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Compass Group reports record contract gains in latest full year results

22nd Nov 2023 - 08:16
compass group results dominic blakemore chief executive
The world’s biggest catering group Compass has won a record amount of new work in its financial year to September 30th, signing £2.7bn of new business, including contracts with National Gas, Moorfield Eye Hospital and Unity Place, Santander’s new home in Milton Keynes.

It has reported revenues of £31bn, a 21.6% increase on the £25.5bn turnover it generated in 2022. Pre-tax profits rose by 19.2 per cent to £1.75bn, from £1.47bn.

Contributing to the revenue growth was the decision by Compass to raise prices by an average of 7% as part of efforts to ‘manage inflation’.

Underlying operating profit growth of 30% was delivered through organic revenue growth of 19%, which was balanced across all regions and sectors.

Dominic Blakemore, Compass Group chief executive, said: “2023 was a strong year for Compass. North America continued its long track record of excellent growth whilst Europe delivered a second year of net new growth in the 4-5% range.

“During the year, we continued to successfully capitalise on the dynamic outsourcing trends, resulting in another record year of new business wins and continued strong client retention.

“We have a strong, balanced, and sustainable growth model across the Group. Our size, strength and scale enable us to continue investing in our operating model, further enhancing our competitive advantages.

“We have exited nine tail countries to focus on markets with the greatest growth opportunities and our strong cash generation continues to fuel investment in our business through capex and attractive M&A.

“The business is in great shape operationally and financially and well positioned for a more focused growth phase. Despite some macroeconomic uncertainty, favourable market dynamics continue and, with a global market share of less than 15% and around 50% of the market still self-operated, we have an exciting structural growth opportunity.

“We are confident that the focus on our core markets, the ongoing investment in our market-leading offer and our proven processes will support high single-digit organic revenue growth in 2024.”

Going forward, we expect to sustain mid to high single-digit organic revenue growth and ongoing margin progression leading to profit growth ahead of revenue growth and increased cash generation.”

Written by
David Foad