Capita says gov cuts hit hard

Osborne's bell tolls for reseller


Capita shares are down nearly five per cent this morning after it warned that government cuts were hitting revenues harder than expected.

In an update to the stock market, the government's favourite outsourcer said the message was mixed. It has had constructive discussions with the government on cutbacks and it believes outsourcing will pay a key role in achieving the £6bn reduction in government spending, it said. Shares are down 4.4 per cent to 690 pence.

Capita said trading was "solid" but revenue growth had been subdued. It said: "Our bid pipeline is at a record level and our prospect list is very active, indicating that the market for significant outsourcing opportunities across both private and public sectors is buoyant."

Capita has no major contract renewals, worth more than one per cent of turnover, until 2012.

However, the offshorer warned: "We expect turnover growth for 2010 to be modest due to the unusually high degree of revenue attrition in the year, fewer sales decisions to date in the second half of this year and the short-term impact of current public sector retrenchment on some of our trading businesses."

In local government, which faces cuts of 7.1 per cent, Capita again expects to pick up some offshoring work.

Capita also said that the bidding process in the life and pensions market was easier under those firms' new owners and management.

Looking forward, Capita said short-term pressures were likely to continue into the first half of 2011 but added that continued spending pressure: "will generate a strong flow of outsourcing opportunities for Capita during 2011 and beyond." ®

Similar topics


Other stories you might like

  • Pentester pops open Tesla Model 3 using low-cost Bluetooth module
    Anything that uses proximity-based BLE is vulnerable, claim researchers

    Tesla Model 3 and Y owners, beware: the passive entry feature on your vehicle could potentially be hoodwinked by a relay attack, leading to the theft of the flash motor.

    Discovered and demonstrated by researchers at NCC Group, the technique involves relaying the Bluetooth Low Energy (BLE) signals from a smartphone that has been paired with a Tesla back to the vehicle. Far from simply unlocking the door, this hack lets a miscreant start the car and drive away, too.

    Essentially, what happens is this: the paired smartphone should be physically close by the Tesla to unlock it. NCC's technique involves one gadget near the paired phone, and another gadget near the car. The phone-side gadget relays signals from the phone to the car-side gadget, which forwards them to the vehicle to unlock and start it. This shouldn't normally happen because the phone and car are so far apart. The car has a defense mechanism – based on measuring transmission latency to detect that a paired device is too far away – that ideally prevents relayed signals from working, though this can be defeated by simply cutting the latency of the relay process.

    Continue reading
  • Google assuring open-source code to secure software supply chains
    Java and Python packages are the first on the list

    Google has a plan — and a new product plus a partnership with developer-focused security shop Snyk — that attempts to make it easier for enterprises to secure their open source software dependencies.

    The new service, announced today at the Google Cloud Security Summit, is called Assured Open Source Software. We're told it will initially focus on some Java and Python packages that Google's own developers prioritize in their workflows. 

    These two programming languages have "particularly high-risk profiles," Google Cloud Cloud VP and GM Sunil Potti said in response to The Register's questions. "Remember Log4j?" Yes, quite vividly.

    Continue reading
  • Rocket Lab is taking NASA's CAPSTONE to the Moon
    Mission to lunar orbit is further than any Photon satellite bus has gone before

    Rocket Lab has taken delivery of NASA's CAPSTONE spacecraft at its New Zealand launch pad ahead of a mission to the Moon.

    It's been quite a journey for CAPSTONE [Cislunar Autonomous Positioning System Technology Operations and Navigation Experiment], which was originally supposed to launch from Rocket Lab's US launchpad at Wallops Island in Virginia.

    The pad, Launch Complex 2, has been completed for a while now. However, delays in certifying Rocket Lab's Autonomous Flight Termination System (AFTS) pushed the move to Launch Complex 1 in Mahia, New Zealand.

    Continue reading

Biting the hand that feeds IT © 1998–2022