Capita PLC (LSE:CPI), the outsourcing company, said its half-year results were in line with expectations.
Revenue dipped to £1.61bn from £1.68bn in the corresponding half-year period of 2020 but the group moved back into the black, with a profit before tax of £261.1mln versus a loss the previous year of £28.5mln.
Adjusted profit, which excludes one-off items, was £45.3mln, compared to a half-year loss of £11.1mln in 2020.
Net debt was whittled down to £894mln at the end of June from £1.09bn a year earlier.
Adjusted free cash flow improved by 12% to £130.7mln from £116.4mln the previous year.
The company has not paid a dividend since 2017 and has not declared a pay-out this time around either.
The group said it expects to deliver full-year revenue growth in 2021, driven by new contracts and recovery in those parts of its business affected by the pandemic.
The outsourcer said its markets are recovering, but at different rates. Contracts from the UK government continue to be a lucrative source of revenue for the group, particularly in health & welfare and in defence but the private sector is being a bit more careful with its money as the economy emerges from lockdown.
The order book at 30 June 2021 was £6.7bn (31 December 2020 £5.9bn), with £1.1bn recognised in the first half and £2.1bn won in order book-qualifying revenue. The book to bill ratio is now above 1.0, having increased from 0.78 in 2019 and 0.94 in 2020; it is expected to be roughly 1.3 at the end of this year.
“We are delivering on our plans and remain on track to deliver organic revenue growth this year for the first time in six years and generate sustainable free cash flow in 2022,” said Jon Lewis, the chief executive officer of Capita.