Sodexo's first-half results show 8.3% revenue growth in UK and Ireland business

Friday 20th April 2012 10:52

French catering and facilities management giant Sodexo has posted "solid" first-half results with revenues in its UK and Ireland business growing 8.3% to €680m (£556m).

The company said the increase was driven by the success of the hospitality contract from the Rugby World Cup in New Zealand in September and October last year, with revenues of about €52m (£43m).

Operating profit grew to €56m (£46m) from €21m (£17m) for the first half of the previous fiscal year, which includes a favourable accounting adjustment of €26m (£21m) resulting from pension adjustment when the Sodexo replaced the Retail Price Index with the Consumer Price Index.

Sodexo's burgeoning facilities management business with its corporate clients, such as GSK and British Aerospace, was reported to have offset a decline in the number of consumers in food services.

Revenues remained flat in its healthcare sector as a result of weak business development over recent months, Sodexo said, while organic growth revenues of 0.1% in education reflects "continued significant commercial selectivity".

Commenting on the results, chief executive Michel Landel said: "Our first half results are solid, demonstrating the relevance of Sodexo's strategy and 'quality of life' services offer, illustrated by the major contract wins of the past several months.

"Organic growth is increasing, driven by development of more than 10% in our facilities management services and in our motivation solutions activity."

"In a tough economic environment, our teams are fully mobilised to provide clients the innovation and productivity they expect.

"We are maintaining our full year Fiscal 2012 objectives of an increase of around 10% in operating profit based on organic revenue growth of between 6% and 7%, with acquisitions also impacting revenues by around 4%."

Sodexo reported a 14.5% rise in operating profit to €559m (£457m) for the business as whole, on sales of €9.07b (£7.4b).

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By Janie Manzoori-Stamford


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