OUTSOURCING specialist Capita has returned record results for the 16th consecutive year.

The group, which employs 1,000 people in the region, provides Business Process Outsourcing (BPO) services.

For the year ending December 31, turnover increased by 19 per cent to £1.285bn and operating profits rose by 22 per cent to £160.1m.

Rod Aldridge, Capita Group executive chairman, said: "All our key financial metrics were strongly ahead and we were especially pleased with the strength of our cash generation."

The company was boosted by 12 contract wins last year, with a value of £1.36bn, up 122 per cent on 2003. They included a five-year contract with Dixons Group and a seven-year contract with the Department for Work and Pensions.

It also has an option to extend its contract to manage the Central London congestion charge scheme.

Other contracts won in the first eight weeks of this year total £110m and it has bid for other contracts worth a total of £3.8bn, a rise of 41 per cent on the same period last year.

Capita employs 410 people at Lingfield Point, Darlington, working on behalf of Government winter fuel payments, NAAFI, the Charity Commission and the Connexions Card.

In nearby Mowden Hall, 300 staff handle teachers' pensions. A further 40 people work in Newton Aycliffe, County Durham.

Another 250 staff provide administration and office services for the Department for Work and Pensions at 27 sites across the North-East.

Industry analysts are predicting the domestic BPO market could grow by up to 13 per cent this year.

"Capita is well placed to make continued progress in 2005," said Mr Aldridge.

"Our existing revenues are strongly underpinned, our sales pipeline is at a record level and the group is trading strongly."

Underlying operating cash flow rose by 26 per cent to £200m, but the company made a one-off £50m contribution from this to its staff's final salary pension scheme.