 million for the first half of 2024, up from a £67.9 million loss a year earlier, amid a boost from savings and the sale of parts of the business.
This included the sale of its majority stake in the Fera Science joint venture it ran with the Department for Environment, Food & Rural Affairs (Defra).
Last month, the group also secured the sale of its Capita One software business, in a move it said will provide net proceeds of £180 million to bolster its finances further.
Capita also reported that adjusted revenues slipped by 9% for the past half-year to £1.2 billion as it was impacted by previously announced contract losses.
Mr Hernandez said: “We are implementing changes that will make us more competitive and drive growth, by becoming more efficient and spending less, digitising our offerings and leveraging technology partnerships.
“This, together with more precision in delivery and evolving our culture, is enabling us to accelerate execution.
“We have much more to do, but I am pleased that Capita is making encouraging progress in its journey to deliver its medium-term financial targets and create sustainable value for all its stakeholders.”