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British back-office outsourcing giant Capita has announced profits of Pounds 141.7 million for the six months to end of June 2009 as government and companies continue to farm out work in order to cut cost in the recession.
Revenues were up by 11% to Pounds 1.31 billion but in spite of this the company has underperformed market expectations.
â€œPre-tax profit was below the Pounds 144.3 million we expected and with profits likely to come under pressure over the coming months, we downgrade our profit forecast to Pounds 320.3 million from Pounds 332.3 million,â€VbCrLf said Panmure analyst Mike Allen.
However, Chief Executive Paul Pindar expects the group to meet analysts' consensus profit target of Pounds 320 million for the year because demand for outsourcing continues to be buoyant across the public and private sectors. "We certainly expect to meet analyst expectations for 2009. I think the consensus number is sensible and would represent around 17 percent growth which would be a reasonable performance in this economic climate," Pindar told Reuters in an interview.
Capita owns Capita Resourcing, the specialist staffing agency. Turnover in the HR Solutions part of Capitaâ€™s business was up from Pounds 117.8 million in 2008 to Pounds 138.2 million in the first six months of 2009. Profit was up from Pounds 11.5 million to Pounds 12.8 million