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Compass to focus on growth following a year of strong financial recovery

By 23/11/2021No Comments

Compass Group has delivered a strong year of recovery following the impacts of the pandemic last year, supported by record new business wins and client retention.

In its published full year results for the year ended 30 September 2021, the group saw underlying revenue recover to 88% of pre-Covid revenue by Q4. Underlying margin also improved to 5.8% in Q4.

On a statutory basis, revenue decreased by 10.2% reflecting the continued impact of the pandemic on the business. Statutory operating profit increased by 85.4% to £545 million reflecting controllable actions taken by the group which included resizing the cost base and improved cost control.

The group also reported record new business wins of £2.1 billion, with around half from first time outsourcing and client retention of 95.4%.

Within the group’s divisions, Healthcare & Senior Living and Defence, Offshore & Remote sectors performed well above pre-pandemic volumes, with strong recovery in Education and Sports & Leisure by Q4, while revenues in its Business & Industry sector have remained subdued due to the delayed return to offices in its major markets.

Given its strong cashflow and increasing confidence in the future, the group has reinstated its dividend with a payout policy of c.50% of underlying earnings.

Dominic Blakemore, Group Chief Executive, said: “Our strong financial recovery in 2021, including record new business wins and client retention, is a credit to our teams’ exceptional resilience, dedication and expertise in extraordinary circumstances.  We are pleased to be reinstating the dividend reflecting our strong cash flow and increasing confidence in the Group’s performance.

Looking ahead we are now focused on growth, driven by encouraging market trends and our ability to provide more bespoke, digital and sustainable solutions that meet the evolving needs of clients in a post-pandemic world. The tailwinds from first time outsourcing continue and, combined with our differentiated operating model and investment opportunities, we are in a strong position for growth.

“As we emerge from the pandemic, our strategic focus is on sustained growth for the future, to enhance our competitive advantages and further strengthen our position as an industry leader in food services. We are increasingly excited about the significant structural growth opportunities globally, leading to the potential for revenue and profit growth above historical rates, returning margin to pre-pandemic levels, and rewarding shareholders with further returns.”

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