(Adds details, background, confirmation)
By Elisabeth O’Leary and Kate Holton
LONDON, March 28 (Reuters) - Britain’s Capita will publish a five-year transformation plan and details of a rights issue with its annual results on April 26, a person familiar with the matter said, giving the services group a clean slate after a raft of profit warnings.
Capita, which handles services for companies and governments such as HR, recruitment and customer services to help them save costs, confirmed the results date and strategy update on its website on Wednesday morning.
Chief Executive Jonathan Lewis, on board since December, aims to simplify and unify an unwieldy structure in which more than 250 different business units have operated “like separate silos,” the source told Reuters late on Tuesday.
Capita will publish results with the overhaul plan aimed at paying down debt, giving markets a clear basis on which to invest, the source said.
Lewis sees potential in the fact Capita is only selling more than one service to just 4 percent of its customers, and cost-savings potential in implementing an overarching structure which was lacking up to now.
The group, with annual turnover expected by analysts at around 4.2 billion pounds ($5.95 billion) in 2017, set out an initial plan in January which said it would raise around 700 million pounds in a rights issue, scrap its dividend and sell assets to try to get back on track.
Its shares fell 50 percent on the day and have not recovered since. They have fallen 74 percent in the past year, versus a 4 percent slide in Britain’s FTSE 100 share index.
The source, who declined to be named, said Capita’s board signed off last week on the plans drawn up by Lewis, a turnaround specialist who joined Capita from oil services company Amec Foster Wheeler last December.
The group, which employs 70,000 staff primarily in Britain ran into problems after a downturn and problems on contracts following years of acquisition-led growth.
The rights issue is aimed at paying down debt, plugging a pension deficit and boosting investment.
Lewis has appointed a chief people officer and intends to bring in a director of digital and a general legal counsel who have a proven track record in turning around operations, the person said.
Capita declined to comment. ($1 = 0.7060 pounds) (Reporting by Elisabeth O’Leary and Kate Holton Editing by Jane Merriman)