Compass says full year expectations unchanged after good quarter

26th Sep 2013 07:03

Compass Group said its expectations for the full year were unchanged with organic revenues set to have risen by just over four per cent and profit margins to have grown slightly.The FTSE 100 catering giant said growth has been driven by new business wins and high client retention particularly in North America where organic revenue growth is expected to be around 7.5%. It has also seen a strong performance in its emerging markets operations but business has been more challenging in Europe where its retention rate has been hit by its planned exit of certain uneconomic contracts and business closures. Organic revenue growth in Europe and Japan is expected to have fallen by around 3%Group operating profit margins are expected to have increased by 20 basis points to over 7%, helped by cost savings. Looking ahead the company said that its pipeline of new contracts was encouraging and it expected to see further good performance in North America and its emerging markets but it warned economic conditions in Europe remain challenging.Compass added: "The actions we are taking give us confidence that we will continue to be able to manage the profit impact o f ongoing weakness in like for likes revenue."TB