Contract assets review

Contract assets review

As part of its year-end close process, Capita has undertaken a comprehensive review across its major contracts. Following this review management has taken the decision to impair, at year end 2016, a number of historic assets relating to a few specific contracts, which were being amortised over their contract life. This treatment is consistent with how contracts have been accounted for in 2016.

These impairments will have no adverse impact on cash or future trading. 

Some of these assets date back to 2009, with the majority relating to the period between 2012 and 2014. Assets amounting to around £50m will be written off as a non-underlying charge consistent with prior year treatment.  Accrued income of around £40m will be written down as a charge to underlying results, consistent with prior year treatment. 

Excluding the impact of accrued income written down, our guidance regarding trading performance for 2016 remains as last stated on 8 December 2016.

Capita will announce its full year results on 2 March 2017.

Ends.

For further information:

Capita plc

Tel: [phone]
Andy Parker, Chief Executive Officer
Shona Nichols, Executive Director, Communications
Andrew Ripper, Head of Investor Relations

Media enquiries

Capita Press office
020 76542399
Powerscourt
Peter Ogden
020 75490997