Capita Group yesterday rejected criticism over the way it has been handling London's congestion charge and other setbacks as it rolled out a 27% rise in first-half profits to £51m.
Shares in Capita raced ahead nearly 10% to 237p as it raised the dividend 30% to 1.3p and promised it was on track to win £770m of new contracts by the end of its financial year.
Chairman Rod Aldridge insisted the audit of its work ordered this week by Ken Livingstone in no way undermined what had been a major success story.
"I have to say it's been implemented very well when you think of the kind of volumes we have been handling - one million images a day," he said, expressing confidence the audit would not throw up wider doubts about the way the company had been operating.
Capita had admitted to Mr Livingstone it had failed to process nearly 1,600 cheques from drivers who had paid penalties after being caught on camera inside the zone.
Half the drivers received letters demanding sums of £120 for late payment, triggering court threats from motorists and leading one politician to describe the situation as "shambolic".
Problems with the congestion charge come on top of a £1.8m fine earlier this year over the way in which Capita's work at the criminal records bureau had failed to carry out checks on teachers.
Meanwhile a £9m contract to run Norfolk's payroll and pension service was terminated this week with six years left to run after a failure to agree a way of working with the local authority.
Mr Aldridge dismissed these setbacks as of little importance for a business that saw a 36% increase in turnover to £532m in the six months to 30 June.
"The company's performance continues to display strong growth, increasing profits and buoyant cashflow...We believe that shareholders will be pleased by Capita's results for 2003 and opportunities for growth remain excellent," he said .
Capita has already won £286m of new business in the first half of the year but said it was actively chasing contracts worth £2.8bn, the largest "pipeline" of deals in its history.
While many analysts were optimistic about the future for Capita not everybody believes it will reach its £770m target. "They have not won anything like that amount over the last six months and we don't believe there's anything that's likely to change that," said Matthew Lloyd at ABN Amro.
Mr Aldridge believes there are longer term opportunities coming out of the London congestion charge as he expects other authorities to adopt the traffic reduction policy - but not until 2005 or 2006.
The 900 people at Capita's Coventry call centre have been reduced to fewer than 300, in part because 160,000 motorists opted to pay for the congestion charge via text messaging. The staff were on short-term contracts so there have been no redundancies, said Capita.
