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    Finance

    Posted By Global Banking and Finance Review

    Posted on May 14, 2025

    Featured image for article about Finance

    By Yadarisa Shabong

    (Reuters) -British catering firm Compass Group maintained its annual profit and revenue forecasts on Wednesday after reporting a jump in first-half operating profit, disappointing investors and sending its shares lower.

    The world's largest catering group reported underlying operating profit for the six months to March 31 rose 11.6% to $1.63 billion, just ahead of the $1.61 billion expected by analysts in a company-provided consensus.

    Compass, said however, for the full year it continued to expect high single-digit underlying operating profit growth, with organic revenue growth above 7.5% for the year.

    Its shares fell nearly 4% in early trade to their lowest since late April. It was among the top losers on the FTSE 100 blue-chip index.

    This is the second time this year that Compass maintained its annual forecast after a good set of results, pressuring its share price. In March, Compass' stock price had come under further pressure after French rival Sodexo cut its forecast on slower growth in North America.

    Compass said it has "flexibility to help mitigate potential macroeconomic challenges", given its local purchasing scale and exposure to diverse sectors.

    Analysts at RBC Capital Markets called Compass' first-half "fairly unremarkable", but "reassuring", showing that Sodexo's challenges were largely specific to the French company, the second-largest player in the sector.

    U.S. rival Aramark last week also maintained its annual outlook.

    Compass said its first-half organic revenue growth was 8.5% and operating profit margin came in at 7.2%, both meeting market expectations.

    Its business in North America, which contributes the lion share of revenue, grew profits by nearly 11% and saw "good growth" across all main sectors, Compass said.

    Growth prospects in the United States, Compass' largest market, have been a concern for investors and had caused a pullback in its shares, analysts have said.

    Compass lifted its dividend by 9.2% to 22.6 cents for the first half. It did not announce any new share buybacks.

    (Reporting by Yadarisa Shabong in Bengaluru; Editing by Varun H K and Tomasz Janowski)

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