Fresh from announcing its expansion in the pensions administration market by its acquisition of Hartshead Solway Ltd (CI No 3,106), Capita Group Plc is basking in the light from its twelfth consecutive year in profit. The London-based facilities management and services company, saw pre-tax profits grow by 30% in fiscal 1996 to 12m pounds on revenue up at almost the same rate to 112m pounds. Shares were up five and a half pence to 646.5 pence after the announcement. While the acquisition will serve to prime Capita for access to more private sector business in line with its long-term strategy (CI No 2,861), public service and privatized government unit contracts continue to contribute significantly to revenues. The flagship facilities management division contributed 70% of total revenue; its profits were up 43% to 8.5m pounds on revenue that rose 37% to 78.5m pounds attributable to the various contracts. Last year in particular, the division embarked upon a number of million-pound projects for the National Health Service Trust, newly-privatized Recruitment & Assessment Services, Teachers’ Superannuation Scheme and the Department of Education & Employment. It was also able to extend existing county council contracts beyond this fiscal year to the tune of 32m pounds. The property services division, contributing 20% to total revenues, had both profits and revenue up at around the 10% mark to 2.74m pounds and 22.6m pounds respectively. Capita quotes further commissions obtained with both Railtrack and the recently formed train operating companies, as being instrumental to the growth. There were also wins in the retail sector with Moss Bros and British Home Stores Plc; the leisure sector with Granada Plc and Bass Leisure Plc as well as Abbey National Plc. Advisory services’s profits were virtually static on 1995’s at 1m pounds due to poor performance in our international consultancy activities. Capita is recommending a two-forone bonus share issue on April 15, and a final dividend of 3.2p bringing the total for the year to 4.8 pence, a rise of 23.1%.
