Slide 1: First half Fiscal 2023 results
First half Fiscal 2023 results April 5, 2023
Slide 2: Agenda
Agenda 1. 5. First half Fiscal 2023 highlights Outlook Figures have been prepared 2. 6. in thousands of euro and published in millions of euro Financial Performance Q&A Please refer to Appendix 10 3. 7. for Alternative Performance Review of Operations Appendices Measures definitions On-site Services
Slide 3: First half Fiscal 2023 highlights
1. First half Fiscal 2023 highlights First half Fiscal 2023 results - April 5, 2023 - © Sodexo 2023. All rights Reserved 3
Slide 4: First half Fiscal 2023 at a glance
1. First half Fiscal 2023 at a glance Organic Revenue Growth Underlying Operating Profit Margin vs. H1 FY22 constant rates current rates Group +50 +60 +13.4% 5.8% bps bps On-site Services +20 +20 +12.9% 5.1% bps bps Benefits & Rewards Services +510 +530 +24.2% 31.9% bps bps First half Fiscal 2023 re
Slide 5: Positive net new wins in H1
1. Positive net new wins in H1 Wins Retention Extensions/Expansions Entegra contract Education contract Corporate contract Accor Mississippi University for Women Unilever 25 countries Benefits & Rewards contract Corporate contract Seniors contract Škoda Auto BASF Korian Healthcare contract Benefits
Slide 6: On-site Services Growth indicators
On-site Services 1. Growth indicators H1 Client Retention in line Record H1 Business development with past performance above €0.8Bn incl. cross-selling 98,1% 97,8% 3,7% 3,6% H1 FY22 H1 FY23 H1 FY22 H1FY2023 Historical Losses New development in €m in €m H1 FY19 H1 FY22 H1 FY23 H1 FY19 H1 FY22 H1 FY23
Slide 7: Refocus on Food services, more selectivity in FM
On-site Services 1. Refocus on Food services, more selectivity in FM Revenues: +20% growth New development: in Food services in H1 FY2023 increasing share of Food services in H1 FY2023 organic growth 45% 35% 41% 41% +2%* 65% 59% +20% 55% 59% H1 FY2022 H1 FY2023 H1 FY2022 H1 FY2023 (*) +6% organic gr
Slide 8: Financial performance
2. Financial performance First half Fiscal 2023 results - April 5, 2023 - © Sodexo 2023. All rights Reserved 8
Slide 9: P&L Performance
2. P&L Performance Change At current Excluding In million € H1 FY2023 H1 FY2022 exchange rates currency effect Revenues 12,085 10,262 +17.8% +12.0% Underlying Operating profit 704 538 +30.9% +22.4% Underlying Operating profit margin 5.8% 5.2% +60 bps +50 bps Other Operating income and expenses (42)
Slide 10: Other income and expenses
2. Other income and expenses In million € H1 FY2023 H1 FY2022 Net scope change impact 1 (1) Restructuring and rationalization costs (10) (3) Amortization of purchased intangible assets (22) (20) Other (11) 23 Other operating income and expenses (42) (1) First half Fiscal 2023 results - April 5, 2023
Slide 11: Free cash flow
2. Free cash flow In million € H1 FY2023 H1 FY2022 Operating cash flow 808 674 Change in working capital(1) (517) (481) IFRS 16 Leases outflow (103) (109) Net capital expenditure (234) (159) Free cash flow (46) (75) Net acquisitions (7) (26) Share buy-backs/Treasury stock (57) (13) Dividends paid to
Slide 12: Rising Gross Capex: OSS focusing on clients and BRS increasing in IT/Data
2. Rising Gross Capex: OSS focusing on clients and BRS increasing in IT/Data Group gross capex €317m, +43%YOY On-site Services Benefits & Rewards Services 2.6% H1 FY2023 revenues €264m €53m 2.3% 10.4% H1 FY2023 revenues H1 FY2023 revenues Digital Other & IT investments > 85% client facing > 85% IT &
Slide 13: Robust balance sheet
2. Robust balance sheet February 28, February 28, February 28, February 28, In million € 2023 2022 2023 2022 Non-current assets 10,416 10,063 Shareholders’ equity 4,096 3,615 Current assets excluding cash 6,312 5,980 Non-controlling interests 4 10 Restricted cash Benefits & Rewards 843 782 Non-curre
Slide 14: Review of Operations
3. Review of Operations First half Fiscal 2023 results - April 5, 2023 - © Sodexo 2023. All rights Reserved 14
Slide 15: H1 FY2023 Organic growth
3. H1 FY2023 Organic growth Group revenues €12,085m +17.8% Currency effect Scope Change Benefits & Rewards Services On-site Services +5.7% -1.3% €11,581m €508m Organic growth Organic growth Organic growth +13.4% +24.2% +12.9% Europe, Asia, Latin North Europe Rest of the USA America America World +22
Slide 16: Review of Operations: On-site Services
3. Review of Operations On-site Services First half Fiscal 2023 results - April 5, 2023 - © Sodexo 2023. All rights Reserved 16
Slide 17: On-site Services H1 pricing effect above 5%
On-site Services 3. H1 pricing effect above 5% ▬ Pricing impact was above 5% as expected in H1 FY2023 ▬ Signs of food inflation slowing down in North America and Brazil but not yet in Europe ▬ Teams remain totally focused on: • passing on inflation to clients • active operational mitigation to manag
Slide 18: North America – H1 Revenues
On-site Services 44% 3. North America – H1 Revenues On-site Services FY22 (in million euros) Organic Organic Growth growth Net +16.4% acquisitions Business & Administrations +31.3% +12.4% • Strong volume increases in Corporate Services and Sodexo Live! fueled by Favorable continued return to the wor
Slide 19: Europe – H1 Revenues
On-site Services 38% 3. Europe – H1 Revenues On-site Services FY22 (in million euros) Organic Growth Organic Business & Administrations +16.7% growth +8.3% • Return to the office continued • Very strong demand for sporting and corporate events Net Unfavorable • Partially offset by contract losses in
Slide 20: Rest of the World – H1 Revenues
On-site Services 18% 3. Rest of the World – H1 Revenues On-site Services FY22 (in million euros) Organic Growth Business & Administrations +14.9% • Strong volume increase in both Corporate Services and E&R • Negotiated price increases • Australia still impacted by last year’s losses and China by Cov
Slide 21: On-site Services Underlying Operating Margin by Zone
On-site Services 3. Underlying Operating Margin by Zone H1 FY21 H2 FY21 H1 FY22 H2 FY22 H1 FY23 6,2% 6,6% 3,7% 4,6% North 3,3% America • Pricing and mitigation covering cost 3,9% 3,9% 3,9% inflation Europe 1,4% 1,7% • Leverage coming from post-Covid volume recovery, especially in Noram and in Europe
Slide 22: Review of Operations: Benefits & Rewards Services
3. Review of Operations Benefits & Rewards Services First half Fiscal 2023 results - April 5, 2023 - © Sodexo 2023. All rights Reserved 22
Slide 23: Quarterly operating and financial revenue
Benefits & Rewards Services 3. Quarterly operating and financial revenue (in million euros) Operating revenue by quarter Financial revenue by quarter 300 20% 300 153,4% 162,8% 170% 15,9% 16,3% 18% 150% 250 15,3% 250 14,2% 16% 130% 200 14% 200 110% 10,2% 12% 90% 150 70,9% 150 10% 63,1% 6,8% 70% 8% 10
Slide 24: H1 revenues by Nature
Benefits & Rewards Services 3. H1 revenues by Nature (in million euros) 93%(1) 7% Operating revenues FY22 Financial revenues FY22 BRS BRS revenues revenues Favorable Organic currency growth effect +16.1% Net acquisitions Favorable Organic currency growth effect n.a. +158.6% • Continued acceleration
Slide 25: H1 revenues by Service
Benefits & Rewards Services 3. H1 revenues by Service (in million euros) 82% 18% Employee Benefits FY22 Services Diversification FY22 BRS BRS revenues revenues Favorable Organic currency growth effect Net +24.2% acquisitions Organic growth Favorable currency +24.1% effect Net acquisitions Issue volu
Slide 26: H1 revenues by Region
Benefits & Rewards Services 3. H1 revenues by Region (in million euros) 65% 35% Europe, Asia, USA FY22 Latin America FY22 BRS BRS revenues revenues Organic growth +22.8% Net Unfavorable acquisitions currency Favorable effect currency Organic effect growth n.a. +26.9% • Growth across all major market
Slide 27: Underlying Operating Profit and Underlying EBITDA
Benefits & Rewards Services 3. Underlying Operating Profit and Underlying EBITDA (variation vs. H1 22 at constant rates) H1 FY22 H1 FY23 H1 FY22 H1 FY23 +510 bps +46.4% UOP and €162m 31,9% Solid increase in UOP and EBITDA margin 26,7% due to: UOP margin €106m • Strong operating leverage despite sust
Slide 28: Plan to spin-off and list BRS
4. Plan to spin-off and list BRS First half Fiscal 2023 results - April 5, 2023 - © Sodexo 2023. All rights Reserved 28
Slide 29: Strategic and financial rationale for creation of two pure players
Plan to spin-off and list BRS 4. Compelling strategic and financial rationale for the creation of two pure players… FOCUSED STRATEGY ON RESPECTIVE MARKETS ENHANCED BUSINESS AND FINANCIAL PERFORMANCE AND CLIENTS SPECIFIC BRANDING, POSITIONING AND EMPLOYEE FULL FINANCIAL FLEXIBILITY TO EXECUTE GROWTH
Slide 30: Distinct business models and leading positions in growth markets
Plan to spin-off and list BRS 4. … with distinct business models and leading positions in growth markets FY ’22 figures ON-SITE SERVICES (‘OSS’) BENEFITS & REWARDS SERVICES (‘BRS’) Large, complementary range of food and FM services including Differentiated and scalable tech-enabled platform ecosyste
Slide 31: Transaction context
Plan to spin-off and list BRS 4. Transaction context Unanimous approval of the project by the Sodexo Board of Directors Bellon SA intends to continue playing a long-term controlling shareholder role in both businesses Contemplated transaction expected to take place during 2024 Subject to a completio
Slide 32: Outlook
5. Outlook First half Fiscal 2023 results - April 5, 2023 - © Sodexo 2023. All rights Reserved 32
Slide 33: Fiscal 2023 guidance upgraded
5. Fiscal 2023 guidance upgraded Benefits & Rewards Group Services FY23 Group guidance: Organic revenue growth now expected to Group organic growth BRS organic growth and be close to +11% driven by: guidance upgraded and UOP UOP margin guidance upgraded margin guidance confirmed • Higher than expect
Slide 34: Mid-term guidance reiterated
5. Mid-term guidance reiterated Benefits & Rewards Group Services Organic Growth Organic Growth 6% to 8% Low double-digit growth for FY2024 & FY2025 for FY2024 & FY2025 UOP Margin UOP Margin Above 6% Well above 30% in FY2025 at constant rates in FY2025 at constant rates First half Fiscal 2023 result
Slide 35: Q&A
6. Q&A First half Fiscal 2023 results - April 5, 2023 - © Sodexo 2023. All rights Reserved 35
Slide 36: Appendices
REVOIR QUALIT E 7. Appendices IMAGE First half Fiscal 2023 results - April 5, 2023 - © Sodexo 2023. All rights Reserved 36
Slide 37: H1 Fiscal 2023 exchange rates
Appendix 1 H1 Fiscal 2023 exchange rates Average Rate Closing Rate Closing Rate Closing Rate Average Rate Average Rate H1 FY2023 H1 FY2023 FY2022 28/02/23 1€ = H1 FY2023 H1 FY2022 vs. H1 FY2022 at 28/02/2023 at 31/08/2022 vs. 31/08/22 U.S. Dollar 1.031 1.143 +10.9% 1.062 1.000 -5.8% Pound Sterling 0
Slide 38: H1 Fiscal 2023 Revenue breakdown
Appendix 2a H1 Fiscal 2023 Revenue breakdown REVENUES BY SEGMENT (in million euros) H1 FY2023 H1 FY2022 Organic Growth External Growth Currency Effect Total Growth North America 5,499 4,232 +16.4% +1.2% +12.4% +29.9% Europe 4,027 3,917 +8.3% -3.8% -1.6% +2.8% Rest of the World 2,055 1,716 +14.7% -2.
Slide 39: Q2 Fiscal 2023 Revenue breakdown
Appendix 2b Q2 Fiscal 2023 Revenue breakdown REVENUES BY SEGMENT (in million euros) Q2 FY2023 Q2 FY2022 Organic Growth External Growth Currency Effect Total Growth North America 2,506 2,026 +17.1% +1.3% +5.3% +23.7% Europe 1,980 1,895 +10.8% -4.1% -2.2% +4.5% Rest of the World 998 862 +14.2% -2.2% +
Slide 40: Revenue breakdown by significant countries
Appendix 2c First half Fiscal 2023 Revenue breakdown by significant countries €12,085m €10,262m First half Fiscal 2023 results - April 5, 2023 - © Sodexo 2023. All rights Reserved 40
Slide 41: Explanation Net capex to sales versus gross capex to sales
Appendix 3 Explanation Net capex to sales versus gross capex to sales February 28, 2023 Client investment Disposal of February 28, 2023 Net Capex/Sales impact assets Gross* Capex/Sales Revenue 12,085 +65 12,150 Underlying EBITDA 837 +65 902 Underlying Operating Profit 704 704 Net profit Group Share
Slide 42: New segment reporting: revenues
New segment reporting following evolution Appendix 4a of the On-site Services organization From the beginning of Fiscal 2023, Sodexo is reporting the breakdown of its On-site Services revenues and Underlying operating profit by geographic Zone rather than by global client segment. The three geograph
Slide 43: New segment reporting: underlying operating profit
New segment reporting following evolution of the Appendix 4b On-site Services organization Please find below the new Underlying operating profit breakdown for Fiscal 2022: On-site Services Fiscal 2022 Underlying operating profit and margin by zone (new breakdown) FISCAL 2022 (in million euros) Reven
Slide 44: Breakdown of Gross Financial debt
Appendix 5 Breakdown of Gross Financial debt: €5,659m (1) By currency By Maturity 6% £ (in million €) 1% Other <1 Year 566 72% € Average maturity 21% $ of 4.2 years 1-3 Years 1,064 at 28/02/2023 Interest rate 3-5 Years 1,782 5% variable >5 Years 2,247 95% fixed Blended cost of debt 1.7% at 28/02/202
Slide 45: Modelling details for FY2023
Appendix 6 Modelling details for FY2023 (At constant rates) Scope change effect on Fiscal 2023 Other income Net financial Tax rate revenues and expenses expenses -1% ~ €-100m(1) €90m ~ 28% (1) Other income and expenses for Fiscal 2023 revised to around €-100m vs. €-75m initially, impacted by increas
Slide 46: Number of shares
Appendix 7 Number of shares Company’s share capital FEBRUARY 28, 2023 AUGUST 31, 2022 FEBRUARY 28, 2022 Company’s share capital, number of shares 147,454,887 147,454,887 147,454,887 Treasury shares 1,473,046 841,102 1,249,534 Number of shares for EPS calculation (Basic weighted average number of sha
Slide 47: Marketable securities comprised
Appendix 8 Marketable securities comprised €580m €524m First half Fiscal 2023 results - April 5, 2023 - © Sodexo 2023. All rights Reserved 47
Slide 48: Growth indicator definitions
Appendix 9 Growth indicator definitions On-site Services Client Retention Business development Client retention rate is the percentage of prior fiscal year revenue retained in this current The business development rate is the annualized estimated revenue for new contracts fiscal year. It is derived
Slide 49: Alternative Performance Measure - Definitions
Appendix 10a Alternative Performance Measure - Definitions Organic growth Reimbursement volume Organic growth corresponds to the increase in revenue for a given period (the "current Reimbursement volume corresponds to the total face value of service vouchers, cards period") compared to the revenue r
Slide 50: Alternative Performance Measure - Definitions
Appendix 10b Alternative Performance Measure - Definitions Blended cost of debt Underlying Net Profit The blended cost of debt is calculated at period end and is the weighted blended of Underlying Net profit presents a net income excluding significant unusual and/or financing rates on borrowings (in
Slide 51: APM - Financial ratios definitions & reconciliation
Appendix 11 APM - Financial ratios definitions & reconciliation H1 Fiscal 2023 H1 Fiscal 2022 Gross borrowings (1) – operating cash (2) Gearing ratio 46% 56% Shareholders’ equity and non-controlling interests Gross borrowings (1) – operating cash (2) Net debt ratio 1.3 1.8 Rolling 12-month Underlyin
Slide 52: Financial calendar
Appendix 12 Financial calendar June 30, 2023 October 26, 2023 December 15, 2023 Fiscal 2023 Fiscal 2023 Fiscal 2023 Third quarter Annual Results Annual Shareholders Revenues Meeting These dates are purely indicative and are subject to change without notice. Regular updates are available in the calen
Slide 53: Sodexo key figures
Appendix 13 Sodexo key figures As of August 31, 2022 ▬ Founded in 1966 by Pierre Bellon ▬ As at 31/08/2022, Bellon S.A. holds 42.8% of capital (57.5% of voting rights) €21.2bn revenues ▬ Our purpose is to create a better everyday for everyone to build a better life for all 422,000 employees 100 mill
Slide 54: Investor relations contacts
Appendix 14 Investor relations contacts Head of Investor Relations ▬ Virginia JEANSON Tel: + 33 1 57 75 80 56 virginia.jeanson@sodexo.com Deputy Head of Investor Relations Deputy Head of Investor Relations ▬ Pauline BIREAUD ▬ Juliette KLEIN Tel: + 33 1 85 65 31 46 pauline.bireaud@sodexo.com juliette
Slide 55: Disclaimer
Appendix 15 Disclaimer Certain information included in this presentation are forward-looking statements, including in relation to the proposed spin-off and listing of Benefits & Rewards Services. These forward-looking statements are based on current beliefs, expectations and assumptions, including,
Slide 56: Sodexo
* sodexo