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SSP Group sees revenue rise on return of travel, expects to meet goals

16th Feb 2023 09:02

(Alliance News) - SSP Group on Thursday said that it remains confident of meeting its annual guidance, after seeing strong momentum across the business continue from the end of last year.

SSP Group is a London-based operator of food and beverage concessions in travel locations, operating restaurants, bars, cafes, food courts, lounges and convenience stores in airports, train stations, motorway service stations and other leisure locations.

The company told investors that the new financial year has started well, with group sales for the four months to January 31 at GBP871 million. This represents a rise from both a year prior, and from Covid-19 levels, it said.

SSP said its improved performance included the benefit from net contract gains as well as price increases compared to the same period in 2019. It also attributed the up-tick in revenue to a further recovery in passenger numbers, led by strong leisure travel demand over the extended holiday season.

While the company said it remains mindful of macroeconomic uncertainties, it believes that the travel food and beverage sector will remain "structurally resilient" to pressures on consumer spending and that its global footprint will deliver sustained growth.

As such, it expects performance in line with expectations, namely for revenues to be in the region of GBP2.9 billion to GBP3.0 billion, with corresponding earnings before interest, tax, depreciation and amortisation in the region of GBP250 million to GBP280 million.

These assumptions included a contribution from SSP's pipeline of new outlets which, once fully mobilised, it believes will add approximately GBP550 million to revenues by 2025, compared to 2019.

"The strong momentum in performance that we saw across the business in the second half of last year has continued into the new financial year, demonstrating the high quality of our business model. We are making excellent progress against our strategic ambitions and are on track to deliver against the planning assumptions we set at the beginning of the financial year," said Chief Executive Officer Patrick Coveney.

"We have headroom for further growth and returns in multiple markets across the world. In particular, we see significant momentum and potential to accelerate expansion across the North America and Rest of World markets where revenues are now growing rapidly and which together are expected to account for approximately 40% of the Group by 2025. In addition to this we continue to expand in a targeted way in the UK, Europe and the Middle East."

SSP shares were trading 2.2% lower at 263.57 pence each in London on Thursday morning.

By Holly Beveridge; Alliance News reporter

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