Compass Group expects 2024 underlying operating profit to grow about 13%, aided by strong demand leading to high single-digit organic revenue growth and stronger margins, it said in a statement.
It also announced a further $500 million (€458 million) in share buyback, after completing a $750 million (€687 million) buyback earlier this month.
Profit Growth
Compass, the world's largest catering group, said adjusted operating profit rose nearly 30% to £2.12 billion (€2.42 billion) for the year ended September 30, in line with market expectations.
The company, which provides food catering services to offices, universities and sports stadiums across 40 countries, has benefited from new businesses and high prices, although red-hot food and wage inflation has been a drag on its margins in the past year.
'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,' the company said in a statement.
Compass also announced that after its year end, it bought a German producer of cook and freeze meals, Hofmann Menü-Manufaktur GmbH, and exited its small operations in Argentina and Angola.
Annual underlying revenue grew 18.8% to £31.3 billion (€35.8 billion), registering growth across its markets.
In financial year 2023, it signed £2.7 billion (€3.09 billion) of new business, with first-time outsourcing accounting for about 50%.
'Well Positioned'
"The business is in great shape operationally and financially and well positioned for a more focused growth phase," commented Dominic Blakemore, chief executive. "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."
Additional reporting by ESM
