Homeserve is set to expand its Black Country base, it revealed today as it unveiled rising profits.

Chief executive Richard Harpin wants to put another building on the Green Lane site in Walsall, which houses Homeserve’s core membership business and employs 1,200 people. He said: “We are one of the few businesses that is recruiting at the moment.

“One of our biggest issues is the need to find more space. We will be looking to put another building on the site or nearby on Green Lane.”

The UK Membership business at Walsall, which provides cover for a range of household emergencies from broken boilers to problem pipes and wiring, boosted its profit by 26 per cent last year up to £89million.

“A lot of people have a lot of worries at the moment, and our membership services means they don’t have to worry about things that might go wrong around the home,” said Mr Harpin. “People want that peace of mind in the current economic climate.

“As a result it is making our business very resilient at the moment and we have hit our target of retaining 83 per cent of our customers.”

Overall pre-tax profits for Homeserve were up 13 per cent to £96.1 million and its policies now cover 55 million households, 23.4 million of them in the UK.

But a decision to sell its Emergency Services arm and write down the value of the business by £97 million resulted in a statutory loss before tax of £21.7 million.

The Emergency Services operation employs around 2,400 of Homeserve’s 5,500-strong workforce at bases in Beverley, Norwich and Nottingham. The decision to sell follows falling sales and profit figures at the business, which was intended to provide a range of tradesmen to handle repair services nationwide.

Homeserve now intends to concentrate on its core membership insurance business, based at Walsall.