UK’s Capita to axe 900 jobs as part of cost-cutting

(Reuters) -British outsourcing firm Capita plans to cut about 900 jobs globally as part of its cost-cutting drive, primarily affecting indirect support function and overhead roles, it said on Tuesday.

Capita, which operates in the UK, Europe, India and South Africa, employs about 50,000 people. The potential layoffs represent less than 2% of its workforce.

The company said it was trading in line with its expectations.

The layoffs, however, are part of its aim to cut costs and double its profit margins over the medium term.

“We continue to identify further areas of cost efficiency and will pursue these during 2024,” CEO Jon Lewis, who plans to retire by the end of this year, said in a statement.

The provider of services to the public and private sectors has had a tumultuous year after a costly cyber incident in March.

The London-listed firm said it will soon start consulting with employees on the programme.

The reorganisation is expected to save it 60 million pounds ($75 million) on an annualised basis from the first quarter of 2024.

It had previously targeted 40 million pounds in cost savings.

Capita shares were up 5% in early trading.

($1 = 0.8025 pounds)

(Reporting by Yadarisa Shabong in Bengaluru; editing by Sonia Cheema and Jason Neely)