Capita says uncertainty rises post-Brexit; shares fall

(Reuters) - British outsourcing group Capita Plc CPI.L said it was seeing some delays in decision-making in the short term due to the impact of the UK's vote to leave the EU, especially in the financial sector.

Shares in the company were down 2.9 percent at 960 pence on the London Stock Exchange at 1024 London time, making them the biggest losers on the blue-chip FTSE 100 index .FTSE.

“The biggest challenge we have is knowing when that uncertainty is going to end,” Chief Executive Andy Parker said, adding that he did not expect the uncertainty to last much beyond this year.

Clients had delayed launching initial public offerings and funds as they were deterred by market volatility, Parker added.

Britain’s historic vote to leave the EU has raised concerns regarding the health of the country’s economy, with the broadest survey of business confidence since the vote showing the economy is shrinking.

Parker said the company, which runs services ranging from the Ministry of Defence pension scheme to police radio systems, would be able to offset the near-term impact by offering support to the financial services and public sectors in the future.

“A strong set of H1 numbers is clouded by the outlook,” Deutsche Bank analysts wrote in a note.

The bank, which rates the stock a “buy”, said a UK exit scenario provides opportunities in the long term.

Capita said its bid pipeline grew to 5.1 billion pounds from 4.7 billion pounds in February, and reported an 8 percent rise in first-half underlying pretax profit to 285.3 million pounds.

Reporting by Mamidipudi Soumithri and Esha Vaish in Bengaluru; Editing by Sunil Nair