Capita profits slightly ahead of expectations despite 7% slide in revenue
Source - SMW
Outsourcing group Capita reported Thursday profits slightly ahead of guidance after completing the first year of its three-year turnaround strategy.
For the 12 months ended 31 December, adjusted pre-tax profit fell 26% to £282.1m, and revenue fell 7% to £3.87bn.
That was slightly ahead of previous guidance for pre-tax profit toward the low-end of £250m to £275m.
The Board did not recommend the payment of a final dividend.
'At the end of year one of our three-year turnaround, we are where we expected to be and have a clear plan laid out for 2019,' the company said.
For 2019, Capita expected to report adjusted net finance costs to be in the region of £40m and adjusted profit before tax to be between £265m and £295m in 2019. Headline net debt to EBITDA ratio was expected to be in the top half of its stated range of 1.0 times to 2.0 times before adoption of IFRS 16.
'Our 2020 targets of £175m initial cost savings, double-digit adjusted EBIT margins and at least £200m of sustainable annual free cash flow, before exceptional and restructuring charges and additional pension contributions, remain unchanged,' the company said.