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Hurricanes curb growth at Sodexho

12 January 2006 by

Sodexho has said its performance in the first quarter of 2006 was "satisfactory" despite the negative impact of the North American hurricanes.

The French caterer estimated that its North American turnover growth had dipped 0.7 percentage points to 3.6% as a result of the natural disasters in New Orleans and the Gulf of Mexico region.

Its higher education business was hit hardest, and seven universities in the area remain closed.

A spokesman said: "Reopening dates and enrolment figures remain uncertain."

Overall, it reported 5.1% turnover growth for the period, which chief executive Michel Landel said was "satisfactory and in line with our objectives for the full year".

In the UK and Ireland, revenue growth was flatter at 1.4%, climbing from €324m (£223m) last year to €333m (£229m) in 2006.

It is the first time the company has posted positive UK organic growth in three years.

Sodexho said that a good performance at its defence and prison sites had buoyed its UK business and industry (B&I) revenues.

There was also positive news at its European B&I sites, where business picked up 5.8%.

Dresdner Kleinwort Wasserstein analyst Karl Green said: "Overall the results mark a good start to the year. However, the numbers are not wall-to-wall positives. Greater contract selectivity in the public education segments in the USA and France and in US B&I is acting as a brake on growth."

By Tom Bill

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