Capita share price: Outsourcing giant posts final resilts

Capita Plc (LON:CPI) today released its results for the year ended December 31. Highlights are provided below:

**Highlights**
**Good financial and operating performance in 2015**
• Underlying revenue growth on a like for like basis** of 11.8% including 4.3% organic growth, excluding businesses exited and held for sale from both 2015 and 2014
• Underlying operating margin* 13.7% (2014 on a like for like basis**: 13.5%)
• Underlying profit before tax* up 9% to £585.5m (2014: £535.7m)
• Underlying earnings per share* up 9% to 70.73p (2014: 65.15p)

• Total dividend up 9% to 31.7p (2014: 29.2p)
• Underlying cash flow* from operations £687m (2014: £644m), a cash conversion ratio of 108% (2014: 112%)
• Post-tax ROCE* of 14.3% (2014: 14.8%) and 15.0% on a continuing basis
• Reported profit before tax £112.1m (2014: £292.4m), impacted by business exits and impairment charges
* Excludes non-underlying items detailed in notes 2, 3 and 4 to the preliminary statement
** The impact of restating 2014 for business exit and other non-underlying items as detailed in note 1 segmental information
**Major contract wins and acquisitions in 2015**
• £1.8bn contract wins (2014: £1.7bn) in health, science, local government and financial services
• Contract win rate of 2 in 3 (by value)
• £402m spent on 17 acquisitions and our Fera partnership to enhance capability and facilitate future organic growth
• Largest acquisition, avocis, integrated well and providing strong platform for growth in Europe
**A solid start to 2016**
• £251m contracts secured to date (2015: £1.1bn)
• Bid pipeline total contract value £4.7bn (February 2015: £5.1bn), with a weighted average contract length of 6 years (February 2015: 8 years)
• Full year Group operating margin range increased to between 13.0% and 14.0%, expected for the foreseeable future (previously 12.5% to 13.5%)
**Platform to drive further value creation**
• We continue to manage the business to deliver strong EPS growth, cash flow and return on capital
• Dual strategy of organic and acquisitive growth, with continued focus on proprietary technology led and platform based solutions
• Remain UK centric, whilst gradually extending our footprint across growth markets, taking our existing services and following existing clients into new geographies.
**Andy Parker, Chief Executive of Capita plc, commented:** “We delivered good financial results in 2015, including 4% organic revenue growth, an improvement in our operating margin and a high level of cash generation. Our largest ever acquisition, avocis, has provided a strong growth platform in Europe. We have re-positioned the business away from certain non-core lower growth businesses and enter the current year in a strong strategic and financial position, enabling us to raise our margin target range to between 13.0% and 14.0%.
In 2016, we are targeting organic revenue growth of at least 4%, driven by the combination of growth from our divisional businesses and conversion of our bid pipeline. In the longer term, we remain excited about the significant structural growth opportunities in our markets and will continue to manage the business to deliver strong EPS growth, cash flow and return on capital.”
As of 07:30 GMT, Thursday, 25 February, Capita PLC share price is 1,072.00p.

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