Half Year Results 2025
Solid progress against strategic objectives; full year expectations unchanged
“We are pleased to see good signs of momentum in the ongoing transformation of Capita, with a particularly strong performance in our Public Sector business, underscoring our important role in bringing innovation and fresh thinking to the challenge of delivering efficient public services.
"The total value of contracts won by the Group increased by 17% compared with the first half of last year, with increased interest from customers in our AI-driven solutions that bodes well for future growth and we have more than £4.4bn of higher technology opportunities in the Group pipeline.
"Meanwhile, our focus on cost discipline continues to help Capita adapt to some of the challenges we have seen in the Contact Centre business and we are on track to deliver £250m of cost savings by
"The operational performance and momentum we have seen in the first half of the year gives confidence in our delivery of the second half of the year and our full year outlook remains unchanged."
Growing momentum against strategic priorities to build a Better Capita
•
Actions taken to deliver £190m annualised cost savings at
•
On track to deliver previously announced £250m target by
• Cash cost to deliver savings in H1 2025 of £21.5m, reflecting slower than expected phasing of in year savings in some areas
• Productivity benefits seen throughout organisation from our improved technology foundations, products and innovation
•
Recently launched
• First use of 'Agents', with Agentforce AI, powered by Salesforce, to drive volume recruitment
• 10 point improvement in Group employee net promoter score
H1 2025 Financial results
• Adjusted revenue 1 decreased by 4% to £1,154.8m (H1 2024: £1,198.6m):
◦ Growth in Capita Public Service ( 62% of Group revenue) of 4% from contract wins and expansions of existing scopes
◦ R evenue reduction in Contact Centre of 20% ( 24% of Group revenue) from the ongoing impact of previously announced contract losses and subdued volumes in the Telecommunications vertical
◦ Revenue broadly in line with the prior period in Pension Solutions at (0.3)% (7% of Group revenue)
◦
1.1%
reduction
in Regulated Services (
7%
of Group revenue) due to previously agreed contract hand backs, offset by the one-off benefit from a contract termination in the
•
Adjusted operating profit
1
decreased 22% to £42.6m reflecting revenue reductions in Contact Centre and non-repeat of one-offs and contract hand backs in Regulated Services, reinvestment in the Group and the timing of the Group's pay award and increase in
• Reported loss before tax of £9.5m (H1 2024 profit: £60.0m); including £23.4m of costs associated with the Group's cost reduction programme and impact of business exits in the prior year
• Free cash outflow excluding business exits, of £26.1m (H1 2024 outflow: £52.5m), reflecting improved operating cash flow, reduced capital expenditure and lease payments and benefit from phasing of cost to achieve the cost reduction programme
•
Extended maturity date of Revolving Credit Facility worth £250m by 12 months to
Growth and contract wins
•
Total contract value (TCV) won
increase
d
17% to
£1,044.4m (H1 2024: £891.9m), reflecting strong performance in Capita Public Service up
53%, offsetting lower TCV performance in the Contact Centre business, with expansions with the
• Improved book to bill ratio of 0.9x (2024: 0.7x)
• Unweighted pipeline of £11.7bn with £4.4bn of opportunities with a higher technology underpin
Group outlook for full year 2025 and medium term targets unchanged
• Adjusted revenue expected to be broadly flat. Capita Public Service guidance upgraded to mid single digit revenue growth, Contact Centre now expected to deliver a mid teen revenue reduction
• Modest improvement in Group margin
• Free cash flow, before impact of business exits, between £45 - £65m, with improved cash conversion of 55% to 65%; expect to be free cash flow positive from the end of 2025
• £55m outflow to deliver the cost reduction programme
Six months ended 30June 2025
Reported Adjusted1
Financial Reported Reported Adjusted12025 Adjusted1
highlights 2025 2024 POP 2024 POP change
change
Revenue £1,159.8m £1,237.3m (6%) £1,154.8m £1,198.6m (4%)
Operating £9.2m £43.9m (79%) £42.6m £54.5m (22%)
profit
Operating 0.8% 3.5% (270)bps 3.7% 4.5% (80)bps
margin2
EBITDA2 £47.0m £101.7m (54%) £80.2m £102.4m (22%)
(Loss)/profit £(9.5)m £60.0m n/a £22.6m £31.9m (29%)
before tax
Basic
(loss)/earnings (6.62)p 47.09p n/a 21.63p 33.06p (35%)
per share3
Operating cash £51.2m £73.5m (30%) £55.9m £50.8m 10%
flow2
Free cash flow2 £(30.7)m £(44.6)m 31% £(26.1)m £(52.5)m 50%
Net debt2 £(412.2)m £(521.9)m 21%
Net financial
debt (pre-IFRS £(87.0)m £(166.4)m 48%
16)
1. Capita reports results on an adjusted basis to aid understanding of business performance (refer to alternative performance measures in the appendix). Adjusted operating cash flow and free cash flow exclude the impact of business exits (refer to note 9).
2. Operating margin, EBITDA, operating cash flow, free cash flow and net debt as presented under reported results are sub-totals or are derived from the reported results but are not defined in IFRS and are therefore also alternative performance measures (refer to alternative performance measures in the appendix). They are presented to enable comparability to the Group's adjusted equivalent of each metric presented in the financial highlights table.
3. 2024 comparatives have been re-presented from those previously published to reflect the 1 for 15 share consolidation undertaken in
Investor presentation
A presentation for institutional investors and analysts hosted by
Webcast link:
https://webcast.openbriefing.com/capita-hy25/
For further information:
Helen Parris , Director of Investor Relations T +44 (0) 7720 169 269
Stephanie Little , Head of Investor Relations T +44 (0) 7541 622 838
Madeleine Little , Group Head of External Communications T +44 (0) 7860 343 604
Capita press office T +44 (0) 2076 542 399
LEI no. CMIGEWPLHL4M7ZV0IZ88.
Chief Executive Officer's review
H1 2025 Summary
We commenced this year in a stronger position to deliver more effectively and efficiently to our clients, reflecting the strong foundations laid in 2024. Our strategy of partnering with technology hyperscalers to improve the agility of the business around client needs is working and our momentum continues to build.
Our vision is clear - to be the trusted outsourcing partner, innovating to deliver quality services by combining the best people, AI, and technology to drive superior results and create outstanding experiences for our customers.
At the start of the year, we outlined six strategic priorities to deliver a “Better Capita” which are; cost transformation, sales effectiveness, product and innovation, technology foundations, operating model and building a high-performance organisation. I’m extremely pleased to see the progress we are making against each of these priorities as we future proof the business.
Better technology is at the core of our transformation, and we are moving at pace building our capabilities in this area. This year we launched our Artificial Intelligence and Product Office (AI&PO) operating model and the internal Capita AI Catalyst lab, a dedicated team focused on identifying, testing, and scaling AI solutions based on ideas generated from employees throughout the business.
Following a detailed review last year of our contract portfolio and services line mapping, we clarified our business focus areas. Our Star Positions - where we have clear strengths and expertise with good returns, Transformational Potential - those areas that needed further work - and Manage for Value businesses many of which we have exited or are exiting. This is critical for where we will focus our resources and technology.
Our focus is on delivering scalable and repeatable solutions to respond to evolving opportunities in the front, middle and back office services that each of our operating divisions offer. Viewing the market in this way means we now have a more client led targeted approach and we are focusing our investments around these market opportunities.
Our Business Process Outsourcing industry is clearly undergoing a major technological shift, with AI already embedded in around 20% of services across
We’ve seen exponential growth in client interest in our AI solutions (including agentic AI). We have been using Capita as 'client zero' whilst working alongside our hyperscaler partners and we have launched five products this year. We are using these products in a number of existing contracts to drive better delivery , and continue to identify opportunities for wider use cases across our contract portfolio. We have a number of products we expect to be launched in the second half of 2025.
We’re driving better efficiencies through the Group’s successful cost reduction programme, which enables us to invest in our technology offerings. At the end of June, the Group has now taken actions that will deliver £190m of annualised savings, growing to £205m at the end of July.
While the phasing of some in year savings has been slower than anticipated, particularly in the Contact Centre business, we are on track to deliver our previously announced £250m target by De cember 2025.
We are re-investing in the business and have begun our planned £50m investment into our technology solutions this year with spend in H1 on our data maturity and governance, investments in our product offerings and further enhancements to our cyber maturity.
We remain focused on our employees during this transformation as we work to build a high-performance culture and better company . This year we launched our refreshed company values and culture playbook and maintained our employee engagement score while seeing a 10-point increase in employee net promoter score within the Group’s mid year people survey, a score of -23 points.
The Group is on track to improve its financial performance and we are confident in the delivery of our medium-term targets of delivering low to mid-single digit adjusted revenue 1 growth per annum; an adjusted operating (EBIT) margin 1 of 6 – 8%; and positive free cash flo w, excluding business exits 1 , from the end of 2025.
Our priorities for the second half of the year are delivering our planned product launches, improving the financial performance of the Contact Centre business which has faced a number of headwinds recently and continuing the roll out of our exciting AI and technology led products, including AgentSuite, to more clients.
Better technology
AI is driving a significant technological revolution and as we expected, is driving disruption in the markets in which we operate. With our combination of "star positions" in higher growth and higher margin services, sector process knowledge and the capabilities of our hyperscaler partners, including AWS, Microsoft, Salesforce and ServiceNow, we are well placed to be at the forefront of these changes. Our ‘human in the loop’ principle, which is part of our strength as a Business Process Service (BPS) provider, augments and amplifies the human role within our customer solutions. This is improving customer outcomes thereby allowing us to drive change both internally and across our contract portfolio.
We have now launched our refreshed operating model and are investing in our AI&PO and Technology Operations teams and their newly formed Capita AI catalyst lab. These bring new skills to Capita given their backgrounds at our hyperscaler partners. This enables us to simplify our service delivery and create better outcomes. This operating model is driving the creation of repeatable, standardised products and solutions which integrate AI quickly, to respond to complex and fast changing market demands and evolving client needs. As we embed these solutions and they amplify the work our people do, we are becoming more efficient and increasing the quality of our delivery, which is helping to future proof the business.
The Capita AI catalyst lab is leading our progress. This dedicated team is focused on identifying, testing and scaling AI solutions based on ideas originated from employees across the organisation. Since inception in Q1 2025, over 300 ideas have been identified and we have launched five products internally; including Contact Centre of the Future, Document Validation & Fraud Detection, Automated Recruitment, Learning & Development and AI-powered Intelligent Mailrooms & Document Processing. There are a number of further product releases planned for the second half of 2025, including Collections & Debt Recovery, Workforce Management, and Estate Management & Building Safety Compliance.
Using our experience across the front, middle and back-office customer operations we are well placed to design and build solutions incorporating hyperscaler technology, and we are using Capita as client zero to test solutions before rolling these out to clients in some cases. For example, this year, to deliver more efficient colleague assistance, we transitioned to ServiceNow for our internal IT and colleague support and we are looking at further rollout opportunities for our finance and HR support.
This year, we will become one of the first companies in
This forms the first use of AI agents, artificial intelligence systems capable of autonomous decision and adaptive behaviour, across Capita. So far, we have identified over 100 agentification opportunities across the Group and this is an area which we will be expanding on and prioritising in the second half of the year.
In the Contact Centre business, our successful roll-out of the AgentSuite tool has continued, with a reduction in average call handling time of c.15% and improvement in customer satisfaction scores on all operational clients. This tool is now driving efficiencies for six clients, with roll-out planned for a further five clients.
Our Microsoft Copilot usage across the Group continues to grow and drive efficiencies, as of
The Group’s most prominent agent is AskMeAnything (AMA), a search tool that helps employees navigate its vast SharePoint estate. Using this tool, employees can ask questions to find specific policies and procedures within the SharePoint knowledge base, instead of time consuming manual searches.
We are identifying AI opportunities on our existing contracts which currently are serviced through traditional BPO methods and infrastructure, to drive efficiency and improve our contract delivery.
For example, this year we co-designed an AI-powered discount verification system for TfL’s new tolling scheme on the Silvertown and Blackwall Tunnels, a tool for which we believe there are a number of other use cases across the sector. In our Local Public Service vertical, we are using the Appian AI tool to identify and recover aged debt, helping councils improve revenue collection.
As a Group we are responsible for a range of data assets and to ensure we can deliver industry leading data-driven and AI enabled solutions for our clients, we are committed to improving the Group’s data management maturity against the
As we drive significant change through our technology transformation we are committed to responsible and ethical AI. All AI adopted by Capita must adhere to our AI principles (inclusive, trustworthy, transparent, accountable, secure, governed and adaptive), which govern the secure, fair and ethical use of AI. Our gen AI oversight committee is ensuring human oversight of critical decisions.
Better delivery
Whilst we are moving at pace, we are ensuring we are maintaining our operational delivery to customers. In the first six months of 2025, the Group's average KPI performance was strong at 94% and consistent with the prior year. This operational delivery, combined with the increased use of technology within contracts, will enable us to increase our margins in line with our medium-term target.
Highlights from our operational delivery in the first half of the year include:
– In Capita Public Service, on the division’s Primary Care Support England contract, we signed a further three-year extension this year, driven by our operational delivery and continued innovation via our PCSE Online self-service platform
–
Also within our Public Service division, in May we delivered the 10
th
service transition which saw further expansion on our successful
– In the Contact Centre business, we were able to design, build and set up a customer experience centre in two days with over 400 employees to assist a client experiencing a sudden steep increase in customer contact
–
In our Contact Centre business, we are continuing to offshore roles in line with client demands to drive efficiency. Our delivery hub in
– In Pension Solutions so far this year, we have engaged with 1.8 million pension scheme members through our communication and engagement team
For any contracts where mobilisation delays were encountered, remediation plans were swiftly put in place to improve performance and reduce avoidable overspend.
In the Conta ct Centre business, we have seen continued volume reductions in the Telecommunications vertical. We expect the impact of this volume reduction to annualise in the second half of this year, and we have the opportunity to regain volumes in the future.
In
We remain in active discussions with the one remaining client to exit in our closed book Life & Pensions business. As previously announced, we have agreed transition agreements for all other clients in this business of Regulated Services and those with transition agreements will be transferred in the coming years, with volume reductions expected as these clients are transitioned. The business continues to have an expected annual cash cost to the Group of £20m.
Better efficiencies
We continue to maintain our cost consciousness across the Group. As of 30
In some areas of the business, the phasing of the in year savings this year has been slower than previously anticipated, particularly within the Contact Centre business. We remain on track to deliver our previously announced target of £250m annualised savings by
These savings have been achieved through the operational efficiencies and synergies gained as we improve our processes and technology and embed AI and generative AI further through the business.
Savings have also been achieved through our ongoing property rationalisation, procurement and our successful offshoring programme, particularly within Group and divisional support functions and in some areas of the Contact Centre business. As expected, we are delivering a proportion of savings through natural employee attrition, particularly in the Contact Centre business where, due to the nature of the business, we have seen historically higher levels of attrition than other areas of the Group. In
In the first half of the year, we incurred
£21.5m
of cash cost to deliver the annualised savings. We are on track to deliver the remaining savings by
We are reinvesting a proportion of the Group’s savings to future proof the Group. Spend in the first half includes our data maturity and governance and investments in our project offerings and further enhancements to our cyber maturity.
Despite the reduction in adjusted operating margin 1 seen in the first half of the year, we are confident in delivering a full year margin improvement as cost saving actions taken in the first half of the year benefit the second half margin performance.
Better company
As part of our transformation, we’ve launched a culture transformation programme to build a high-performance organisation and culture. Our colleagues are at the heart of everything we do and are a critical part of the consistency of our client and customer delivery.
In the first half of the year, we have launched a refreshed set of values which were co-created with colleagues across all our geographies. The refreshed values of Customer First, Always; Fearless Innovation; Achieve Together; and Everyone is Valued will help us drive performance, enhance service delivery, and foster inclusivity. These values underpin our delivery model and are embedded through our new Colleague Playbook.
As part of our transformation journey, we are upskilling our people and our AI, Data and Technology academy continues to be an important resource on this journey. So far over 10,000 digital learning courses have been completed by employees across our geographies and we’ve equipped over 1,500 managers through our Manager and Leadership Academies. Our AI Academy Multiverse partnership continues to go from strength to strength. We now have 240 colleagues, across four intakes, completing apprenticeships focused on leveraging AI responsibly to drive improved business outcomes.
This year we launched the Capita 500 programme, which is a change initiative for the Group’s top 500 leaders to accelerate the Group’s transformation and develop our leaders to drive change at pace in all areas of the organisation.
More broadly, we are empowering our people to be change champions with refreshed communication channels, ‘better bootcamps’ which focus on engagement and building teams capability and Capita reactor days allowing colleagues to be a part of and help shape the transformative change across the organisation.
We are seeing the positive impact of our culture initiatives across our global workforce. In the global pulse people survey in H1, the Group’s employee net promoter score improved 10 points to -23, with employee engagement maintained at 63% (2024 year-end: 64%). This is a positive indicator given some of the difficult decisions which have been made through this period of transformation.
Attrition continues to decrease with rolling 12-month attrition at the end of June at 20%, the lowest level it has been for many years. While our attrition rate has reduced, we are using natural attrition to aid delivery of our cost savings target, particularly in those areas of the business where attrition has historically been higher, such as Contact Centre where rolling 12-month attrition is currently 26%.
Total contract value and growth
In the first six months of 2025, we saw Total Contract Value (TCV) won increase 17% to £1,044.4m , with a strong performance in Capita Public Service which saw a 53% increase in TCV won, compared to the same period in 2024. In Year Revenue associated with the deals won across the Group was 3% higher, in the first six months of 2025, at £387m.
Significant wins in the first half of the year include a renewal with expanded scope with
The Group’s book to bill in H1 2025 was 0.9x up from 0.7x in H1 2024, following a strong performance in Capita Public Service which had a book to bill rate of 1.1x, which offset the lower performance in Contact Centre and limited wins in the Regulated Services division where we are actively exploring exits.
As we continue to build a leaner organisation we are becoming more cost competitive, which we expect to have a positive impact on our win rate in the long term. In the first half of 2025, the win rate across all opportunities was 77%, up from 44% in the same period in 2024. This was driven by an increased win rate for new and expanded scopes of work which improved from 48% in H1 2024 to 77% in H1 2025.
We are building a pipeline around our innovative solutions with a higher technology underpin as we increase efficiencies and further delivery quality. As of 30
In July, the Group secured a further scope expansion with
The order book at
30
Financial results - revenue and profit
Adjusted revenue 1 reduced 3.7% period on period to £1,154.8m (H1 2024: £1,198.6m), reflecting the impact of previously announced contracts losses, subdued volumes in the Telecommunciations vertical and offshoring in the Contact Centre business. This was partially offset by growth in the Capita Public Service division from contract wins in the Central Government vertical.
Reported revenue reduced 6% to £1,159.8m in line with the above reduction and the impact of business exits.
Adjusted operating profit
1
decreased
22%
to
£42.6m
reflecting revenue reductions in Contact Centre, reinvestment in the Group and the timing of the Group's pay award and increase in
The adjusted operating margin 1 for the Group was 3.7%, reducing from 4.5% in the same period in 2024.
Reported operating profit was £9.2m (H1 2024 profit: £43.9m) including £23.4m of costs associated with the cost reduction programme and £6.9m operating loss in respect of business exits, which includes the trading performance up to the point of being disposed and project costs.
Financial results - free cash flow and net debt
Operating cash flow excluding business exits, increased by 10% to £55.9m, driven by the timing of a cash receipt on a major contract in the Telecommunications vertical in the Contact Centre.
Free cash flow excluding business exits 1 was an outflow of £26.1m (outflow in 2024 of £52.5m), reflecting the flow through of the increase in operating cash flow excluding business exits, reduction in pension deficit contributions and the decrease in the capital element of lease rental payments, partly offset by an increase in the cash cost to deliver the cost reduction programme.
Pre-IFRS 16 net financial debt
1
was £87.0m (31
Post-IFRS 16 net debt was £412.2m (31
In July, the Group extended the maturity date of its Revolving Credit Facility to
Full-year outlook unchanged
We expect Group adjusted revenue 1 to be flat. We now expect Capita Public Service to deliver mid single digit revenue growth, improving from our initial low to mid single digit guidance, which offsets Contact Centre where we now expect to see a mid-teen revenue reduction.
In Pension Solutions we expect a mid single digit revenue increase and a decline in Regulated Services as we hand-back contracts.
We expect a modest improvement in year on year adjusted operating margin for the Group as a whole, with an improvement in the second half of the year from the Group's cost saving programme and the expectation of continued revenue growth in Capita Public Service.
We continue to expect to deliver positive free cash flow before business exits from the end of 2025 with a total outflow of £45 - £65m, including a £55m cost to achieve associated with the cost reduction programme.
___________________________________________
1. Refer to alternative performance measures in the appendix
2. Gartner
Divisional performance review
The following divisional financial performance is presented on an adjusted revenue 1 and adjusted operating profit 1 basis. Reported profit is not included, because the Board assesses divisional performance on adjusted results. The basis of preparation of the adjusted figures and KPIs is set out in the Alternative Performance Measures (APMs) summary in the appendix to this statement.
Public Service
Public Service is the number one strategic supplier of Software and IT Services
3
(SITS) and business process services
3
(BPS) to the
The division is structured around three market verticals: Local Public Service; Defence & National Preparedness (including Learning); and Central Government, delivering to their respective client groups.
Markets and growth drivers
Digital BPS is an area of fast growth with more traditional, less technology enabled services, currently shrinking, given the Government’s consistent announcements on using AI to make government processes more efficient.
The division's deep sector process and domain expertise, alongside our hyperscaler partnership strategy, means Capita Public Service is well placed to deliver more effective and efficient public services.
The division is adopting and implementing AI with a pragmatic and outcome led model to deliver a number of the Government’s priorities on a large scale, for example getting defence recruits to the frontline faster, digitising medical assessment for the
Operational performance and better technology
So far this year, we have maintained our operational delivery with an average KPI performance of 94%, consistent with the performance in the prior year.
Our strong operational performance and continued innovation via our Primary Care Support England (PCSE) Online self-service platform drove a further three year extension on our PCSE contract with
On our
Elsewhere, in the first six months of 2025, Capita Public Service has seen an increase in contracts delivered with a high level of technology underpin.
On our contract with
In Local Public Service, our Appian aged debt tool is continuing to assist councils collecting aged council tax debt. We are expanding its use to additional Local Council s with a further 27 Councils exploring the opportunity to utilise this tool in the second half of the year. We are exploring the use of this tool for other areas of aged Local Council debt such as housing debt.
On the two contracts where we had encountered operational challenges, one of these contracts went live at the end of 2024 and we have seen continued operational improvements across the first half of the year. The remaining contract transformation has been paused while we agree an appropriate outcome with the client.
Growth
In H1 2025, Public Service won contracts with a TCV of £796.4m, up 53% from the same period in 2024. Material wins included renewals with Education Authority Northern Ireland,
Pleasingly, as we continue to build our cost competitiveness, our bid margin on all successful bids this year has either met or exceeded the divisional margin target. The division's win rate across all opportunities was 81%, up from 39% in H1 2024, with a significant improvement in the win rate for new and expanded scopes of work which increased to 88% from 28%.
Alongside our focus on targeted large opportunities, we have aimed to improve our win rate on mid-sized deals with a TCV between £5-£50m, where historically the division's win rate has been lower, as we build a more sustainable and predictable growth model with a more disciplined and repeatable approach to deal conversion.
We are therefore very encouraged to have seen a significant improvement in wins of this size this year, delivering over £100m of TCV for the division in the first half of the year, with clients including a competitive re-bid with
As we move into the second half of the year and into 2026 there are a number of new scope opportunities and renewals within the pipeline, both in mid-sized and larger deals in each vertical in which the division operates, including with the Ministry of Defence and the Home Office. The division's total unweighted pipeline stands at £9.3bn, up from £8.2bn at the end of
The divisional order book stands at £2,769m, a decrease of £155m from the year end, reflecting the revenue recognised in the period which more than offset wins in the period.
Divisional financial summary 2025 2024 % change Adjusted revenue1 (£m) 711.8 685.6 3.8% Adjusted operating profit1 (£m) 57.2 47.4 20.7% Adjusted operating margin1 (%) 8.0% 6.9% Adjusted EBITDA1 (£m) 72.3 66.9 8.1% Operating cash flow excluding business exits1 (£m) 52.2 49.2 6.1% Order book (£m) (comparative at 31 December 2024) 2,768.6 2,923.4 (5.3)% Total contract value secured (£m)* 796.4 519.1 53.4%
* The comparative has been represented for the impact of business exits announced since
Adjusted revenue
1
grew
3.8% to £711.8m.
The division saw the positive impact from wins including the Health Assessment Advisory Service and Disabled Students Allowance contracts and the benefit from the continued expansion of the
Adjusted operating profit 1 increased 20.7% to £57.2m, as the division benefitted from the impact of revenue growth and significant savings from the cost reduction programme, which was offset by timing from the Group's pay award, the impact from the increase in National Insurance Contributions and the continued reinvestment in technology offerings.
Operating cash flow excluding business exits 1 increased by 6.1% to £52.2m, reflecting the flow through of improved operating profit on EBITDA.
Outlook
Reflecting the strong performance in the first half of the year, we now expect Capita Public Service to deliver mid-single digit revenue growth in 2025, compared to 2024.
We expect a year on year improvement in adjusted operating margin 1 , driven by the division's revenue growth and cost reduction programme.
Capita Experience
Capita Experience comprises two focused business areas; the Contact Centre business and
1. Contact Centre
Contact Centre is one of Europe’s leading
4
customer experience businesses with a top three
4
market share across EMEA, managing millions of interactions, with customers in the
The division is structured around the market sectors it serves: Financial Services; Telecommunications, Media & Technology; Energy & Utilities; and Retail.
Markets and growth drivers
The customer experience market is evolving rapidly. AI and automation are elevating what is possible, driving demand for a personalised omnichannel service which can be delivered 24/7. Consumer expectations continue to rise, making customer experience a differentiator for businesses.
Alongside digitally led services, customers in this market are demanding a flexible service model spanning onshore, nearshore and offshore operations anchored around the human in the loop philosophy combining cutting edge technology and the human element; to provide empathy and trust.
The pursuit of better customer experience will continue to drive innovation, and AI will play an ever-growing role, but with the foundations of understanding and serving the customer.
Operational performance and better technology
In 2024 , we launched AgentSuite which continues to drive significant productivity benefits alongside improved customer satisfaction scores. We now have six clients utilising AgentSuite with five further clients in the implementation phase. Based on the success of AgentSuite, we are developing a sales module which will be integrated into AgentSuite and will allow a more efficient and effective sales process, where applicable.
In H1 we expanded the deployment of Centrical into our
Last year, the division launched nine customer service bundles that offer repeatable, modular and scalable solutions that can be easily tailored to client needs and allow more efficient and effective delivery. Following a specific marketing drive and campaign for our offerings with potential Tier 1 and Tier 2 clients in this vertical, this year we have seen an increase in pipeline origination for retail clients. This is providing a more diversified pipeline of opportunities which historically has been more focused on the Telecommunications, Media & Technology vertical.
As we build our cost efficiency and reduce our cost to deliver, we are growing our near and offshore capabilities which offer lower cost solutions to clients, while maintaining high quality. Following the successful offshoring of a number of support areas, we have seen a number of clients offshore elements of their operations this year, particularly in the Utility sector. While we are making progress on delivery of the divisional cost savings, there has been some phasing impact this year with savings in the first half being achieved at a slower rate than anticipated which, alongside the division's revenue performance, has impacted the operating profit performance in the first half of 2025.
This year, we have seen continued volume reductions in the Telecoms business, the impact of which we expect to annualise in H2 2025, and we have the opportunity to regain volumes in the future.
Growth performance and key wins
In the first six months of 2025, the Contact Centre business won deals with a T
CV of £172.0m, down 48% from the same period in 2024, reflecting reduced bidding activity in the division in
2025
. The book to bill for Contact Centre was 0.6x, down from 0.9x in the first six months of 2024. Ther
e were material wins with
The division saw a slight decrease in win rate across all opportunities to 63%, down from 67% in H1 2024. There is significant scope to increase the win rate for new and expanded scopes of work where the division saw a win rate of 21% in the first six months of 2025 .
The unweighted pipeline for the division stood at £1.8bn at
30
There are material opportunities in the second half across all of the geographies in which the division operates, including in the Telecommunications, Media & Technology and Financial Services vertical. Given the reduction in pipeline, we recognise work is required to rebuild the pipeline in the second half of the year.
The
divisional order book stands at £625m, representing a small decrease of £20m from £645m at 31
Divisional financial summary 2025 2024 % change Adjusted revenue1 (£m) 277.4 346.2 (19.9)% Adjusted operating profit1 (£m) (11.4) 1.1 n/a Adjusted operating margin1 (%) (4.1)% 0.3% Adjusted EBITDA1 (£m) 4.8 21.4 (77.6)% Operating cash flow excluding business exits1 (£m) 21.4 13.3 60.9% Order book (£m) (comparative at 31 December 2024) 624.6 644.6 (3.1)% Total contract value secured (£m) 172.0 328.5 (47.6)%
Adjusted revenue 1 reduced by 19.9% to £277.4m, as we saw the impact the from annualisation of volume reductions in the Telecommunications vertical, previously announced contract losses, volume reductions and the impact of offshoring on some clients.
The division's adjusted operating loss 1 was £11.4m reflecting the flow through of the revenue reduction noted above which was partially offset by the cost reduction programme where we saw some slower than expect phasing. The division also saw the negative impact from the timing of the Group's pay award, increased National Insurance Contributions partially offset by the benefit of indexation.
Operating cash flow excluding business exits 1 increased by 60.9% to £21.4m reflecting the timing of cash receipts on two major contracts in the division.
Outlook
Due to the continued reduction in volumes in the Telecommunications vertical, impact of contract losses which have not been offset by wins and the impact of off-shoring on some contracts, we expect a mid-teen revenue reduction in the division in 2025.
Reflecting the revenue headwinds faced in the division, we now expect a year on year reduction in adjusted operating profit 1
2. Pension Solutions
Pension Solutions is our pension administration and consulting business, with a focus on defined benefit schemes. It administers over 400 private and public sector pension schemes based in the
Pension Solutions also provides consulting services including actuarial and data services to its clients via its 500 expert pension consultants, which accounts for around one-third of its revenue.
Markets and growth drivers
The pensions industry continues to move towards an end-to-end digital experience with users looking for a seamless experience with increased automation and self-service options to allow a 24/7 service offering.
Our Capita Digital Pensions Solutions tool will provide a step forward for the digitisation of the division’s operations. This digital tool utilises the Pensions Solutions' existing infrastructure and Microsoft Dynamics. When this tool is fully operational this will benefit clients, providing them even higher levels of operational resilience, increased engagement and an ability to reach underrepresented scheme members. For members the tool will allow for an enhanced digital experience with increased knowledge and flexible money management.
We expect the Digital Pensions Solutions tool will increase member satisfaction and loyalty, providing Pension Solutions with a higher level of differentiation in a competitive market and data insights to inform our future services and products.
We expect this tool to go live in late 2025 with a number of key clients, including the Civil Service Pensions Scheme which is due to transition in
Operational performance and better technology
So far this year, the division has engaged with over 1.8 million pension scheme members through the communication and engagement team. KPI performance continues to be strong at 95%, consistent with the same period in 2024.
The division's digital pensions tool is modernising how pensions are managed and this year we have seen a further 200% increase in member engagement through digital channels as we continue the transition for all clients to paperless communications. This will reduce costs to deliver and improve efficiency of communications.
We are improving our cost efficiency with our global delivery model and this year we have increased our offshoring presence in a number of support roles. As we look to the second half of the year, this is an area we are looking to expand on.
Elsewhere, technology is driving efficiencies and a better service as we improve internal AI capabilities. Within the division we have fourteen agents in development, including MyPensionsBuddy which is currently being tested with two clients.
Growth performance and key wins
In the six months to 30
Material wins in the first half of the year included a renewal with an expansion of scope worth £37m for the
The unweighted pipeline for the division at 30
The order book at 30
Divisional financial summary 2025 2024 % change Adjusted revenue1 (£m) 86.1 86.4 (0.3)% Adjusted operating profit1 (£m) 9.7 11.4 (14.9)% Adjusted operating margin1 (%) 11.3% 13.2% Adjusted EBITDA1 (£m) 13.3 15.1 (11.9)% Operating cash flow excluding business exits1 (£m) 9.3 22.3 (58.3)% Order book (£m) (comparative at 31 December 2024) 467.8 441.3 6.0% Total contract value secured (£m) 75.3 40.0 88.3%
Adjusted revenue 1 reduced 0.3% to £86.1m, broadly flat with the prior year .
Adjusted operating profit 1 decreased 14.9% to £9.7m due to the impact from the reduction in interest rates which more than offset the impact from the cost reduction programme.
Operating cash flow excluding business exits 1 was an inflow of £9.3m reducing from £22.3m in the first half of 2024, reflecting the mobilisation and upfront implementation costs on Civil Service Pension Scheme contract.
Outlook
We expect the division to deliver mid-single digit revenue growth in 2025, driven by growth with our existing clients with margin across the year stable compared to the prior year.
3. Regulated Services
Regulated Services includes a number of ‘manage for value’ businesses where we are exploring exits.
The largest of the non-core businesses, is the closed book Life & Pensions business, for which we are making good progress exiting, with just one client remaining and hand back transitions agreed for all other clients, over the coming years. We expect to see continued revenue reductions in future years, as these contracts are transitioned. We are actively engaged with the remaining client to exit this area. The division is forecast to have an annual cash cost to the Group of around £20m per annum in future years.
In the first half of the year, we agreed the termination of a contract within the
Divisional financial summary 2025 2024 % change Adjusted revenue1 (£m) 79.5 80.4 (1.1)% Adjusted operating profit1 (£m) 2.5 12.6 (80.2)% Adjusted operating margin1 (%) 3.1% 15.7% Adjusted EBITDA1 (£m) 4.5 15.9 (71.7)% Operating cash flow excluding business exits1 (£m) (8.1) (9.5) 14.7% Order book (£m) (comparative at 31 December 2024) 170.9 231.4 (26.1)% Total contract value secured (£m) 0.7 4.3 (83.7)%
Adjusted revenue
1
reduced
1.1%
to
£79.5m
reflecting the one-off benefit from
Adjusted operating profit 1 decreased 80.2% to £2.5m following the non-repeat of a £10m one-off benefit in the prior year. The division benefited from the one-off revenue benefits noted above, offset by a £12m contract fulfilment asset impairment associated with the Mortgage Service contract termination and impact of contract hand backs within closed book Life & Pensions.
Operating cash flow excluding business exits 1 was an outflow of £8.1m an improvement from the prior year reflecting the termination fee received in the first half of the year offset by the impact of contract hand backs in closed book Life & Pensions.
Outlook
We continue to expect an adjusted revenue 1 reduction in Regulated Services in 2025 as we hand back contracts in line with previously agreed transition agreements.
Reflecting the divisions revenue reduction, we expect a reduction in the divisions adjusted operating margin 1 .
___________________________________________
1. Refer to alternative performance measures in the appendix
2. Gartner
3. TechMarketView
4.
Chief Financial Officer's review
Financial Reported results Adjusted1results
highlights
30June 30 June POP change 30June 2025 30 June POP change
2025 2024 2024
Revenue £1,159.8m £1,237.3m (6)% £1,154.8m £1,198.6m (4)%
Operating £9.2m £43.9m (79)% £42.6m £54.5m (22)%
profit
Operating 0.8% 3.5% (270)bps 3.7% 4.5% (80)bps
margin2
EBITDA2 £47.0m £101.7m (54)% £80.2m £102.4m (22)%
(Loss)/profit £(9.5)m £60.0m n/a £22.6m £31.9m (29)%
before tax
Basic
(loss)/earnings (6.62)p 47.09p n/a 21.63p 33.06p (35)%
per share3
Operating cash £51.2m £73.5m (30)% £55.9m £50.8m 10%
flow2
Free cash flow2 £(30.7)m £(44.6)m 31% £(26.1)m £(52.5)m 50%
Net debt2 £(412.2)m £(521.9)m 21%
Net financial
debt (pre-IFRS £(87.0)m £(166.4)m 48%
16)
1. Capita reports results on an adjusted basis to aid understanding of business
performance (refer to alternative performance measures in the appendix).
Adjusted operating cash flow and free cash flow exclude the impact of business
exits (refer to note 9).
2. Operating margin, EBITDA, operating cash flow, free cash flow and net debt as
presented under reported results are sub-totals or are derived from the reported
results but are not defined in IFRS and are therefore also alternative
performance measures (refer to alternative performance measures in the
appendix). They are presented to enable comparability to the Group's adjusted
equivalent of each metric presented in the financial highlights table.
3. 2024 comparatives have been re-presented from those previously published to
reflect the 1 for 15 share consolidation undertaken in April 2025 (refer to
notes 7 and 13).
Overview
Adjusted revenue 1 reduction of 4% mainly reflected previously announced contract hand-backs and losses, and the impact of the expected subdued volumes in the Telecommunications vertical in the Contact Centre business.
Public Service revenue growth benefitted from the Health Assessment Advisory Service contract win, the Disabled Students Allowance contract, the extension of the Primary Care Support England contract, and the continued expanded scope on the
The reduction in adjusted operating profit
1
reflected the impact of the revenue trends noted above, investment in the business, timing of the pay award and the increase in
Adjusted earnings per share 1 reduced reflecting the decrease in adjusted profit before tax 1 , offset by a lower adjusted income tax credit of £2.1m (2024: credit £5.2m).
The reported operating profit of £9.2m reflects the reduction in adjusted operating profit 1 detailed above, and an increase in costs to deliver the significant cost reduction programme (2025: £23.4m; 2024: £8.2m).
The reported loss before tax of £9.5m (2024: profit £60.0m), reflects the reduction in reported operating profit detailed above, and the disposal of Fera in
The reported loss per share reflected the reduction in profit before tax partly offset by the income tax credit in the current period compared to an income tax charge in the six months ended 30
Operating cash flow excluding business exits 1 increased by 10% to £55.9m, driven by timing of cash receipts on two major contracts within the Contact Centre business.
Free cash flow excluding business exits
1
in the six months ended 30
The improvement in free cash flow 1 reflects the above increase in free cash flow excluding business exits 1 , and the reduction in pension deficit contributions triggered by disposals, offset by the movement from a cash inflow from business exits to a cash outflow.
In
Liquidity as at 30
Financial review
Adjusted results
Capita reports results on an adjusted basis to aid understanding of business performance. The Board has adopted a policy of disclosing separately those items that it considers are outside the underlying operating results for the particular period under review and against which the Group’s performance is assessed internally. In the Board's judgement, these items need to be disclosed separately by virtue of their nature, size and/or incidence for users of the financial statements to obtain an understanding of the financial information and the underlying in-period performance of the business.
In accordance with the above policy, the trading results of business exits, along with the non-trading expenses (including the income statement charges in respect of major cost reduction programmes) and gain or loss on disposals, have been excluded from adjusted results. To enable a like-for-like comparison of adjusted results, the 2024 comparatives have been re-presented to exclude business exits in the second half of 2024 and the first six months of 2025. As at 30
Reconciliations between adjusted and reported operating profit, profit before tax and free cash flow excluding business exits are provided on the following pages and in the notes to the financial statements.
Adjusted revenue
Capita Experience
Public Contact Pension Regulated
Total
Adjusted revenue1bridge by division Service Centre Solutions Services
£m
£m £m £m £m
Six months ended 30June 2024 685.6 346.2 86.4 80.4 1,198.6
Net increase/(reduction) 26.2 (68.8) (0.3) (0.9) (43.8)
Six months ended 30June 2025 711.8 277.4 86.1 79.5 1,154.8
Adjusted revenue 1 reduced 4% and was impacted by the following:
•
Public Service
(3.8% growth):
benefit of the Health Assessment Advisory Service contract win, the Disabled Students Allowance contract, the extension of the Primary Care Support England contract, and continued expanded scope on the
• Experience:
◦ Contact Centre (19.9% reduction) : previously announced contract losses, the expected annualised impact of the subdued volumes within the Telecommunications vertical, and other volume reductions including the impact of working with our customers to drive volumes to our nearshore and offshore delivery centres, which reduces revenue while becoming more efficient and competitive;
◦ Pension Solutions (0.3% reduction) : broadly in-line with the prior period; and
◦
Regulated Services (1.1% reduction)
: previously announced contract exits and additional in-year losses, partially offset by a £19m one-off benefit from a contract exit in the
Order book
The Group’s consolidated order book was £4,031.9m at 30
Adjusted operating profit
Capita Experience
Public Contact Pension Regulated Capita
Adjusted operating Total
profit1bridge by division Service Centre Solutions Services plc
£m
£m £m £m £m £m
Six months ended 30June 2024 47.4 1.1 11.4 12.6 (18.0) 54.5
Net growth/(reduction) 9.8 (12.5) (1.7) (10.1) 2.6 (11.9)
Six months ended 30June 2025 57.2 (11.4) 9.7 2.5 (15.4) 42.6
Adjusted operating profit
1
decreased in the six months ended 30
•
Public Service:
flow through of higher revenue partially offset by the timing of pay awards and £3m impact of the
• Experience:
◦
Contact Centre:
flow through of revenue decline and lower volumes within the Telecommunications vertical, the impact of net losses and volume reductions, including initial costs of offshoring and the
◦ Pension Solutions: lower interest rate partly offset by the benefit from cost savings;
◦
Regulated Services:
flow through of contract exits, partially offset by £6m benefit from termination fee received from the contract exit in the
•
Adjusted profit before tax
Adjusted profit before tax 1 reduced to £22.6m (2024: £31.9m), reflecting the above decrease in adjusted operating profit, partially offset by a reduction in net finance costs included within adjusted profit (2025: £20.0m; 2024: £22.6m).
Adjusted tax credit
The adjusted income tax credit for the period was £2.1m and is lower than the comparative period (credit of £5.2m) primarily as a result of a smaller increase in the deferred tax asset.
Operating cash flow excluding business exits 1
Capita Experience
Public Contact Pension Regulated Capita
Operating cash flow excluding Total
business exits1by division Service Centre Solutions Services plc
£m
£m £m £m £m £m
Six months ended 30June 2024 49.2 13.3 22.3 (9.5) (24.5) 50.8
Net growth/(reduction) 3.0 8.1 (13.0) 1.4 5.6 5.1
Six months ended 30June 2025 52.2 21.4 9.3 (8.1) (18.9) 55.9
Operating cash conversion1six 73.5 % 62.1 % 147.7 % (59.7) % 145.0 % 49.6 %
months ended 30June 2024
Operating cash conversion1six 72.2 % 445.8 % 69.9 % (180.0) % 128.6 % 69.7 %
months ended 30June 2025
Operating cash flow excluding business exits 1 and operating cash flow conversion 1 increased in 2025 driven by the following:
• Public Service: flow through of the improved operating profit;
• Experience:
◦ Contact Centre: the timing of cash receipts on two major contracts;
◦ Pension Solutions: mobilisation and upfront implementation costs for digital investment on the contract with the Civil Service Pension Scheme;
◦
Regulated Services:
termination fee received from the contract exit in our
•
Cash generated from operations and free cash flow
Adjusted operating profit to free cash flow excluding 30June 2025 30 June 2024
business exits1
£m £m
Adjusted operating profit1 42.6 54.5
Add: depreciation/amortisation and impairment of
property, plant and equipment, right-of-use assets and 37.6 47.9
intangible assets
Adjusted EBITDA1 80.2 102.4
Working capital (11.8) (31.2)
Non-cash and other adjustments (12.5) (20.4)
Operating cash flow excluding business exits1 55.9 50.8
Adjusted operating cash conversion1 70% 50%
Pension deficit contributions — (6.3)
Cyber incident 1.1 (6.4)
Cost reduction programme (21.5) (19.7)
Cash generated from operations excluding business 35.5 18.4
exits1
Net capital expenditure (15.2) (21.2)
Interest/tax paid (22.8) (22.6)
Net capital lease payments (23.6) (27.1)
Free cash flow excluding business exits1 (26.1) (52.5)
The working capital improvement is principally driven by a higher net inflow from deferred income and contract fulfilment assets, reflecting the timing of cash receipts on two major contracts, and the non-recurrence of several one-off deferred income releases in the comparative period, both within the Contact Centre business. Non-cash and other adjustments includes movement in provisions, and amendments and early termination of leases.
Cash generated from operations excluding business exits 1 reflects the above and the direct cash inflow of the cyber incident in the first half of 2023 (£1.1m) and the cash costs of delivering the cost reduction programme (£21.5m).
Free cash flow excluding business exits
1
for the six months ended 30
Reported results
Adjusted to reported profit
As noted above, to aid understanding of our underlying performance, adjusted operating profit 1 and adjusted profit before tax 1 exclude a number of specific items, including the amortisation and impairment of acquired intangibles and goodwill, the impact of business exits and the impact of the cyber incident and cost reduction programme.
Adjusted1to reported results Operating profit/(loss) Profit/(loss) before tax
bridge
30June 2025 30 June 2024 30June 2025 30 June 2024
£m £m £m £m
Adjusted1 42.6 54.5 22.6 31.9
Amortisation and impairment (0.1) (0.1) (0.1) (0.1)
of acquired intangibles
Net finance income/(expense) — — 1.7 (0.4)
Business exits (6.9) (2.7) (7.3) 36.4
Cyber incident (3.0) 0.4 (3.0) 0.4
Cost reduction programme (23.4) (8.2) (23.4) (8.2)
Reported 9.2 43.9 (9.5) 60.0
Business exits
Business exits include the effects of businesses that have been sold or exited during the period and the results of businesses held-for-sale at the reporting date. In accordance with our policy, the trading results of these businesses, along with the non-trading expenses and gain on disposal, were included in business exits and therefore excluded from adjusted results. To enable a like-for-like comparison of adjusted results, the 2024 comparatives have been re-presented to exclude businesses classified as business exits from 1
At 30
Cyber incident
A charge of £3.0m has been recognised in the six months ended 30
Cost reduction programme
The Group initiated a multi-year cost reduction programme in
A charge of £23.4m has been recognised in the six months ended 30
Further detail of the specific items charged in arriving at reported operating profit and profit before tax for 2025 is provided in note 4 to the condensed consolidated financial statements.
Reported tax credit
The reported income tax credit for the period of £2.1m (six months ended 30
Free cash flow 1 to free cash flow excluding business exits 1
30June 2025 30 June 2024
£m £m
Free cash flow1 (30.7) (44.6)
Business exits 4.6 (22.4)
Pension deficit contributions triggered by disposals — 14.5
Free cash flow excluding business exits1 (26.1) (52.5)
Free cash flow 1 was lower than free cash flow excluding business exits 1 reflecting the free cash outflows from business exits.
Movements in net debt
Net debt at 30
Net debt does not include finance lease receivables, which at 30
30June 2025 31 December 2024
Net debt
£m £m
Opening net debt (415.2) (545.5)
Cash movement in net debt 5.6 197.4
Non-cash movements (2.6) (67.1)
Closing net debt (412.2) (415.2)
Remove closing IFRS 16 impact 325.2 348.7
Net financial debt (pre-IFRS 16) (87.0) (66.5)
Cash and cash equivalents net of overdrafts 179.6 191.4
Financial debt net of swaps (266.6) (257.9)
Net financial debt/adjusted EBITDA1(both pre-IFRS 0.8x 0.5x
16)
Net debt (post-IFRS 16)/adjusted EBITDA1 2.6x 2.3x
Net financial debt (pre-IFRS 16) increased by £20.5m to £87.0m at 30
Capital and financial risk management
Financial instruments used to fund operations and to manage liquidity comprise USD and GBP private placement loan notes, revolving credit facility (RCF), leases and overdrafts.
30June 2025 31 December 2024
Available liquidity1
£m £m
Revolving credit facility (RCF) 250.0 250.0
Less: drawing on committed facilities — —
Undrawn committed facilities 250.0 250.0
Cash and cash equivalents net of overdrafts 179.6 191.4
Less: restricted cash (45.9) (44.2)
Available liquidity1 383.7 397.2
In
In addition, the Group has in place non-recourse trade receivable financing, utilisation of which has become economically more favourable than drawing under the RCF as prevailing interest rates have increased. As such, the Group has continued its use of the facility across the year with the value of invoices sold under the facility at 30
In
At 30
Going concern
The Board closely monitors the Group’s funding position throughout the year, including compliance with covenants and available facilities to ensure it has sufficient headroom to fund operations. In addition, to support the going concern assumption the Board conducts a robust assessment of the projections, considering also the committed facilities available to the Group. The Group continues to adopt the going concern basis in preparing these condensed consolidated financial statements as set out in note 1 to the condensed consolidated financial statements.
Pensions
The latest formal valuation for the Group’s main defined benefit pension scheme (the HPS), was carried out as at 31
The valuation of scheme liabilities (and assumptions used) for funding purposes (the actuarial valuation) are specific to the circumstances of each scheme. It differs from the valuation and assumptions used for accounting purposes, which are set out in IAS
19 and shown in these condensed consolidated financial statements. The main difference is in assumption principles being used based in the different regulatory requirements of the valuations. Management estimates that at 30
The net defined benefit pension position of all reported defined benefit schemes for accounting purposes decreased from a surplus of £37.9m at 31
Balance sheet
Consolidated net assets were £178.2m at 30
The decrease predominantly reflects the loss arising on cash flow hedges recognised directly in other comprehensive income in the six months ended 30
Following shareholder approval at the Company’s 2025 Annual General Meeting held on
Also, following shareholder approval at the 2025 AGM and subsequent sanctioning by the
_____________________________________
1. Refer to alternative performance measures in the appendix
Forward looking statements
This half year results statement is prepared for and addressed only to the Company's shareholders as a whole and to no other person. The Company, its Directors, employees, agents and advisors accept and assume no liability to any person in respect of this trading update except as would arise under English law. Statements contained in this trading update are based on the knowledge and information available to Capita’s Directors at the date it was prepared and therefore facts stated and views expressed may change after that date.
This document and any materials distributed in connection with it may include forward-looking statements, beliefs, opinions or statements concerning risks and uncertainties, including statements with respect to Capita’s business, financial condition and results of operations. Those statements, and statements which contain the words "anticipate", "believe", "intend", "estimate", "expect" and words of similar meaning, reflect Capita’s Directors' beliefs and expectations and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and which may cause results and developments to differ materially from those expressed or implied by those statements and forecasts.
No representation is made that any of those statements or forecasts will come to pass or that any forecast results will be achieved. You are cautioned not to place any reliance on such statements or forecasts. Those forward-looking and other statements speak only as at the date of this trading update. Capita undertakes no obligation to release any update of, or revisions to, any forward-looking statements, opinions (which are subject to change without notice) or any other information or statement contained in this trading update. Furthermore, past performance cannot be relied on as a guide to future performance.
No statement in this document is intended as a profit forecast or a profit estimate and no statement in this document should be interpreted to mean that earnings per Capita share for the current or future financial years would necessarily match or exceed the historical published earnings per Capita share.
Nothing in this document is intended to constitute an invitation or inducement to engage in investment activity. This document does not constitute or form part of any offer for sale or subscription of, or any solicitation of any offer to purchase or subscribe for, any securities nor shall it, or any part of it, nor the fact of its distribution form the basis of, or be relied on in connection with any contract, commitment or investment decision in relation thereto. This document does not constitute a recommendation regarding any securities.
Principal risks and uncertainties
The principal risks and uncertainties faced by the Group and its approach to internal control and risk management are set out on pages 68 to 74 of the 2024 Annual Report and Accounts, which is available on the Group’s website at www.capita.co.uk – Capita-2024-Annual-Report.pdf.
Risk title Risk description
Attract new customers and retain
1 Deliver profitable growth existing customers on appropriate
commercial terms.
Deliver services to customers in
2 Contract performance accordance with contractual and legal
obligations.
3 Innovation Innovate and develop new customer value
propositions with speed and agility.
4 People attraction and retention Attract, develop, engage and retain the
right talent.
Our ability to maintain financial
5 Financial stability resilience and achieve financial
targets.
Protect our systems, networks and
6 Cyber security programs from unauthorised use and
access.
Comply with regulatory and contractual
7 Environment, social and governance requirements to drive a purpose driven
(ESG) organisation with the right focus on
governance.
Protect the safety and health of all
Capita's employees and manage our duty
8 Safety and health of care to them, the people we work with
and those affected by our acts and
omissions.
Manage our data effectively (both
9 Data governance and data privacy customer's and Capita's) as a strategic
asset across the organisation.
Statement of Directors’ responsibilities
The Board of directors confirms, to the best of its knowledge, that these condensed consolidated financial statements have been prepared in accordance with IAS
34 as adopted for use in the
The names and functions of the Board of directors of
By order of the Board
Adolfo Hernandez
Pablo Andres
Chief Executive Officer Chief Financial Officer
4 August 2025 4 August 2025
Condensed consolidated income statement
For the six months ended 30
30June 2025 30 June 2024
Notes
£m £m
Revenue 3 1,159.8 1,237.3
Cost of sales (941.5) (973.2)
Gross profit 218.3 264.1
Administrative expenses (209.1) (220.2)
Operating profit 3 9.2 43.9
Share of results in associates and losses on 8 (0.4) 1.4
financial assets
Finance income1 5 5.0 4.9
Finance costs1 5 (23.3) (28.3)
Gain on disposal of business 8 — 38.1
(Loss)/profit before tax (9.5) 60.0
Income tax credit/(charge) 6 2.1 (7.1)
Total (loss)/profit for the period (7.4) 52.9
Attributable to:
Owners of the Company (7.5) 53.0
Non-controlling interests 0.1 (0.1)
(7.4) 52.9
(Loss)/earnings per share 7
– basic2 (6.62)p 47.09p
– diluted2 (6.62)p 45.97p
Adjusted operating profit 4 42.6 54.5
Adjusted profit before tax 4 22.6 31.9
Adjusted basic earnings per share2 7 21.63p 33.06p
Adjusted diluted earnings per share2 7 21.63p 32.27p
1. Finance income and finance costs have been separately disclosed for the current period, with the prior period re-presented on the same basis. Previously these were presented as net finance expenses.
2.
2024 comparatives have been re-presented from those previously published to reflect the 1
for
15 share consolidation undertaken in
Condensed consolidated statement of comprehensive income
For the six months ended 30
30June 2025 30 June 2024
Notes
£m £m
Total (loss)/profit for the period (7.4) 52.9
Other comprehensive (expense)/income
Items that will not be reclassified subsequently
to the income statement
Actuarial loss on defined benefit pension schemes (3.4) (3.5)
Tax effect on defined benefit pension schemes 0.8 0.8
Items that will or may be reclassified
subsequently to the income statement
Exchange differences on translation of foreign (2.4) 0.2
operations
(Loss)/gain on cash flow hedges (20.0) 4.8
Cash flow hedges recycled to the income statement 9.8 (0.9)
Tax effect on cash flow hedges 2.6 (1.0)
Other comprehensive (expense)/income for the (12.6) 0.4
period net of tax
Total comprehensive (expense)/income for the (20.0) 53.3
period net of tax
Attributable to:
Owners of the Company (20.1) 53.4
Non-controlling interests 0.1 (0.1)
(20.0) 53.3
The accompanying notes are an integral part of these condensed consolidated financial statements.
Condensed consolidated balance sheet
At 30
30June 2025 31 December 2024
Notes £m £m
Non-current assets
Property, plant and equipment 60.9 68.5
Intangible assets 83.3 79.8
Goodwill 10 373.3 372.4
Right-of-use assets 164.7 180.7
Contract fulfilment assets 2 243.3 257.5
Financial assets 12 93.9 99.0
Deferred tax assets 120.2 111.6
Employee benefits 14 39.1 42.9
Trade and other receivables 8.3 10.0
1,187.0 1,222.4
Current assets
Financial assets 12 5.3 20.6
Income tax receivable 6.9 7.0
Disposal group assets held-for-sale 8 0.1 0.1
Trade and other receivables 407.8 335.3
Cash 12 334.1 253.6
754.2 616.6
Total assets 1,941.2 1,839.0
Current liabilities
Overdrafts 12 154.5 62.2
Trade and other payables 362.2 353.2
Disposal group liabilities held-for-sale 8 0.2 0.1
Income tax payable 4.3 3.8
Deferred income 494.2 435.4
Lease liabilities 12 38.4 42.9
Financial liabilities 12 4.8 88.2
Provisions 11 70.1 81.4
1,128.7 1,067.2
Non-current liabilities
Trade and other payables 6.7 6.7
Deferred income 14.1 30.5
Lease liabilities 12 286.8 305.8
Financial liabilities 12 277.8 183.2
Deferred tax liabilities 7.0 7.0
Provisions 11 37.4 37.9
Employee benefits 14 4.5 5.0
634.3 576.1
Total liabilities 1,763.0 1,643.3
Net assets 178.2 195.7
Capital and reserves
Share capital 13 35.3 35.2
Share premium 13 — 1,145.5
Employee benefit trust shares 13 — (0.3)
Capital redemption reserve 1.8 1.8
Other reserves (19.5) (9.5)
Retained earnings/(deficit) 164.7 (972.8)
Equity attributable to owners of the Company 182.3 199.9
Non-controlling interests (4.1) (4.2)
Total equity 178.2 195.7
The accompanying notes are an integral part of these condensed consolidated financial statements.
Condensed consolidated statement of changes in equity
For the six months ended 30
Employee Total
Share Share benefit Capital Retained Other attributable Non-controlling Total
capital premium trust redemption (deficit)/earnings reserves to the interests equity
shares reserve owners of
£m £m £m £m the parent £m £m
£m £m
£m
At 31 December 35.2 1,145.5 (0.7) 1.8 (1,053.8) (15.0) 113.0 1.9 114.9
2023
Profit/(loss) — — — — 53.0 — 53.0 (0.1) 52.9
for the period
Other
comprehensive — — — — (2.7) 3.1 0.4 — 0.4
(expense)/income
Total
comprehensive — — — — 50.3 3.1 53.4 (0.1) 53.3
income/(expense)
for the period
Share-based — — — — 2.8 — 2.8 — 2.8
payment
Elimination of
non-controlling
interest on — — — — — — — (9.1) (9.1)
disposal of
businesses (note
8)
Exercise of
share options
under employee — — 0.3 — (0.3) — — — —
long-term
incentive plans
De-recognition
of put-options
held by — — — — 8.5 — 8.5 — 8.5
non-controlling
interests (note
12)
At 30 June 2024 35.2 1,145.5 (0.4) 1.8 (992.5) (11.9) 177.7 (7.3) 170.4
At 31 December 35.2 1,145.5 (0.3) 1.8 (972.8) (9.5) 199.9 (4.2) 195.7
2024
(Loss)/profit — — — — (7.5) — (7.5) 0.1 (7.4)
for the period
Other
comprehensive — — — — (2.6) (10.0) (12.6) — (12.6)
expense
Total
comprehensive — — — — (10.1) (10.0) (20.1) 0.1 (20.0)
(expense)/income
for the period
Share-based — — — — 2.9 — 2.9 — 2.9
payment
Share premium
cancellation1 — (1,145.5) — — 1,145.5 — — — —
(note 13)
Exercise of
share options
under employee — — 0.8 — (0.8) — — — —
long-term
incentive plans
(note 13)
Shares issued 0.1 — (0.1) — — — — — —
(note 13)
Parent Company
shares purchased — — (0.4) — — — (0.4) — (0.4)
(note 13)
At 30 June 2025 35.3 — — 1.8 164.7 (19.5) 182.3 (4.1) 178.2
1.
Following shareholder approval at the Company’s 2025 Annual General Meeting on 28
The accompanying notes are an integral part of these condensed consolidated financial statements.
Condensed consolidated cash flow statement
For the six months ended 30
30June 2025 30 June 2024
Notes
£m £m
Cash generated from operations 9 30.8 26.6
Income tax paid1 (3.2) (1.9)
Income tax received1 0.6 1.5
Interest received 4.0 4.1
Interest paid (24.1) (26.3)
Net cash inflow from operating activities 8.1 4.0
Cash flows from investing activities
Purchase of property, plant and equipment (3.3) (7.2)
Purchase of intangible assets (12.9) (14.3)
Proceeds from sale of property, plant and 1.0 —
equipment, and intangible assets
Proceeds from disposal of associates and joint — 0.3
ventures
Additions to originated loans receivable — (0.5)
Disposals of investments at FVTPL 0.4 —
Capital element of lease rental receipts 2.1 2.8
Deferred consideration from sale of subsidiary — 10.7
companies
Total proceeds received from disposal of 8 (0.6) 56.0
businesses, net of disposal costs
Cash held by businesses when sold 8 — (6.3)
Net cash (outflow)/inflow from investing (13.3) 41.5
activities
Cash flows from financing activities
Purchase of Parent Company shares by the Employee (0.4) —
Benefit Trust
Capital element of lease rental payments (25.7) (29.9)
Proceeds on issue of private placement loan notes 93.4 —
Gain from cross currency swaps 0.8 —
Repayment of private placement loan notes (89.0) —
Proceeds from cross-currency interest rate swaps 13.1 —
Proceeds from other finance 0.2 —
Debt financing arrangement costs (0.5) —
Net cash outflow from financing activities (8.1) (29.9)
(Decrease)/increase in cash and cash equivalents (13.3) 15.6
Cash and cash equivalents at the beginning of the 191.4 67.6
period
Effect of exchange rates on cash and cash 1.5 2.2
equivalents
Cash and cash equivalents at 30 June 179.6 85.4
Cash and cash equivalents comprise:
Cash 334.1 148.7
Overdrafts (154.5) (74.6)
Cash, net of overdrafts, included in disposal — 11.3
group assets and liabilities held-for-sale
Total 179.6 85.4
Alternative performance measures (refer to
note1.2(b))
Cash generated from operations excluding business 9 35.5 18.4
exits
Free cash flow excluding business exits 9 (26.1) (52.5)
1. Income tax paid and income tax received has been separately disclosed for
the current period, with the prior period re-presented on the same basis.
Previously these were presented net as 'income tax paid'.
The accompanying notes are an integral part of these condensed consolidated financial statements.
Notes to the condensed consolidated financial statements
For the six months ended 30
1.1 Corporate information
These condensed consolidated financial statements as at and for the six months ended 30
These condensed consolidated financial statements were authorised for issue by the Board of directors (the 'Board') on 4
These condensed consolidated financial statements are presented in British pounds sterling and all values are rounded to the nearest tenth of a million (£m) except where otherwise indicated.
1.2 Basis of preparation, judgements and estimates, and going concern
(a) Basis of preparation
These unaudited condensed consolidated financial statements have been prepared in accordance with the Disclosure and Transparency Rules of the
These condensed consolidated financial statements have been prepared by applying the same accounting policies and presentation that were applied in the preparation of the Company’s published consolidated financial statements for the year ended 31
The Group has considered the impact of new, and amendments to, reporting standards which are effective from 1
The Group is in the early stages of its assessment for all other standards, amendments and interpretations that have been issued by the
These condensed consolidated financial statements do not comprise statutory accounts within the meaning of Section
434 of the Companies Act
2006. Statutory accounts for the year ended 31
These condensed consolidated financial statements have been reviewed by the Group's auditor pursuant to the Auditing Practices Board guidance on the Review of Interim Financial Information.
(b) Adjusted results
IAS 1 Presentation of Financial Statements permits an entity to present additional information for specific items to enable users to better assess the entity’s financial performance.
The Board has adopted a policy to separately disclose those items that it considers are outside the underlying operating results for the particular period under review and against which the Group’s performance is assessed internally. In the Board’s judgement, these need to be disclosed separately by virtue of their nature, size and/or incidence for users of the condensed consolidated financial statements to obtain a proper understanding of the financial information and the underlying performance of the Group.
In general, the Board believes that alternative performance measures (APMs) are useful for investors because they provide further clarity and transparency about the Group’s financial performance and are closely monitored by management to evaluate the Group’s operating performance to facilitate financial, strategic and operating decisions. Accordingly, these items are also excluded from the discussion of divisional performance. Refer to the appendix for further details of the Group’s APMs. Those items which relate to the ordinary course of the Group’s operating activities remain within adjusted results.
The Board has limited the items excluded from the adjusted results to: business exits; amortisation and impairment of acquired intangibles; impairment of goodwill; certain net finance expense/income; the costs associated with the cyber incident in
The Board considers free cash flow, and cash generated from operations excluding business exits, after deducting the capital element of lease payments and receipts, to be APMs because these metrics provide a more representative measure of the sustainable cash flow of the Group.
While the Board considers APMs to be helpful to the reader, it notes that APMs have certain limitations, including the exclusion of significant recurring and non-recurring items, and may not be directly comparable with similarly titled measures presented by other companies.
A reconciliation between reported and adjusted operating profit and profit before tax is provided in note 4, and a reconciliation between reported and free cash flow excluding business exits and cash generated from operations is provided in note 9.
(c) Judgements and estimates
These condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles which require the Board to make judgements and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingencies at the date of the financial statements and the reported income and expense during the presented periods. Although these judgements and assumptions are based on the Board’s best knowledge of the amounts, events or actions, actual results may differ.
The significant judgements and assumptions made by the Board in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those applied to the consolidated financial statements for the year ended 31
Judgements
The key areas where significant accounting judgements have been made and which have the most significant effect on the amounts recognised in these condensed consolidated financial statements, are summarised below and set out in more detail in the related note:
• Contract accounting (note 2) - revenue recognition;
• Capitalisation of contract fulfilment assets (note 2); and
• Adoption of the going concern basis of preparation (note 1.2(d)).
Estimates and assumptions
The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet date, which have a significant risk of causing material adjustment to the carrying amounts of assets and liabilities within the next financial year, are summarised below and set out in more detail in the related note. The Group based its assumptions and estimates on parameters available when these condensed consolidated financial statements were prepared.
Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Group. Such changes are incorporated into the assumptions when they occur:
• Contract accounting (note 2) - impairment of contract fulfilment assets, and carrying value of onerous contract provisions;
• Deferred tax asset recognition (note 6);
• Impairment of goodwill in respect of the Contact Centre group of cash generating units (note 10); and
• Measurement of defined benefit pension obligations (note 14).
(d) Going concern
In determining the appropriate basis of preparation of these condensed consolidated financial statements for the six months ended 30
Accounting standards require that ‘the foreseeable future’ for going concern assessment covers a period of at least twelve months from the date of approval of these condensed consolidated financial statements, although those standards do not specify how far beyond twelve months a Board should consider. In its going concern assessment, the Board has considered the period from the date of approval of these condensed consolidated financial statements to 31
The base case financial forecasts used in the going concern assessment are derived from financial projections for 2025-2026 as approved by the Board in
The going concern assessment considers the Group’s sources and uses of liquidity and covenant compliance throughout the period under review. The value of the Group’s committed revolving credit facility (RCF) was £250.0m at 30
Financial position at 30
As detailed further in the Chief Financial Officer's review, as at 30
Board assessment
Base case scenario
Under the base case scenario, the Group forecasts growth in revenue, profit and cash flow over the medium term. When combined with available committed facilities, this allows the Group to manage scheduled debt repayments. The most material sensitivities to the base case are the risk of not delivering the planned revenue growth and further efficiency savings being delayed or not delivered in accordance with the Group's previously announced cost reduction programme.
The base case projections used for going concern assessment purposes reflect business disposals completed up to the date of approval of these condensed consolidated financial statements. The liquidity headroom assessment in the base case projections reflects the Group’s existing committed financing facilities and debt redemptions and does not reflect any potential future refinancing. The base case financial forecasts demonstrate liquidity headroom and compliance with all debt covenant measures throughout the going concern period to 31
Severe but plausible downside scenario
In considering severe but plausible downside scenarios, the Board has taken account of the potential adverse financial impacts resulting from the following risks:
• revenue growth falling materially short of plan;
• operating margin expansion not being achieved;
• targeted cost savings delayed or not delivered;
• unforeseen operational issues leading to contract losses and cash outflows;
• sustained interest rates at current levels;
• non-availability of the Group’s non-recourse trade receivables financing facility; and
• unexpected financial costs linked to incidents such as data breaches and/or cyber-attacks.
The likelihood of simultaneous crystallisation of the above risks is considered by the Board to be low. Nevertheless in the event that simultaneous crystallisation were to occur, the Group would need to take action to ensure there is sufficient liquidity. In its assessment of going concern, the Board has considered the mitigations, under the direct control of the Group, that could be implemented including, but not limited to, reductions or delays in capital investment, and substantially reducing (or removing in full) bonus and incentive payments. Taking these considerations into account, the Group’s financial forecasts, in a severe but plausible downside scenario, demonstrate sufficient liquidity headroom and compliance with all debt covenant measures throughout the going concern period to 31
Adoption of going concern basis
Reflecting the forecasts, coupled with the Board's ability to implement appropriate mitigations should the severe but plausible downside materialise, the Group continues to adopt the going concern basis in preparing these condensed consolidated financial statements. The Board has concluded that the Group will be able to continue in operation and meet its liabilities as they fall due over the period to 31
2 Contract accounting
At 30
30June 2025 30 June 2024 31 December 2024
Note
£m £m £m
Long-term contractual revenue 3 877.0 908.7
Contract fulfilment assets 243.3 257.5
(non-current)
Accrued income 165.9 132.7
Deferred income 508.3 465.9
Onerous contract provisions 42.8 46.2
Background
The Group operates diverse businesses. The majority of the Group’s revenue is from contracts greater than two years in duration (long-term contractual), representing 75.6% of Group revenue for the six months ended 30
Recoverability of contract fulfilment assets and completeness of onerous contract provisions
Management first assesses whether contract assets are impaired and then further considers whether an onerous contract exists. For half and full year reporting, the
The major contracts are rated by management according to their financial risk profile, which is linked to the level of uncertainty over future assumptions. The major contracts that the
An assessment of which contracts are major contracts is performed twice a year. Other contracts are reported to the
In the following paragraphs, the amounts disclosed for the current period are only in respect of those major contracts that the
The major contracts contributed £305.3m (30
As noted above, the major contracts, both pre- and post-transformation, are rated according to their financial risk profile. For those that are in the high and medium rated risk categories the associated non-current contract fulfilment assets were, in aggregate £83.6m at 30
Following these reviews, and reviews of smaller contracts across the business, non-current contract fulfilment asset impairments of £0.9m (30
Given the quantum of the relevant contract assets and liabilities, and the nature of the estimates noted above, management has concluded it is reasonably possible, that outcomes within the next financial year may be different from management’s current assumptions and could require a material adjustment to the carrying amounts of contract assets and onerous contract provisions. However, as noted above, £48.9m of non-current contract fulfilment assets relates to major contracts with ongoing transformational activities; and, £83.6m of non-current contract fulfilment assets and £37.9m of onerous contract provisions relate to the high and medium rated risk category. Due to the level of uncertainty, combination of variables and timing across numerous contracts, it is not practical to provide a quantitative analysis of the aggregated judgements that are applied, and management do not believe that disclosing a potential range of outcomes on a consolidated basis would provide meaningful information to a user of the financial statements. Due to commercial sensitivities, the Group does not specifically disclose the amounts involved in any individual contract.
Certain major contracts in transformation have key milestones during the next twelve months and an inability to meet these key milestones could lead to reduced profitability and a risk of impairment of the associated contract assets. These include contracts with the
3 Revenue and segmental information
The Group’s operations are managed separately according to the nature of the services provided, with each segment representing a strategic business division offering a different package of client outcomes across the markets the Group serves. Capita plc is a reconciling item and not an operating segment. Inter-segmental pricing is based on set criteria and is either charged on an arm's length basis or at cost.
The tables below present revenue and segmental profit for the Group’s operating segments as reported to the Chief Operating Decision Maker (‘CODM’). The Group comprises two trading divisions – Capita Public Service and Capita Experience – and at
Revenue
Adjusted revenue, excluding results from businesses exited in both periods (adjusting items), was £1,154.8m (30
Capita Experience
Capita
Six months Contact Pension Regulated Total Adjusting Total
ended Public
Notes Centre Solutions Services adjusted items reported
30 June 2025 Service
£m £m £m £m £m £m
£m
Continuing
operations
Long-term 589.3 148.5 60.8 78.3 876.9 0.1 877.0
contractual
Short-term 75.2 119.0 25.3 — 219.5 4.9 224.4
contractual
Transactional 47.3 9.9 — 1.2 58.4 — 58.4
(point-in-time)
Total segment 711.8 277.4 86.1 79.5 1,154.8 5.0 1,159.8
revenue
Trading revenue 722.2 286.6 87.5 81.2 1,177.5 — 1,177.5
Inter-segment (10.4) (9.2) (1.4) (1.7) (22.7) — (22.7)
revenue
Total adjusted 711.8 277.4 86.1 79.5 1,154.8 — 1,154.8
segment revenue
Business exits 8 — — — — — 5.2 5.2
– trading
Inter-segment — — — — — (0.2) (0.2)
revenue
Total segment 711.8 277.4 86.1 79.5 1,154.8 5.0 1,159.8
revenue
Capita Experience
Capita
Six months Contact Pension Regulated Total Adjusting Total
ended Public
Notes Centre Solutions Services adjusted items reported
30 June 2024 Service
£m £m £m £m £m £m
£m
Continuing
operations
Long-term 570.5 168.1 62.8 78.8 880.2 28.5 908.7
contractual
Short-term 77.7 166.5 23.6 — 267.8 5.5 273.3
contractual
Transactional 37.4 11.6 — 1.6 50.6 4.7 55.3
(point-in-time)
Total segment 685.6 346.2 86.4 80.4 1,198.6 38.7 1,237.3
revenue
Trading revenue 696.6 359.5 87.2 82.3 1,225.6 — 1,225.6
Inter-segment (11.0) (13.3) (0.8) (1.9) (27.0) — (27.0)
revenue
Total adjusted 685.6 346.2 86.4 80.4 1,198.6 — 1,198.6
segment revenue
Business exits 8 — — — — — 39.4 39.4
– trading
Inter-segment — — — — — (0.7) (0.7)
revenue
Total segment 685.6 346.2 86.4 80.4 1,198.6 38.7 1,237.3
revenue
Order book
The tables below show the order book for each division, categorised into long-term contractual (contracts with length greater than two years) and short-term contractual (contracts with length less than two years). The length of the contract is calculated from the service commencement date. The figures present the aggregate amount of the currently contracted transaction price allocated to the performance obligations that are unsatisfied or partially unsatisfied. Revenue expected to be recognised upon satisfaction of these performance obligations is as follows:
Capita Experience
Capita
Contact Pension Regulated
Order book Public Total
Centre Solutions Services
30June 2025 Service £m
£m £m £m
£m
Long-term contractual 2,749.5 442.5 445.9 167.5 3,805.4
Short-term contractual 19.1 182.1 21.9 3.4 226.5
Total 2,768.6 624.6 467.8 170.9 4,031.9
Capita Experience
Capita
Contact Pension Regulated
Order book Public Total
Centre Solutions Services
31 December 2024 Service £m
£m £m £m
£m
Long-term contractual 2,843.1 426.1 431.2 226.1 3,926.5
Short-term contractual 80.3 218.5 10.1 5.3 314.2
Total 2,923.4 644.6 441.3 231.4 4,240.7
The table below shows the expected timing of revenue to be recognised from long-term contractual orders at 30
Capita Experience
Capita
Contact Pension Regulated
Time bands of expected revenue Public Total
recognition from long-term Centre Solutions Services
contractual orders Service £m
£m £m £m
£m
< 1 year 880.5 181.7 80.0 90.9 1,233.1
1–5 years 1,506.9 247.1 221.8 76.6 2,052.4
> 5 years 362.1 13.7 144.1 — 519.9
Total 2,749.5 442.5 445.9 167.5 3,805.4
Prior year comparative information is not presented for the expected timing of revenue recognition because it is a forward looking disclosure and therefore management does not believe that such disclosure provides meaningful information to a user of these condensed consolidated financial statements.
The order book represents the consideration that the Group will be entitled to receive from customers when the Group satisfies its remaining performance obligations under the contracts. However, the total revenue that will be earned by the Group will also include non-contracted volumetric revenue, future indexation linked to an external metric, new wins, scope changes and anticipated contract extensions. These elements have been excluded from the figures in the tables above because they are not contracted. Additionally, revenue from contract extensions is also excluded from the order book unless the extensions are pre-priced whereby the Group has a legally binding obligation to deliver the performance obligations during the extension period. The total revenue related to pre-priced extensions included in the tables above amounted to £206.8m (31
Of the £3.8 billion (31
Deferred income
The Group’s deferred income balances solely relate to revenue from contracts with customers. Revenue recognised in the reporting period that was included in the deferred income balance at the beginning of the period was £372.9m (30
Movements in the deferred income balances were driven by transactions entered into by the Group in the normal course of business during the six months ended 30
___________________________________________
1.
The prior period amounts in relation to major contracts are as previously presented, and as such reflect the major contracts reviewed by the
Segmental profit
The tables below present profit/(loss) of the Group’s operating segments. For segmental reporting, the costs of central functions have been allocated to the segments using appropriate drivers such as adjusted revenue, adjusted profit or headcount. Comparative information has been re-presented to reflect businesses exited during the second half of 2024 and the first half of 2025.
Capita Experience
Capita
Six months Contact Pension Regulated Capita Total Adjusting Total
ended Public
Notes Centre Solutions Services plc adjusted items reported
30June 2025 Service
£m £m £m £m £m £m £m
£m
Adjusted
operating 4 57.2 (11.4) 9.7 2.5 (15.4) 42.6 — 42.6
profit/(loss)
Cost
reduction 4 (7.1) (9.0) (1.1) (1.1) (5.1) — (23.4) (23.4)
programme
Business
exits – 8 — — — — — — (4.7) (4.7)
trading
Total trading 50.1 (20.4) 8.6 1.4 (20.5) 42.6 (28.1) 14.5
result
Non-trading
items:
Business
exits – 8 — (2.2) (2.2)
non-trading
Other
adjusting 4 — (3.1) (3.1)
items
Operating 42.6 (33.4) 9.2
profit/(loss)
Interest 5 5.0
income
Interest 5 (23.3)
expense
Share of
results in
associates (0.4)
and losses on
financial
assets
Loss before (9.5)
tax
Supplementary
information
Depreciation
and 14.7 16.0 3.6 1.8 0.7 36.8 0.1 36.9
amortisation
Impairment of
property,
plant and
equipment,
intangible 0.4 0.2 — 0.2 — 0.8 0.1 0.9
assets,
right-of-use
assets and
goodwill
Non-current
contract
fulfilment
assets 28.4 3.9 2.3 13.0 — 47.6 — 47.6
utilisation,
impairment
and
derecognition
Net onerous
contract — — — 8.0 — 8.0 — 8.0
provisions1
1. Net of additions, releases, the unwinding of discount, and changes in the discount rate in respect of onerous contract provisions.
Capita Experience
Capita
Six months Contact Pension Regulated Capita Total Adjusting Total
ended Public
Notes Centre Solutions Services plc adjusted items reported
30 June 2024 Service
£m £m £m £m £m £m £m
£m
Adjusted
operating 4 47.4 1.1 11.4 12.6 (18.0) 54.5 — 54.5
profit/(loss)
Cost
reduction 4 (3.6) 0.7 (0.2) — (5.1) — (8.2) (8.2)
programme
Business
exits – 8 — — — — — — 8.1 8.1
trading
Total trading 43.8 1.8 11.2 12.6 (23.1) 54.5 (0.1) 54.4
result
Non-trading
items:
Business
exits – 8 — (10.8) (10.8)
non-trading
Other
adjusting 4 — 0.3 0.3
items
Operating 54.5 (10.6) 43.9
profit/(loss)
Interest 5 4.9
income
Interest 5 (28.3)
expense
Share of
results in
associates 1.4
and losses on
financial
assets
Gain on
business 38.1
disposal
Profit before 60.0
tax
Supplementary
information
Depreciation
and 18.6 19.2 3.5 3.1 1.1 45.5 1.5 47.0
amortisation
Impairment of
property,
plant and
equipment,
intangible 0.9 1.1 0.2 0.2 — 2.4 8.4 10.8
assets,
right-of-use
assets and
goodwill
Non-current
Contract
fulfilment
assets 27.6 2.7 1.7 0.4 — 32.4 1.0 33.4
utilisation,
impairment
and
derecognition
Net onerous
contract — — — 4.2 — 4.2 — 4.2
provisions1
4 Adjusted operating profit and adjusted profit before tax
The Board has adopted a policy to separately disclose those items that it considers are outside the underlying operating results for the particular period under review and against which the Group’s performance is assessed internally. In the Board’s judgement, these need to be disclosed separately by virtue of their nature, size and/or incidence for users of these condensed consolidated financial statements to obtain a proper understanding of the financial information and the underlying performance of the Group.
In general, the Board believes that alternative performance measures (APMs) are useful for investors because they provide further clarity and transparency about the Group’s financial performance and are closely monitored by management to evaluate the Group’s operating performance to facilitate financial, strategic and operating decisions. Accordingly, these items are also excluded from the discussion of divisional performance. Those items which relate to the ordinary course of the Group’s operating activities remain within adjusted profit.
The items excluded from adjusted profit are discussed further below.
Operating profit (Loss)/profit before tax
30June 2025 30 June 2024 30June 2025 30 June 2024
Notes
£m £m £m £m
Reported 9.2 43.9 (9.5) 60.0
Amortisation and
impairment of acquired 0.1 0.1 0.1 0.1
intangibles
Net finance 5 — — (1.7) 0.4
(income)/expense
Business exits expense/ 8 6.9 2.7 7.3 (36.4)
(gain)
Cyber incident expense/ 3.0 (0.4) 3.0 (0.4)
(gain)
Cost reduction 23.4 8.2 23.4 8.2
programme
Adjusted 42.6 54.5 22.6 31.9
1.
Adjusted operating profit of £42.6m (30
2.
The tax impact of the profit before tax adjusting items is £nil (30
3. The comparative adjusted operating profit and adjusted profit before tax has been re-presented for the impact of business exits announced since 30
Amortisation and impairment of acquired intangible assets:
the Group recognised acquired intangible amortisation of £0.1m (30
Net finance expense: the net finance expense excluded from adjusted profits relates to movements in the mark-to-market value of forward foreign exchange contracts to cover anticipated future costs and therefore have no equivalent offsetting transaction in the accounting records.
Business exits : the trading result of businesses exited, or in the process of being exited, and the gain or loss on disposals, are excluded from the Group's adjusted results. Note 8 provides further detail regarding which income statement lines are impacted by business exits.
Cyber incident:
the Group has incurred exceptional costs associated with the
Cost reduction programme:
the Group implemented a multi-year cost reduction programme in
The Group exercises judgement in assessing whether the actions being taken to deliver these savings are exceptional as opposed to business as usual, and therefore whether or not the costs to deliver the savings should be excluded from the Group's adjusted results. The assessment considers the nature of the activity being undertaken, in particular, whether it was anticipated in the original bid to win a customer contract. Investment in new technology that supports the delivery of customer contracts are considered business as usual and are not excluded from the Group’s adjusted results.
A charge of £23.4m (30
Refer to note 9 for the cash flow impact of the above.
5 Net finance costs
The table below shows the composition of net finance costs, including those excluded from adjusted profit:
30June 2025 30 June 2024
Notes
£m £m
Finance income
Interest income
Interest on cash (1.2) (1.2)
Interest on finance lease assets (2.7) (2.8)
Net interest income on defined benefit pension 14 (1.1) (0.9)
schemes
Total finance (income) (5.0) (4.9)
Finance costs
Interest expense
Private placement loan notes1 9.3 8.2
Bank loans and overdrafts 2.7 5.6
Cost of non-recourse trade receivables financing 12 1.4 2.1
Interest on finance lease liabilities 10.4 10.9
Discount unwind on provisions 1.2 0.7
Total interest expense 25.0 27.5
Finance costs included within business exits
Interest on finance lease liabilities — 0.4
Finance costs excluded from adjusted profits
Non-designated foreign exchange forward contracts (0.4) (0.2)
- change in mark-to-market value
Fair value hedge ineffectiveness2 (1.3) 0.6
Total finance (income)/cost excluded from (1.7) 0.8
adjusted profits
Total finance costs 23.3 28.3
Net finance costs included in adjusted profit 20.0 22.6
Total net finance costs 18.3 23.4
1. Private placement loan notes comprise US dollar and British pound sterling private placement loan notes.
2. Fair value hedge ineffectiveness arises from changes in currency basis, and the movement in a provision for counterparty risk associated with the swaps.
6 Income tax
30June 2025 30 June 2024
Included in Excluded Included in Excluded from
Total adjusted from Total adjusted adjusted
reported profit adjusted reported profit profit
profit
£m £m £m £m £m
£m
Tax credit/ 2.1 2.1 — (7.1) 5.2 (12.3)
(charge)
Excluding discrete items, the adjusted income tax charge for the six month period is £6.5m (2024: charge of £8.6m) and has been calculated by applying management’s best estimate of the full-year effective tax rate of 28.7% (estimated using full-year profit projections excluding any discrete items) to the adjusted profit before tax for the six months to 30
Excluding discrete items, the reported tax charge of £6.5m (2024: charge of £6.5m) reflects the £nil tax impact on adjusting items. This is determined to be £nil due to the non-deductibility of some business exit costs, and any deductible costs increasing unrecognised timing differences. The reported tax on discrete business exit items is also £nil (2024: charge of £14.5m), resulting in the total reported tax credit, including discrete items, of £2.1m (2024: charge of £7.1m), on a reported loss before tax of £9.5m (2024: profit of £60.0m).
Deferred tax assets are recognised only to the extent that it is probable that future taxable profits will be available against which the assets can be utilised. The recoverability of deferred tax assets is supported by the deferred tax liabilities against which the reversal can be offset and the expected level of future profits in the countries concerned. The recognition of deferred tax assets has been based on the latest financial projections for 2025-2027, using a long-term growth rate of 1.8% and a reducing probability factor applied to future profits, consistent with the approach in recent years. This assessment results in a change in the accounting estimate of deferred tax, adjusted and reported, of £9.7m credit relating to an increase in taxable profits in the assessment model.
Unrecognised temporary differences have reduced by £7.4m, resulting in total unrecognised temporary differences as at 30
The estimated full year effective tax rate of 28.7% includes an income tax charge of £0.2m (2024: charge of £0.5m) related to Pillar Two income taxes. This charge relates to estimated Pillar Two top-up taxes on profits earned in
The Group has an open and positive working relationship with HMRC, has a designated customer compliance manager, and is committed to prompt disclosure and transparency in dealings with HMRC and overseas tax authorities. The Group does not have a complex tax structure, supported by the legal structure simplification from the entity rationalisation programme. The Group does not pursue aggressive tax avoidance activities and has a low-risk rating from HMRC. The Group has operations in a number of countries outside the
7 (Loss)/Earnings per share
Basic earnings/(loss) per share are calculated by dividing the net profit/(loss) for the period attributable to ordinary equity holders of the Parent Company by the weighted average number of ordinary shares outstanding during the period.
Diluted earnings/(loss) per share are calculated by dividing the net profit/(loss) for the period attributable to ordinary equity holders of the Parent Company by the weighted average number of ordinary shares outstanding during the period plus the weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares.
30June 2025 30 June 2024
pence pence1
Basic (loss)/earnings per share – reported (6.62) 47.09
– adjusted 21.63 33.06
Diluted (loss)/earnings per share – reported (6.62) 45.97
– adjusted 21.63 32.27
1.
The 2024 comparatives have been re-presented from those previously published to reflect the 1
for
15 share consolidation undertaken in
The following tables show the earnings and share data used in the basic and diluted earnings/(loss) per share calculations:
30June 2025 30 June 2024
Notes £m £m
Reported (loss)/profit before tax for the period (9.5) 60.0
Income tax credit/(charge) 6 2.1 (7.1)
Reported (loss)/profit for the period (7.4) 52.9
Less: Non-controlling interest (0.1) 0.1
Total (loss)/profit attributable to shareholders (7.5) 53.0
Adjusted profit before tax for the period 4 22.6 31.9
Income tax credit 2.1 5.2
Adjusted profit for the period 24.7 37.1
Less: Non-controlling interest (0.2) 0.1
Adjusted profit attributable to shareholders 24.5 37.2
30June 2025 30 June 2024
thousands thousands1
Weighted average number of ordinary shares (excluding
Employee Benefit Trust shares) for basic earnings per 113,286 112,539
share
Dilutive potential ordinary shares:
Employee share options 3,036 2,743
Weighted average number of ordinary shares (excluding
Employee Benefit Trust shares) adjusted for the effect 116,322 115,282
of dilution
1. The number of shares at 30
At 30
The earnings per share figures are calculated based on earnings attributable to ordinary equity holders of the Parent Company, and therefore exclude non-controlling interest. The earnings per share are calculated on a total reported and an adjusted basis. The earnings per share for business exits and specific items are reconciling items between total reported and adjusted basic earnings per share.
Details of transactions involving ordinary shares or potential ordinary shares between the balance sheet date and the date on which these condensed consolidated financial statements were authorised for issue, are included in note 13.
8 Business exits and assets held-for-sale
Business exits
Business exits are businesses that have been sold, exited during the period, or are in the process of being sold or exited in accordance with the Group's strategy. None of these business exits meet the definition of ‘discontinued operations’ as stipulated by IFRS 5 Non-current assets held-for-sale and discontinued operations , which requires disclosure and comparatives to be restated where the relative size of a disposal or business closure is significant, which is normally understood to mean a reported segment.
However, the trading results of these businesses, non-trading expenses, and any gain/loss on disposal, have been excluded from adjusted results. To enable a like-for-like comparison of adjusted results, the 30
Assets held-for-sale
The Group classifies a non-current asset (or disposal group) as held-for-sale if its carrying amount will be recovered principally through a sale transaction instead of continued use. For this to be the case, the asset (or disposal group) must be available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets (or disposal groups) and its sale must be highly probable. For the sale to be highly probable, the appropriate level of management must be committed to a plan to sell the asset (or disposal group), and an active programme to locate a buyer and complete the plan must have been initiated. Further, the asset (or disposal group) must be actively marketed for sale at a price that is reasonable in relation to its current fair value, and the sale should be expected to be completed within one year from the date of classification.
Based on the above requirements, individual businesses will only reach the criteria to be treated as held-for-sale where the disposal is seen to be highly probable and expected to complete within the following twelve months. At 30
2025 business exits
In addition to the above disposals, as disclosed in the 2024 Annual Report, the Group decided to exit its corporate venture business (Capita Scaling Partner) in Capita Experience and a small business from Capita Public Service during 2024. The trading results and non-trading expenses of these businesses have also been excluded from adjusted results.
The Capita Scaling Partner business managed the Group’s investments in start-up and scale-up companies. One of these investments was partially sold during the first half of the year realising a gain of £nil which is included within 'share of results in associates and losses on financial assets' in the table below. Also included is a loss of £0.4m in relation to the revaluation of the remaining Capita Scaling Partner investments. The Group will seek to maximise value from the remaining Capita Scaling Partner investments, which at 30
The Group continues to progress the exit of the closed book Life & Pensions business within the Regulated Services business in Capita Experience. Although transition agreements have been reached for the majority of clients, there remains one client where this is not the case. Given that this contract contains evergreen clauses (which potentially allow the customer to extend the contracts indefinitely until the run-off of the underlying life and pension books is complete), the overall closed book Life & Pensions business is not seen to meet the criteria to be treated as a business exit until an exit agreement has been agreed with the client.
30June 2025 30 June 2024
Income statement impact
Trading Non-trading Total Trading Non-trading Total
£m £m £m £m £m £m
Revenue 5.0 — 5.0 38.7 — 38.7
Cost of sales (6.8) — (6.8) (30.5) — (30.5)
Gross profit (1.8) — (1.8) 8.2 — 8.2
Administrative expenses (2.9) (2.2) (5.1) (0.1) (10.8) (10.9)
Operating profit/(loss) (4.7) (2.2) (6.9) 8.1 (10.8) (2.7)
Share of results in
associates and investment — (0.4) (0.4) — 1.4 1.4
gains
Net finance income/ — — — (0.4) — (0.4)
(expense)
Gain on business disposal — — — — 38.1 38.1
Profit/(loss) before tax (4.7) (2.6) (7.3) 7.7 28.7 36.4
Taxation — — — (1.9) (12.2) (14.1)
Profit/(loss) after tax (4.7) (2.6) (7.3) 5.8 16.5 22.3
Trading revenue and costs represent the trading performance of the above businesses up to the point of being disposed or exited, and in the comparative those businesses disposed of during 2024 (being Capita One and the Group's 75% shareholding in
Non-trading administrative expenses comprise: project costs of £2.5m (30
Non-trading taxation in 2024 relates to a change in accounting estimate of deferred tax assets, due to businesses being disposed or exited and deductible intangible impairments. Refer to note 6 for further details.
2025 disposals
No disposals were completed during the six months ended 30
30June 2025 30 June 2024
£m £m
Disposal group assets held-for-sale — 69.9
Disposal group liabilities held-for-sale — (42.4)
Net identifiable assets sold — 27.5
Non-controlling interests — (9.1)
— 18.4
Sales price
- received in cash — 61.9
Less: disposal costs — (5.4)
Net sales price — 56.5
Gain on business disposals — 38.1
Net cash inflow
Proceeds received — 61.9
Less disposal costs:
- income statement charge — (5.4)
- change in accrued disposal costs during the period (0.6) (0.5)
Total proceeds received net of disposal costs paid (0.6) 56.0
Total cash held by businesses when sold
Cash held by businesses classified as held-for-sale — (6.3)
Total cash held by businesses when sold — (6.3)
Net cash inflow (0.6) 49.7
Disposal group assets and liabilities held-for-sale
At both 30
30June 2025 31 December 2024
£m £m
Property, plant and equipment 0.1 0.1
Disposal group assets held-for-sale 0.1 0.1
Accruals 0.2 0.1
Disposal group liabilities held-for-sale 0.2 0.1
Business exit cash flows
Businesses exited and being exited had a cash generated from/(used by) operations outflow of £4.7m (30
9 Cash flow information
30June 2025 30 June 2024
Excluding business Reported Excluding business
Note Reported exits1 exits1
£m £m
£m £m
Cash flows from
operating
activities:
Reported operating 4 9.2 9.2 43.9 43.9
profit
Add back: business 8 — 6.9 — 2.7
exit operating loss
Total operating 9.2 16.1 43.9 46.6
profit
Adjustments for
non-cash items:
Depreciation 27.9 27.9 34.9 34.9
Amortisation of 9.0 9.0 12.1 10.7
intangible assets
Share-based payment 2.9 2.9 2.8 2.8
expense
Employee benefits 14 4.8 4.8 4.2 4.2
(Loss)/gain on sale
of property, plant (0.2) (0.2) 0.1 0.1
and equipment and
intangible assets
Amendments and
early terminations (0.1) (0.1) (8.4) (8.4)
of leases
Impairment of 0.9 0.9 10.8 2.1
non-current assets
Other adjustments:
Movement in (12.4) (10.8) (35.4) (30.6)
provisions2
Pension deficit — — (20.8) (6.3)
contributions
Other contributions
into pension (3.9) (3.9) (4.1) (4.1)
schemes
Movements in
working capital2:
Trade and other (67.8) (68.6) (46.7) (43.7)
receivables
Non-recourse trade
receivables (4.0) (4.0) (1.7) (1.7)
financing
Trade and other 8.4 4.8 (25.8) (28.5)
payables
Deferred income 41.8 42.4 65.7 45.5
Contract fulfilment
assets 14.3 14.3 (5.0) (5.2)
(non-current)
Cash generated from 30.8 35.5 26.6 18.4
operations
Adjustments for
free cash flows:
Income tax paid3 (3.2) (3.2) (1.9) (1.9)
Income tax 0.6 0.6 1.5 1.5
received3
Interest received 4.0 3.9 4.1 4.1
Interest paid (24.1) (24.1) (26.3) (26.3)
Net cash inflow/
(outflow) from 8.1 12.7 4.0 (4.2)
operating
activities
Purchase of
property, plant and (3.3) (3.3) (7.2) (6.9)
equipment
Purchase of (12.9) (12.9) (14.3) (14.3)
intangible assets
Proceeds from sale
of property, plant 1.0 1.0 — —
and equipment and
intangible assets
Capital element of
lease rental 2.1 2.1 2.8 2.8
receipts
Capital element of
lease rental (25.7) (25.7) (29.9) (29.9)
payments
Free cash flow1 (30.7) (26.1) (44.6) (52.5)
1. Definitions of the alternative performance measures and related KPIs can be found in the appendix.
1. These movements exclude items that have been adjusted for elsewhere within
the cash flow statement. For example, balances transferred to held-for-sale
or relate to a business disposal. As such these movements may not directly
agree to the period-on-period movements within the balance sheet.
3. Income tax paid and income tax received have been separately disclosed for the current period, with the prior period re-presented on the same basis. Previously these were presented net as 'income tax paid'.
Cyber incident:
In relation to the exceptional cyber incident costs referred to in note
4, the cash inflow during the six months ended 30
Cost reduction programme:
In relation to the implementation of the cost reduction programme detailed in note
4, the cash outflow during the six months ended 30
Free cash flow and cash generated from operations (alternative performance measures - refer to the appendix)
The Board considers free cash flow, and cash generated from operations excluding business exits, to be alternative performance measures because these metrics provide a more representative measure of the sustainable cash flow of the Group.
These measures are analysed below:
Cash
Free cash generated/
flow (used) by
operations
2025 2024 2025 2024
£m £m £m £m
Reported (including business exits) (30.7) (44.6) 30.8 26.6
Business exits 4.6 (22.4) 4.7 (22.7)
Pension deficit contributions triggered by disposals — 14.5 — 14.5
Excluding business exits (26.1) (52.5) 35.5 18.4
Business exits:
The cash flows of businesses exited, or in the process of being exited, and the proceeds from disposals, are disclosed outside the adjusted results. The 30
Pension deficit contributions triggered by disposals: The Trustees of the Group's main defined benefit pension scheme (HPS) agreed with the Group to accelerate the payment of future agreed deficit contributions on a pound for pound basis in the event of disposal proceeds being used to fund mandatory prepayments of debt. The Group paid all the outstanding deficit contributions in 2024. There are no further agreed deficit contributions to be paid at this time.
Reconciliation of net cash flow to movement in net debt
Overdrafts comprise the aggregate value of overdrawn bank account balances within the Group’s notional interest pooling arrangements. These aggregate overdrawn amounts are fully offset by surplus balances within the same notional pooling arrangements.
At 30
Non-cash
Net debt at Cash flow Net debt at
Six months ended 30June 2025 1 January movements movement1 30June
£m £m £m
£m
Cash, cash equivalents and 191.4 (13.3) 1.5 179.6
overdrafts
Private placement loan notes (271.9) (4.4) 10.0 (266.3)
Unamortised transaction costs on 2.6 0.5 (0.7) 2.4
debt issuance
Carrying value of private placement (269.3) (3.9) 9.3 (263.9)
loan notes
Cross-currency interest rate swaps 12.2 (13.1) (0.8) (1.7)
Fair value of private placement loan (257.1) (17.0) 8.5 (265.6)
notes
Other finance (0.1) (0.2) — (0.3)
Lease liabilities (348.7) 36.1 (12.6) (325.2)
Total net liabilities from financing (605.9) 18.9 (4.1) (591.1)
activities
Deferred consideration payable (0.7) — — (0.7)
Net debt (415.2) 5.6 (2.6) (412.2)
1. The non-cash movement relates to: the effect of changes in foreign exchange rates on cash; fair value changes on the swaps; amortisation of private placement loan notes issuance costs; and additions, terminations and foreign exchange rate effects on the Group's lease liabilities.
Net debt at Cash flow Non-cash Net debt at
Six months ended 30 June 2024 1 January movements movement 1 30 June
£m £m £m £m
Cash, cash equivalents and 67.6 15.6 2.2 85.4
overdrafts
Private placement loan notes (267.0) — (1.5) (268.5)
Unamortised transaction costs on 4.5 — (1.1) 3.4
debt issuance
Carrying value of private placement (262.5) — (2.6) (265.1)
loan notes
Cross-currency interest rate swaps 13.6 — 0.5 14.1
Fair value of private placement (248.9) — (2.1) (251.0)
loan notes
Other finance (0.1) — — (0.1)
Lease liabilities (363.4) 41.2 (33.3) (355.5)
Total net liabilities from (612.4) 41.2 (35.4) (606.6)
financing activities
Deferred consideration payable (0.7) — — (0.7)
Net debt (545.5) 56.8 (33.2) (521.9)
10
In preparing these condensed consolidated financial statements, the Group undertook a review to identify possible indicators of impairment of goodwill, in particular for the Contact Centre group of CGUs where an impairment had been recognised at 31
In accordance with the requirements of IAS 36 Impairment of Assets , this was done through consideration of qualitative and quantitative factors. In particular, consideration was given to performance against forecast cash flows used in the 2024 year end impairment test, which had been derived from the 2025-2027 business plan approved by the Board. For the Contact Centre group of CGUs these business plan cash flows had been further risk adjusted from 2025 onwards to reflect risks inherent to the business from a market participant perspective, and taking account of the historical performance of the business and inherent uncertainty in forecasting.
Where this gave rise to an indicator of potential impairment, further review was performed. No indicators of impairment were identified as at 30
11 Provisions and contingent liabilities
Cost Business Claims and Customer
reduction exit Property Other
litigation contract Total
provision provision provision provisions
provision provision £m
£m £m £m £m
£m £m
At 1 9.1 6.4 30.2 6.4 62.2 5.0 119.3
January
Provisions
in the 15.7 1.9 9.2 2.1 9.0 0.4 38.3
period
Releases in (0.1) (0.1) (10.1) (0.4) (0.5) — (11.2)
the period
Utilisation (14.9) (1.6) (4.6) (1.3) (16.2) (1.7) (40.3)
Unwinding
of discount
and changes — — — — 1.6 — 1.6
in the
discount
rate
Exchange — — (0.1) — — (0.1) (0.2)
movement
At 30June 9.8 6.6 24.6 6.8 56.1 3.6 107.5
30June 2025 31 December 2024
£m £m
Current 70.1 81.4
Non-current 37.4 37.9
107.5 119.3
Claims and litigation: The Group's entities are party to legal actions and claims which arise in the normal course of business. The Group needs to apply judgement in determining the merit of litigation against it and the chances of a claim being successfully made. It needs to determine the likelihood of an outflow of economic benefits occurring and whether there is a need to disclose a contingent liability or whether a provision might be required due to the probability assessment. These matters are reassessed regularly and where obligations are probable and estimable, provisions are made representing the Group’s best estimate of the expenditure to be incurred. Due to the nature of these claims, the Group cannot give an estimate of the period over which this provision will unwind.
At the date of approval of these condensed consolidated financial statements, we remain in dialogue with the Information Commissioner’s Office (ICO) following the cyber incident in
At any time there are a number of claims or notifications that need to be assessed across the Group. The disparate nature of the Group's entities heightens the risk that not all potential claims are known at any point in time.
Customer contract: The provision includes onerous contract provisions in respect of customer contracts where the costs of fulfilling a contract (both incremental and costs directly related to contract activities) exceeds the economic benefits expected to be received under the contract, claims/obligations associated with missed milestones in contractual obligations, and other potential exposures related to contracts with customers. Customer contract lifetime reviews are used to determine the value of an onerous contract provision. The contract lifetime review reflects the best estimate of forecast external revenues and costs over the remaining contract term. These provisions are forecast to unwind over periods of up to five years.
The customer contract provision includes £42.7m (31
At 30
12 Financial instruments
The Group’s financial assets and liabilities are classified based on the following fair value hierarchy:
• Level-1: quoted (unadjusted) prices in active markets for identical assets or liabilities.
• Level-2: other techniques for which inputs that have a significant effect on the recorded fair value are based on observable (directly or indirectly) market data. With the exception of current financial instruments (which have a short maturity), the fair value of the Group’s level-2 financial instruments was calculated by discounting the expected future cash flows at prevailing interest rates. The valuation models incorporate various inputs including foreign exchange spot and forward rates and interest rate curves. In the case of floating rate borrowings the nominal value approximates to fair value because interest is set at floating rates where payments are reset to market values at intervals of less than one year.
• Level-3: other techniques for which inputs that have a significant effect on the recorded fair value are not based on observable market data.
Other financial instruments, where observable market data is not available, are carried at either amortised cost or cost (undiscounted cash flows) as a reasonable approximation of fair value. During the six months ended 30
The following table analyses, by classification and category, the carrying value of the Group’s financial instruments and identifies the level of the fair value hierarchy for the instruments carried at fair value:
Derivatives
Fair Amortised Non-
FVPL FVOCI used for Total Current
At 30June 2025 Note value cost current
£m £m hedging £m £m
hierarchy £m £m
£m
Financial
assets
Lease n/a — — — 93.6 93.6 4.5 89.1
receivables
Cash flow
hedges -
foreign Level-2 — — 0.6 — 0.6 0.3 0.3
exchange
contracts
Cash flow
hedges - Level-2 — — 0.3 — 0.3 0.3 —
currency swaps
Non-designated
foreign
exchange Level-2 0.2 — — — 0.2 0.2 —
forwards and
swaps
Originated
loans n/a — — — 0.7 0.7 — 0.7
receivable
Financial
assets at fair Level-3 3.2 — — — 3.2 — 3.2
value through
P&L
Financial
assets at fair Level-3 — 0.6 — — 0.6 — 0.6
value through
OCI
3.4 0.6 0.9 94.3 99.2 5.3 93.9
Other
financial
assets
Cash n/a — — — 334.1 334.1 334.1 —
Total
financial 3.4 0.6 0.9 428.4 433.3 339.4 93.9
assets
Fair Derivatives Non-
FVPL FVOCI used for Amortised Total Current
At 30June 2025 Note value £m £m hedging cost £m current
£m £m £m
hierarchy £m
Financial
liabilities
Private
placement loan a n/a — — — 263.9 263.9 — 263.9
notes
Other finance n/a — — — 0.3 0.3 0.3 —
Cash flow
hedges -
foreign Level-2 — — 6.3 — 6.3 3.1 3.2
exchange
contracts
Cash flow
hedges - Level-2 — — 7.8 — 7.8 — 7.8
currency swaps
Cash flow
hedges - Level-2 — — 0.1 — 0.1 — 0.1
interest rate
swaps
Non-designated
foreign
exchange Level-2 1.8 — — — 1.8 1.4 0.4
forwards and
swaps
Cross-currency
interest rate a Level-2 — — 1.7 — 1.7 — 1.7
swaps
Deferred
consideration n/a — — — 0.7 0.7 — 0.7
payable
1.8 — 15.9 264.9 282.6 4.8 277.8
Other
financial
liabilities
Overdrafts n/a — — — 154.5 154.5 154.5 —
Lease n/a — — — 325.2 325.2 38.4 286.8
liabilities
Total
financial 1.8 — 15.9 744.6 762.3 197.7 564.6
liabilities
Financial assets measured at amortised cost consist of cash, lease receivables and originated loans. The carrying value of cash is a reasonable approximation of its fair value due to the short-term nature of the instruments. Lease receivables and originated loans are measured at amortised cost using the effective interest rate method. Included in other investments are £0.6m (31
The financial assets at Fair Value through Profit and Loss (FVPL) relate to the Group’s minority shareholding in companies as part of the Capita Scaling Partner business. As disclosed in note 8, during the first half of 2024 the Group decided to exit the Capita Scaling Partner business as a whole, while seeking to maximise value from the remaining investments. Following the decision to exit the business and subsequent losses realised on disposals in the second half of 2024, the Group evolved its revaluation approach for these assets to take into account recent experiences, and to better reflect expected disposal proceeds.
Financial liabilities measured at amortised cost consist of private placement loan notes, overdrafts, lease liabilities and deferred consideration payable. With the exception of certain series within the fixed rate private placement loan notes, the carrying value of financial liabilities are a reasonable approximation of their fair value. This is because either the interest payable is close to market rates or the liability is short-term in nature. The private placement loan note series that remain subject to a fixed rate of interest have an underlying carrying value of £231.4m (31
The Group’s key financial liabilities are set out below:
a. Private placement loan notes
The private placement loan notes were issued in USD and GBP. The Group manages its exposure to foreign exchange and interest rate movements through cross-currency interest rate swaps, interest rate swaps, and cross currency swaps. USD and GBP private placement loan notes of £66.7.m and £22.3m were repaid at maturity in
b. Bank facilities
The Group's RCF was undrawn at 30
Derivatives
Fair Amortised Non-
At 31 December FVPL FVOCI used for Total Current
2024 Note value cost current
£m £m hedging £m £m
hierarchy £m £m
£m
Financial
assets
Lease n/a — — — 95.7 95.7 4.2 91.5
receivables
Cash flow
hedges -
foreign Level-2 — — 1.8 — 1.8 0.4 1.4
exchange
contracts
Cash flow
hedges - Level-2 — — 2.7 — 2.7 1.8 0.9
currency swaps
Cash flow
hedges - Level-2 — — 0.2 — 0.2 0.2 —
interest rate
swaps
Non-designated
foreign
exchange Level-2 0.7 — — — 0.7 0.6 0.1
forwards and
swaps
Cross-currency
interest rate a Level-2 — — 13.0 — 13.0 13.0 —
swaps
Originated
loans n/a — — — 0.7 0.7 — 0.7
receivable
Financial
assets at fair Level-3 4.1 — — — 4.1 0.4 3.7
value through
P&L
Financial
assets at fair Level-3 — 0.7 — — 0.7 — 0.7
value through
OCI
4.8 0.7 17.7 96.4 119.6 20.6 99.0
Other
financial
assets
Cash and cash n/a — — — 253.6 253.6 253.6 —
equivalents
Total
financial 4.8 0.7 17.7 350.0 373.2 274.2 99.0
assets
Fair Derivatives Amortised
At 31 December FVPL FVOCI used for Total Current Non-
2024 Note value hedging cost £m £m current
£m £m £m £m
hierarchy £m
Financial
liabilities
Private
placement loan a n/a — — — 269.3 269.3 87.6 181.7
notes
Other finance n/a — — — 0.1 0.1 0.1 —
Cash flow
hedges - Level-2 — — 0.3 — 0.3 0.3 —
interest rate
swaps
Non-designated
foreign
exchange Level-2 0.2 — — — 0.2 0.2 —
forwards and
swaps
Cross-currency
interest rate a Level-2 — — 0.8 — 0.8 — 0.8
swaps
Deferred
consideration n/a — — — 0.7 0.7 — 0.7
payable
0.2 — 1.1 270.1 271.4 88.2 183.2
Other
financial
liabilities
Overdrafts n/a — — — 62.2 62.2 62.2 —
Lease n/a — — — 348.7 348.7 42.9 305.8
liabilities
Total
financial 0.2 — 1.1 681.0 682.3 193.3 489.0
liabilities
The following table shows the changes from the opening balances to the closing balances for Level-3 fair values.
Investments
FVPL and
FVOCI
£m
At 1 January 4.8
Disposals (0.6)
Loss in fair value recognised in income statement (0.4)
At 30June 3.8
Non-recourse trade receivables financing
In the
13 Issued share capital and share premium
Share capital Share premium Employee benefit
trust shares
Allotted, called up and fully No.thousands £m £m No.thousands £m
paid
Ordinary shares of 2 1/15p
each pre share consolidation
At 1 January 1,701,274 35.2 1,145.5 9,058 (0.3)
Share consolidation (1,587,856) — — (8,570) —
Ordinary shares of 31p each 113,418 35.2 1,145.5 488 (0.3)
post share consolidation
Issue of share capital 542 0.1 — 542 (0.1)
Share premium cancellation — — (1,145.5) — —
Issued on exercise of share — — — (1,096) 0.8
options
Shares purchased — — — 195 (0.4)
At 30June 113,960 35.3 — 129 —
The Group uses shares held in the
During the six months to 30
On 10
Following shareholder approval at the Company’s 2025 Annual General Meeting held on 28
Also, following shareholder approval at the 2025 AGM and subsequent sanctioning by the
The Group has an unexpired authority to repurchase up to 9.95% of its issued share capital.
14 Employee benefits
The total net defined benefit pension position for accounting purposes as at 30
The principal financial assumptions for the accounting valuation as at 30
30June 2025 31 December 2024 30 June 2024
Discount rate 5.60% pa 5.50% pa 5.15% pa
Rate of price inflation – RPI 2.95% pa 3.10% pa 3.15% pa
Rate of price inflation – CPI 2.40% pa 2.55% pa 2.60% pa
There were no changes in demographic assumptions since 31
Movements in the total net defined benefit pension position recognised in the balance sheet were as follows:
30June 2025 30 June 2024
£m £m
At 1 January 37.9 26.8
Current service and administration costs (4.8) (4.2)
Interest income 1.1 0.9
Actuarial gain recognised in OCI1 17.4 81.1
Return on plan assets, excluding interest, recognised (20.8) (84.6)
in OCI
Employer contributions 3.9 24.9
Exchange movement (0.1) 0.1
At 30 June 34.6 45.0
Schemes in a net surplus 39.1 49.7
Schemes in a net deficit (4.5) (4.7)
At 30 June 34.6 45.0
1. As at 30
The latest formal valuation for the Group’s main defined benefit pension scheme (HPS), which represents around 95% of the total assets of the defined benefit pension schemes in which the Group reports, was carried out as at 31
The estimated updated funding positions as at 30
The next full actuarial valuation for the HPS is due to be carried out with an effective date of 31
The Group remains aware of the 2023 high court case (and subsequent appeal in 2024) that considered the validity of deeds where no Section 37 certificate (confirming that the minimum level of benefits had not been breached) was attached to the deed. The Government has recently announced that they will introduce legislation to enable schemes to retrospectively obtain the necessary actuarial confirmations required where these are not currently available. It is expected that this will resolve the issue in the majority of cases.
The trustees of the Group’s defined benefit pension schemes are awaiting full details of this legislation before assessing any remaining impact.
15 Related-party transactions
Compensation of key management personnel
30June 2025 30 June 2024
£m £m
Short-term employment benefits 3.6 2.9
Pension 0.1 —
Share-based payments 1.4 0.9
5.1 3.8
Gains on share options exercised in the period by Capita
plc Executive Directors were £nil (30
During the period, the Group rendered administrative services to Smart
HPS (Capita's main defined benefit pension scheme) is a related party of the Group.
16 Post balance sheet events
On 1
Independent review report to
Conclusion
We have been engaged by
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30
Basis for conclusion
We conducted our review in accordance with International Standard on Review Engagements (
A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed in an audit as described in the Basis for conclusion section of this report, nothing has come to our attention that causes us to believe that the directors have inappropriately adopted the going concern basis of accounting, or that the directors have identified material uncertainties relating to going concern that have not been appropriately disclosed.
This conclusion is based on the review procedures performed in accordance with ISRE (
Directors’ responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the DTR of the
As disclosed in note 1.2, the annual financial statements of the Group are prepared in accordance with
The directors are responsible for preparing the condensed set of financial statements included in the half-yearly financial report in accordance with IAS 34 as adopted for use in the
In preparing the condensed set of financial statements, the directors are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.
Our responsibility
Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review. Our conclusion, including our conclusions relating to going concern, are based on procedures that are less extensive than audit procedures, as described in the Basis for conclusion section of this report.
The purpose of our review work and to whom we owe our responsibilities
This report is made solely to the Company in accordance with the terms of our engagement to assist the Company in meeting the requirements of the DTR of the
for and on behalf of
Chartered Accountants
London
E14 5GL
4
Appendix: Alternative performance measures
The Group presents various alternative performance measures (APMs) because internally the performance of the Group is reported and measured on this basis. This includes key performance indicators (KPIs) such as adjusted revenue, adjusted operating margin, adjusted basic/diluted earnings per share, free cash flow excluding business exits, and gearing ratios. In general, the Board believes that the APMs are useful for investors because they provide further clarity and transparency about the Group’s financial performance and are closely monitored by management to evaluate the Group’s operating performance and facilitate financial, strategic and operating decisions.
These APMs should not be viewed as a complete picture of the Group’s financial performance which is presented in the reported results. The exclusion of certain items may result in a more favourable view when expenses such as goodwill impairment; and, costs relating to the cyber incident in
Closest Definition,
APM equivalent Purpose and
IFRS Reconciliation
measure
Income
statement
Calculated as revenue less any revenue relating to
Revenue businesses that have been sold, or exited during the year
or prior year; or, are in the process of being sold, or
exited.
Adjusted
revenue This measure of revenue is used internally in respect of
the Group’s continuing business (being the Group’s
continuing activities, which exclude business exits) and
the Board believes it is a good indication of ongoing
performance.
The table below shows a reconciliation between reported and
adjusted revenue, as well as adjusted revenue growth/
(decline):
30June 30 June
2025 2024
Reported £1,159.8m £1,237.3m
revenue
Deduct:
business exits £(5.0)m £(38.7)m
(note 3)
Adjusted £1,154.8m £1,198.6m
revenue
Adjusted
revenue (3.7)% (9.3)%
reduction
Operating Calculated as reported operating profit excluding items
Adjusted profit determined by the Board to be outside underlying
operating operations. These items are detailed in note 4.
profit
A reconciliation of reported to adjusted operating profit
is provided in note 4.
Calculated as the reported / adjusted operating profit
No direct divided by reported / adjusted revenue.
equivalent
This measure is an indicator of the Group’s operating
Reported efficiency.
/
adjusted The table below shows the components, and calculation, of
operating reported / adjusted operating profit margin:
margin
Reported Adjusted
30June 30 June 30June 30 June
2025 2024 2025 2024
Revenue a £1,159.8m £1,237.3m £1,154.8m £1,198.6m
Operating
profit (note b £9.2m £43.9m £42.6m £54.5m
4)
Operating b/a 0.8% 3.5% 3.7% 4.5%
margin
Calculated as reported profit before tax for the six month
period before: depreciation, amortisation and impairment of
Reported No direct property, plant and equipment, intangible assets and
EBITDA equivalent right-of-use assets; net finance costs; the share of
results in associates and losses on financial assets and
gain/loss on business disposal.
The directors believe that reported Earnings before
Interest, Tax, Depreciation and Amortisation (EBITDA) is a
useful measure for investors because it is closely
monitored by management to evaluate Group and divisional
operating performance.
The table below shows the calculation of reported EBITDA:
30June 30 June
2025 2024
Reported (loss)/profit before tax £(9.5)m £60.0m
Add back: net finance costs (note 5) £18.3m £23.4m
Add back: depreciation and impairment £9.9m £13.1m
of property, plant and equipment
Add back: depreciation and impairment £18.3m £22.0m
of right-of-use assets
Add back: amortisation and impairment £9.6m £22.7m
of intangibles
Add back: gain on business disposal £—m £(38.1)m
(note 8)
Add back: share of results in
associates and losses on financial £0.4m £(1.4)m
assets
Reported EBITDA £47.0m £101.7m
Reported EBITDA 4.1% 8.2%
margin
Alternative performance measures continued
Closest Definition,
APM equivalent Purpose and
IFRS Reconciliation
measure
Income statement
continued
Calculated as adjusted operating profit for the six month
period before: depreciation, amortisation and impairment
Adjusted No direct of property, plant and equipment, intangible assets and
EBITDA equivalent right-of-use assets; net finance costs; and the share of
results in associates and losses on financial assets
(other than those already excluded from adjusted
operating profit).
The directors believe that adjusted Earnings before
Interest, Tax, Depreciation and Amortisation (EBITDA) is
a useful measure for investors because it is closely
monitored by management to evaluate Group and divisional
operating performance.
This measure has been calculated pre and post the impact
of IFRS 16 to enable investors to understand the impact
of the Group’s lease portfolio on adjusted EBITDA.
The table below shows the calculation of adjusted EBITDA:
Post IFRS16 Pre IFRS16
30June 30 June 30June 30 June
2025 2024 2025 2024
Adjusted profit £22.6m £31.9m £28.6m £32.7m
before tax
Add back: adjusted
net finance costs £20.0m £22.6m £12.3m £14.5m
(note 5)
Add back: adjusted
depreciation and
impairment of £9.9m £12.9m £9.9m £12.9m
property, plant
and equipment
Add back: adjusted
depreciation and
impairment of £18.2m £22.3m £—m £—m
right-of-use
assets
Add back: adjusted
amortisation and £9.5m £12.7m £9.5m £12.7m
impairment of
intangibles
Adjusted EBITDA £80.2m £102.4m £60.3m £72.8m
Adjusted EBITDA 6.9% 8.5% 5.2% 6.1%
margin
Calculated as profit or loss before tax excluding the
items detailed in note 4 which include: business exits
Profit/ (trading results, non-trading expenses, and any gain/loss
Adjusted (loss) on business disposal); acquired intangible amortisation;
profit/ before tax impairment of goodwill and acquired intangibles; costs of
(loss) the cyber incident in March 2023; and expenses associated
before tax with the cost reduction programme.
A reconciliation of reported to adjusted profit before
tax is provided in note 4.
Profit/ Calculated as the above adjusted profit or loss before
(loss) tax, less the tax credit or expense on adjusted profit or
Adjusted after tax loss.
profit/
(loss) The table below shows a reconciliation:
after tax
30June 30 June
2025 2024
Adjusted
profit before £22.6m £31.9m
tax (note 4)
Tax on
adjusted £2.1m £5.2m
profit (note
6)
Adjusted
profit after £24.7m £37.1m
tax
Basic Calculated as the adjusted profit or loss for the period
earnings after tax less non-controlling interests divided by the
Adjusted per share weighted average number of ordinary shares outstanding
basic during the period.
earnings
per share The Board believes that this provides an indication of
basic earnings per share of the Group on adjusted profit
after tax.
For the calculation of adjusted basic earnings per share
refer to note 7.
Calculated as the adjusted profit or loss for the period
after tax less non-controlling interests divided by the
Diluted weighted average number of ordinary shares outstanding
Adjusted earnings during the period plus the weighted average number of
diluted per share ordinary shares that would have been issued on the
earnings conversion of all the dilutive potential ordinary shares
per share into ordinary shares.
The Board believes that this provides an indication of
diluted earnings per share of the Group on adjusted
profit after tax.
For the calculation of adjusted diluted earnings per
share refer to note 7.
Alternative performance measures continued
Closest Definition,
APM equivalent Purpose and
IFRS Reconciliation
measure
Cash flows and net
debt
Cash flows Calculated as the cash flows generated from operations
generated excluding the items detailed in note 9 which includes:
from/(used Cash business exits (trading results and non-trading expenses)
by) generated and pension deficit contributions which have been
operations from/(used triggered by disposals.
excluding by)
business operations A reconciliation of reported to cash generated from/(used
exits by) operations excluding business exits is provided in
note 9.
Free cash flow is calculated as cash generated from
operations after: capital expenditure; income tax and
interest; and the proceeds from the sale of property,
plant and equipment and intangible assets; and the
Free cash capital element of lease payments and receipts. Free cash
flow and Net cash flow excluding business exits has the same calculation
free cash flows from but excludes the impact of business exits.
flow operating
excluding activities Free cash flow and free cash flow excluding business
business exits are measures used to show how effective the Group
exits is at generating cash and the Board believes they are
useful for investors and management to measure whether
the Group is generating sufficient cash flow to fund
operations, capital expenditure, non-lease debt
obligations, and dividends.
A reconciliation of net cash flows from operating
activities to free cash flow and free cash flow excluding
business exits and a reconciliation of free cash flow to
free cash flow excluding business exits are provided in
note 9.
Calculated as operating cash flow excluding business
exits divided by adjusted EBITDA.
No direct
Operating equivalent The Board believes that this measure is useful for
cash flow investors because it is closely monitored by management
and to evaluate the Group’s operating performance and to make
operating financial, strategic and operating decisions.
cash
conversion Reported Excluding business
exits
30June 30 June 30June 30 June
2025 2024 2025 2024
Operating £9.2m £43.9m £42.6m £54.5m
profit
Depreciation £27.9m £34.9m £27.9m £34.9m
(note 9)
Amortisation
of intangible £9.0m £12.1m £8.9m £10.6m
assets
Impairment of
non-current £0.9m £10.8m £0.8m £2.4m
assets
EBITDA a £47.0m £101.7m £80.2m £102.4m
Add back:
EBITDA element
of cyber £26.3m £8.1m £—m £—m
incident and
cost reduction
programme
Trade and
other £(67.8)m £(46.7)m £(68.6)m £(43.7)m
receivables
(note 9)
Non-recourse
trade
receivables £(4.0)m £(1.7)m £(4.0)m £(1.7)m
financing
(note 9)
Trade and
other payables £8.4m £(25.8)m £4.8m £(28.5)m
(note 9)
Deferred
income (note £41.8m £65.7m £42.4m £45.5m
9)
Contract
fulfilment
assets £14.3m £(5.0)m £14.3m £(5.2)m
(non-current)
(note 9)
Add back:
Working
capital
element of £(0.7)m £2.4m £(0.7)m £2.4m
cyber incident
and cost
reduction
programme
Working £18.3m £(3.0)m £(11.8)m £(31.2)m
capital
Share-based
payment £2.9m £2.8m £2.9m £2.8m
expense (note
9)
Employee
benefits (note £4.8m £4.2m £4.8m £4.2m
9)
Loss/(gain) on
sale of
property,
plant and £(0.2)m £0.1m £(0.2)m £0.1m
equipment and
intangible
assets (note
9)
Amendments and
early
terminations £(0.1)m £(8.4)m £(0.1)m £(8.4)m
of leases
(note 9)
Movement in
provisions £(12.4)m £(35.4)m £(10.8)m £(30.6)m
(note 9)
Other
contributions
into pension £(3.9)m £(4.1)m £(3.9)m £(4.1)m
schemes (note
9)
Add back:
Non-cash
element of
cyber incident £(5.2)m £15.6m £(5.2)m £15.6m
and cost
reduction
programme
Non-cash and
other £(14.1)m £(25.2)m £(12.5)m £(20.4)m
adjustments
Operating cash b £51.2m £73.5m £55.9m £50.8m
flow
Operating cash b/a 108.9% 72.3% 69.7% 49.6%
conversion
Alternative performance measures continued
Closest Definition,
APM equivalent Purpose and
IFRS measure Reconciliation
Cash flows and net debt
continued
Calculated as the sum of any undrawn committed
facilities and the net cash, cash equivalents net of
Available No direct overdrafts, less any restricted cash. Restricted cash
liquidity equivalent includes cash required to be held under FCA regulations,
cash held in foreign bank accounts, and cash represented
by non-controlling interests.
30June 31
2025 December
2024
Revolving
credit £250.0m £250.0m
facility (RCF)
Less: drawing on committed £—m £—m
facilities (note 12)
Undrawn
committed £250.0m £250.0m
facilities
Cash and cash equivalents £179.6m £191.4m
net of overdrafts (note 9)
Less:
restricted £(45.9)m £(44.2)m
cash
Available £383.7m £397.2m
liquidity
Calculated as the net of the Group’s: cash, cash
Net debt Borrowings, equivalents and overdrafts; private placement loan
cash, notes; other finance; currency and interest rate swaps;
derivatives, lease liabilities; and deferred consideration.
lease
liabilities The Board believes that net debt enables investors to
and deferred see the economic effect of debt, related hedges and cash
consideration and cash equivalents in total and shows the indebtedness
of the Group.
The calculation of net debt is provided in note 9.
Net
financial No direct Calculated as the sum of the Group’s: cash, cash
debt equivalent equivalents and overdrafts; private placement loan
(pre-IFRS notes; other finance; and deferred consideration.
16)
The Board believes that this measure of net debt allows
investors to see the Group's net debt position excluding
its IFRS 16 lease liabilities.
30June 31
2025 December
2024
Net debt (note £412.2m £415.2m
9)
Remove: IFRS16
impact (note £(325.2)m £(348.7)m
9)
Net financial
debt (pre-IFRS £87.0m £66.5m
16)
This ratio is calculated as net debt divided by adjusted
Gearing: No direct EBITDA over a rolling twelve month period including
net debt equivalent business exits not yet completed at the balance sheet
to date.
adjusted
EBITDA The Board believes that this ratio is useful because it
ratio shows how significant net debt is relative to adjusted
EBITDA.
This measure has been calculated including and excluding
the impact of IFRS 16 leases on EBITDA and net debt
because the Board believes this provides useful
information to enable investors to understand the impact
of the Group’s lease portfolio on its gearing ratio.
The table below shows the components, and calculation,
of the net debt / net financial debt (post and pre IFRS
16) to adjusted EBITDA ratio:
Post IFRS16 Pre IFRS16
Rolling twelve 30June 31 30June 31
month period 2025 December 2025 December
20241 20241
Adjusted £163.9m £186.1m £122.6m £135.1m
EBITDA
EBITDA in
respect of
business exits £(7.0)m £(7.7)m £(7.0)m £(7.7)m
not yet
completed
Adjusted
EBITDA
(including £156.9m £178.4m £115.6m £127.4m
business exits
not yet
completed)
Net debt / net £412.2m £415.2m £87.0m £66.5m
financial debt
Net debt / net
financial debt 2.6x 2.3x 0.8x 0.5x
to adjusted
EBITDA ratio
1. To ensure the consistent presentation of the ratios between periods, the
2024 comparatives have not been re-presented.
Comparatives re-presented
Appendix: Covenants
The below measures are submitted to the Group’s lenders and the Board believes these measures provide a useful insight to investors. The 31 December 2024 comparatives have not been re-presented because they are not required to be re-presented for covenant purposes.
Source
Covenants (based on 30June 2025 31 December 2024
rolling twelve months)
Adjusted operating £84.0m £95.9m
profit1
Add back: covenant
adjustments2 and £35.1m £54.1m
amortisation
Adjusted EBITA a1 £119.1m £150.0m
Less: IFRS 16 impact £(3.2)m £(8.8)m
Adjusted EBITA a2 £115.9m £141.2m
(excluding IFRS 16)
Adjusted EBITA £119.1m £150.0m Line item above
Add back: covenant
adjustments3 and £58.0m £55.8m
depreciation
Covenant calculation – b1 £177.1m £205.8m
adjusted EBITDA
Less: IFRS 16 impact £(41.4)m £(51.1)m
Covenant calculation –
adjusted EBITDA b2 £135.7m £154.7m
(excluding IFRS 16)
Adjusted for
Adjusted EBITA (US PP a3 £119.1m £150.0m difference in
covenants) exceptional items
treatment
Adjusted for
Adjusted EBITDA (US PP b3 £177.1m £205.8m difference in
covenants) exceptional items
treatment
Adjusted interest £(43.3)m £(45.9)m
charge
Add back: covenant £1.8m £2.0m
adjustments4
Borrowing costs c1 £(41.5)m £(43.9)m
Less: IFRS 16 impact £16.4m £16.8m
Borrowing costs c2 £(25.1)m £(27.1)m
(excluding IFRS 16)
Adjusted
EBITA/Borrowing costs
with adjusted EBITA
5.1 Interest cover including the impact
(USPP covenant) a3/c2 4.7x 5.5x of IFRS 16 and the
borrowing costs
excluding the impact
of IFRS 16. Minimum
permitted value of 4.0
Adjusted
5.2 Interest cover EBITA/Borrowing costs
(other financing a2/c2 4.6x 5.2x with both variables
agreements) excluding IFRS 16.
Minimum permitted
value of 4.0
Net debt £412.2m £415.2m Line information in
note 9
Add back: covenant £45.9m £44.2m
adjustments5
Less: IFRS 16 impact £(325.2)m £(348.7)m Line information in
note 9
Covenant calculation -
adjusted net debt d1 £132.9m £110.7m
(excluding IFRS 16)
Adjusted net
debt/adjusted EBITDA
6.1 Adjusted net debt with adjusted net debt
to post IFRS16 excluding the impact
adjusted EBITDA ratio d1/b3 0.8x 0.5x of IFRS 16 and
(USPP covenant) adjusted EBITDA
including the impact
of IFRS 16. Maximum
permitted value of 3.0
Adjusted net
6.2 Adjusted net debt debt/adjusted EBITDA
to adjusted EBITDA d1/b2 1.0x 0.7x with both variables
ratio (other financing excluding IFRS 16.
agreements) Maximum permitted
value of 3.0
1. Adjusted operating profit excludes items that are separately disclosed and
considered to be outside the underlying operating results for the
particular period under review and against which the Group’s performance is
assessed.
2. Covenant adjustments include adjustments for business exits, exceptional costs, share-based payment and pension adjustments, and removal of profits owned by minority interests.
3. Covenant adjustments include adjustments for depreciation and earnings related to disposed entities.
4. Covenant adjustments include adjustments for interest income and interest expense.
5. Covenant adjustments include adjustments relating to restricted cash and cash in businesses held-for-sale.
4214528_5.png 4214528_0.png 4214528_8.png 4214528_6.png 4214528_3.png 4214528_10.png 4214528_7.png 4214528_1.png 4214528_9.png 4214528_4.png 4214528_11.png 4214528_2.png
