Capita plc, the UK's leading customer and business process management company, has issued its interim management statement covering trading and financial progress to date in 2013.
Update on performance
Capita has made a positive start to the year securing £660m of new major sales wins including contracts with the Cabinet Office, Carphone Warehouse and the University of Strathclyde. The bid pipeline of the company remains strong and comprises opportunities across their target markets, particularly in central and local government and in the private sector, primarily in retail, utilities and financial services. To date in 2013, Capita have acquired 7 complementary businesses for a total consideration of £165m, enhancing propositions to their clients in their existing and developing markets and supporting the delivery of further organic growth.
The Group is making good progress across key financial metrics as anticipated in the preliminary results statement issued on 28 February 2013. Due to strong major sales performance in 2012 and to date in 2013, Capita are placed to achieve organic growth in line with expectations for the full year 2013.
Delivering organic growth
In the first 19 weeks of 2013, Capita secured 4 new major contracts with an aggregate value of £660m (2012 Q1 IMS: 6 new contracts totalling £823m). These include:
Bid pipeline: This pipeline is a snapshot of major bid opportunities, worth £25m or above and capped at £1bn, where Capita have been shortlisted by the client to the last 4 bidders or fewer. As at February 2013, the bid pipeline stood at £5.2bn (£4.8bn Nov 12) comprised of 27 bids of which 98% related to new contracts and 2% to renewals.
Securing value enhancing acquisitions
The acquisition of small to medium sized businesses supports Capita's long term organic growth by providing entry into new markets and enhancing their sales offering by adding further scale and complementary capabilities to the Group's service offering.
To date in 2013, 7 companies have been acquired across a number of areas including justice and emergency services, customer management, education and workplace services for a total cash consideration of £165m. These include:
The market for customer management and BPM remains very active in the UK with government and commercial organisations under pressure to maintain and develop efficient operational models which deliver quality services while achieving value for money.
This buoyant sales environment underpins the board’s confidence in the Group's long term performance and growth prospects. The Group remain on track to deliver strong growth in 2013 as a result of major contract wins and acquisitions completed during 2012 and to date in 2013 and anticipate continued strong progress into 2014 and beyond.
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