It’s time to sell outsourcing giant Capita Group PLC (LON:CPI), according to one City broker.
Capita announced on Thursday afternoon that it is bringing in a new management and operating structure – along with some new faces - to try and spark some growth.
As chief executive Andy Parker said: “[The company] is reshaping and simplifying its organisational and management structure to deliver organic growth and good financial performance in 2017 and beyond.”
While Shore’s Robin Speakman welcomes the refocus on organic growth, he’s not a fan of the lack of information being offered by Capita.
“At present Capita has not provided any guidance on the outlook/visibility for FY2017,” says Speakman.
“We hope to get some insight into the totality of the restructuring charges (in respect of the new divisional structure) and any potential intangible write downs for the current year,” says Speakman.
On top of the lack of guidance, Speakman thinks further restructuring activity and subsequent charges will continue through next year, hampering the firm’s progress.
“To us, at present, next year feels like it may be one of further retrenchment, building foundations for a return to growth thereafter.
“With continuing clouded visibility we retain a ‘sell’ stance.”