Feeds

Logica profits hit by misers in public sector

Plan A: still hurting

High performance access to file storage

Logica is continuing to shift its order book from the public sector toward the commercial markets following a tough first half-year that challenged margins and gave operating profits a pounding.

The IT service provider and consultancy's sales for calendar H1 were up 5 per cent to just shy of £2bn and it expects similar growth in the second half of 2011.

CEO Andy Green said Logica had taken market share from rivals and saw gains in outsourcing deals across France, Northern and Central Europe "and in the commercial sectors in the UK".

Outsourcing revenues were up 11 per cent to £880m as Consulting and Professional services turnover returned to growth – albeit at just 1 per cent – to £1.12bn. Group sales to the private sector were up 10 per cent, but fell 5 per cent in the public sector.

UK revenues – 18 per cent of group turnover – fell 2 per cent to £208m on the back of a 10 per cent slide in public sector sales to £208m. The energy and utilities and other sectors grew double digits to £70m and £83m respectively.

Sales in the Benelux were also hit, down 3 per cent to £242m, and fell 11 per cent in Logica's international operations to £179m. All other operations – France, northern and central Europe and Sweden – pushed up the top line.

However, a 16 per cent slide in operating margins to 4.2 per cent, an 11 per cent dip in operating profits to £83m, and a 13 per cent decline in profit before tax to £75m took the shine off revenue gains, with the Benelux and UK worst hit.

"Our public sector clients continued to implement spending cuts, with a particularly sharp decline in the Netherlands leading to disappointing profitability in the Benelux. We grew revenue and margin in half of our six regions," said Green.

Logica said margin improvement was "now dependent" on progress in the Benelux region redirecting resources. ®

High performance access to file storage

More from The Register

next story
Audio fans, prepare yourself for the Second Coming ... of Blu-ray
High Fidelity Pure Audio – is this what your ears have been waiting for?
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
MtGox chief Karpelès refuses to come to US for g-men's grilling
Bitcoin baron says he needs another lawyer for FinCEN chat
Did a date calculation bug just cost hard-up Co-op Bank £110m?
And just when Brit banking org needs £400m to stay afloat
Zucker punched: Google gobbles Facebook-wooed Titan Aerospace
Up, up and away in my beautiful balloon flying broadband-bot
Apple DOMINATES the Valley, rakes in more profit than Google, HP, Intel, Cisco COMBINED
Cook & Co. also pay more taxes than those four worthies PLUS eBay and Oracle
It may be ILLEGAL to run Heartbleed health checks – IT lawyer
Do the right thing, earn up to 10 years in clink
France bans managers from contacting workers outside business hours
«Email? Mais non ... il est plus tard que six heures du soir!»
prev story

Whitepapers

Securing web applications made simple and scalable
In this whitepaper learn how automated security testing can provide a simple and scalable way to protect your web applications.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
HP ArcSight ESM solution helps Finansbank
Based on their experience using HP ArcSight Enterprise Security Manager for IT security operations, Finansbank moved to HP ArcSight ESM for fraud management.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Mobile application security study
Download this report to see the alarming realities regarding the sheer number of applications vulnerable to attack, as well as the most common and easily addressable vulnerability errors.