Capita (CPI) H1 2025 earnings summary

Executive summary

• Strong progress in strategic transformation, with solid Public Service performance, increased contract wins, and operational momentum, despite significant Contact Centre declines.

• AI and digital transformation are central to strategy, with over 212 AI use cases, launch of AI Catalyst Labs, and increased client engagement in AI solutions.

• Cost discipline remains a focus, with annualised savings of £205m–£212m delivered and on track for £250m by year-end.

• Employee engagement and Net Promoter Score improved, with a 10-point eNPS increase and refreshed company values.

Financial highlights

• Group revenue declined 3.7%–4% year-over-year to £1,154.8m, with Public Service growth offset by a 20% decline in Contact Centres.

• Adjusted operating profit fell 21.8%–22% to £42.6m; operating margin declined to 3.7%.

• Free cash outflow improved to £26.1m, with net debt reduced to £412.2m and liquidity of £383.7m.

• Adjusted EPS down 34.7%–35% to 21.6p; reported loss before tax of £9.5m, including £23.4m in cost reduction charges.

Outlook and guidance

• Full-year 2025 outlook unchanged: adjusted revenue expected to be flat, with Public Service upgraded to mid-single digit growth and Contact Centre to see mid-teen revenue reduction.

• Pension Solutions to grow mid-single digit; Regulated Services to decline as contracts are handed back.

• Modest margin improvement expected, with free cash outflow of £45m–£65m for the year and positive free cash flow from end-2025.