SSP’s (SSPG) like-for-like sales edged up by 2 per cent over the first half, helped by continued growth in air passenger numbers. Such expansion came despite a smaller second-quarter improvement of 1.5 per cent, reflecting the timing of Easter (which slipped into the second half) and France’s ‘Gilets Jaunes’ protests. Other factors affecting performance included the redevelopment of airports, particularly in Copenhagen and Malaga.
Given the “ongoing level of economic uncertainty and disruption”, SSP expects full-year like-for-like sales to rise by 2 per cent – down from previous guidance of 2-3 per cent. This is due to “some impact” within its ‘rest of the world’ division from the suspension of Jet Airways’ operations in India and the grounding of Boeing 737 Max aircraft – although the division's like-for-like sales still climbed 6.4 per cent.
There remains cause for optimism. Net contract gains of 4.1 per cent stemmed from new unit openings and good levels of contract retention. Now, management expects full-year net contract gains of 4-5 per cent – up from 3 per cent.
In turn, capital expenditure expectations have increased. After soaring almost three-quarters to £108m (with new unit development being first-half-weighted), this figure is expected to rise to around £160m by the year-end – up approximately £15m from earlier guidance.
Barclays expects adjusted EPS of 28.5p for its September 2019 year-end, up from 24.8p for FY2018.
| SSP (SSPG) | ||||
| ORD PRICE: | 703p | MARKET VALUE: | £3.13bn | |
| TOUCH: | 702-704p | 12-MONTH HIGH: | 749p | LOW: 613p |
| DIVIDEND YIELD*: | 1.6% | PE RATIO: | 28 | |
| NET ASSET VALUE: | 85p | NET DEBT: | 94% | |
| Half-year to 31 Mar | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2018 | 1.18 | 48.4 | 5.6 | 4.8 |
| 2019 | 1.26 | 51.4 | 6.1 | 5.8 |
| % change | +7 | +6 | +9 | +21 |
| Ex-div: | 06 Jun | |||
| Payment: | 28 Jun | |||
*Excludes special dividends **Includes intangible assets of £725m, or 163p a share | ||||
