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(Adds details on restructuring, background)
March 17 (Reuters) - British outsourcer Capita will
merge multiple businesses into two core operating divisions and
seek to raise 700 million pounds from sales of other assets, it
said on Wednesday, launching the latest in a series of recovery
plans.
The company, which provides consulting and digital services
to the public and private sector, saw its last push to return to
sustained profit and growth upended by coronavirus effects last
year.
Shares in the company have lost 94% of their value compared
to 2015 peaks and it posted a 49 million pound loss for last
year on Wednesday that was only marginally improved on 63
million pounds a year earlier.
Chief Executive Jon Lewis, however, said that he expected to
return to organic revenue growth this year and sustainable cash
generation in 2022, as the company streamlines operations.
"Despite the challenges, we have continued to make good
progress, improving client relationships and winning significant
new contracts," he said in the results statement.
"Capita is a much better business than it was three years
ago when we began our transformation."
Britain's outsourcing sector has struggled in recent years,
with both Carillion and Interserve collapsing, as the challenges
of withdrawal from the European Union forcing companies to
shrink and rethink operations.
COVID-19 brought a range of new challenges last year that
benefitted some businesses and hurt others. Both reported and
adjusted 2020 revenues at Capita fell around 10%.
Of the 700 million pounds Capita said it was targeting in
sale proceeds, 500 million pounds are expected in 2021, it said,
adding that it was cutting down its office spaces by another 15%
this year.
Sky News reported some details of the new restructuring plan
late on Tuesday.
($1 = 0.7190 pounds)
(Reporting by Pushkala Aripaka in Bengaluru, Editing by Sherry
Jacob-Phillips and Patrick Graham)
