Outsourcer Capita has seen one-off prices wipe out earnings in its first half because it continues to dump non-core companies to strengthen its stability sheet.
The corporate, which is accountable for implementing BBC TV licences and offers buyer assist companies for ScottishPower, noticed pre-tax revenue plunge to £100,000, from £261million a yr earlier.
It put the sharp fall right down to weaker-than-expected returns from the sale of a few of its companies, a £92.5million goodwill impairment and a discount in working revenue as a result of enterprise exits.
Falling earnings: Capita is accountable for implementing BBC TV licences
Revenues fell 6 per cent to £1.52billion, however Capita expects them to speed up within the second half because of a ‘robust pipeline of over £5billion of alternatives’.
‘We count on income development to be pushed by work that we’ve already secured, equivalent to the brand new ScottishPower contract and the timing of contracts such because the Requirements and Testing Company and the BBC’, it added.
The entire worth of gained contracts was £1.6billion, down from £2.5billion within the first half of 2021, when it was boosted by an enormous win to supply coaching companies to the Royal Navy.
On an adjusted foundation, revenue really jumped to £37million, from £1.1million a yr in the past, reflecting value cuts and the top of main restructuring bills.
General, the group mentioned that its outcomes had been in step with expectations.
However Capita shares nonetheless fell 6.5 per cent to 27.4p, with fellow outsourcer Serco additionally 4 per cent decrease at 175p.
Capita issued a string of revenue warnings lately and has been promoting off a number of companies to bolster its stability sheet.
It bought off 4 companies within the first half, together with Trustmarque for £118million in Could, and mentioned money from disposals helped it cut back its debt mountain to £710million, from £880million on the finish of December.
Capita added it will proceed promoting off its non-core companies, with three gross sales presently in progress, together with that of its funds companies enterprise Pay360.
It’ll use the money to repay extra debt, make additional deficit discount contributions to its outlined profit pension scheme and spend money on driving development within the remaining core companies.
Within the yr to this point, it has made £223million from disposals, taking complete receipts from the disposal programme to over £750million.
‘I’m happy with the progress we’ve continued to make throughout Capita to date this yr,’ chief govt Jon Lewis mentioned.
‘Our efficiency has been in step with our expectations.’
The corporate turned a pre-tax revenue of £286million within the yr to the top of March, in comparison with a lack of £49million the yr earlier than.