Capita swings to a loss as outsourcer faces £25m cyber attack costs
Costs relating to cyber attack to be £20-£25m, up from forecasts of £15-£20m
Some data was 'exfiltrated'; probe into cyber attack 'close to an end'
Capita made a £67.9m pre-tax loss for the six months to the end of June
By CAMILLA CANOCCHI
4 August 2023
Capita shares slumped after the outsourcing group swung to a first-half loss and said March's cyber attack would cost it more than previously expected.
The group, which has £6.5billion of public sector contracts including with the NHS, expects to incur costs of £20million to £25million as a result of the attack that left staff unable to access IT systems and disrupted services.
The figure is higher than the £15-£20million it had estimated in May and comprises 'specialist professional fees, recovery and remediation costs, and investment to reinforce Capita's cyber security environment'.
Cyber attack: Capita confirmed that some data was 'exfiltrated' following the incident
A charge of £21.8million relating to the accident was recognised in its first half, contributing to Capita swinging to a £67.9million pre-tax loss for the six months to the end of June, from £100,000 profit a year earlier.
The loss was also driven by business exits and a goodwill impairment, the group said. Revenues slipped 3 per cent to £1.48billion.
Capita shares fell 12 per cent to 23.60p in morning trading on Friday. They have lost around 22 per cent of their value over the last 12 months.
The company confirmed that some data was 'exfiltrated' following the cyber incident, but from less than 0.1 per cent of its servers, adding that its probe was close to completion.
'There was minimal operational impact to the majority of our clients and their customers during the incident,' it told shareholders.
The business also said it was making continued progress on its lengthy turnaround plan and left its expectations for the full-year unchanged.
It signed a new contract with the Student Loans Company in July worth £250million and was the preferred bidder for a £565million contract with the Department for Work and Pensions, which it expects to sign in the second half.
The update comes days after chief executive Jon Lewis said he will retire next year.
On Friday, the outgoing boss said: 'I am pleased with the good progress we continued to make at Capita during the first half of the year as we accelerate our financial performance.
'Our strategy, focused on two core, growing markets, is working.
'We have delivered increased adjusted revenue growth for the fourth successive reporting period, improving profitability, winning an increasing amount of work with new clients, and remain on track to deliver on our full-year expectations.
'Our strong client relationships, long-term contracts, increasingly competitive and digitised solutions, engaged colleagues and reputation for delivery mean we have a resilient business, well positioned for further growth.'
Some data was 'exfiltrated'; probe into cyber attack 'close to an end'
Capita made a £67.9m pre-tax loss for the six months to the end of June
By CAMILLA CANOCCHI
4 August 2023
Capita shares slumped after the outsourcing group swung to a first-half loss and said March's cyber attack would cost it more than previously expected.
The group, which has £6.5billion of public sector contracts including with the NHS, expects to incur costs of £20million to £25million as a result of the attack that left staff unable to access IT systems and disrupted services.
The figure is higher than the £15-£20million it had estimated in May and comprises 'specialist professional fees, recovery and remediation costs, and investment to reinforce Capita's cyber security environment'.
Cyber attack: Capita confirmed that some data was 'exfiltrated' following the incident
A charge of £21.8million relating to the accident was recognised in its first half, contributing to Capita swinging to a £67.9million pre-tax loss for the six months to the end of June, from £100,000 profit a year earlier.
The loss was also driven by business exits and a goodwill impairment, the group said. Revenues slipped 3 per cent to £1.48billion.
Capita shares fell 12 per cent to 23.60p in morning trading on Friday. They have lost around 22 per cent of their value over the last 12 months.
The company confirmed that some data was 'exfiltrated' following the cyber incident, but from less than 0.1 per cent of its servers, adding that its probe was close to completion.
'There was minimal operational impact to the majority of our clients and their customers during the incident,' it told shareholders.
The business also said it was making continued progress on its lengthy turnaround plan and left its expectations for the full-year unchanged.
It signed a new contract with the Student Loans Company in July worth £250million and was the preferred bidder for a £565million contract with the Department for Work and Pensions, which it expects to sign in the second half.
The update comes days after chief executive Jon Lewis said he will retire next year.
On Friday, the outgoing boss said: 'I am pleased with the good progress we continued to make at Capita during the first half of the year as we accelerate our financial performance.
'Our strategy, focused on two core, growing markets, is working.
'We have delivered increased adjusted revenue growth for the fourth successive reporting period, improving profitability, winning an increasing amount of work with new clients, and remain on track to deliver on our full-year expectations.
'Our strong client relationships, long-term contracts, increasingly competitive and digitised solutions, engaged colleagues and reputation for delivery mean we have a resilient business, well positioned for further growth.'
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