Capita reckons the outsourcing market is picking up after a quiet 2009 and 2010.

Even public sector contracts are coming back to life especially in local government and defence.

In an interim management statement, Capita said it saw a solid performance in the first four months of 2011. It expects to hit targets for revenue growth and margin improvement for the year.

Capita said its "bid pipeline" was worth £4.7bn on 24 February 2011. This represents contracts worth over £10m for which Capita has been short-listed to the last four bidders or less.

There are no bids worth more than 1 per cent of last year's revenue due until 2012.

Capita said central government work was beginning to emerge – much of this as joint ventures and mutual deals instead of standard contracts.

It said it had acquired six businesses so far in 2011 for a total of £80m and expects to buy more companies during the year.

Plans to build a shared services centre in Krakow, Poland are going well; Capita has signed heads of terms to lease a 500-seat call centre.

Capita's full statement is here. ®