Capita reports solid progress in transformation despite contact center headwinds

Published 05/08/2025, 08:00
Capita reports solid progress in transformation despite contact center headwinds

LONDON - Capita plc reported a 4% decline in adjusted revenue to £1,154.8m for the first half of 2025, while making progress on its strategic transformation and cost reduction program, according to a press release issued Tuesday.

The business process outsourcing provider saw a 22% decrease in adjusted operating profit to £42.6m, with adjusted operating margin falling to 3.7% from 4.5% in the same period last year. The company reported a loss before tax of £9.5m compared to a £60.0m profit in the first half of 2024.

Capita’s Public Service division, which accounts for 62% of group revenue, delivered 4% growth driven by contract wins and scope expansions. However, this was offset by a 20% revenue reduction in the Contact Centre business due to previously announced contract losses and subdued volumes in the telecommunications sector.

The company reported progress on its cost reduction program, with actions taken to deliver £190m of annualized savings as of June 30, increasing to £205m by July 31. Capita remains on track to deliver its previously announced £250m target by December 2025.

"We are pleased to see good signs of momentum in the ongoing transformation of Capita, with a particularly strong performance in our Public Sector business," said Adolfo Hernandez, Chief Executive Officer.

Total (EPA:TTEF) contract value won increased 17% to £1,044.4m compared to the first half of 2024, with a stronger book-to-bill ratio of 0.9x (2024:0.7x). The company’s unweighted pipeline stands at £11.7bn, with £4.4bn of opportunities having a higher technology component.

Free cash outflow excluding business exits improved to £26.1m from £52.5m in the first half of 2024. Net financial debt (pre-IFRS 16) was £87.0m at June 30, 2025.

Capita maintained its full-year outlook, expecting broadly flat adjusted revenue with modest improvement in group margin. The company continues to expect to be free cash flow positive from the end of 2025.

The results were based on a press release statement from Capita plc.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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