Capita Reports Operational Progress Despite Pension Contract Costs

The business process services provider Capita plc reported operational progress for the first half of 2026, though financial results were heavily impacted by costs from its Civil Service Pension Scheme (CSPS) contract. The company recorded a £14 million direct cost and a £3 million collateral impact during the period, with an expected further profit-and-loss hit between £25 million and £40 million.

Chief Executive Officer Adolfo Hernandez apologized for the CSPS issues, stating the company has shifted from crisis management to reducing the accumulated backlog. To stabilize the business, Capita completed a £250 million cost-reduction program and identified an additional £40 million in savings following the sale of its contact-center business.

Despite the pension contract setbacks, the company secured over £1 billion in contract awards, including a £425 million agreement with Transport for London, maintaining an 84% win rate. Capita is also advancing its AI strategy by deploying nearly 500 AI use cases in production to establish itself as an AI-enabled services provider for government and regulated industries.