Compass warns interims could fall by up to £225m on Covid-19 hit
Compass Group
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16:40 26/04/24
Food services company Compass Group said it expected interim operating profit to be up to £225m lower due to the coronavirus.
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“We are implementing significant mitigation plans to manage our costs, and at this stage expect the drop-through impact of the lost revenue to be between 25%-30% across the business,” the company said on Tuesday.
“As a result, our operating profit for half Year 2020 will be £125m - £225m lower than expected.”
Compass said the acceleration of containment measures adopted by governments and clients in Continental Europe and North America had hit expectations as the majority of its sports & leisure and education business were closed.
With business and industry volumes severely impacted the company said half year organic revenue growth would be between 0% - 2%.
Compass' organic revenue growth for the five months to February 29 was 6% as measures to contain the virus in its Asia-Pacific region did not materially impact on the business.
“Our operating margin during that five month period increased by around 10 basis points with the benefits from the restructuring programme in Europe coming through strongly,” the company said.