Compass Group Plc · LSE:CPG
Compass — HY2025 Earnings Presentation
45 slides from Compass's earnings presentation, May 14, 2025
Slide 1: 2025 Half Year Results
2025 Half Year Results 14 May 2025 1
Slide 2: Disclaimer
Disclaimer Certain information included in this presentation is of operations and financial conditions and the Company’s information known to the Company on the date of this forward looking and involves risks, assumptions and plans and objectives for future operations, including, presentation. Accor
Slide 3: Dominic Blakemore, Group Chief Executive Officer
Dominic Blakemore Group Chief Executive Officer 3
Slide 4: Strong H1 performance as we deliver on strategic priorities
Strong H1 performance… Organic Operating Operating revenue profit margin growth growth 1 +10bps to 8.5% 11.6% 7.2% …as we deliver on our strategic priorities Notes: Based on underlying performance at reported exchange rates unless otherwise indicated. See definitions in the supplementary slides. 1 O
Slide 5: Fourth year of elevated net new business growth
Fourth year of elevated net new business growth… 5.7% 4.6% Target range 4.4% 4 – 5% 4.2% c.3% p.a. 40-45% new business wins from FTO 2015-19 FY22 FY23 FY24 HY25 …supported by a client retention rate of over 96% Notes: FY22 net new business growth rebased to FY19 revenues due to impact of the COVID p
Slide 6: Resilient business model and operational flexibility
Resilient business model and operational flexibility Diverse sector portfolio Attractive outsourcing market Investing in future growth ● Mostly captive locations ● Significant FTO opportunity ● Capex ● Wide-ranging client base ● Emerging sub-sectors ● M&A ● Largest 10 clients <10% revenue ● Opportun
Slide 7: Petros Parras, Group Chief Financial Officer
Petros Parras Group Chief Financial Officer 7
Slide 8: Good progress across our key metrics
Good progress across our key metrics Organic growth Operating profit Earnings per share +8.5% +11.6% +10.6% $22.6bn 7.2% Increased Group revenue operating margin to 64.5c Notes: Growth measures on a constant currency basis. Other measures based on underlying performance at reported exchange rates. S
Slide 9: Continued excellent growth in net new business
Continued excellent growth in net new business $bn 4.4% c.1% c.3% Organic 8.5% 22.6 20.9 HY 2024 revenue Net new Volume Pricing HY 2025 revenue Notes: Growth measures on a constant currency basis. 9
Slide 10: We continue to expect positive volume growth
We continue to expect positive volume growth… Attractive Increased use of Additional proposition technology events Value gap drives higher participation & helps mitigate potential volatility 10
Slide 11: Strong profit growth in both regions
Strong profit growth in both regions Organic Operating Year on year Operating profit revenue growth margin margin change growth1 North America 8.6% 8.3% +10bps 10.8% International 8.2% 5.8% +20bps 13.0% Group 8.5% 7.2% +10bps 11.6% Notes: Based on underlying performance at reported exchange rates un
Slide 12: Double-digit increase in operating profit
Double-digit increase in operating profit $m HY 2025 HY 2024 Revenue 22,596 20,887 Operating profit 1,627 1,474 Operating profit margin 7.2% 7.1% Net finance costs (149) (111) Interest charge HY25: increase due to higher debt Profit before tax 1,478 1,363 FY25: still expected to be c.$300m Tax expen
Slide 13: Continuing to grow cash flow
Continuing to grow cash flow $m HY 2025 HY 2024 Operating profit 1,627 1,474 Capex Depreciation and amortisation 618 556 HY25: 3.0% of underlying revenue EBITDA 2,245 2,030 FY25: expected to be c.3.5% of underlying revenue Net capital expenditure (671) (693) Trade working capital (347) (158) Working
Slide 14: Invested $1.7bn in capex and M&A to support future growth
Invested $1.7bn in capex and M&A to support future growth $bn 0.2 Leverage 1.5x Investment $1.7bn Leverage 1.3x 0.7 1.0 (1.4) 0.7 6.6 5.4 FY24 closing net debt FCF (pre capex) Net capex Acquisitions and Dividends Other HY25 closing net debt disposals Notes: Based on underlying performance at reporte
Slide 15: European acquisitions are performing well
European acquisitions are performing well TARGETS ATTRIBUTES FINANCIALS PERFORMANCE ● Sourced locally ● Quality brands ● Strong revenue growth ● Established ● Complementary relationships capabilities ● Margin benefit from synergies ● Cultural fit ● Entrepreneurial ● Attractive cash flows ● Client re
Slide 16: Our capital allocation model is consistent
Our capital allocation model is consistent Invest in business M&A Capex Required returns > cost of capital c.3.5% of revenue by the end of year two Strong balance sheet Investment grade credit rating Target net debt/ Ordinary dividends EBITDA 1-1.5x c.50% of underlying earnings Surplus capital pay o
Slide 17: FY25 guidance unchanged
FY25 guidance unchanged Operating profit growth 1 High-single digit % Organic Ongoing revenue growth margin Above 7.5% improvement Notes: Based on underlying performance at reported exchange rates unless otherwise indicated. See definitions in the supplementary slides. 1 On a constant currency basis
Slide 18: Dominic Blakemore, Group Chief Executive Officer
Dominic Blakemore Group Chief Executive Officer 18
Slide 19: Unlocking the total addressable market and FTO opportunity
Unlocking the total addressable market and FTO opportunity <. 15% share FTO opportunity Compass c.50% Large At least Players Self operated $320bn Regional players Business & Healthcare & Education Sports & Defence, Industry Snrs. Leisure Offshore & Remote Includes vending in North America and Europe
Slide 20: Mega trends offer significant growth opportunity
Mega trends offer significant growth opportunity… Recent M&A ● Technology; AI advancements Business ● Onshoring of manufacturing & Industry ● Personalised nutrition & experience ● Cost pressures Healthcare ● Emerging technology & efficiency drive & Senior Living ● High surgical demand & ageing popul
Slide 21: We have a diverse portfolio across many industries
We have a diverse portfolio across many industries… DOR Sports & Leisure Business 'office based' K-12 Higher Education International Healthcare Industry 'manufacturing' Industry 'manufacturing' Senior Living Business 'office based' North America DOR Healthcare Sports & Leisure Senior Living K-12 Hig
Slide 22: Macro headwinds often lead to further outsourcing & growth
Macro headwinds often lead to further outsourcing & growth Cost pressures Catalyst for first time outsourcing Client Sales Complexity / allergens Consumer Sales Volume potential: value gap vs. high street Technology & innovation Client Sales & Share gains: benefit of scale & sectorisation Cost of Fo
Slide 23: North America: resilient model and localised supply chain
North America: resilient model and localised supply chain… Macro factor Mitigation • Vast majority items sourced from US Procurement & tariffs • Menu autonomy • Client’s choice on ingredients Federal / national spending cuts in • Clients mostly private Healthcare & Education • Multiple consumers: ou
Slide 24: The increasing role of technology and data
The increasing role of technology and data… Client Sales Consumer Sales Cost of Food Cost of Labour Client solutions Serving customers Simplifying processes Optimise performance ● Customised apps ● Reducing friction ● Creating menus ● Labour scheduling ● Dashboards ● Health & nutrition ● Managing in
Slide 25: Tech enabled growth: Sports & Leisure, Intuit Dome
Tech enabled growth: Sports & Leisure, Intuit Dome ● Home of the LA Clippers (NBA) ● Frictionless experience powered by facial recognition ● Leveraged state-of-art stadium camera technology Fan picks up item Camera recognises avatar Card charged 25
Slide 26: Underpinning our outlook for continued net new business growth
Underpinning our outlook for continued net new business growth 4-5% Net new business growth 8-9% ~96% New business wins Retention 26
Slide 27: Margin will continue to expand
Margin will continue to expand … Efficiency opportunities ● Leverage of fixed overhead costs ● Tech solutions in back-of-house ● Procurement scale leads to cost advantage ● M&A integration ● Retention focus: pre-emption …generating profit growth ahead of revenue growth 27
Slide 28: Summary: We're confident in our growth algorithm
Summary: We’re confident in our growth algorithm… Long-term attractive Ahead compounding of revenue shareholder Mid to high growth returns single digit 4-5% Net new business growth Organic revenue growth Profit growth Returns …as we continue delivering long-term compounding shareholder returns 28
Slide 29: FY25 guidance summary
FY25 guidance summary Underlying operating profit: High single-digit growth %1 - organic revenue growth above 7.5% - ongoing margin progression Capex: c.3.5% of underlying revenue Interest charge: c.$300m Effective tax rate: c.25.5% FX2 $(17)m on FY24 operating profit 1 On a constant currency basis
Slide 30: Supplementary Information
Supplementary Information 30
Slide 31: Revenue
Revenue International North America 32% 68% Sports & Other Support services Leisure International Business & Industry 14% 13% 16% Healthcare Australia & Senior 3% Living 38% France 4% GEOGRAPHY SERVICE 23% SECTOR 9% UK 65% 3% USA Canada 6% 86% 20% DOR Food service Education Notes: Based on underlyin
Slide 32: Geographic revenue by sector
Geographic revenue by sector 11% 14% 35% 14% 45% NORTH AMERICA INTERNATIONAL 27% 14% 1% 23% 16% Business & Industry Defence, Offshore & Remote Education Healthcare & Senior Living Sports & Leisure Notes: Based on underlying performance at reported exchange rates unless indicated otherwise, see the d
Slide 33: Geographic financials
Geographic financials $m North America International Other1 Total HY 2025 Revenue 15,452 7,144 22,596 Organic growth 8.6% 8.2% 8.5% Operating profit 1,289 416 (78) 1,627 Margin 8.3% 5.8% 7.2% HY 2024 Revenue 14,127 6,760 20,887 Organic growth 10.9% 11.9% 11.2% Operating profit 1,165 381 (72) 1,474 M
Slide 34: Balance sheet
Balance sheet $m HY 2025 HY 2024 FY 2024 Goodwill 7,411 6,263 6,899 Other non-current assets 9,394 8,013 8,757 Working capital (1,247) (1,097) (1,805) Net assets held for sale - 130 94 Provisions (731) (646) (714) Net post-employment benefit obligations (927) (654) (732) Current tax payable (121) (2
Slide 35: Components of net debt
Components of net debt $m Bonds 3,786 Private placements 600 Commercial Paper 1,309 Financing1 5,695 Other loans and fair value accounting adjustments (150) Borrowings 5,545 Leases 1,449 Derivatives 129 Gross debt 7,123 Cash net of overdrafts (531) Closing net debt at 31 March 2025 6,592 Notes: 1 Ba
Slide 36: Financing
Financing Principal borrowings Coupon Maturing in Financial Year Drawn $m Bonds £250m 2.000% 2025 323 £250m 3.850% 2026 323 €500m 1.500% 2028 540 £300m 2.000% 2029 387 €500m 3.000% 2030 540 €750m 3.250% 2031 810 £250m 4.375% 2032 323 €500m 3.250% 2033 540 Total 3,786 US private placements $300m (201
Slide 37: Maturity profile
Maturity profile $m 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 2025 2026 2027 2028 2029 2030 2031 2032 2033 £ Bond £ Sustainable Bond € Bond € Sustainable Bond US $ Private Placement US $ Commercial Paper Notes: Based on borrowings and facilities in place as at 31 March 2025, maturing in
Slide 38: Financing
Financing Debt ratios and credit ratings Ratings Short term Long term Outlook Latest Update Standard & Poor’s A-1 A Stable 25 Mar 25 Moody’s P-1 A2 Stable 9 Aug 24 Ratios for USPP covenant purposes HY 2025 FY 2024 Net debt1 / EBITDA1 1.4x 1.1x EBITDA1 / net interest1 17.4x 19.6x Reported ratios HY 2
Slide 39: Exchange rates
Exchange rates Rates used in consolidation Average exchange rate Closing exchange rate HY 2025 per $ HY 2024 per $ HY 2025 per $ HY 2024 per $ FY 2024 per $ Australian Dollar 1.56 1.53 1.60 1.53 1.44 Canadian Dollar 1.42 1.35 1.44 1.35 1.35 Euro 0.94 0.93 0.93 0.93 0.90 Japanese Yen 151.03 148.06 14
Slide 40: Currency impact on operating profit and revenue
Currency impact on operating profit and revenue $m IMPACT ON FY 2024 IMPACT ON HY 2024 AUD (3) (1) CAD (3) (2) EUR 3 (2) GBP 0 0 JPY 0 0 TRY (8) (3) Other (6) (8) Total currency impact on profit (17) (16) Total currency impact on revenue (136) (201) Notes: Based on underlying performance at reported
Slide 41: Exchange rates
Exchange rates Effect on 2024 revenue and profit POUND STERLING CANADIAN DOLLAR EURO $m cumulative change for an $m cumulative change for an $m cumulative change for an incremental 5 pence movement incremental 5 cent movement incremental 5 cent movement Exchange Rate Revenue Change Profit Change Exc
Slide 42: Exchange rates
Exchange rates Effect on 2024 revenue and profit AUSTRALIAN DOLLAR TURKISH LIRA JAPANESE YEN $m cumulative change for an $m cumulative change for an $m cumulative change for an incremental 5 cent movement incremental 2 lira movement incremental 5 Yen movement Exchange Rate Revenue Change Profit Chan
Slide 43: Definitions
Definitions INCOME STATEMENT Underlying revenue Revenue plus share of revenue of joint ventures. Underlying operating profit Operating profit excluding specific adjusting items2. Underlying operating margin1 Underlying operating profit divided by underlying revenue. Current year: Underlying revenue
Slide 44: Definitions
Definitions BALANCE SHEET Net debt Bank overdrafts, bank and other borrowings, lease liabilities and derivative financial instruments, less cash and cash equivalents. Net debt to EBITDA Net debt divided by underlying EBITDA. CASH FLOW Purchase of intangible assets, purchase of contract fulfilment as
Slide 45: Definitions
Definitions BUSINESS GROWTH New business Current year underlying revenue for the period in which no revenue had been recognised in the prior year. Lost business Prior year underlying revenue for the period in which no revenue has been recognised in the current year. Net new business New business min