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Capita (CPI) investor relations material
Capita H2 2025 earnings summary
Complete event summary combining all related documents: earnings call transcript, report, and slide presentation.Executive summary
Achieved significant progress in transformation strategy in 2025, focusing on technology, efficiency, and delivery improvements, becoming a leaner, more technology-driven organization.
Delivered £250m annualized cost savings, improved operating margin by 140bps to 5.2%, and launched AI Catalyst Lab and Stack, with AI integration underpinning operational and financial gains.
Over 60% of revenue now served from public cloud; 300 AI agents live across the group, boosting productivity.
Resolved major legacy issues, including closed book life and pensions and ICO settlement.
Employee engagement and Net Promoter Scores reached all-time highs, with CNPS at +31 and total contract value won up 36% to over £2bn.
Financial highlights
Revenue: £2,199.5m, down 1.2% year-over-year; operating profit: £113.5m, up 34.2%; operating margin increased to 5.2% from 3.8%.
Group operating margin increased by 140 bps to 5.2% year-over-year, driven by cost reduction and improved contract performance.
Public Service revenue grew 4.5% to £1,450m, now two-thirds of group adjusted revenue; Contact Centres declined 17.5% to £536.7m.
Profit before tax rose 84% year-over-year, aided by reduced depreciation and financing costs; reported loss before tax of -£170.9m due to business exits and cost reduction program.
Free cash flow improved to -£54.0m from -£110.9m; cash conversion improved to 74%; net debt increased to £461.6m.
Outlook and guidance
Positive free cash flow of £20m–£40m expected in 2026, with cash conversion between 70%–80%.
2026 group revenue expected to grow low single digits; Public Service to see low to mid-single digit growth, Contact Centre to decline mid to high single digits, Pension Solutions to grow mid-teens.
Margins expected to see a small reduction due to Contact Centre challenges and contract mobilization costs, with margin benefits expected in H2 2026.
Net debt to remain broadly aligned with 2025; revenue and margin growth weighted to H2.
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