Xchanging hopes to do better in 2012

1 March 2012

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1 March 2012 | Adam Leach

British outsourcing firm Xchanging is gearing up for a strong performance in 2012 after it reported a drop in profits during 2011 in what it labelled a year of “transition”, its full-year results revealed.

During 2011, the company sold off its US workers’ compensation business, cut £8 million in costs by reducing the number of managers and relocating London staff to cheaper premises. The company also won and renewed large contracts with French cosmetics company L’Oreal and defence giant BAE Systems, which it expects to contribute to increased profitability in the year ahead. For the past financial year, it reported an adjusted operating profit of £43.2 million, down 23 per cent from the year before.

Chairman Geoff Unwin, said: “Xchanging has emerged from a year of considerable activity as it has addressed a number of operating and strategic issues. It was a year of transition, as we started reshaping the business to meet the needs of changing markets.”

For the year ahead, Xchanging is eyeing growth in the business process outsourcing (BPO) market, where it expects the market to continue to develop for a prolonged period. In particular it sees expansion coming from smaller businesses who were previously unable to outsource processes because they lacked the scale.

Outlining the strategic direction for the procurement and other BPO services, CEO Ken Lever, said: “We expect the growth of the business processing market to continue for some time to come. There is no doubt that the market is changing. Once the focus of very large businesses, outsourced business processing and technology services are increasingly available to lesser-sized businesses as developing technology makes available ‘everything-as-a-service’.”

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