Compass Group to focus on markets with growth opportunities

Compass Group is shrinking its global footprint by withdrawing from nine countries to focus on markets with the most promising growth opportunities.
The world’s largest catering group, whose operations span schools, airports, hospitals, sporting events and military bases across 30 markets, is pulling out of non-core regions to free up financial firepower for takeovers.
It has divested from five countries — Argentina, Angola, Brazil, the United Arab Emirates and mainland China — and is preparing to exit operations in Chile, Colombia, Mexico and Kazakhstan.
Dominic Blakemore, the chief executive, said that 2024 had been “a year of strong operational and financial performance, with net new business growth accelerating in the second half as expected”.
He added: “Our priority is to invest in the business through capital expenditure and M&A to support future growth, with surplus capital being returned to shareholders.”
The FTSE 100 group, one of London’s biggest listed companies with a £45 billion market valuation, saw operating profit rise by 16.4 per cent to $2.99 billion in the 12 months to the end of September, up from $2.57 billion the year before.
Revenue was up 10.8 per cent to $42 billion, with growth across all regions led by North America, long the engine room of Compass’s growth. It expects high single-digit underlying operating profit growth next year, and is “confident’ in sustaining ongoing margin progression in the longer term.
Compass spent $1.22 billion on acquisitions last year including Germany’s Hofmann-Menue Holdings and CH&CO, whose venues include Kew Gardens and the Royal Opera House in London. Since its financial year ended, the group has continued its merger push buying Dupont Restauration, one of France’s biggest caterers, and agreeing to a deal for 4Service, a Norwegian food service and facilities management business.
The caterer, whose clients include Microsoft, Shell and a host of the world’s biggest companies, employs 580,000 staff and also provides catering services at the annual Wimbledon tennis championships and the American football Super Bowl.
Greg Johnson, an analyst at Shore Capital, said the lack of a further share buyback may disappoint investors “although we continue to see significant returns and M&A potential over the medium term”.
Shares of Compass, which have risen in value by 25 per cent so far this year, closed up 27p, or 1 per cent, at £26.80 in London.