Capita is today reporting good financial results for the first half of 2014 underpinned by strong sales and operational performance.
Financial results for the first 6 months of the year include revenue increasing by 13.9% to £2.1bn (H1 2013: £1.8bn2), underlying operating profit1 up 14.7% to £260.2m (H1 2013: £226.8m2) and underlying profit before taxation1 increasing by 16.0% to £238.0m (H1 2013: £205.2m2). Underlying earnings per share1 grew by 12% to 28.9p (H1 2013: 25.8p2) and we have increased our dividend for the half year by 10.3% to 9.6p per share (H1 2013: 8.7p).
To date this year, we have secured £1.3bn of major contracts (H1 2013: £2.0bn, which included our largest ever contract with O2 of £1.2bn), comprising 90% new business and 10% renewed contracts. As a result of strong sales performance in 2013 and to date in 2014, we have generated strong organic growth in H1 2014 of 11% (H1 2013: 3%). We have also swiftly replenished the bid pipeline to £5.7bn (February 2014: £5.5bn), reflecting strong sales momentum across our 11 private and public sector markets. In addition to our established sectors, we continue to see a particularly high level of interest in a number of our newer growth areas, including justice and emergency services and across the telecoms, retail, utilities and financial services sectors.
Our divisions are trading well with particularly strong performance in our Workplace Services and Customer Management businesses. Following the management changes introduced last year, together with the more positive macroeconomic environment, our Property & Infrastructure and IT businesses are reporting improved sales and trading performance.
We retain our position at the forefront of the customer and business process management market by continually evolving our capability and identifying changes in market dynamics which create a compelling business case for outsourcing. The acquisition of small to medium sized businesses extend our capabilities and market reach, enhancing our value creating propositions, facilitating entry into new target sectors and thereby fuelling future organic growth. To date in 2014, we have invested £240m in acquiring 10 businesses. This has included establishing a footprint in a new sector for Capita through the acquisition of a mortgage processing business. We have also extended our existing customer management offering into a new geographic region through acquiring a niche customer management business in Germany to support our current and new clients' needs in Europe.
1 Excludes non-underlying items being: intangible amortisation, acquisition expenses, net contingent consideration movements, impairments, non-cash impact of mark-to-market finance costs.
2 Includes businesses exited in H2 2013.