9th May 2018 08:19
LONDON (Alliance News) - Compass Group PLC said on Wednesday that revenue and profit fell in the first half of its financial year, but the catering firm lifted its dividend nearly 10% nonetheless with its full-year outlook unchanged.
Revenue for the six months to March 31 slipped 0.8% to GBP11.4 billion from GBP11.5 billion, while operating profit fell 2.7% to GBP853 million from GBP877 million. On an underlying basis, these two figures were up 4.8% and 4.5% respectively.
The FTSE 100-listed caterer said excluding the timing of Easter and extreme weather in the period, revenue was up 5.3% on an organic basis. The decrease in operating profit included a 5.3% hit from adverse foreign currency translation.
Pretax profit for the period dipped to GBP792 million from GBP831 million last year.
"Compass had another strong half with good revenue growth. North America continues to make excellent progress with broad-based growth across sectors. Performance in Europe was mixed, with good growth in the UK, offset by subdued trading in Continental Europe. Notably, the performance in our Rest of World region is improving," said Chief Executive Dominic Blakemore.
Compass said it saw a "strong performance" in North America, with broad based organic revenue growth of 7.3%. Europe organic revenue was up by 0.5%, driven by good growth in the UK. Rest of World grew by 3.4%, a "significant improvement" on the 3.8% decline last year.
The company posted an operating margin of 7.5% for the period, which was "as expected" though 10 basis points lower than the 7.6% recorded for the same period a year earlier.
Compass lifted its interim dividend 9.8% to 12.3 pence from 11.2p a year before.
"The business is trading well and our full year expectations are unchanged, with organic growth above the middle of our 4-6% range, and modest margin progression," Blakemore said.
Compass shares were down 5.3% at the open Wednesday in London at 1,499.00 pence.
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