Capita plc said on Thursday that it has secured new contract wins totaling £1 billion in the first half of 2026 and achieved adjusted revenue growth of 1.6% versus the same period in 2025. The company described the result as its strongest first-half performance in Public Services since 2021.
In a move to bolster liquidity, Capita extended its revolving credit facility to £325 million through June 2029. That replaces the prior £250 million facility and an additional committed £75 million facility. The fresh arrangement includes options for two further one-year extensions.
Management warned, however, that issues on the Civil Service Pension Scheme contract will have a material near-term financial impact. The company said these problems will reduce adjusted operating profit in 2026 by between £25 million and £40 million and will weigh on free cash flow by £35 million to £50 million.
Capita signalled it still expects to deliver positive free cash flow in 2027, on a basis that excludes the impact of business disposals or exits.
Chief Executive Officer Adolfo Hernandez commented on the first-half progress: "We have made good progress in the first half, with strong momentum in contract extensions and wins, and taking further steps to simplify the Group. We are also advancing the use of technology and AI to improve delivery for clients."
The company acknowledged service shortfalls on the Civil Service Pension Scheme, noting members are experiencing delays particularly in bereavement, retirement, and quotation cases. Capita said it has processes, automation and technology in place to work through the backlog.
Within the Pension Solutions division, Capita said it will incur additional costs in 2026 to address the scheme contract issues. Those costs include surge resource spending and remediation expenses. The group also said its wider pension consulting business has been affected as personnel are redirected to focus on the scheme contract.
Operational performance varied across divisions in the six months to June 30, 2026. Public Service revenue rose by 2.4%, while Pension Solutions reported growth of 24.7% over the same period. Capita said average KPI performance in Public Service remained around 90% throughout 2026.
On disposals, the company said its private sector contact centre sale is progressing and is expected to complete before the release of its half-year results on August 4. Separately, management has implemented measures intended to deliver £8 million of annualised cost savings towards a target of £40 million by the end of 2027.
Financial and operational highlights
- £1 billion of contracts secured in H1 2026.
- Adjusted revenue up 1.6% year-on-year for the first half of 2026.
- Revolving credit facility extended to £325 million through June 2029, with two one-year extension options.
- Public Service revenue growth of 2.4%; Pension Solutions growth of 24.7% for the six months to June 30, 2026.
Outlook and cash flow
While Capita reiterated a target of returning to positive free cash flow in 2027 excluding business exits, it quantified a near-term earnings and cash flow headwind from the Civil Service Pension Scheme contract for 2026.