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Compass Group's European profit growth slows to 1.9%

25 July 2019 by
Compass Group's European profit growth slows to 1.9%

Compass Group's organic revenue growth in Europe slowed between 1 April and 30 June 2019, the firm's Q3 trading update has confirmed.

The global foodservice provider posted overall European organic revenue growth of 1.9% across the period. The figure rose to 2.9% excluding the Easter break, and 4.3% when adding growth from the nine months to 30 June 2019.

The slowing of the firm's revenue growth follows the impact of significant UK defence contracts, which were implemented in H2 2018.

In a statement to investors, the firm noted: "The deceleration in revenue growth in the third quarter principally reflects the expected lapping of new business from the significant UK defence contracts which mobilised in H2 2018.

"We have continued to see weakening volumes in the UK, France and Germany reflecting the more uncertain macro environment and, as a result, the margin for the nine months to 30 June 2019 was down by a similar amount to that reported in H1."

The numbers were balanced out overall by trade in other markets the UK-based firm operates in, including the US where revenues for the quarter grew by 8.5%, and the rest of the world where revenues experienced a 3.2% uptick.

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