Compass Group announced half-year financial results for the six months ending March 31, 2024.
Strong underlying operating profit growth of 18.7% delivered through:
- Balanced organic revenue growth of 11.2% and underlying operating margin up 50 bps year on year to 7.1%.
Invested in growth, further refined its portfolio and returned surplus capital to shareholders:
- Invested $693m in capex (3.3% of underlying revenue) supporting growth and generating strong returns.
- Spent $373m on M&A, including the acquisition of Hofmanns. CH&CO completed in April 2024.
- Exited four countries during the period and agreed to exit Brazil subject to regulatory approval.
Strategic priorities:
- Focusing on core markets; capitalizing on significant structural growth opportunities.
- Investing in capex and strategic in-fill M&A to support future growth through sectorization and flexible operating models.
- Nurturing talent and developing leaders to support long-term growth ambitions.
Dominic Blakemore, Group chief executive, said in the announcement: “The Group has delivered a strong set of results, with balanced double-digit organic revenue growth and good underlying operating margin progression across all regions, leading to underlying operating profit growth of 19% on a constant-currency basis.
Europe is building a strong track record of growth, having benefited from investment and best practice sharing. We have completed the acquisitions of HOFMANNs in Germany and CH&CO in the UK and Ireland, increasing operational flexibility as well as further strengthening our unique sectorised approach to the market.
Our results are driving strong cash generation which in turn gives us the flexibility to invest capital back in the business through capex and strategic in-fill M&A, to support future growth through sectorisation and flexible operating models, both of which generate excellent returns.
We have continued to refine our portfolio and increase focus on our core markets where we see significant growth opportunities. The Group has built strong competitive advantages over the past few decades which are being replicated across all our regions.
As a result of our strong first-half performance and positive outlook, we are raising guidance for underlying operating profit growth to towards 15% for the full year. Beyond 2024, we expect to sustain mid to high single digit organic revenue growth, ongoing margin progression and profit growth ahead of revenue growth. We will continue to reinvest in the business to support future growth, with any surplus capital returned to shareholders, as we maintain our strong track record of delivering long-term, compounding shareholder returns.”
