The expansion of support services company Interserve in the Middle East has helped raise profit more than 15%.

The firm posted a pre-tax profit of £48m in 2005, an increase of 16% from £41m in 2004. Turnover grew 4% to £1.2bn.

Growth in outsourcing in the UK public sector also added to the bottom line. Contracts in the year included FM services at the University College London Hospital PFI and Project Armada, a fleet accommodation centre at Devonport naval base, Plymouth.

Its activities in the Middle East contributed £6m pre-tax profit to the business, up from £4m in 2004. Projects included the Mall of the Emirates in Dubai and contracts for the Wafi Raffles Hotel and the Dubai Festival City Golf Clubhouse.

Adrian Ringrose, the chief executive, said: "The place to start is with organic growth but we have a strong balance sheet to address areas where we are not so strong."