Member Info for BadgerB

Here’s the thing Savage one… despite what you claim your motivations are on this chat board, you spend an awful lot of time on a daily basis posting here, especially since the trading update (you claimed to have taken a day off work for on 17th). Your posts here are relentless then you claim of conspiracy therories when anyone so much as suggests you’re a paid deramper. If you took a day off your work for the trading update, did you then decide to take days off following without limit, when will it end ;-)

Worth viewing any of the 2024 presentations on this topic, the last one it was brought up on being the Yellowstone webinar - one of the key focuses of the Hyperscaler collaborations is developing standard repeatable solutions which by design specifically moves away from an upfront overhead. Furthermore Hyperscaler support can be switched on or off adding further efficiencies.

Good summary JO. AH had suggested on more than one occasion that a portion of the £160m cost savings would be reinvested for growth, it seems to me they're ahead of schedule if the £50m cash outflow in 1H25 is for that purpose (£160m savings target was six months from now with reinvestment to follow while £140m savings already achieved). Potential for up to £250m cost savings one year from now where current CPI market cap is exactly that = ~£250m. Consider a typical industry p/e ratio once dividends recommence.

Savage - the 140M annualised cost savings are separate from the Capita One disposal proceeds, please get your facts right!

Doesn't seem to be much mention of the 140M annualised cost savings CPI have achieved of the initial 160M target set for 6 months from now, that in itself is significant (let alone targeted annualised cost savings of 250M by 2H25). Instead focus appears to be on 8% revenue decline - i.e. potentially only ~11M profit @ ~5% margin based on 8% of 2.8B 2023 revenue.

Hopefully market wakes up soon & realises the SP is ludicrously undervalued on a forward looking basis..

Several months before NICS change becomes effective & CPI are 100% in organisation transformation mode. Employee attrition can be high (10K per year not unusual historically) where a higher % could be offshored , further increase tech/automation, contract price review, annual wage review etc. Avg. UK salary at CPI will be no way near £40-50k, much closer to half that..

Let's remember, CPI annualised cost reduction target is £160m, £60m of which to be reinvested for growth, £100m to the bottom line with a similar timeline to NICS increase!

Not sure about a 90M loss : 90-110M is expected 'cash outflow' this year, the cost reductions should help counter that. As of 1H24 end of June report annualised cost savings were at 100M - likely to be more by now, four months on.

Worth a read -

https://www.capita.com/about-capita/celebrating-black-history-month-2021

https://www.vercida.com/uk/articles/black-history-month-capita

https://www.capita.com/careers/diversity-equality-and-inclusion

https://www.capita.com/careers/hear-our-brilliant-people/importance-of-diversity-and-wellbeing

On a more positive note, nice to see Capita contract wins in October have seen a strong uptick, ~700M so far (https://bidstats.uk/tenders/?ntype=tender)

By my math, Schroders top up would have been ~21.5M shares in total - from ~323,187,154 (18.996778%) to 344,703,158 (20.261477%). Very nice.

Great summary of the webinar Alex, well done. It was an upbeat presentation & Capita has enormous potential going forward in my view.

Capitalizer - AH saying we’re on track would be the 6-8% margin as a starting point in my view. Analyst estimates on the website seem pretty conservative in 25/26, probably to be expected.

Thanks for the excellent webinar Yellowstone, very informative & much appreciated!

Pleased AH answered 2 of my questions too - on customer uptake on new digital product offerings & 2025 unweighted sales pipeline!

We should get an update on Monday what the annualised cost savings have reached. At the capital markets day £90m was noted, up to £100m at HY. £110+m now perhaps?. Staggering amount of top line required to generate these levels of bottom line contributions at mid single digit margin.

Kipper, we’ve got the Yellowstone Advisory session on 23rd Sept, 3pm. Expect AH will attend as last time & it will include a Q&A.

Simpiles, my thoughts too.

The unweighted sales pipeline for 2025 as detailed in the 1H 24 update at £5.7b versus £3.6b at 1H 23 was certainly of note, i.e. addressable market for CPI new/existing offerings is increasing which is a good indicator AH’s strategy is starting to unfold. The executive team have many balls to juggle to fully execute on overall strategy although they’re already making impressive progress & at speed.

‘What I dream of is seeing the next results day, when CPI inevitably gets spanked’

Your words SK. Sleep tight, don’t let the bedbugs bite!

Interesting UT on the buy side over 1M had no effect on closing SP. Yesterday’s UT on the sell side was smaller & appeared to drag closing SP down at least 1%.

06-Sep-24 16:35:13 18.30 1,131,133 Buy* 18.30 18.34 207.00k UT

‘ + the people on this board are little better.’

SK - it’s easy, you don’t have to put yourself through this daily ordeal of dealing with this board. Switch your PC off and have a lie down, surely no one is forcing you to engage?