Compass sees rise in revenue and profit

Catering giant the Compass Group has seen a surge in both revenue and profit in the year to September 30th, the company's latest annual results show.

Compass saw its revenue on a constant currency basis increase to £16.9 billion, up eight per cent on the year before, while profit before tax rose seven per cent to £789 million.

The company performed particularly well in both North America and emerging markets, helping to offset the effects of a difficult economic environment in Europe.

In North America, revenue grew to £7.5 billion, up 9.8 per cent year-on-year, while underlying operating profit rose 11.2 per cent to £598 million.

The North American market now accounts for 44.5 per cent of the group's total revenue, compared to 43.2 per cent a year before.

Compass also performed well in emerging markets, seeing a 13.7 per cent rise in revenue to £3.1 billion and a 13.5 per cent increase in operating profit to £235 million.

Meanwhile, revenue and profit in Europe, including the UK, remained broadly flat, with the group implementing a programme of cost cutting and improving efficiency.

However, the group said that the European market is still performing solidly, with an increase in new business providing encouragement.

"Compass has continued to perform well. We've seen particularly good trading in North America and the fast growing and emerging markets and the outlook in both regions is encouraging," said Richard Cousins, group chief executive at Compass.

"The fundamentals of our European businesses remain solid and the decisive actions we're taking to improve operational efficiency are progressing well.

Compass says that its future growth strategy will be built around a focus on its food services, raising the possibility of an increase in chef recruitment.

"Food remains our core business," it said. "The structural opportunity in the outsourced food service market, estimated at £200 billion, is a key growth driver.

"With an overall penetration rate of less than 50 per cent, it represents a significant opportunity."

Berkeley Scott is a specialist recruitment agency in the catering industry