UPDATE 1-UK's Mitie reports improved June after virus-hit quarter

(Adds detail on results, backgorund)

July 28 (Reuters) - British outsourcer Mitie reported an 11% drop in revenue in its fiscal first-quarter on Tuesday while saying its performance had improved slightly in June as it fought coronavirus-induced weakness in some businesses.

The provider of engineering, security, cleaning and care services reported revenue from continuing operations of 458.3 million pounds ($589.28 million) for the three months ended June 30.

It said revenue at its main Business Services division was dragged down by the earlier-flagged loss of a Ministry of Justice contract, while Technical Services suffered from a slump in discretionary work including engineering projects.

It added, however, that business had been more resilient than expected and that performance in June was better than that in April and May. Traders expected shares in the company to gain around 5% at opening.

Mitie announced plans last month to buy rival outsourcing company Interserve’s support services arm, using its financial muscle to scale-up at a time when many businesses are struggling and enterprise values have been deflated.

Britain’s huge outsourcing industry has struggled in recent years with infrastructure-focussed group Carillion collapsing in 2018, followed by a slide into administration for Interserve last year.

Mitie has taken other steps to reinforce the company against the coronavirus crisis, scrapping its final dividend, raising 190 million pounds in a rights issue and extending a 250 million pound credit facility to Dec. 2022.

With a majority of its staff working for essential locations such as hospitals, schools and coronavirus testing centres, Mitie said it has brought over 40% of its 7,000 furloughed employees back to work as customers begin to resume operations. ($1 = 0.7777 pounds) (Reporting by Yadarisa Shabong in Bengaluru; Editing by Krishna Chandra Eluri and Patrick Graham)