SSP Group plc (LSE:SSPG) shares jumped 14% to 68.6p as investors latched onto the company’s most consequential move of the year: a wide-ranging review of its Continental European rail business, long the weakest link in the group’s portfolio.
The review sits at the heart of a results update that otherwise showed a business grinding steadily forward in FY25 while promising sharper value delivery in the current year.
Revenue from the rail station and airport concessions group, which owns the Upper Crust and Caffè Ritazza brands, rose 8% on a constant-currency basis to £3.6 billion, with operating profit up 13% to £233 million and margins improving by 30bps.
Free cash flow turned positive at £80 million, net debt/EBITDA improved to 1.6x and EPS climbed 25% to 12.5p. A 4.2p dividend and a £100 million buyback underline management’s confidence.
But the market’s focus is Europe, where underperformance has dragged for years.
CEO Patrick Coveney said the team, model and balance sheet had now been “reset”, and that the newly launched review aims to lift Continental European rail margins from 2.2% to above 3% next year. Management is also weighing options to “realise value” linked to the TFS free-float requirement.
Early current-year trading is encouraging, with group like-for-likes at 4% and North America improving. SSP now expects EPS towards the top of its 12.9p–13.9p range and free cash flow above £100 million.