Capita secures a five-year extension on its contract with Transport for London

By: Wajeeh Khan
Wajeeh Khan
Wajeeh is an active follower of world affairs, technology, an avid reader, and loves to play table tennis in his free… read more.
on Aug 10, 2020
  • Capita secures a five-year extension on its contract with Transport for London.
  • The professional services company to hire 900 new workers in upcoming months.
  • Transport for London says 79% vehicles in ULEZ meet emission standards.

In an announcement on Monday, Capita plc (LON: CPI) said it secured an extension of £355 million on its Transport for London (TfL) contract. Capita has managed London’s congestion charge for years. Its current contract was set to expire in October 2021. As of Monday, however, the contract has been extended for five years through October 2026. Capita also signed a network infrastructure contract with TfL last month.

Shares of the company opened about 4% on Monday. The stock continued its rally in the next hour and jumped another 4% before losing almost all of its intraday gain in the later hours. Capita is currently exchanging hands at 37.67 pence per share that translates to an over 75% decline on a year to date basis. Here’s how you can invest online with ease and start trading on the stock market.

Capita to hire 900 new workers in upcoming months

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On top of that, the newly announced contract expands responsibilities for Capita that will now be in charge of direct vision standards and will manage London’s low emission zones and ultra-low emission zones. Capita’s new role, the contract highlights, will also last until October 2026.

Capita boasted confidence that the new contract will help expand its footprint as it offers broader services to TfL. The process-outsourcing firm also expressed plans of increasing its workforce by 900 new employees, the majority of whom, it added, will work from home.

CEO Jon Lewis of Capita commented on the news on Monday and said:

“These new contracts will see us build on our existing partnership, which has already seen us launch ULEZ on time and on budget, and will draw on our track record of transformation and digitally-enabled services, as well as adding value for our shareholders.”

TfL says 79% vehicles in ULEZ meet emission standards

In an earlier report, TfL highlighted London’s ultra-low emissions zone to have resulted in a 44% decline in nitrogen dioxide levels. As per TfL, the emission standards were being met by about 79% of vehicles in this zone.

Capita is a prominent name in the league of professional services which work directly with the British government. In June, the company announced plans of slashing roughly 200 jobs to cushion the economic blow from the Coronavirus pandemic that has so far infected more than 300,000 people in the United Kingdom and caused over 46,500 deaths.

At the time of writing, Capita is valued at £626.91 million.

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