Capita PLC on Friday said its cost-cutting plan was on track as it reported an interim profit.
The London-based outsourcing and professional services company said it swung to a pretax profit of £60.0 million in the first half of 2024 from a loss of £67.9 million a year prior.
While revenue fell 16% to £1.24 billion from £1.48 billion, administrative expenses were reduced by 41% to £220.2 million from £374.4 million, and cost of sales came down 15% to £973.2 million from £1.14 billion.
The company said it is targeting £160 million in annualised cost reductions to be delivered by June 2025, having so far taken action to deliver £100 million. Back in November, Capita announced it planned to cut 900 jobs to save costs, as it had begun to conduct employee consultation programmes.
Chief Executive Officer Adolfo Hernandez said Friday: ‘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.’
Looking ahead, Capita expects a low to mid single-digit percentage adjusted revenue reduction in 2024. In 2023, revenue had grown 1.3% to £2.64 billion from £2.61 billion in 2022.
Capita shares were down 2.9% to 18.56 pence each on Friday morning in London.
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