Capita reported delivered 23.4% growth in its pension solutions business this year
Capita Pension Solutions business delivered 23.4% revenue growth in the four months to 30 April, a trading update published today (18 May) reveals.
The update, which comes ahead of the outsourcing firm's annual general meeting today, said the revenue increase for its pension solutions arm reflected the annualised impact of the contract to run the Civil Service Pension Scheme, the administration of which the firm took over on 1 December last year and has been experiencing challenges with since.
It said growth in pension solutions also resulted from higher volumes from the Teachers' Pension Scheme contract, a contract which will be transferred to Tata Consultancy Services within the next 12 months.
In the update, Capita said it remained focused on resolving the known challenges on the Civil Service Pension Scheme – noting it had a plan with the Cabinet Office and remained committed to delivering the plan, in spite of the challenging environment and nature of the backlog inherited.
It added it continued to focus on improving the call centre and back-office operations, resolving urgent cases as well as improving wider case resolution times.
The update comes just weeks after the government announced it had terminated the Royal Mail Statutory Pension Scheme's contract with Capita.
Capita said it continued to expect "mid-teen revenue growth" in its pension solutions business for the full financial year.
Commenting on the trading update, Capita chief executive Adolfo Hernandez said: "We have made positive progress in the first four months of the year, with adjusted group revenue up 2.9% compared to the same period last year, in line with expectations. We have had positive and deep engagement with Inspirit, the purchaser of the private sector contact centre business and expect the sale to complete ahead of the H1 results in early August.
"We are now planning to hold our investor update after the summer once the contact centre disposal has completed to ensure the separation is fully underway. We continue to make excellent progress against our other strategic objectives to deliver a better Capita, with innovation both internally and for clients, including the launch of Storefront, providing customers with access to the company's artificial intelligence, data and digital services via AWS Marketplace.
"We remain fully focussed on delivering the administration of the Civil Service Pension Scheme under the project improvement plan with the Cabinet Office."
