Full-year numbers from commercial catering provider Compass Group (CPG) had extra flavour thanks to the European division, which delivered its highest organic revenue growth rate since 2008. The geography accounts for 28 per cent of group revenues and has benefited from increased attention from management. Chief executive Richard Cousins said he'd extended the best practice framework from the US to Europe to "improve customer win and retention rates", while the division will now operate as nine sub-regional units to keep costs low.
North America remains the main driver of growth, accounting for the lion's share of revenues. New contract wins and good revenue growth in areas such as healthcare, seniors and sports and leisure also helped. Organic revenues jumped 8.1 per cent here, just above the 7.9 per cent rate from FY2015. The 'rest of the world' division is the most exposed to customers dependent on commodity prices, and organic revenues there dropped 1.2 per cent as a result. Mr Cousins said it had been tough in places such as Brazil, although countries like India reported growth of 20 per cent, so he remains bullish in the medium term.
Analysts at Numis expect pre-tax profit of £1.67bn in the year to September 2017, leading to EPS of 76.6p, compared with £1.34bn and 61.1p in 2016.
| COMPASS GROUP (CPG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,351p | MARKET VALUE: | £22.2bn | |
| TOUCH: | 1,350-1,351p | 12-MONTH HIGH: | 1,559p | LOW: 1,061p |
| DIVIDEND YIELD: | 2.3% | PE RATIO: | 22 | |
| NET ASSET VALUE: | 152p* | NET DEBT: | 115% | |
| Year to 30 Sep | Turnover (£bn) | Pre-tax profit (£bn) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 16.9 | 0.79 | 32.1 | 21.3 |
| 2013 | 17.6 | 0.72 | 23.3 | 24.0 |
| 2014 | 17.1 | 1.14 | 48.8 | 26.5 |
| 2015 | 17.8 | 1.16 | 52.3 | 29.4 |
| 2016 | 19.9 | 1.32 | 60.4 | 31.7 |
| % change | +11 | +14 | +15 | +8 |
Ex-div:19 Jan Payment: 20 Feb *Includes intangible assets of £5.52bn, or 336p a share | ||||
