Featured Images

Capita chief Andy Parker to leave as outsourcing group exits FTSE 100

Capita announced that chief executive Andy Parker would leave later this year – a day after his likely departure was first reported by Sky News.

It came as the group reported a 33% fall in pre-tax profits to £75m for 2016 amid a slowdown in central government outsourcing and delays in client decision making which were “likely compounded” by the Brexit vote. Shares fell 9.1% by the close.

A number of big City shareholders in Capita have been demanding Mr Parker’s scalp for several months, and have told the company’s respected new chairman, Sir Ian Powell, that they want to see a change in leadership.

The announcement of his departure came a day after a quarterly review confirmed that the group was to be relegated to the FTSE 250 following its slump in value.

Shares in Capita have sunk by more than 40% over the past 12 months, with fellow outsourcers including Mitie and Serco also experiencing tough trading conditions and the legacy of poor corporate decision making.

Sir Ian, who said he had worked closely with Mr Parker since he started as chairman at the beginning of this year, said the chief executive had “made a significant contribution throughout his career at Capita”.

Announcing his departure, Mr Parker – who will continue in his current role for now – said 2016 “has been a difficult year” but that it was now a “simpler, more focused group”.

He added: “We have achieved a great deal but going forward it is time for a new leader to take Capita through the next steps to renewed and sustainable organic growth.”

Mr Parker has run the company since 2014 and joined the board in 2011.

He said last autumn that he would put one of its most profitable divisions, Capita Asset Services, up for sale, and has hired Goldman Sachs to run the process.

The company was heavily criticised earlier this week over its behaviour when carrying out its TV Licensing contract, with Lord Hall, the BBC director-general, demanding urgent answers from Capita.

Last week, Capita said it would take a £50m charge on a range of contracts but insisted it would have “no adverse impact on cash or future trading”.

Article source: http://news.sky.com/story/capita-chief-andy-parker-to-leave-as-outsourcing-group-exits-ftse-100-10787056

Leave a Reply

You can use these HTML tags

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>