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15 May 2019 | 07:53

Compass Group lifts guidance following 'very strong' first-half performance

Compass Group lifted its guidance after reporting 'very strong' performance in the first half of the year, driven by 'excellent' growth in North America, and strong performance in UK Defence.

'Following the very strong first half performance, we now increase our organic revenue growth guidance for the full year and expect to deliver organic revenue growth and margin progression similar to 2018,' the company said. For the six months ended 31 March, operating profit climbed 5.8% to £951m and revenue rose 6.6% to £12.5bn. Revenue growth was boosted by performance in North America with broad based organic revenue growth of 7.9%, 'strong' Europe organic revenue growth of 5.5%, driven by UK Defence contract wins and continuing good growth in Continental Europe, the company said. The Rest of World segment grew 3.2% with continuing 'good performance in developing markets,' it added. The interim dividend was raised by 6.5% to 31.1p a share. 'Compass had a strong first half. Organic revenue growth was 6.6%, driven by excellent growth in North America, a strong performance in Europe, particularly in UK Defence, and good growth in Rest of World,' the company said. 'We maintained our strong margin whilst absorbing the increased mobilisation costs in Europe from the higher growth as well as strategic investments being made by the business.' 'Our focus on efficiencies and pricing have continued to offset inflation and helped mitigate ongoing volume weakness in the UK and Continental Europe.'

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