Capita downgrades again (update)

Confidence in Capita has taken a real hit following its second profits warning in as many months (see Capita downgrades again, plans Asset Services sale), with its shares now off c60% year to date.

Capita’s CE Andy Parker talked of taking ‘decisive action’, to reduce Capita’s cost base and its improve its operating efficiency.

The UK SITS market leader is now cutting c2,000 jobs, or c3% of its workforce, seeking to dispose of the majority of its highly profitable Asset Services business, and turning to offshoring and automation, to turn things around. Capita said the changes will ‘strengthen management, improve visibility, enhance reporting and sales effectiveness. Leaves Capita more focused and leaner.’

However, this isn't going to be an overnight fix. There's a huge amount of work to be done to restore lost confidence.

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Posted by John O'Brien at '08:17'