Logica profits plunge
Restructure hits bottom line
Restructuring charges battered Logica's first half profits despite first half revenues growing by six per cent, figures released today show.
But the services vendor has shrugged off the bottom line slump and raised its prediction for full year revenues.
For the six months ended 30 June 2008 revenues were £1.8bn compared to £1.5bn for the first six months of 2007. Pre-tax profit was £13m compared to £29m for the same period last year.
New CEO Andy Green said it had been a good first half and the restructuring was going well. “Given the market environment, we remain alert to changes in customer sentiment but our first half performance gives us increased confidence that 2008 pro forma revenue growth will be closer to 4 per cent, compared to our previous guidance of around 3 per cent.”
But net profits were hit by exceptional charges of £46m relating to the company's restructuring and redundancy programme. Logica also wrote off £43m of intangible assets from acquisitions mostly due to currency changes.
In the UK revenue grew six per cent to £354m with £201m of this coming from public sector projects. Adjusted operating profit for the UK was £22m.
Logica shares were up almost nine per cent on the news at 122.5 pence.
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