Strongly positioned for growth across multiple markets
2012 was an excellent year for Capita. We achieved record sales, securing £4.0bn (2011: £2.0bn) of contract wins, comprising 90% new business and 10% extensions. This reflects the health of the UK business process management (BPM) and customer management market and the strength of our many service propositions. We have achieved particular sales success across the central and local government markets and in health, justice and emergency services, defence and the private sector.
We have delivered against the three key objectives that we set for the year:
- maintaining good profit performance
- securing organic growth of 3% for the full year
- delivering improved conversion of operating profit to operating cash compared to 2011.
In the full year 2012, revenue increased by 14% to £3,352m (2011: £2,930m). Underlying operating profit2 rose by 10% to £471.7m (2011: £427.4m) and underlying profit before taxation2 increased by 10% to £425.6m (2011: £385.2m). Underlying earnings per share2 grew by 10% to 53.16p (2011: 48.49p). We have increased our total dividend for the full year 2012 by 10% to 23.5p per share (2011: 21.4p).
The majority of our divisions traded well in 2012, with particularly strong performance across our Customer Management & International, Justice & Secure Services, Workplace Services and Investor & Banking divisions. The trading activities of two of our divisions, Property Services and parts of our IT business, continue to be adversely affected by challenging economic conditions but are well positioned to benefit as the economy recovers. Our General Insurance division had a poor year with lower revenues and profits and we have therefore strengthened both the leadership and sales teams to reinvigorate these operations.
We completed a range of acquisitions in 2012 which have strengthened our position in our target markets and played a key role in enhancing our client propositions, contributing to our contract wins and fuelling further organic growth.
2 Excludes non-underlying items detailed in note 2 administrative expenses, in the notes to the preliminary statement.