Capita lifted by its strong order book
A STRING of contract wins and a buoyant sales market are making outsourcing giant Capita confident of better growth prospects this year, after a six per cent profits rise for 2011 underpinned by acquisitions.
Capita, which runs contact centres and customer services for customers such as BBC TV licensing, The Pension Services and the Criminal Records Bureau, said underlying pre-tax profits for 2011 was £385.2m, helped by a £341m spend on 21 firms to help support earnings in tough UK markets.
The firm won contracts totaling a record £2bn in 2011 but over half came in the form of less profitable renewals.
This, coupled with government budget cuts, contract delays and increasing competition, saw organic revenues decline seven per cent. Group revenue rose seven per cent to £2.93bn.
The FTSE 100 listed group has started 2012 in different fashion, however, seeing off rival Serco as preferred bidder on a deal to run recruitment services for the British Army, and on Wednesday securing a contract to manage the provision of training across the Civil Service.
“Going forward we’ve probably got increased grounds for optimism,” Capita chief executive Paul Pindar said.
“In the first seven weeks of the year we have secured five major contracts with an aggregate value of £620m, so we sit here today already knowing that we will have a return to organic growth.
“This visibility and the current buoyant sales environment, underpin our confidence in good growth prospects for 2012 and beyond.”