Compass Group results ‘surpass' expectations

Compass Group said performance had "surpassed" expectations in its full-year results announcement, adding that an increased desire for outsourcing had resulted in growth opportunities.

The global caterer's underlying results showed a 37.5% increase in revenue from £18.7b in 2021 to £25.8b in 2022, a figure that represents 116% of 2019 revenues.

Its underlying operating margin improved by 170bps year-on-year to 6.2%, with H2 2022 at 6.5%.

Client retention hit a new record of 96.4%, while new business wins accounted for £2.5b with strong contributions from both North America and Europe. The group said that 45% of those new business wins were from clients outsourcing for the first time.

Chief executive Dominic Blakemore said: "The group's performance surpassed our expectations both in terms of net new business growth and base volume recovery, with business & industry now operating above its pre-pandemic revenues.

"The strong growth trends seen in the first half have continued, with net new business accelerating through the year in all our regions. Our clients are continuing to face operational complexities and inflationary pressures, which are driving increased outsourcing, and we are successfully capitalising on the resulting growth opportunities."

He added: "While the macroeconomic environment is uncertain, we are working in partnership with our clients to mitigate inflationary pressures and supporting our colleagues during this challenging period by offering financial support and other benefits."

Looking to 2023 Blakemore said the business expects operating profit growth to be above 20% on a constant-currency basis, delivered by organic revenue growth of 15% and operating margin growth of 6.5%.