Support services firm Carillion said it has its largest ever pipeline of contract opportunities as local authorities look to outsourcing and it is on track to meet market expectations.

The Wolverhampton-based company said it was well-positioned to take advantage of public service customers increasingly looking to outsource work to help them reduce costs and it expected to achieve its targeted operating margin of around five per cent in its support service unit.

Revenues from activities in the Middle East picked up in the third quarter, said Carillion, adding that it sees strong full-year margins from the region and hopes its recently established Qatar business will start to win contracts in the next six months.

The company won a number of new contracts in the third quarter, including a £124 million residential project deal for its Dubai joint venture and 200 million pounds worth of contracts in the energy sector.

Earnings growth for 2010 will be in line with market expectations, said Carillion, with the consensus for full-year pre-tax profit at £181 million according to a Reuters poll of nine analysts.