Feeds

Logica profits hit by misers in public sector

Plan A: still hurting

Reducing security risks from open source software

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. ®

Mobile application security vulnerability report

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Nadella: Apps must run on ALL WINDOWS – PCs, slabs and mobes
Phone egg, meet desktop chicken - your mother
White? Male? You work in tech? Let us guess ... Twitter? We KNEW it!
Grim diversity numbers dumped alongside Facebook earnings
Microsoft: We're making ONE TRUE WINDOWS to rule us all
Enterprise, Windows still power firm's shaky money-maker
HP, Microsoft prove it again: Big Business doesn't create jobs
SMEs get lip service - what they need is dinner at the Club
ITC: Seagate and LSI can infringe Realtek patents because Realtek isn't in the US
Land of the (get off scot) free, when it's a foreign owner
Dude, you're getting a Dell – with BITCOIN: IT giant slurps cryptocash
1. Buy PC with Bitcoin. 2. Mine more coins. 3. Goto step 1
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
prev story

Whitepapers

Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Reducing security risks from open source software
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.