Compass back on course for a successful year

11 April 2012

Compass, the world's biggest caterer, reported a better than expected first half operating profit, benefiting from acquisitions and an improved margin, shrugging off the impact of the tsunami in Japan.

Compass, which feeds office workers, members of the armed forces and schoolchildren, on Wednesday said its underlying operating profit rose by 11.8% on a constant currency basis to £567 million.

Market expectations had ranged between £547 million and £562 million, with the average at £558 million, according to a Thomson Reuters poll of 5 analysts.

The FTSE-100 group, which also provides catering services at major sporting events and entertainment venues, said the earthquake and tsunami in Japan knocked £5 million off its first half profit and the group estimates it will result in a reduction in second half profit of £20 million.

Despite that, Chief Executive Richard Cousins said the group had made a good start to the year, delivering both strong organic revenue growth and a further improvement in its margin.

"After absorbing the expected profit impact of the tragic events in Japan, our expectations for the full year remain unchanged," Cousins said.

Market expectations for Compass's full-year EBIT currently range between £1.04 billion and £1.17 billion with the average forecast at £1.09 billion, according to a Thomson Reuters poll of 27 analysts.

France's Sodexho, the world's No. 2 caterer, last month raised its full-years sales target on the back of a healthy order book and stronger-than-expected first half.

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