CSC blames poor performance on NHS debacle

US systems integrator CSC has said a 'poor' yearly performance was in part due to NHS write-offs.CSC earnings per share for its 2012 fiscal year fell by $10.

US systems integrator CSC has said a 'poor' yearly performance was in part due to NHS write-offs.

CSC earnings per share for its 2012 fiscal year fell by $10.03 (£6.34) due to NHS losses, the company said in a statement on Thursday, in addition to a goodwill impairment of $17.41 per share. CSC's full-year revenue was $15.88bn, compared with $16.04bn in 2011.

"We consider these results to be very poor as the company is executing well below an acceptable level for CSC and its investors," CSC chief executive Mike Lawrie said in the statement. "There are many reasons for our underperformance — primarily NHS write-offs and challenges managing our cost structure, aligning our global organization, and in executing some of our managed services sector contracts. We are also experiencing some market headwinds in the federal business and in Europe."

CSC has been in protracted talks with the Department of Health over the future of the disastrous Lorenzo patient care records system. Lorenzo was heavily criticised in a number of public sector reports in 2011. In December 2011 CSC announced it expected to lose $1.5bn (£900,000) on the project, but to recoup some or all of those costs from revived contracts.

We consider these results to be very poor as the company is executing well below an acceptable level for CSC and its investors.

– Mike Lawrie, CSC

Lawrie came over to the UK last week to meet with Department of Health officials, and to work out how to enter into an interim agreement, he told an investor call on Thursday. The agreement was supposed to be signed at the end of March.

"Both parties want to get to this interim agreement," Lawrie said on the call. "We are hoping to [sign the] NHS agreement in the not-too-distant future."

Lawrie is having weekly telephone conversations with the NHS over the deal, he said.

CSC announced more than 1,100 job cuts in Britain earlier this year. Around 500 of those job cuts will be for Lorenzo, and 640 redundancies elsewhere in the UK and Ireland.

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