Compass Group PLC (LSE:CPG) was in upbeat mood as it unveiled strong interim results, raising full-year profit guidance, lifting the dividend by 60% and pledging a further share buyback of £750mln.
The Chertsey-based multinational contract foodservice company lifted its forecast for full-year operating profit growth to 30%, from 20% previously, reflecting organic revenue growth of around 18% (up from earlier expectations of around 15%) and an operating margin in the range of 6.7% to 6.8% (from above 6.5%).
At the half-year stage, the FTSE 100-listed firm reported underlying revenue of £15.8bn, up 24.7% from £12.6bn, with balanced growth across all regions with a very strong performance in Europe.
There were double-digit increases in organic revenue across all sectors in the six-month period to end-March 2023 and performance was particularly strong in Business & Industry, as employees continued to return to the office, and Sports & Leisure, where participation rates improved.
Dominic Blakemore, group chief executive, said: “Net new business continued to be excellent, and significantly higher than our historical rate.
“We are particularly pleased with the step change in our Europe performance which has benefited from growth initiatives as well as favourable outsourcing conditions.”
Operating profit of £1.05bn was 41.1% higher than £744mln a year prior while the operating margin improved 80 basis points to 6.6%. EPS jumped 43% to 42.7p from 29.9p while shareholders were rewarded with a 60% increase to the dividend to 15p from 9.4p.