- Capita announced plans to cut 900 jobs in November amid cost cutting drive
Capita revenues ticked higher in 2023 as the government contractor continued to recover from a cyber attack on its business earlier in the year.
The firm’s revenue increased by 2.1 per cent in the 11 months to November, while total contract value hit £2.89billion, up 47 per cent amid a ‘significant improvement in win rate’.
Last month, Capita, which manages the BBC licence fee, said it was axing around 900 jobs as part of a cost cutting scheme to boost margins.
Turnaround specialist: Jon Lewis is Capita’s chief executive
Capita said on Thursday it would incur exceptional redundancy costs of £27million as a result, ‘with the majority of the cash impact of the redundancies expected to fall into Q1 2024’.
The group is accelerating its cost-cutting drive.
Capita expects mid-single-digit revenue growth in the medium term, doubled operating margin and positive free cash flow.
The group said: ‘Key wins in the period include renewals with Virgin Media O2 and the Recruiting Partnering Project alongside the British Army and expanded scopes working with the Department for Work and Pensions and Department for Education, which commence in 2024.’
It added: ‘New clients include the Civil Service Pension Scheme starting in 2025, City of London Police starting in Q2 2024, and Santander which has now commenced.’
Jon Lewis, Capita’s chief executive, said: ‘We have continued to make good progress against our core priorities and remain on track to deliver our medium term guidance of mid-single digit revenue growth, doubling our operating margin and delivering positive free cash flow.
‘We have stronger client relationships as demonstrated by our material growth in TCV won and continued strong cNPS scores.
‘Capita is a growing business with a materially stronger balance sheet, reflecting the reductions in financial debt and pension deficit.’
Lewis joined as chief executive in late 2017 when Capita was reeling from successive profit warnings, huge debts and its departure from the FTSE 100.
During his tenure, the turnaround specialist has overseen tens of thousands of job cuts, the sale of numerous divisions, and sought to make Capita a more high-tech company.
Capita shares rose 0.29 per cent to 20.80p on Thursday, having fallen 16 per cent in the last year.
