Capita to focus on core segments

13th Jun 2024 08:55

(Sharecast News) - Process services company Capita said on Thursday that it will look to focus on its core segments as the firm hopes to improve both its financial performance and cash generation.

Capita revealed cost-cutting measures worth roughly £100.0m back in March after it delivered a full-year loss and wider cash outflows on the back of costs linked to a cyber incident and a number of business exits.

The London-listed group will now zero-in on its public services, contact centres and pension solutions units. It will also restructure and right-size the group as part of an effort to reduce costs, drive efficiency and improve cash flow.

Capita expects operating profit margins to improve to 6%-8% over the medium-term, and eyes free cash-flow generation from 2025.

Chief executive Adolfo Hernandez said: "Our technology strategy will be organic with low capital intensity and will be principally funded through partial reinvestment of our previously announced 160 million pound cost- saving programme and refocusing of the business towards more profitable customer solutions."

As of 0855

BST, Capita shares were up 1.29% at 14.18p.

Reporting by Iain Gilbert at Sharecast.com