The difficult economic environment is encouraging firms to outsource more of their business and lengthening the potential client list at Capita, the professional services company, according to a bullish interim statement this morning.

Capita, which administers the London congestion charge, said it had gained contracts worth £626 million in the first half to the end of June and another £187 million so far in July. The latest gains include one from the Department of Health to develop NHS Choices, a digital channel that will link patients with the NHS.

Interim profits before tax were up 16 per cent to £120.2 million, and the dividend is boosted from 4p to 4.8p. Paul Pindar, the chief executive, said the markets that Capita operates in continue to generate "an encouraging volume of opportunities". The company is most active in local government and life and pensions. The current challenging economic climate was encouraging businesses to explore opportunities for outsourcing, which was leading to an increasing number of potential clients approaching the company.

However, the need to invest in recruiting senior management meant that operating margins during the first half fell from 12.1 per cent to 11.9 per cent, against a background of unprecedented growth in the life and pensions business.

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