Capita PLC (LON:CPI) is expected to shut more than one in three of its UK offices as the coronavirus (COVID-19) pandemic accelerates its plans to cut costs and have more staff working from home.
The FTSE 250-listed group will close almost 100 of its 250 office leases, according to reports at the weekend.
The group, a major government contractor, is making the move just as Downing Street launches a media campaign to get more people to return to their workplaces, supporting city centre businesses.
But Capita, which is working on 100 government pandemic response projects, as well as long-term contracts such as managing London’s congestion charge and electronic tagging for prisoners, swung to a loss in the first half of the year and warned of a slow return to growth.
“We are now starting to look at longer-term cost opportunities resulting from our experiences amid the COVID-19 crisis, with remote working practices meaning that we will not return to a number of our properties,” the company said in its recent interim results.
“COVID-19 has accelerated the transformation of our working practices,” it added, with around 35,000 of its 46,000 staff working from home, including more 80% of its technology division.
These moves were said to have produced improved productivity and were getting positive customer feedback, which had resulted in the reworking of some contracts with major customers “to mutual benefit”.
This led to a “reassessment of our property footprint”, Capita said last month, and a programme of “consolidation and closure” had begun, with 25 of the 100 leases cancelled so far.
Prime Minister Boris Johnson will launch a publicity campaign this week to encourage people to return to the office, according to newspaper reports.
Shares in Capita were down 2% to 30.32p on Tuesday morning.
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