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Cultivating
Growth
Annual Report 2024
Visit our website to find out more
about our sustainability strategy,
our approach to talent and
investor resources:
www.compass-group.com
We are cultivating growth
by increasing focus and
investment in our core
markets, and by further
nurturing our talent to
develop current and
futurebusiness leaders.
Strategic Report
1 Highlights
2 At a glance
3 Strategic framework
4 Business model
7 Key performance indicators
8 Chair’s letter
9 Market review
10 Chief Executive’s review
12 Health and safety
13 Ethics and integrity
15 Performance
15 Financial review
21 Regional reviews
23 Risk management
24 Principal risks
29 Viability statement
30 People
34 Purpose
41 Task Force on Climate-related Financial Disclosures
53 Non-financial and sustainability information statement
Corporate Governance and
Directors’ Report
54 Governance and leadership
55 Compliance with UK Corporate Governance Code2018
56 Board of Directors
61 Executive Committee
62 Governance framework
68 Section 172 and stakeholder engagement
73 Audit Committee Report
79 Corporate Responsibility Committee Report
82 Nomination Committee Report
86 Directors’ Remuneration Report
119 Other statutory disclosures
123 Directors’ responsibilities statement
Financial Statements
124 Independent Auditor’s Report
138 Consolidated financial statements
144 Notes to the consolidated financial statements
223 Parent Company financial statements
225 Notes to the Parent Company financial statements
Shareholder Information
230 Shareholder information
Forward-looking Statements
232 Forward-looking statements
Compass Group PLC, the parent company of the Group,
is a non-trading investment holding company which derives its
distributable reserves from dividends paid by subsidiary companies.
Highlights
of the year
Investing for future growth
We are investing in our portfolio, both
through capital investment and M&A,
to support our existing capabilities,
increase operational flexibility and
further strengthen our unique
sectorised approach to the market.
The Group’s net expenditure on M&A
was $1 billion in 2024, mainly on
HOFMANN
s
in Germany and CH&CO
in the UK and Ireland. Subsequent to
the year-end we also acquired Dupont
Restauration in France and agreed to
acquire 4Service AS in Norway.
An even more focused business
During the year, we exited, or agreed
to exit, nine countries, principally in
our Rest of World region.
By divesting of a number of our
non-core markets, we have further
improved the quality of our portfolio.
This enables us to better focus on our
core markets, where there remain
significant opportunities for growth,
particularly from first-time
outsourcing.
We now operate in around 30
countries in North America, Europe,
and Asia-Pacific, compared to around
50 countries in 2019.
Step change in Europe
The step change in the performance
of our European businesses is
continuing as they benefit from
additional investment, growth
initiatives and the transfer of
bestpractice.
We are continuing to expand our
brand portfolio in Europe and are
developing more flexible operating
models with compelling financial
returns. These initiatives are driving
higher organic growth compared to
our pre-pandemic levels.
Scale in procurement
During the year Compass highlighted
its competitive advantage in
procurement in a virtual deep dive for
investors. We leverage our significant
purchasing scale in food and
beverages to source the best-quality
products at the best prices.
Alternative Performance Measure (APM) (see pages 207 to 214).
1. Measured on a constant-currency basis.
APM which is also a Key Performance Indicator (see page 7).
Underlying operating profit growth
1
16%
Statutory operating profit growth 12%
Organic revenue growth
11%
Statutory revenue growth 11%
Underlying operating margin
.1%
Statutory operating margin 6.2%
Strong operational performance
2024 results were strong across all our
key performance metrics.
The Group delivered double-digit
organic growth and good margin
progression, resulting in strong
underlying operating profit growth.
Looking ahead, industry outsourcing
trends remain favourable, providing
Compass with an exciting pipeline of
new business growth opportunities.
The Group’s APMs are defined in note 34 (non-GAAP measures) and reconciled to GAAP measures in notes2 (segmental analysis) and 34 to the consolidated
financial statements.
1Compass Group PLC Annual Report 2024
At a glance
Our core focus is the provision
of outsourced food services and
targeted support services to five
key market sectors.
We create bespoke, innovative and cost effective solutions
through our unique sectorised approach to the market.
By understanding what is important to our clients we address
their unique needs and create long-lasting partnerships.
Business & Industry
We work with a diverse range of clients including the financial,
legal, technology and manufacturing sectors. Our scale, flexible
operating models and digital capabilities help us tailor our
dining solutions to each client.
Education
We provide healthy, balanced meals right through the learning
journey, from nurseries to universities. Our catering solutions
come in multiple formats, from traditional onsite dining to
vending and delivery or takeaway options.
Sports & Leisure
We provide outstanding customer experiences, providing food,
beverages and hospitality across large stadiums, conference
venues, museums and galleries.
Defence, Offshore & Remote
We provide food and support services to many major oil, gas,
mining and construction companies. Our clients rely on us to
provide uninterrupted support, however challenging the
operating conditions.
Healthcare & Senior Living
We work directly with healthcare providers to prepare food
that improves patient and senior living experiences – from
restaurant-style cafés to in-room patient dining and
specialistfeeding.
Compass is a global leader
in food services operating inaround 30 countries
Food services Support services
Underlying revenue
$42.2 billion
14%86%
North America
Europe Rest of World
Underlying revenue by region
3 regions
9%23%68%
Business & Industry
Sports & Leisure Defence, Offshore & Remote
EducationHealthcare & Senior Living
Underlying revenue by sector
5 sectors
7%14%18%23%38%
Underlying revenue is defined as revenue plus share of revenue of joint ventures.
Statutory revenue in 2024 is $42.0 billion.
The Group’s APMs are defined in note 34 (non-GAAP measures) and reconciled
to GAAP measures in notes 2 (segmental analysis) and 34 to the consolidated
financial statements.
Alternative Performance Measure (APM) (see pages 207 to 214).
2 Strategic Report
Strategic framework
Strategic
framework
Our vision
To be a world-class provider of contract food services and support services,
renowned for our great people, our great service, and our great results.
Underpinned by our robust health and safety programmes, and doing what is right
See pages 12 to 14
Our enablers
Diversity
Compass is committed to inclusion for
all and endeavours to harness the talents
of its diverse workforce across every level
of the business.
Digitisation
Digital is a right to entry in almost every
client proposal and a clear growth enabler.
It also unlocks cost savings and enhances
our sustainability proposition.
Decarbonisation
The Group was the first in its
industry to set a global climate netzero
target and aims to be carbonneutral in
its own operationsby 2030.
Our values
Can-do safely
Openness, trust
and integrity
Responsibility Passion for quality
Win through
teamwork
Our strategic focus
Create lifetime
opportunities
People are at the heart of who we are and
what we do. Compass is uniquely positioned
to create lifetime opportunities and to
positively impact and represent the
communities in which its businesses operate.
Deliver long-term
valued relationships
We use the Management and Performance
(MAP) framework to drive performance across
the Group. This discipline ensures businesses
are managed efficiently while continuing to
delight clients and consumers with innovative,
healthy and exciting food service solutions.
Maintain a positive social
and environmental impact
Compass continually seeks ways to be more
socially and environmentally responsible.
Our purpose continues to drive innovation
and collaboration across the Group as
partnerships with clients, business partners
and local communities are strengthened.
See page 30 See page 15 See page 34
People Performance Purpose
Representative of the
communities we serve
Industry-leading
services
A sustainable
future for all
Our goals
3Compass Group PLC Annual Report 2024
We use our Management and Performance (MAP) framework to drive performance
across the business. It is a simple framework embedded in our culture, which ensures
employees are focused on meeting our key performance drivers.
• Winning new business and retaining our existing clients. We invest in sales
and retention and are increasingly sectorising andsub-sectorising the business
around the worldto allow us to get closer to our clients.
• Like-for-like revenue consists of both volume andprice. We are focused
on attracting and satisfying our client base with strong consumerpropositions.
• Food makes up around one-third of our costs. In addition to the benefits
of our scale in food procurement, we are able to manage food costs through
careful menu planning and by rationalising the number of products we buy.
• In-unit costs are predominantly made up of labour. Byusing
labourscheduling techniques and improving productivity, we are able
to deliver the optimum level of serviceinthe most efficient way.
• We have a simple organisational model with few
layers of management and little bureaucracy, which
enables us to keep overheads low whilst
wecontinue to grow revenue.
Delivering
for our stakeholders
Business model
Driving
performance
through MAP
Cost of food
Client sales
andmarketing
In-unit
costs
Consumer sales
andmarketing
Above-unit
overheads
People and culture
Our people are at the heart of our
business. Energetic, ambitious and
entrepreneurial, they deliver amazing
food and hospitality to millions of
consumers worldwide.
Our sectors and
portfolio of brands
Our sectorised approach is a key
differentiator. Our businesses create
bespoke solutions using extensive
knowledge of their clients’
requirements.
Culinary and digital
innovation
We provide clients and consumers with
greater choice, award-winning
innovation and market-leading
contemporary food offers.
O
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t
Enabled by our
competitive advantages
4 Strategic Report
Compass is a strong cash-generating
business with a clear capital
allocationmodel.
We invest both organically and through
acquisitions to drive future growth.
Our policy is to pay around 50% of underlying
earnings through an ordinary dividend.
We maintain a resilient balance sheet,
targeting net debt to EBITDA in the range
of1x-1.5x, with any surplus capital
returnedto shareholders.
Shareholder returns in the year
$1.5 billion
Total dividend per ordinary share
Increased by
13.7% to 59.8c
Capital investment
3.7%
of underlying revenue
1
Leverage
Strong balance sheet with
1.3x
net debt to EBITDA
1
1. Alternative Performance Measure (APM) (see pages
207 to 214). The Group’s APMs are defined in note
34 (non-GAAP measures) and reconciled to GAAP
measures in notes 2 (segmental analysis) and34 to
the consolidated financial statements.
Net M&A expenditure
$1 billion
to drive future growth
Procurement
Our scale enables our
businesses to pass onpurchasing
benefits to clients and consumers by
offering better quality products at more
attractive prices. Spendingwith local
and diverse suppliers and social
enterprises enables greater
reinvestment into local
communities.
Decentralised structure
The Group operates on a
decentralised basis, enabling an
entrepreneurial approachby local
management teams. Thisis supported
by our MAP framework, which
standardises business processes
andincreases efficiency.
Financial
strength
A strong financial foundation
with a low level of leverage means
we can invest in growth, enabling our
businesses to innovate their offer, and
evolve their operating model.
Ourfinancial strength also attracts
new clients seeking stability and
long-term outsourcing
solutions.
5Compass Group PLC Annual Report 2024
Key performance indicators
Creating shareholder
value
Delivered through
Dividend per share
59.8c
Share buybacks
$2.2 billion
Since 2022 the Group has
returned $2.2 billion in surplus
capital to shareholders through a
number of share buybacks
Total shareholder return since 2014
198%
Compass FTSE100
0
10
20
30
40
50
60
59.8c
52.6c
40.3c
19.1c
2423222120
0.0c
2423222120191817161514
0
100
200
300
400
Generating attractive long-term compounding shareholder returns
Value created through operations (MAP)
Higher revenue growth
Capex to support organic growth
Cost efficiencies
Bolt-on M&A
Scale benefits
Progressive ordinary dividend
Margin opportunity
Surplus cash returned to shareholders
Value created through capital allocation
shareholder
returns
Long-term
compounding
P
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This generates cash
which enables us to
reinvest in our
businesses
Whilst also
focusing on people
and our purpose
Which creates
greater value for all
our stakeholders
Our businesses are
growing and creating
value through their
operations
6 Strategic Report
Measuring
progress
We track our progress against a mix of financial and non-financial measures, which we believe
best reflects the delivery of ourstrategy. Wemeasure growth, efficiency and shareholder returns,
which are all underpinned by our focus onsafety andourimpact onthe environment.
Financial KPI Non-financial KPI
Alignment with our strategic focus areas KPI type
People
Performance
Purpose
Organic revenue change
1
10.6%
Organic revenue growth was strong at
10.6%, reflecting net new business
growth of 4.2%, pricing of around 4%
and volume growth of around 2%.
Underlying operating margin
1
7.1%
Underlying operating margin improved
by 30bps to 7.1%, with strong margin
progression achieved across all the
Group’s regions.
Underlying free cashflow
1
$1,740m
Underlying free cash flow increased
to $1,740 million representing a
conversion rate of 85.0% of
underlying profit after tax.
Underlying basic earnings per share
1
119.5c
Earnings per share growth of 14.6% on
aconstant-currency basis reflects the
Group’s strong organic revenue growth
and the improvement inunderlying
operating margin.
Return on capital employed (ROCE)
1
19.0%
The reduction in ROCE in 2024 reflects a
higher underlying effective tax rate, as the
impact of recent business acquisitions on
capital employed was offsetby the
Group’s strong trading performance.
Global Food Safety Incident Rate
2
0.13
Our focus on global food safety has led to
a reduced rate of incidents on a five-year
basis (down 38%), despite our business
having grown significantly since 2020.
Greenhouse gas intensity ratio (GHG)
2
5.1 tCO
2
e/$m
Our greenhouse gas intensity ratio has
increased in the past year due to new
business wins and acquisitions. This ratio
is based on Scope 1 and 2 emissions
which represent 2% of Compass Group’s
total emissions. Including Scope 3
emissions our intensity ratio reduced by
4% compared to 2023.
1. Our financial KPIs represent underlying and other Alternative Performance Measures (APMs) which are not defined by generally accepted accounting
principles(GAAP). The Group’s APMs are defined in note 34 (non-GAAP measures) and reconciled to GAAP measures in notes 2 (segmental analysis)
and 34 to the consolidated financial statements.
2. Our non-financial KPIs are further explained on pages 12 and 36.
3. Restated (see footnote 3 on page 36).
$1,740m
$1,516m
$1,139m
$901m
$272m
2423222120
19.0%
19.3%
16.0%
8.7%
4.7%
2423222120
2423222120
10.6%
18.8%
37.5%
(6.3)%
(18.8)%
7.1%
6.8%
6.2%
4.5%
2.9%
2423222120
0.13
0.15
0.14
0.20
0.21
2423222120
5.0
3
5.5
3
6.4
3
7.1
3
2423222120
5.1
119.5c
105.2c
80.6c
40.3c
23.8c
2423222120
Measuring progress looking ahead
We are updating how we measure our safety progress to reflect a
broader approach to safety and food standards across Compass.
As reported in last year’s Annual Report, starting next year, the Total
Recorded Incident Frequency Rate (TRIFR) will be included to
provide a more comprehensive view of safety performance, with
2024 as its baseline year (see page 12).
Additionally, we will transition to featuring leading food safety
indicators that align with industry and regulatory standards allowing
us to emphasise qualitative insights. The Global Food Safety
Incident Rate remains important to us and will continue to be
tracked by management.
Key performance indicators 7Compass Group PLC Annual Report 2024
Chair’s letter
Delivering compounding
shareholder returns
Dear Shareholder
I am delighted to report another strong year for Compass with
double-digit organic revenue growth and good margin progress.
Thestrength of our balance sheet and continued strong cash
generation have enabled us to invest in future growth whilst returning
capital to shareholders through dividends and share buybacks.
Strategy
We have a clear strategy which is focused on providing outsourced
food services, together with targeted support services. The outsourcing
market remains very attractive, driven by increasingly complex
consumer demands, the desire for cost savings, and macroeconomic
pressures. Our addressable market is estimated to be worth
c.$320billion, with a significant opportunity available from
first-time outsourcing.
We have continued to refine our portfolio to become an even more
focused business, going deeper into our core markets, where there
remain significant growth opportunities.
People
With around 580,000 colleagues across the world, people are at the
heart of our business and integral to our continued success. We are
focused on attracting, developing and retaining the best talent. We
provide opportunities to diverse people from the communities we
serve, underpinned by our principles of respect, teamwork and growth.
I would like to thank all our people for their continued hard work and
commitment to the business. Without their dedication, Compass
would not be able to achieve its goals.
Financial results
The Group delivered strong organic revenue growth of 10.6%
1
and
underlying operating margin increased by 30bps to 7.1%
1
. This
resulted in underlying operating profit increasing by 16.4%
1
on a
constant-currency basis to $2,998 million
1
. On a statutory basis,
revenue increased by 10.8% to $42,002 million and operating
profitwas up 11.7% to $2,584 million.
Shareholder returns
The Board recognises the importance of returning capital to shareholders
through dividends and share buybacks. In line with ourpolicy of paying
out 50% of underlying earnings, the Board has declared a final dividend
of 39.1 cents per share, which, when added to the interim dividend,
provides a total dividend for the year of 59.8 cents per share. We also
provided additional returns in the form of a $500 million share buyback.
Sustainability
Our Planet Promise is the Group’s global commitment to a sustainable
future for all. It encompasses our values as an ethical, sustainable,
and inclusive business, together with our ambition to positively impact
the world. As well as being the right thing to do, this mission is also
keyto our growth aspirations as sustainability is also a priority for
many of our clients.
Governance and Board changes
Several changes were made to the Board during the year, including
the retirement of some familiar faces, the arrival of new colleagues,
and changes to roles and responsibilities.
In the first half of the year, Gary Green and Carol Arrowsmith retired
from the Board. Palmer Brown took over from Gary in the US, and
Petros Parras succeeded Palmer as the Group CFO. In the second-half
we appointed two new directors, Liat Ben-Zur and Juliana Chugg who,
together with their non-executive colleagues, bring balance and a
wealth of skills and experience to our organisation which complement
the talents of our strong executive team. I thank them all for their
valuable contributions and also wish good luck to Ireena Vittal and
Nelson Silva who, after nine years, will retire from the Board at the
conclusion of the 2025 AGM. Liat Ben-Zur succeeded Ireena as
Designated Non-Executive Director for Workforce Engagement in
October, and Arlene Isaacs-Lowe will succeed Nelson as Chair of the
Corporate Responsibility Committee when he retires from the Board in
February. More details of the above are in the Nomination Committee
report on page 82.
Summary
2024 was another strong year for Compass. We delivered good
top-line growth with margin progression, whilst further improving the
quality of our portfolio and increasing investment in core markets.
We are continuing to take advantage of opportunities for growth,
particularly in first-time outsourcing, by leveraging our significant
scale, culinary expertise and sectorised approach to the market
through the Group’s unique brand portfolio.
We look forward to continued success based on our focused strategy,
and to generating sustainable compounding shareholder returns over
the long-term.
Ian Meakins
Chair of the Board
26 November 2024
Statement on section 172 of the Companies Act 2006
Section 172 of the Companies Act 2006 requires the directors to promote
thesuccess of the Company for the benefit of the members as a whole,
havingregard to the interests of stakeholders in their decision making.
The Company’s section 172 statement is set out on page 68 and
isincorporatedinto this Strategic Report by reference.
Ian Meakins
Chair of the Board
1. Alternative Performance Measure (APM) (see pages 207 to 214).
The Group’s APMs are defined in note 34 (non-GAAP measures)
and reconciled to GAAP measures in notes 2 (segmental analysis)
and 34 to the consolidated financial statements.
8 Strategic Report
Market review
Significant market opportunity
with a runway for growth
We estimate the global food services
marketfor Compass to be worth
c.$320billion, of which we have
lessthan15% market share.
This provides us a significant runway
forgrowth, with nearly three-quarters of
themarket still self-operated or in the
handsof regional players.
For North America and Europe, our
foodservices market estimate now
includesvending.
In addition, there are further growth
opportunities for Compass in targeted
support services which are not included
in this estimate.
Tech and innovation
– culinary
– digital
– use of data
– flexible food models
Macro challenges
– labour shortages
– food and labour inflation
– supply chain disruption
– higher energy costs
Environment
– organic and locally sourced
– net zero targets
– plant-forward
– carbon labelling
People
– health and wellbeing
– talent attraction and retention
– encourage return to office
– improve productivity and morale
Risk and regulation
– health and safety
– business continuity
– allergen labelling
– calorie labelling
Cost reduction
– procurement savings
– back-office synergies
– labour utilisation
– menu management
Increased operational complexities are driving outsourcing...
c.$320bn
addressable global food
services market
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Large players
Regional players
Compass Group
Self-operated
9Compass Group PLC Annual Report 2024
Sustaining growth
in our core markets
Chief Executive’s review
2024 has been a year of strong operational and financial performance,
with net new business growth accelerating in the second half as
expected. The business continues to successfully capitalise on
thedynamic market trends, using its proven competitive advantages
to drive higher revenue and profit growth.
We have exited, or agreed to exit, nine non-core countries, further
improving the quality of our portfolio and enabling us to better
focuson our core markets with the greatest growth opportunities.
Tosupport this growth, we’re investing in capex to drive net new
business and are currently prioritising strategic acquisitions to
furtherenhance our unique sectorised approach to clients.
We have a proven track record of successful M&A in North America
and are using that blueprint to unlock growth in other regions. The
integration of recent high-quality acquisitions in Europe is progressing
well, and we’re excited by the capabilities they bring to the Group.
Performance
Compass has delivered another strong year, with organic revenue
growth of 10.6%
1
and underlying operating margin improving by
30bps to 7.1%
1
. As a result, underlying operating profit grew by
16.4%
1
on a constant-currency basis to $2,998 million
1
(2023:$2,576million).
Statutory revenue increased by 10.8% reflecting the strong trading
performance. Statutory operating profit increased by 11.7% to
$2,584million.
Cash flow generation remains robust, with underlying operating cash
flow of $2,642 million
1
(2023: $2,228 million) and underlying free
cash flow of $1,740 million
1
(2023: $1,516 million). Leverage
(netdebt to underlying EBITDA) remains well within the Group’s
guided range at 1.3x
1
as at 30 September 2024.
Our strong balance sheet provides us with flexibility to invest in future
growth, both through M&A and capital expenditure, which was 3.7%
of underlying revenue
1
. This was slightly higher than our guidance of
3.5% due to catch-up from the prior year.
Net M&A expenditure was $1,040 million, the main outflows being
HOFMANN
s
(Germany) and CH&CO (UK and Ireland), offset by an
inflow from the disposal of Brazil. Subsequent to the year-end, the
Group also completed the acquisition of Dupont Restauration, a food
services business in France, and agreed to acquire 4Service AS, a
catering and facility management services business in Norway.
The Group has refined its portfolio and has exited five countries during
the year, those being Argentina, Angola, Brazil, mainland China and
the United Arab Emirates. In addition, we have also agreed to exit
Chile, Colombia, Mexico and Kazakhstan, subject to regulatory
approval and completion procedures.
Strategy
Compass is focused on the provision of food services, with targeted
support services where appropriate. By divesting of non-core markets
we have further improved the quality of our portfolio. This also enables
us to better focus on our core markets, where there remain significant
opportunities for growth. We now operate in around 30 countries in
North America, Europe, and Asia-Pacific.
Our addressable market in food services is worth c.$320 billion, a
significant proportion of which remains self-operated. More
demanding consumer expectations and increased macroeconomic
pressures have contributed to the acceleration of first-time
outsourcing, and we have clear competitive advantages built over
thelast 30 years to capture these opportunities.
Our sector and sub-sector portfolio enables us to better differentiate
our offer compared to our competitors and create bespoke solutions
for our clients. We also leverage our scale, particularly in food
procurement, and are increasing the flexibility of our offer, ranging
from different food models to digital or sustainability initiatives.
Our thought leadership and solutions in these areas are also often
cited by clients as one of the reasons they outsource to Compass.
People
Our team of about 580,000 colleagues delivers exceptional
experiences to clients and consumers worldwide every day. These
dedicated professionals are the core of our business, and our people
strategy is designed to identify, attract, develop, support, and retain
the high-calibre talent essential for achieving our objectives.
Our goal is to provide lifelong opportunities for diverse individuals from
the communities we serve, ensuring they work in a positive and secure
environment. This approach is bolstered by empowered teams and
proactive leaders, grounded in respect, teamwork, and growth.
When sourcing new talent, we assess the specific requirements of
each sector and organisational level, adjusting our recruiting
strategies accordingly. For example, our North America business
employs targeted campaigns, process automation, AI, and other tools
to locate suitable candidates and facilitate their engagement with the
selection process in their preferred language and at convenient times.
We aspire to cultivate a diverse and inclusive workforce at all levels.
Our focus is on treating everyone with fairness and respect, providing
opportunities for growth and development, and fostering a positive,
supportive workplace throughout their careers.
Dominic Blakemore
Group Chief Executive Officer
1. Alternative Performance Measure (APM) (see pages 207 to 214).
The Group’s APMs are defined in note 34 (non-GAAP measures)
and reconciled to GAAP measures in notes 2 (segmental analysis)
and 34 to the consolidated financial statements.
10 Strategic Report
Recognising the challenges of daily life, we offer a variety of support
measures to ensure our employees’ wellbeing, encompassing
physical, financial, and mental health.
Purpose
We are dedicated to building a sustainable future for everyone.
Weharness our passion for food, advocate for responsible sourcing,
and reduce food waste on a large scale to drive global change and
improve lives.
Through culinary innovation, collaboration, and partnerships, we are
committed to achieving climate net zero across our global operations
by 2050 as part of our Planet Promise. This isn’t achievable through
asingle solution; instead, we continually review and enhance our
practices across the Group to amplify our impact and expedite our
progress towards sustainability goals.
One significant initiative demonstrating our commitment to reducing
food waste is linking a food waste-related KPI to the annual bonus
planof our executive directors and senior management.
Our culinary teams and front-line staff understand the importance
ofminimising food waste and are utilising various waste-reduction
technologies. For example, Waste Not 2.0 is our proprietary
tablet-based online tracking tool for chefs, and has been deployed
in12 countries, helping kitchen teams to identify opportunities to
reduce food waste and giving our unit managers tools to report on
their carbon footprint.
Whilst the Group’s absolute Scope 1, 2 and 3 emissions increased
year on year due to new business wins, our overall greenhouse gas
intensity ratio (normalised for revenue growth) reduced by 4%
compared to 2023.
Part of our core identity is being an ethical, sustainable, and inclusive
business. By integrating these principles into our culture, we aim to
make a meaningful difference and positively influence the world. Our
customers and partners increasingly align with these values, which
are crucial for our growth goals and long-term success.
Summary
Our 2024 results were strong across all our key performance metrics.
We delivered double-digit organic revenue growth and good margin
progress, driving strong underlying operating profit growth. The
Groupremains very cash generative, enabling us to invest in future
opportunities for growth and return capital to shareholders, whilst
maintaining a strong balance sheet.
We have further improved the quality of our portfolio, having exited, or
agreed to exit, nine countries. The Group is also increasing investment
in its core markets, particularly in Europe, where there are significant
first-time outsourcing opportunities. We are consistently delivering
netnew business growth in our target 4 to 5% range, with excellent
client retention.
The Group is continuing to develop its sub-sector portfolio, particularly
in Europe, where we have acquired, or agreed to acquire, four great
businesses. These also provide us with additional resources and talent
to help drive growth. We are also increasing investment in more
flexible operating models and innovating our offer to meet more
sophisticated consumer demands.
We remain excited about the significant global structural opportunities
and continue to anticipate profit growth ahead of revenue growth.
Weexpect our established value creation model to continue to deliver
strong earnings momentum, rewarding shareholders with
compounding returns over the long term.
Dominic Blakemore
Group Chief Executive Officer
26 November 2024
11Compass Group PLC Annual Report 2024
Our safety
journey
Health and safety
At Compass, a culture of care, respect and safety is paramount in
everything we do. Whether it’s inside or outside the kitchen, keeping
everyone safe is always our top priority. We strive to operate a safe,
injury-free and healthy workplace. Our safety journey, continuously
evolving with the growth of the business, reflects the shared
commitment across all levels of our businesses’ operations.
Food safety
Throughout every step of the food journey, from our supply chain to
final service, preventing potential health risks that can arise from the
handling, preparation and storage of food is a priority. The varying
complexities require every colleague, at every site and for every meal
to deliver the highest standards of food safety.
Adhering to industry frameworks like Hazard Analysis and Critical
Control Point (HACCP) and Good Catering Practices (GCPs), our
Global Safety Standards help us to achieve this. Recognising the
differing business climates and customs from country to country and
region to region, these standards allow our individual businesses to
adopt local regulatory requirements, as well as client-specific
protocols where appropriate.
In 2024, we achieved a Food Safety Incident Rate (FSIR) rate of 0.13,
below our limit of 0.17, representing a 13% year-on-year rate
improvement. Our focus on global food safety has led to significant
long-term reductions in incidents, despite continued business growth.
Safety audits
As well as ensuring we have industry-leading policies and procedures,
our standards provide the framework for leadership and oversight,
communication, awareness and training, risk assessments, issues
management and investigations, as well as reporting, monitoring
andreview.
Our Global Safety Standards are reinforced through regular safety
self-assessments, Group internal audits and third-party external audits
– ensuring multiple layers of assurance both internally and externally.
Personal safety
Training our people to manage safety in operations is crucial for
maintaining a safe and efficient work environment. Comprehensive
training equips our teams with the knowledge and skills needed to
identify and mitigate risks, ensuring they can effectively respond to
potential hazards.
This training fosters a sense of ownership and responsibility,
encouraging proactive behaviour and prompt intervention. It promotes
a strong focus on safety, where everyone is actively encouraged to
engage in protecting their own wellbeing and that of their colleagues.
As indicated in last year’s Annual Report, the businesses have looked
to capture a more holistic view of personal injuries by transitioning to a
Total Recordable Injury Frequency Rate (TRIFR) performance
measure which reflects all work-related injury types. In 2024, we
achieved a TRIFR rate of 10.7, representing a 12% improvement
compared to our limit of 12.10.
Safety governance and advancing food safety
Safety learnings are shared across our businesses with a safety
moment at the start of management meetings, whilst Board and
Executive Committee meetings regularly feature health and safety
updates. In 2024, we supported the globally recognised World Food
Safety Day, engaging our chefs, operators and colleagues globally and
further educating them on our approach to food safety.
We believe it is critical to partner with leading industry food safety
groups and actively collaborate on global food safety initiatives that
support learnings which continuously evolve our strategy and
approach. We are active board members of SSAFE, a global non-profit
that works to strengthen food safety across the supply chain, and we
participate in advisory committees across the following industry
groups: Food Industry Intelligence Network, International Association
of Food Protection, Conference forFood Protection and the National
Restaurant Association.
Evolving our processes
In 2024, we evolved our Global Safety Standards to reflect current risk
trends that are impacting our operational environment, and the
actions required of our businesses to achieve further excellence
through consistency of approach. We have built a globally connected
community for our safety professionals and senior leaders, uniting
people in a shared understanding of our safety journey through the
use of a market-leading employee engagement mobile application.
Priorities for the year ahead
The businesses will continue to prioritise initiatives that further the
maturity of our safety programmes. As we looked to capture a more
holistic view of personal injuries by transitioning to TRIFR in 2024, we
will prioritise the forthcoming EU Corporate Sustainability Reporting
Directive (CSRD), emphasising the qualitative aspects that add depth
and context to our strategies and opportunities for managing the
evolving risks throughout our business. As part of this, we will
transition to measuring our food safety progress through leading food
safety indicators that align with industry and regulatory standards. Our
Global Food Safety Incident Rate remains important to us and will
continue to be tracked by management.
12 Strategic Report
Doing what
is right
Ethics and integrity
Business ethics and integrity
At Compass we are committed to upholding high standards of ethics
and integrity (E&I), a commitment which has earned us our position
asa global leader and trusted partner. We believe in responsible
leadership and aim to set the standard and act as a role model for
ethical behaviour. Through an inclusive culture, we promote a
workplace where our people and partners can speak up and be
heard.Our values, commitments, Code of Business Conduct (CBC)
and Business Integrity Policy (BIP) guide the decisions, actions
andbehaviours of our people and serve as a foundation for the way
our businesses conduct themselves in an ethical, fair and
responsibleway.
Our E&I programme
Our risk-based programme and policy framework provide the minimum
standards, ethical principles, expectations and guidance for Compass’
employees and those we work with or who act on our behalf.
Global initiatives
We are committed to continuous improvement, and this year we
haveprioritised:
– the launch of country-specific BIPs in local languages, with locally
approved disclosure thresholds for gifts and hospitality, conflicts
ofinterest, donations, sponsorships and community investments
– our annual E&I awareness week, which focused on embedding
E&I principles within our countries
– the phased implementation of our Third-Party Integrity Due
Diligence (TPIDD) process
– further embedding key E&I controls through piloting our
Programme Implementation Playbook (PIP) which sets out
expected compliance standards and provides guidance to
countriesand regions
– continuing to collaborate across Group functions to strengthen
governance activities relating to supply chain risk management
andM&A due diligence
– undertaking a fraud risk assessment and an effectiveness review
ofour SpeakUp, We’re Listening programme, both carried out by
anindependent external adviser
Training and awareness
Through communication, awareness and training, we empower,
encourage and equip our people to spot red flags and make well-
informed integrity-driven decisions. Our training population includes
all Legal, Sales, Finance, People, Internal Audit, Procurement, Growth
and Retention teams in addition to our Board of Directors and
executive management, leadership and above-unit manager roles at
Group, region and country-level.
Our global E&I awareness week involved all our countries, targeting an
audience of over 100,000 employees across the Group’s businesses
and resulting in a total of 8,600 employees globally electing to become
E&I ambassadors. To set clear expectations of our ethical behaviours
and values, we have initiated new starter training covering E&I
principles for unit managers and above, in all of our countries.
Pledge and declaration
To confirm understanding of and compliance with the CBC and BIP,
our annual self-certification process requires all our target training
population of nearly 19,000 employees globally to provide a pledge
and declaration covering key business integrity risk areas and conflict
of interest disclosures.
Priorities for the year ahead
In partnership with the businesses and our community of E&I leaders,
we will prioritise initiatives in accordance with our strategic plan.
These priorities include: continuing to further embed key controls
through the PIP and TPIDD; strengthening monitoring, oversight and
assurance of key programme elements including external reviews;
Data Privacy Policy compliance; and optimising E&I’s suite of tools
and technologies, including a new learning management system.
13Compass Group PLC Annual Report 2024
Ethics and integrity continued
SpeakUp, We’re Listening (SpeakUp) is our confidential reporting
programme that is accessible to anyone through use of QR codes,
via the web or by phone, and is available 24/7, 365 days a year.
SpeakUp is managed by Group E&I, a team independent of any
other lines of business.
In 2024, SpeakUp received a total of 4,974 reports (2023: 4,130),
from employees in the Group, contractors and external parties.
Positive engagement with the programme is observed through
increased reporting and engagement, which was especially
notable following our annual E&I awareness week, including a
leader-led campaign to further promote the programme and
celebrate our ‘speak and listen up’ ethos.
Of the 4,974 reports made to SpeakUp, 1,460 were non-ethics-
related matters and were typically referred to country teams for
follow-up rather than requiring an ethics investigation. The
remaining 3,514 were ethics-related matters assessed as potential
breaches of our CBC.
Whilst 60% (2,105) of reporters elected to remain anonymous
(2023: 1,735), the overall substantiation rate for 2024 was 34%
(2023: 38%). Notwithstanding the rise in total reports received in
2024, we maintained a stable substantiation rate, which reflects
consistency in investigation processes including continued
engagement with reporters to develop a better understanding of
concerns raised. At Compass, we take all matters raised through
SpeakUp very seriously: we ensure our reporters receive a
response and that appropriate actions are taken with respect to
concerns raised.
Compass Group and all of its Group companies strongly encourage
raising concerns about improper behaviour or possible violations of
our CBC, BIP, other policies or laws. Compass prohibits and does
not tolerate retaliation or detrimental conduct in response to
anyone raising a concern, irrespective of the outcome.
SpeakUp, We’re Listening 2024 overview
1
3,514 ethics reports
Ethics report categories
34% substantiation rate
Ethics case outcomes
30% 23% 11%
Warning
11%
Feedback Termination
25%
Coaching
Other outcomes such as: referral to another process;
training; employee performance improvement.
N
o
n
-
e
t
h
i
c
s
r
e
p
o
r
t
s
=
1
,
4
6
0
E&I pulse survey responses
*
6
0%
of our employees stated that they speak up
when things do not feel right (2023: 89%)
6
8%
of our employees are aware of SpeakUp,
We’re Listening (2023: 96%)
88%
observed integrity-driven decisions being
made where they work (2023: 85%)
6
6%
agreed that training raised their awareness of
E&I principles (2023: 91%)
1. Data as at 30 September 2024.
5 most frequently
reported ethics issues:
1. Harassment/bullying.
2. Workplace conflict.
3. Issues with management.
4. Retaliation.
5. Discrimination.
Business
integrity
16.5%
Finance
0.5%
Health, safety &
sustainability
5.0%
Employee
behaviours
78%
* Based on responses as part of the 2024 training
(all regions ex. UK&I)
14 Strategic Report
Financial review
Performance
Another year of strong
performance
Change in reporting currency
With effect from 1 October 2023, the reporting currency of the Group
was changed from sterling to US dollars. The change in presentation
currency provides investors and other stakeholders with greater
transparency in relation to the Group’s performance and reduces
foreign exchange volatility on earnings given that approximately
three-quarters of the Group’s underlying operating profit originates in
US dollars. The amounts for prior periods have been translated into
US dollars at average exchange rates for the relevant periods for
income statements and cash flows, with spot rates used for significant
transactions, and at the exchange rates on the relevant balance sheet
dates for assets and liabilities.
Group performance
We manage and assess the performance of the Group using various
underlying and other Alternative Performance Measures (APMs).
These measures are not defined by International Financial Reporting
Standards (IFRS) or other generally accepted accounting principles
(GAAP) and may not be directly comparable with APMs used by other
companies. Underlying measures reflect ongoing trading and,
therefore, facilitate meaningful year-on-year comparison. The Group’s
APMs, together with the results prepared in accordance with IFRS,
provide comprehensive analysis of the Group’s results. Accordingly,
the relevant statutory measures are also presented where appropriate.
Certain of the Group’s APMs are financial Key Performance Indicators
(KPIs) which measure progress against our strategy. The Group’s
APMs are defined in note 34 (non-GAAP measures) and reconciled to
GAAP measures in notes 2 (segmental analysis) and 34 to the
consolidated financial statements.
2024
$m
Restated
1
2023
$m Change
Revenue
Underlying 42,176 38,216 10.4%
Underlying (constant currency) 42,176 38,147 10.6%
Organic 41,021 37,075 10.6%
Statutory 42,002 37,907 10.8%
Operating profit
Underlying 2,998 2,592 15.7%
Underlying (constant currency) 2,998 2,576 16.4%
Statutory 2,584 2,313 11.7%
Operating margin
Underlying 7.1% 6.8% 30bps
Statutory 6.2% 6.1% 10bps
Return on capital employed (ROCE)
ROCE 19.0% 19.3% (30)bps
Basic earnings per share
Underlying 119.5c 105.2c 13.6%
Underlying (constant currency) 119.5c 104.3c 14.6%
Statutory 82.3c 92.2c (10.7)%
Cash flow
Underlying – free cash flow 1,740 1,516 14.8%
Statutory – net cash flow from operating activities 3,135 2,536 23.6%
Dividend
Full-year dividend per ordinary share 59.8c 52.6c 13.7%
1. With effect from 1 October 2023, the reporting currency of the Group was changed from sterling to US dollars. The results for the year ended 30 September 2023
have been restated in US dollars.
Alternative Performance Measure (APM) (see pages 207 to 214) APM which is also a Key Performance Indicator (see page 7)
Petros Parras
Group Chief Financial Officer
15Compass Group PLC Annual Report 2024
Financial review continued
Statutory income statement
On a statutory basis, revenue increased by 10.8% to $42,002 million
(2023: $37,907 million).
Statutory operating profit was $2,584 million (2023: $2,313 million), an
increase of 11.7%, with statutory operating margin of 6.2% (2023: 6.1%).
Statutory operating profit includes non-underlying item charges of
$414million (2023: $279 million), including acquisition-related charges of
$235 million (2023: $153 million) and $170 million (2023: $118 million)
of charges related to the strategic portfolio review.
As part of our strategic portfolio review, and considering country
exits,ongoing advancement of technologies and the increased
decentralisation of our business, we have reviewed our European
regional business transformation ERP programme that commenced
anumber of years ago. We have decided to discontinue the
implementation and roll out of our cross-market ERP programme and,
accordingly, have recognised a charge of $160 million as a specific
adjusting item, which includes $146 million for the non-cash
impairment of work-in-progress head office (non-client-related)
computer software assets. An impairment charge of $10 million has
been recognised in respect of our business in Qatar. In 2023, the net
charge included the impact of site closures and contract
renegotiations and terminations in the UK.
A full list of non-underlying items is included in note 34 (non-GAAP
measures).
The Group has recognised a net loss of $203 million (2023: net gain
of$24 million) on the sale and closure of businesses, including exit
costs of $92 million (2023: $14 million) and a charge of $250 million
(2023: credit of $1 million) in respect of the reclassification of
cumulative currency translation differences. As part of our strategic
portfolio review, we exited five countries during the year and, in July,
the Group agreed the sale of its businesses in Chile, Colombia and
Mexico, subject to regulatory approval and completion procedures.
Subsequent to the year-end, we agreed the sale of our business in
Kazakhstan, subject to regulatory approval.
Finance costs increased to $325 million (2023: $200 million) mainly
reflecting both higher net debt and interest rates during the year,
together with a partial reversal of the fair value gains on derivatives
held to minimise volatility in short-term underlying finance costs in
previous years.
Profit before tax was $2,056 million (2023: $2,137 million) giving rise to an
income tax expense of $642 million (2023: $525 million), equivalent to an
effective tax rate of 31.2% (2023: 24.6%). The increase in rate primarily
reflects the increase in the UK corporate tax rate from 19% to 25% from
1 April 2023 and the impact of non-taxable non-underlying items.
Basic earnings per share was 82.3 cents (2023: 92.2 cents),
adecrease of 10.7%, as the higher operating profit is more than
offsetby the impact of the reclassification of cumulative currency
translation differences on sale of businesses, higher finance costs
andhigher effective tax rate.
Underlying income statement
Organic revenue growth was strong at 10.6%, including net new
business growth of 4.2%, which remains above our historical level
of approximately 3%, pricing of around 4% and like-for-like volume
growth of around 2%. As expected, volume growth moderated during
the year as we lapped strong prior year comparatives.
Growth in underlying revenue was broad-based reflecting double-digit
organic revenue growth, especially in North America and Europe, and
also the contributions from significant acquisitions during the year. This
was partly offset by the impact of exits from non-core countries as part of
the Group’s strategy to focus on our larger developed markets and
de-risk our portfolio. Client retention rates remained strong at 96.0%.
Underlying operating profit increased by 16.4% on a constant-
currency basis, to $2,998 million, with underlying operating margin
at7.1% (2023: 6.8%). Strong margin progression was achieved across
all regions, underpinned by our operational scale, efficiencies and
appropriate levels of pricing to mitigate inflation.
Underlying finance costs increased to $249 million (2023: $166 million)
mainly reflecting both higher net debt and interest rates during the year.
On an underlying basis, the tax charge was $702 million (2023: $588
million), equivalent to an effective tax rate of 25.5% (2023: 24.2%).
The increase in rate primarily reflects the increase in the UK corporate
tax rate from 19% to 25% from 1 April 2023. The tax environment
continues to be uncertain, with more challenging tax authority audits
and enquiries globally.
On a constant-currency basis, underlying basic earnings per share
increased by 14.6% to 119.5 cents (2023: 104.3 cents) reflecting
the higher profit for the year.
Income statement
2024
Restated
1
2023
For the year ended 30 September
Statutory
$m
Adjustments
$m
Underlying
$m
Statutory
$m
Adjustments
$m
Underlying
$m
Revenue 42,002 174 42,176 37,907 309 38,216
Operating profit 2,584 414 2,998 2,313 279 2,592
Net (loss)/gain on sale and closure of businesses (203) 203 – 24 (24) –
Finance costs (325) 76 (249) (200) 34 (166)
Profit before tax
2,056 693 2,749 2,137 289 2,426
Tax expense (642) (60) (702) (525) (63) (588)
Profit for the year
1,414 633 2,047 1,612 226 1,838
Non-controlling interests (10) – (10) (5) – (5)
Attributable profit 1,404 633 2,037 1,607 226 1,833
Average number of shares 1,705m – 1,705m 1,743m – 1,743m
Basic earnings per share 82.3c 37.2c 119.5c 92.2c 13.0c 105.2c
EBITDA $4,145m $3,620m
1. With effect from 1 October 2023, the reporting currency of the Group was changed from sterling to US dollars. The results for the year ended 30 September 2023
have been restated in US dollars.
Alternative Performance Measure (APM) (see pages 207 to 214) APM which is also a Key Performance Indicator (see page 7)
16 Strategic Report
Liquidity
The Group finances its operations through cash generated by the
business and borrowings from a number of sources, including banking
institutions, the public and the private placement markets. The Group
has developed long-term relationships with a number of financial
counterparties with the balance sheet strength and credit quality
to provide credit facilities as required.
The Group seeks to avoid a concentration of debt maturities in any
one period to spread its refinancing risk. A $352 million US Private
Placement (USPP) note matured and was repaid in October 2023.
In February 2024, the Group issued a €750 million ($806 million)
fixed-rate sustainable bond maturing in February 2031. The new bond
effectively pre-financed a €750 million ($809 million) bond which
matured and was repaid in July 2024. In September 2024, the Group
issued a €500 million ($557 million) fixed-rate sustainable bond
maturing in September 2033. The maturity profile of the Group’s
principal borrowings at 30 September 2024 shows that the average
period to maturity is 4.6 years (2023: 3.3 years).
The Group’s USPP notes contain leverage and interest cover
covenants which are tested semi-annually at 31 March and
30September. The leverage covenant test stipulates that
consolidated net debt must be less than or equal to 3.5 times
consolidated EBITDA. The interest cover covenant test stipulates
thatconsolidated EBITDA must be more than or equal to 3 times
consolidated net finance costs. Consolidated EBITDA and net finance
costs are based on the preceding 12 months. The leverage and
interest cover ratios were 1.1 times and 19.6 times, respectively,
at 30September 2024. Net debt, consolidated EBITDA and net
finance costs are subject to certain accounting adjustments for
the purposes of the covenant tests.
At 30 September 2024, the Group had access to $3,236 million
(2023: $3,271 million) of liquidity, including $2,683 million (2023:
$2,441 million) of undrawn bank facilities committed to August 2026
and $553 million (2023: $830 million) of cash, net of overdrafts. Our
credit ratings remain strong investment grade: Standard & Poor’s
A/A-1 long-term/short-term (outlook Stable); and Moody’s A2/P-1
long-term/short-term (outlook Stable).
Net debt
Net debt has increased by $932 million to $5,391 million
(2023:$4,459 million). The Group generated $1,675 million of free
cash flow and received $327 million in respect of the sale of its 19%
effective interest in ASM Global Parent, Inc., which was more than
offset by $999 million spent on the acquisition of subsidiaries, joint
ventures and associates, net of disposal proceeds, dividends of
$963million and share buybacks of $577 million. Adverse exchange
translation was $143 million. Cash net of lease liabilities of $34 million
in Chile, Colombia and Mexico has been reclassified to held
for sale in the Group’s balance sheet at 30 September 2024.
At 30 September 2024, the ratio of net debt to underlying EBITDA
was 1.3x (2023: 1.2x). Our leverage policy is to maintain strong
investment-grade credit ratings and to target net debt to underlying
EBITDA in the range of 1x-1.5x.
Post-employment benefits
The Group has continued to review and monitor its pension obligations
throughout the year, working closely with the trustees and actuaries of
all schemes across the Group to ensure appropriate assumptions are
used and adequate provision and contributions are made.
The accounting surplus in the Compass Group Pension Plan is $542
million at 30 September 2024 (2023: $525 million). The deficit in the
rest of the Group’s defined benefit pension schemes has increased to
$1,274 million (2023: $983 million). The net deficit in these schemes
is $154 million (2023: $130 million) including investments of $1,120
million (2023: $853 million) held in respect of unfunded pension
schemes and the US Rabbi Trust arrangements which do not meet the
definition of pension assets under IAS 19 Employee Benefits.
The total pensions operating charge for defined contribution schemes
in the year was $289 million (2023: $254 million) and $41 million
(2023: $37 million) for defined benefit schemes.
Return on capital employed
Return on capital employed was 19.0% (2023: 19.3%) based on net
underlying operating profit after tax. Excluding the effect of the
higherunderlying effective tax rate of 25.5% (2023: 24.2%), the
impact of recent business acquisitions on capital employed was offset
by the Group’s strong tradingperformance.
Balance sheet
At 30 September
2024
$m
Restated
1
2023
$m
Goodwill 6,899 6,105
Other non-current assets 8,757 7,301
Working capital (1,805) (1,514)
Provisions (714) (633)
Net post-employment benefit obligations (732) (458)
Current tax (94) (152)
Deferred tax (108) 105
Net debt (5,391) (4,459)
Net assets held for sale 94 5
Net assets 6,906 6,300
Borrowings (4,596) (4,114)
Lease liabilities (1,315) (1,153)
Derivatives (103) (221)
Cash and cash equivalents 623 1,029
Net debt (5,391) (4,459)
1. With effect from 1 October 2023, the reporting currency of the Group was changed from sterling to US dollars. The results for the year ended 30 September 2023
have been restated in US dollars.
Alternative Performance Measure (APM) (see pages 207 to 214)
17Compass Group PLC Annual Report 2024
Financial review continued
Free cash flow
Free cash flow totalled $1,675 million (2023: $1,425 million).
Duringthe year, we made cash payments totalling $24 million
(2023:$70million) in relation to restructuring and strategic
programmes and the one-off pension charge. Adjusting for this, and
for acquisition transaction costs of $41 million (2023: $21 million)
which are reported as part of operating cash flow, underlying free cash
flow was $1,740 million (2023: $1,516 million), with underlying free
cash flow conversion at 85.0% (2023: 82.5%). Underlying profit for
the year has replaced underlying operating profit as the denominator
in the calculation of underlying free cash flow conversion. Underlying
free cash flow conversion would be 58.0% (2023: 58.5%) using
underlying operating profit as the denominator.
Capital expenditure of $1,541 million (2023: $1,098 million) is
equivalent to 3.7% (2023: 2.9%) of underlying revenue. The working
capital inflow, excluding provisions and pensions, was $186 million
(2023: outflow of $120 million). The net interest outflow increased
to$228 million (2023: $147 million) consistent with the higher
underlying finance costs in the year. The net tax paid was $693 million
(2023: $539 million), which is equivalent to an underlying cash tax
rate of 25.2% (2023: 22.2%).
Acquisition and disposal of businesses
The Group spent $1,224 million (2023: $408 million) on business
acquisitions during the year, net of cash acquired, including $878
million on CH&CO in the UK and Ireland and HOFMANN
S
in Germany
(including the repayment of acquired borrowings), $285 million on
bolt-on acquisitions and interests in joint ventures and associates,
and$61 million of deferred and contingent consideration and other
payments relating to businesses acquired in previous years.
The Group received $225 million (2023: $58 million) in respect of
disposal proceeds net of exit costs, which primarily comprises the sale
of businesses in five countries during the year.
Including $41 million (2023: $21 million) of acquisition transaction
costs included in net cash flow from operating activities, the total
netcash spent on the acquisition and disposal of businesses is
$1,040million (2023: $371 million).
Sale of 19% effective interest in ASM Global Parent, Inc.
The Group received $327 million in respect of the sale of its 19%
effective interest in ASM Global Parent, Inc. in August 2024.
Dividends paid
Dividends paid in 2024 of $963 million represents the 2023 final
dividend ($606 million) and the 2024 interim dividend ($357 million).
Purchase of own shares
The cash outflow in respect of share buybacks totalled $577 million
during the year, which comprises $185 million in respect of the
completion of the share buyback announced in May 2023 and
$392million in respect of the $500 million share buyback announced
in November 2023. The share buyback is scheduled to complete in
December 2024.
Foreign exchange translation
The $143 million (2023: $91 million) loss on foreign exchange
translation of net debt primarily arises in respect of the Group’s
sterling and euro debt.
Other movements
Other movements primarily comprises fair value movements on
derivative financial instruments used to manage the Group’s
interestrate exposure and lease liabilities acquired through
businessacquisitions.
Cash flow
For the year ended 30 September
2024
$m
Restated
1
2023
$m
Free cash flow 1,675 1,425
Add back: Lease repayments 227 215
New lease liabilities and amendments (325) (323)
Acquisition and disposal of businesses (999) (350)
Sale of 19% effective interest in ASM Global Parent, Inc. 327 –
Dividends paid (963) (796)
Purchase of own shares (577) (1,167)
Foreign exchange translation (143) (91)
Other movements (120) (35)
Increase in net debt (898) (1,122)
Opening net debt (4,459) (3,337)
Net debt transferred to held for sale (34) –
Net debt (5,391) (4,459)
Free cash flow 1,675 1,425
Add back: Cash payments related to restructuring and strategic programmes and the one-off pension charge 24 70
Add back: Acquisition transaction costs 41 21
Underlying free cash flow 1,740 1,516
1. With effect from 1 October 2023, the reporting currency of the Group was changed from sterling to US dollars. The results for the year ended 30 September 2023
have been restated in US dollars.
Alternative Performance Measure (APM) (see pages 207 to 214) APM which is also a Key Performance Indicator (see page 7)
18 Strategic Report
Capital allocation
Our capital allocation framework is clear and unchanged. Our priority
is to invest in the business to fund growth opportunities, target a
strong investment-grade credit rating with a leverage target of around
1x-1.5x net debt to EBITDA and pay an ordinary dividend, with any
surplus capital being returned to shareholders.
Growth investment consists of: (i) capital expenditure to support
organic growth in both new business wins and retention of existing
contracts; and (ii) bolt-on M&A opportunities that strengthen our
capabilities and broaden our exposure. We have a proven track record
of strong returns from our investment strategy as evidenced by our
historical returns on capital employed.
Shareholder returns
Our dividend policy is to pay out around 50% of underlying earnings
through an interim and final dividend, with the interim dividend
reflecting around one-third of the total annual dividend.
In determining the level of dividend in any year, the Board considers a
number of factors, which include but are not limited to:
– the level of available distributable reserves in the Parent Company
– future cash commitments and investment requirements to sustain
the long-term growth prospects of the business
– potential strategic opportunities
– the level of dividend cover
Further surpluses, after considering the matters set out above, may be
distributed to shareholders over time by way of special dividend
payments, share repurchases or a combination of both.
Compass Group PLC, the Parent Company of the Group, is a
non-trading investment holding company which derives its
distributable reserves from dividends paid by subsidiary companies.
The level of distributable reserves in the Parent Company is reviewed
annually and the Group aims to maintain distributable reserves that
provide adequate cover for shareholder returns. The distributable
reserves of the Parent Company include the distributable portion
ofretained earnings and the own shares reserve, which total
£2,457million at 30 September 2024 (2023: £2,379 million).
An interim dividend of 20.7 cents per share (2023: 17.9 cents per
share), $357 million in aggregate, was paid in July 2024. It is proposed
that a final dividend of 39.1 cents per share (2023: 34.7 cents per
share), $664 million in aggregate, be paid on 27 February 2025 to
shareholders on the register on 17 January 2025. This will result in a
total dividend for the year of 59.8 cents per share (2023: 52.6 cents
per share), $1,021 million in aggregate (2023: $940 million). The
dividend is covered 2.0 times on an underlying earnings basis.
Shareholders appearing on the Register of Members or holding their
shares through CREST will automatically receive their dividends in
sterling, but have the option to elect to receive their dividends in US
dollars. The closing date for the receipt of dividend currency elections
is 3 February 2025. The sterling equivalent of the 2024 final dividend
will be announced on 11 February 2025.
For shares held in certificated form on the register, US dollar elections
can be made by contacting our share registrar, Link Group. Link’s
contact details can be found on page 230 or on our website under
Dividend Information.
A Dividend Reinvestment Plan (DRIP) will be available. The last date
for receipt of elections for the DRIP will be 6 February 2025.
The Group is in a strong position to fund its dividend, which is well
covered by cash generated by the business. Details of the Group’s
going concern assessment can be found on page 145. The ability of
the Board to maintain its future dividend policy will be influenced by a
number of the principal risks identified on pages 24 to 28 that could
adversely impact the performance of the Group, although we believe
we have the ability to mitigate those risks as outlined on pages 24 to 28.
At the date of this Report, $476 million of the $500 million share
buyback announced in November 2023 had been completed, with the
remainder scheduled to complete in December 2024. We prioritise
investment in the business through capex and M&A to support future
growth, with any surplus capital being returned to shareholders as we
maintain our strong track record of delivering long-term, compounding
shareholder returns.
Treasury
The Group manages its liquidity, foreign currency exposure and
interest rate risk in accordance with the policies set out below.
The Group’s financial instruments comprise cash, borrowings,
receivables and payables that are used to finance the Group’s
operations. The Group also uses derivatives, principally interest rate
swaps, forward currency contracts and cross currency swaps, to
manage interest rate and currency risks arising from the Group’s
operations. The Group does not trade in financial instruments.
TheGroup’s treasury policies are designed to mitigate the impact of
fluctuations in interest rates and exchange rates and to manage the
Group’s financial risks. The Board approves any changes to the policies.
Foreign currency risk
The Group’s policy is to balance its principal projected cash flows by
currency with actual or effective borrowings in the same currency. As
currency cash flows are generated, they are used to service and repay
debt in the same currency. Where necessary, to implement this policy,
forward currency contracts and cross currency swaps are taken out
which, when applied to the actual currency borrowings, convert these
to the required currency.
The borrowings in each currency can give rise to foreign exchange
differences on translation. Where the borrowings are less than, or
equal to, the net investment in overseas operations, these exchange
rate variances may be treated as movements on reserves and
recorded in the consolidated statement of comprehensive income
rather than in the consolidated income statement.
Non-dollar earnings streams are translated at the average rate of
exchange for the year. Fluctuations in exchange rates have given, and
will continue to give, rise to translation differences. The Group is only
partially protected against the impact of such differences through the
matching of cash flows to currency borrowings.
Interest rate risk
As set out above, the Group has effective borrowings in a number of
currencies and its policy is to ensure that, in the short term, it is not
materially exposed to fluctuations in interest rates in its principal
currencies. The Group implements this policy either by borrowing
fixed rate debt or by using interest rate swaps or options so that the
interest rates on at least 80% of the Group’s projected debt are fixed
or capped for one year. For the second and third years, interest rates
are fixed within ranges of 30% to 70% and 0% to 40% of projected
debt, respectively.
19Compass Group PLC Annual Report 2024
Financial review continued
Tax
As a Group, we are committed to creating long-term shareholder value
through the responsible, sustainable and efficient delivery of our key
business objectives. This will enable us to grow the business and make
significant investments in the Group and its operations.
We adopt an approach to tax that supports this strategy and also
balances the various interests of our stakeholders, including
shareholders, governments, employees and the communities in which
we operate. Our aim is to pursue a principled and sustainable tax
strategy that has strong commercial merit and is aligned with our
business strategy. We believe this will enhance shareholder value
whilst protecting our reputation.
In doing so, we act in compliance with the relevant local and
international laws and disclosure requirements, and we conduct an
open and transparent relationship with the relevant tax authorities
that fully complies with the Group’s Code of Business Conduct and
Business Integrity Policy.
After many years of operation, the Group has numerous legacy
subsidiaries across the world. Whilst some of these entities are
incorporated in low-tax territories, Compass does not seek to
avoidtaxthrough the use of tax havens. Details of the Group’s
relatedundertakings are listed in note 36 to the consolidated
financial statements.
In an increasingly complex international corporate tax environment,
adegree of tax risk and uncertainty is, however, inevitable. Tax risk
can arise from unclear regulations and differences in interpretation
but, most significantly, where tax authorities apply diverging standards
in assessing intra-group cross-border transactions. This is the
situation for many multinational organisations. We manage and
control these risks in a proactive manner and, in doing so, exercise
ourjudgement and seek appropriate advice from relevant professional
firms. Tax risks are assessed as part of the Group’s formal governance
process and are reviewed by the Board and the Audit Committee on a
regular basis.
Risks and uncertainties
The Board takes a proactive approach to risk management aimed at
protecting the Group’s employees, clients and consumers and
safeguarding the interests of the Company and its shareholders in a
constantly changing environment.
The principal risks and uncertainties facing the business, and the
activities the Group undertakes to mitigate these, are set out on pages
24 to 28.
Related party transactions
Details of transactions with related parties are set out in note 32 to the
consolidated financial statements. These transactions have not had,
and are not expected to have, a material effect on the financial
performance or position of the Group.
Going concern
The factors considered by the directors in assessing the ability of the
Group and Parent Company to continue as a going concern are
discussed on page 145.
The Group has access to considerable financial resources, together
with longer-term contracts with a number of clients and suppliers
across different geographic areas and industries. As a consequence,
the directors believe that the Group is well placed to manage its
business risks successfully.
Based on the assessment discussed on page 145, the directors have a
reasonable expectation that the Group and Parent Company have
adequate resources to continue in operational existence for at least
the period to 31 March 2026. For this reason, they continue to adopt
the going concern basis in preparing the financial statements.
Petros Parras
Group Chief Financial Officer
26 November 2024
20 Strategic Report
Regional
performance
Underlying Change Statutory Change
Revenue 2024
Restated
1
2023 Reported rates Constant currency Organic 2024
Restated
1
2023
North America $28,581m $25,768m 10.9% 10.9% 10.5% $28,557m $25,745m 10.9%
Europe $9,887m $8,598m 15.0% 14.3% 11.9% $9,737m $8,312m 17.1%
Rest of World $3,708m $3,850m (3.7)% (0.8)% 8.5% $3,708m $3,850m (3.7)%
Total $42,176m $38,216m 10.4% 10.6% 10.6% $42,002m $37,907m 10.8%
Operating profit
North America $2,335m $2,019m 15.7% 15.7% 15.7% $2,251m $1,931m 16.6%
Europe $583m $479m 21.7% 22.0% 15.0% $380m $297m 27.9%
Rest of World $224m $214m 4.7% 10.3% 27.3% $224m $205m 9.3%
Unallocated costs $(144)m $(120)m $(271)m $(120)m
Total $2,998m $2,592m 15.7% 16.4% 16.2% $2,584m $2,313m 11.7%
Underlying Change Statutory Change
Operating margin 2024 2023 2024 2023
North America 8.2% 7.8% 40bps 7.9% 7.5% 40bps
Europe 5.9% 5.6% 30bps 3.9% 3.5% 40bps
Rest of World 6.0% 5.6% 40bps 6.0% 5.3% 70bps
Total 7.1% 6.8% 30bps 6.2% 6.1% 10bps
Alternative Performance Measure (APM) (see pages 207 to 214) APM which is also a Key Performance Indicator (see page 7)
1. With effect from 1 October 2023, the reporting currency of the Group was changed from sterling to US dollars. The results for the year ended 30 September 2023
have been restated in US dollars.
2. Measured on a constant-currency basis.
North America Europe Rest of World
Underlying operating profit
$2,335m
2023: $2,019m
1
Underlying operating
profit growth
2
15.7%
Underlying operating profit
$583m
2023: $479m
1
Underlying operating
profit growth
2
22.0%
Underlying operating profit
$224m
2023: $214m
1
Underlying operating
profit growth
2
10.3%
Underlying revenue
$28.6bn
Underlying revenue
$9.9bn
Underlying revenue
$3.7bn
Business & Industry Sports & LeisureEducation Defence, Offshore & RemoteHealthcare & Senior Living
15%28%
1%
21%35% 13% 10%15%14%48% 35% 40%14%
7% 4%
Regional reviews
Sector
By sector By sector By sector
21Compass Group PLC Annual Report 2024
Regional reviews continued
North America
Underlying
Operating profit growth was 15.7% on a
constant-currency basis, increasing to
$2,335 million, driven by strong revenue
growth and operating margin progression.
Organic revenue growth was 10.5%, driven
by net new business growth, appropriate
levels of pricing and like-for-like volume
growth. Client retention rates remained
strong at 96.4%.
Growth rates were high single-digit or greater
across all sectors, and notably strong in
Business & Industry driven by net new
business growth and like-for-like volumes,
which benefited from the continued ‘return
to office’ trend and value proposition versus
the high street. Across our other sectors,
Sports & Leisure and Education continued
tobenefit from high attendance levels and
per capita spend levels, while Healthcare &
Senior Living business performance
includedstrong retail sales and new
businessopenings.
Operating margin increased by 40bps to
8.2% driven by management productivity
initiatives, cost control and appropriate levels
of pricing.
The region continues to acquire high-quality
businesses and talent within our existing
sectors, with a particular focus on vending.
Statutory
Statutory revenue increased by 10.9% to
$28,557 million reflecting the strong organic
revenue growth.
Statutory operating profit was $2,251 million
(2023: $1,931 million), with the difference
from underlying operating profit being
acquisition-related charges of $84 million
(2023: $88 million).
Europe
Underlying
The region continues to benefit from ongoing
investments in its people, brands and
processes. Operating profit was $583 million,
representing growth of 22.0% on a
constant-currency basis, driven by double-
digit revenue growth, strong margin
progression and the impact of acquisitions
during the year.
Organic revenue growth of 11.9% comprised
net new business growth, volume growth and
pricing. Client retention rates at 95.5%
remain significantly above historical levels.
All sectors delivered high single-digit growth
rates or above, with double-digit growth rates
achieved in Business & Industry, Education
and Defence, Offshore & Remote.
Operating margin increased by 30bps to
5.9%, reflecting management focus across
the portfolio, ongoing operational efficiencies
and appropriate levels of pricing.
We have increased our focus on M&A with
significant acquisitions to deepen our
sectorisation and sub-sectorisation
strategy,unlock new capabilities and
increase the flexibility of our operating
model. During the year, we acquired
HOFMANN
S
in Germany and CH&CO in the
UK and Ireland. Subsequent to the year-end,
we also completed the acquisition of
DupontRestauration in France and agreed
toacquire 4Service AS in Norway.
Additionally, as part of our focus on core
markets, we exited our joint venture in the
United Arab Emirates.
Statutory
Statutory revenue increased by 17.1% to
$9,737 million, with the difference from
underlying revenue being the presentation of
the share of results of our joint ventures
operating in the Middle East.
Statutory operating profit was $380 million
(2023: $297 million), with the difference
from underlying operating profit mainly
reflecting acquisition-related charges of
$151 million (2023: $56 million) and charges
related to the Group’s strategic portfolio
review of $43 million (2023: $118 million).
Rest of World
Underlying
Operating profit grew by 10.3% on a
constant-currency basis, to $224 million,
driven by strong organic revenue growth and
margin progression. This growth was despite
the impact of exits from our operations in
four non-core countries during the year.
Organic revenue growth was 8.5% and
strongest in our Business & Industry sector,
particularly in India, driven by high levels of
net new business growth and the ‘return to
office’ trend. All other sectors delivered
mid-to-high single-digit organic revenue
growth underpinned by net new business
growth, like-for-like volume growth and
pricing. Client retention rates remained
above historical levels at 94.3%.
Operating margin increased by a further
40bps to 6.0% reflecting the benefits from
strong focus on our core markets, including
Australia, Japan and India.
As part of the Group’s strategy to increase
focus on its core markets, we exited
Argentina, Angola, mainland China and
Brazil during the year and agreed to exit our
businesses in Chile, Colombia and Mexico,
subject to regulatory approval and
completion procedures. Subsequent to the
year-end, we agreed to exit our business in
Kazakhstan, subject to regulatory approval.
Statutory
Statutory revenue decreased by 3.7% to
$3,708 million reflecting the non-core
business disposals. There is no difference
between statutory and underlying revenue.
Statutory operating profit was $224 million
(2023: $205 million), with the difference
from underlying operating profit in 2023
being acquisition-related charges of $9
million.
22 Strategic Report
Identifying and
managing risk
Risk management
The Board takes a proactive approach to risk management aimed
at protecting the Group’s employees, clients and consumers and
safeguarding the interests of the Company and its shareholders in a
constantly changing environment.
Risk management is an essential element of business governance.
The Group has risk management policies, processes and procedures
in place to ensure that risks are properly identified, evaluated and
managed at the appropriate level.
The identification of risks and opportunities, the development of
action plans to manage those risks and maximise the opportunities,
and the continual monitoring of progress against agreed key
performance indicators (KPIs) are integral parts of the business
process and core activities throughout the Group.
In compliance with provision 28 of the UK Corporate Governance
Code 2018 (the Code), the Board has conducted a robust assessment
of the Company’s emerging and principal risks. The following pages
set out the Board’s approach to assessing and mitigating risk, the
principal risks of the Company, and the procedures in place to identify
emerging risks.
Risk management framework
The Board has overall responsibility for risk management. This
includes establishing policies and procedures to manage risk,
overseeing the internal control framework, reviewing the nature and
extent of the principal risks, setting risk appetite and embedding a
mindset of risk management throughout the business.
The Board has approved a Risk Management Policy. The Group
operates a formal risk management process in accordance with this
policy, under which the Group’s principal risks (set out on pages 24 to
28) are assessed and prioritised biannually. In accordance with the
Financial Reporting Council’s Guidance on Risk Management, Internal
Control and Related Financial Business Reporting 2014 and in the
Code, this process has been in place for the financial year under
review. These systems are designed to manage rather than eliminate
the risk of failure to achieve the Group’s strategic objectives,
safeguard the Group’s assets against material loss, fairly report the
Group’s performance and position, and ensure compliance with
relevant legislation, regulation and best practice including that related
to social, environmental and ethical matters. These systems provide
reasonable, but not absolute, assurance against material
misstatement or loss.
The Board delegates aspects of risk management, with the Executive
Committee responsible for the day-to-day management of significant
risk, and the Audit Committee responsible for the oversight of
Compass’ risk management systems and internal financial controls.
The Group Director of Risk and Internal Audit maintains the risk
management framework including the Risk Management Policy.
The Audit Committee annually reviews the effectiveness of the
Group’s approach to risk management and any changes to the
RiskManagement Policy and recommends the principal risks and
uncertainties disclosures made in the Annual Report and Accounts
tothe Board for approval. The Audit Committee’s report is on
pages73 to 78.
Risks and the corresponding controls and mitigations are reviewed
by country and regional leadership teams on an ongoing basis.
Risk updates are integral to periodic management reviews and are
regularly reviewed by the Regional Governance Committees (RGCs)
and the Executive Committee. A critical component of the risk review
process is the dynamic identification of emerging and developing risks
at a country, regional and Group-level. This bottom-up and top-down
approach provides a comprehensive assessment of the key risks
facing the Group. The findings of the risk reviews, including the
principal risks and any developing trends, are reported to and
considered by the Board twice a year.
Risks are considered at gross and net levels. This allows the impact of
each risk and likelihood of its occurrence both before and after
controls and mitigations to be assessed. Risk management plans are
developed for all significant risks. They include a clear description of
the nature of the risk, quantification of the potential impact and
likelihood of occurrence, the owners for each risk, and details of the
controls and mitigations in place, proportionate to the risk, and in line
with the Company’s business. The identification and assessment of
climate-related risks and opportunities are incorporated within the risk
management process. All country operating units are mandated to
consider climate-related risks and opportunities. These are assessed
in terms of percentage profit before interest and tax (PBIT) impact in
accordance with the criteria set out in the Board-approved Risk
Management Policy. All country and Group-level risks are assigned
risk owners and, together with the mitigations, are recorded in the
central risk reporting system.
Group companies also submit biannual risk and internal control
assurance letters to the Group CFO on internal control and risk
management issues, with comments on the control environment
within their operations. The Chair of the Audit Committee reports to
the Board on any matters arising from the Committee’s review of how
the risk management and internal control processes have been
applied.
The Audit Committee keeps under review the adequacy and
effectiveness of the Company’s and Group’s internal financial controls
and risk management systems. These are discussed in further detail
in the Audit Committee report on pages 73 to 78.
Risk appetite
The Board interprets risk appetite as the level of risk that the Company
is willing to take to meet its strategic objectives. The Board’s attitude
to and appetite for risk are communicated to the Group’s businesses
through the strategy planning process and the internal risk
governance and control frameworks. In determining its risk appetite,
the Board recognises that a prudent and robust approach to risk
mitigation must be carefully balanced with a degree of flexibility so
that the entrepreneurial spirit that has greatly contributed to the
Group’s success is not inhibited.
In assessing risk appetite, the Board reviews the three-year business
plan and associated strategic risks. Risk appetite for specific financial
risks such as funding and liquidity, counterparty, foreign exchange
and interest rate risk are set out in the Board approved treasury
policies. Compliance with legal and regulatory requirements, such as
those contained in the Companies Act, health and safety and other
risk-specific legislation, is mandatory.
23Compass Group PLC Annual Report 2024
Principal risks
New and emerging risks
The Board has established processes for identifying emerging risks,
and horizon scanning for risks that may arise over the medium to
long-term. Emerging and potential changes to the Group’s risk profile
are identified through the Group’s risk management framework and
through direct feedback from management, including in regard to
changing operating conditions, and market and consumer trends.
The democratisation of generative artificial intelligence (AI) has
givenwidespread access to powerful online AI services for content
creation. This opportunity presents several risks including breach
ofdata confidentiality and data privacy, and other intellectual
property- related risks. In response, to mitigate these risks,
Compasshas implemented principles-based rules that apply
globally,and we have developed a framework for responsible
useofAIto support all our markets.
The ongoing tensions in the Middle East and the Russia-Ukraine
conflict have elevated geopolitical risks and while we do not operate
directly in those countries currently affected, we do have interests
elsewhere in Europe and the Middle East. We continue to monitor
these situations closely with the safety and security of the Group’s
employees front of mind.
Our principal risks
Over recent years, we have reviewed our global portfolio of operations
and as part of this we have exited a number of countries deemed both
higher-risk and non-core to our long-term business objectives.
This has significantly reduced our risk exposure in certain areas
including political instability, economic volatility, employee welfare
(particularly foreign migrant labour risks) and international tax.
Risksarising in the immediate aftermath of the COVID-19 pandemic
have also reduced.
As a result, certain risks (Political instability and International tax as
set out in Annual Report 2023) are no longer considered to be
principal risks while others have been combined and streamlined.
All risks disclosed in previous years can be found in the annual reports
available on our website, www.compass-group.com. These risks
remain important to the business and are kept under regular review.
The principal risks and uncertainties facing the business at the date of
this Report are set out on pages 24 to 28. These risks are not listed in
any order of priority.
Other risks
The principal risks do not comprise all the risks that the Group may
face. The Group faces a number of operational risks on an ongoing
basis, such as litigation and financial risks. Additional risks and
uncertainties not presently known to management, or which are
considered to be remote or are deemed to be less material at the date
of this Report, may also have an adverse effect on the Group.
Risk and description Mitigation
Climate change
2024: 2023:
Strategic pillar link:
The Group continues to focus on evaluating its exposure to climate
change and seeks to identify potential future issues early so that
sourcing and operations can be adjusted, and menus adapted
appropriately. The Task Force on Climate-related Financial
Disclosures scenario analysis helps inform the materiality of these
risks. Work continues with clients and suppliers to propose, execute
and measure solutions to support their efforts and those of Compass
in reducing greenhouse gas (GHG) emissions. Compass has targeted
climate net zero GHG emissions by 2050 alongside validated
science-based targets to reduce emissions by 2030 (from a 2019
base year) in line with the 2015 Paris Agreement.
The impact of climate change on the environment may lead to
issues around food sourcing and security, and supply chain
continuity in some of the Group’s markets. Issues in these areas
could affect the availability of some food products, and potentially
may lead to food cost inflation.
MAP 1: Client sales and marketing
Increased risk
Static risk Decreasing risk New risk
MAP 2: Consumer sales and marketing MAP 3: Cost of food MAP 4: In-unit costs MAP 5: Above-unit overheads
Link to
See page 4
Risk management continued
Alignment with our strategic focus areas
People Performance
Purpose
24 Strategic Report
Risk and description Mitigation
Food safety
1
2024: 2023:
Strategic pillar link:
Management meetings throughout the Group feature a health and
safety update (food safety and/or occupational safety) as one of their
first substantive agenda items.
Food safety improvement KPIs are included in the annual bonus
plans for each of the businesses’ management teams. The Group
has policies, procedures and standards in place to ensure
compliance with legal obligations and industry standards.
The safety and quality of the Group’s global supply chain are assured
through compliance with a robust set of standards which are
regularly reviewed, audited and upgraded as necessary to improve
supply chain visibility and product integrity.
Further mitigations in place include our Global Safety Standards,
Global Supply Chain Integrity Standards and a Global Allergen
Management Plan.
Compass Group companies feed millions of consumers every day.
For that reason, setting the highest standards for food hygiene and
safety is paramount. Safety breaches could cause serious business
interruption and could result in criminal and/or civil prosecution,
increased costs and potential damage to the Company’s reputation.
Occupational safety
1
2024: 2023:
Strategic pillar link:
In addition to the priority focus in management meetings,
occupational safety improvement KPIs are included in the annual
bonus plans for each of the businesses’ management teams.
Our safety framework outlines the methods for executing and
reporting safety measures, ensuring a secure environment for
colleagues, contractors, and consumers. We regularly update and
refine the health and safety framework to address any challenges
that may emerge from operational changes.
Group standards are supplemented in country with occupational
safety standards that meet local regulatory conditions.
Compass Group companies employ hundreds of thousands of
people globally. Ensuring the safety of our employees, consumers,
and suppliers is our top priority. Failure to comply with workplace
safety standards can result in injuries to employees, clients and
consumers, or other third parties, potentially causing operational
disruptions and adverse financial, legal, and reputational
consequences.
Pandemic
2024: 2023:
Strategic pillar link:
Operations and working practices have been adjusted to retain the
skills and experience of colleagues and provide flexibility in the
eventof another pandemic which leads to a resumption of
containment measures.
To protect the Group’s employees, clients and consumers, in the
event of another pandemic, enhanced health and safety protocols
and personal protective equipment requirements and guidelines,
hygiene requirements and site layout solutions developed in
consultation with expert advisers and with our clients, would
beadopted.
Careful management of the Group’s cost base and robust measures
to protect the Group’s liquidity position have ensured that we remain
resilient and well placed to take advantage of appropriate
opportunities as they arise.
Robust incident management and business continuity plans are in
place and are monitored for effectiveness and regularly reviewed to
ensure they reflect evolving best practice.
The Group’s operations were significantly disrupted due to the
global COVID-19 pandemic and associated containment
measures. Compass recovered well and learned from the
pandemic, and this risk has now diminished. However, outbreaks
of another pandemic, could cause further business risk.
1. Combined under Health and safety risk in Annual Report 2023.
25Compass Group PLC Annual Report 2024
Risk and description Mitigation
Talent
1
2024: 2023:
Strategic pillar link:
Leadership succession planning is performed at Board, regional and
country-levels. The Group has established tools, training,
development, performance management and reward programmes
to help retain, develop, motivate and support its skilled workforce,
including an increasing focus on global mobility and opportunities.
The Group has a number of well-established initiatives which help to
monitor levels of engagement and to respond to the needs of
employees. Specifically, Compass has increased its local focus and
employee support on mental health awareness, stress management
and resilience and the provision of financial advice and assistance to
better equip its people in times of uncertainty and change.
Attracting, retaining and motivating the best people with the right
skills, at all levels of the organisation, is key to the long-term
success of the Group.
Changes to economic conditions may increase the risk of attrition
at all levels of the organisation.
Sales and retention
2
2024: 2023:
Strategic pillar link:
Compass has strategies based on quality, value, innovation and
investment in new technologies that strengthen its long-term
relationships with its clients and consumers.
The Group’s business model is structured so that it is not reliant on
one particular sector or group of clients.
Technology is used to support the delivery of efficiencies and to
contribute to growth through, for example, cashierless and cashless
payment systems and the use of AI. This is beneficial to clients and
consumers and positively impacts retention and new business wins.
Compass continues to focus on financial security and safety. In
today’s environment, these are key strengths for clients.
Processes are in place to ensure that the services delivered to clients
are of an appropriate standard and comply with the required
contract terms and conditions.
Compass continues to evolve its offer to increase participation rates
and service sites of different sizes.
The Group’s growth ambitions rely on sustainably driving positive
net new business through securing and retaining a diverse range
ofclients.
The Group’s operating companies contract with a large number of
clients. Failure to comply with the terms of these contracts,
including proper delivery of services, could lead to the loss of
business and/or claims.
The potential loss of material client contracts and the inability to
secure additional new contracts in a competitive market is a risk to
Compass’ businesses.
The emergence of new industry participants and traditional
competition using disruptive technology could adversely affect the
Group’s businesses.
Geopolitical
2024: 2023:
Strategic pillar link:
As a Group, Compass is monitoring the situation closely with the
safety and security of the Group’s employees front of mind.
Whilst we do not operate in Israel or the Palestinian territories,
we do have interests elsewhere in the Middle East. Compass has
permanently exited the Russian market and moved away from all
known Russian suppliers.
The Group has in place strategies to manage economic volatility
including cost inflation and cybersecurity threats.
The conflict in the Middle East and the ongoing Russia-Ukraine war
have increased geopolitical risks, heightened national security
threats in those regions, and disrupted the global energy market.
These factors contribute to risks such as economic volatility
including cost inflation and cybersecurity threats.
1. Combines and streamlines risks relating to Recruitment and Retention and motivation as set out in Annual Report 2023.
2. Incorporates and streamlines risks relating to Service delivery, contractual compliance and retention, and Competition and disruption as set out in Annual
Report 2023.
Risk management continued
MAP 1: Client sales and marketing
Increased risk
Static risk Decreasing risk New risk
MAP 2: Consumer sales and marketing MAP 3: Cost of food MAP 4: In-unit costs MAP 5: Above-unit overheads
Link to
See page 4
Alignment with our strategic focus areas
People Performance
Purpose
26 Strategic Report
Risk and description Mitigation
Economic volatility
1
2024: 2023:
Strategic pillar link:
As part of Compass’ strategy, the Group is focused on productivity
and purchasing initiatives which help to manage the cost base.
During adverse conditions, if necessary, actions can be taken to
reduce labour costs and action plans have been implemented to
protect profitability and liquidity.
As part of the MAP framework, and by sharing best practice across
the Group, Compass seeks to manage inflation by continuing to drive
greater efficiencies through menu management, supplier
rationalisation, labour scheduling and productivity, and through the
increased use of technology. Cost indexation in our contracts also
gives Compass the contractual right to review pricing with clients.
Our success in managing cost inflation also provides an opportunity,
as the scale and maturity of our procurement operations allows us to
manage supply chain price increases more effectively than some of
our competitors and in-house operations. We believe this is a factor
in increasing levels of first-time outsourcing.
Certain sectors of Compass’ business could be susceptible to
negative shifts in the economy and employment rates. Compass
has strategically exited a number of countries with high economic
volatility. This move, coupled with improved economic conditions
in our primary markets, has reduced the risks affecting the Group.
Business ethics and integrity
2
2024: 2023:
Strategic pillar link:
The Group’s zero-tolerance-based Code of Business Conduct (CBC),
Business Integrity Policy (BIP) and Human Rights Policy (HRP),
govern all aspects of its relationships with its stakeholders. Compass
operates a continuous improvement process as part of the Group’s
Ethics and Integrity programme (EIP).
The Group’s risk management process helps identify major risks and
informs the regular monitoring, effectiveness testing and review of
key areas of our internal control framework.
A strong culture of integrity is promoted through Compass’ EIP
(including training and awareness activities) and its independently
operated SpeakUp, We’re Listening helpline and web platform. All
alleged breaches of the CBC, BIP and the HRP, and other serious
misconduct, are followed up and investigated (as appropriate).
To enhance its ability to counter risks to its businesses and supply
chains from modern slavery, Compass has focused on the areas
where its human rights strategy can have the greatest impact.
This has been done through the continued implementation of the
HRP, the work of the Human Rights Working Group, the engagement
of external specialist advisers, e-learning and continued efforts to
improve the Group’s human rights due diligence through supplier
evaluation and labour agency reviews.
The strategic exit of several countries has helped to lower the risk
around employee welfare.
Ineffective compliance management systems, lack of an
embedded business integrity culture or serious violation of our
policies, relevant laws, or regulations (including but not limited to
anti-bribery and corruption, anti-competitive behaviour, fraud,
money laundering, tax evasion, trade and economic sanctions,
human rights and modern slavery, and data protection), could
result in civil and/or criminal proceedings leading to significant
fines, sanctions, financial loss and reputational harm.
Regulatory expectations and new laws in these areas are being
introduced in certain countries and regions, with a heightened
focus on corporate enforcement, accountability and supply
chainresilience.
1. Incorporates risk relating to Cost inflation as set out in Annual Report 2023.
2. Combines and streamlines risks relating to Social and ethical standards, and Compliance and fraud as set out in Annual Report 2023.
27Compass Group PLC Annual Report 2024
Risk and description Mitigation
Cybersecurity and data privacy
2024: 2023:
Strategic pillar link:
Compass continually assesses its cyber risk, and monitors and
manages the maturity of its enterprise infrastructure, platforms and
security controls to ensure that it can effectively prevent, detect and
respond to current or future cyber attacks.
Appropriate crisis management procedures are in place to manage
issues in the event of a cyber incident occurring. Our response
protocols are supported by using industry-standard tooling,
experienced IT and security professionals, and external partners to
mitigate potential impacts. Assurance is provided by regular
compliance monitoring of our key information technology control
framework, which is designed to prevent and defend against cyber
threats and other risks.
The Group relies on a variety of digital and technology platforms to
manage and deliver services and communicate with its people,
clients, consumers and suppliers. Compass’ decentralised model
and infrastructure help to mitigate propagation of attacks across the
Group’s technology estate.
Compass continues to be focused on the need to maximise the
effectiveness of its information systems and technology as a
business enabler. As such, the Group continues to invest in
technology and specialist resources in order to further strengthen its
platforms, cyber-security defences and controls to prevent and
detect cyber threats and respond to attacks in order to mitigate the
risk of operational disruption, technology failure, unauthorised
access to and/or loss of data.
The Group has implemented configuration changes designed to
block phishing emails, increased awareness campaigns, and
provided cyber training to help employees identify these kinds
ofattacks.
In response to the potential risks posed by AI, Compass has
implemented principles-based rules that apply globally, and we are
currently developing a framework for the responsible use of AI in all
our markets.
Information systems, technology and cyber-security controls and
risks are assessed as part of the Group’s formal governance
processes and are reviewed by the Audit Committee on a
regular basis.
The digital world creates increasing risk for global businesses
including, but not limited to, technology failures, loss of
confidential data, data privacy breaches and damage to brand
reputation through, for example, the increased threat of cyber-
attacks, and use and instantaneous nature of social media.
Disruption caused by the failure of key software applications,
security controls, or underlying infrastructure, or disruption caused
by cyber-attacks could impact day-to-day operations and
management decision-making or result in a regulatory fine or other
sanction and/or third-party claims.
The incidence of sophisticated phishing and malware attacks
(including ransomware) on businesses is rising with an increase in
the number of companies suffering operational disruption,
unauthorised access to and/or loss of data, including confidential,
commercial, and personal identifiable data.
A combination of geopolitical instability and accessibility of
sophisticated AI enabled tools and techniques have contributed to
an increase in the risk of phishing and malware attacks including
ransomware across all industries.
The democratisation of generative AI has given widespread access
to powerful online AI services for content creation. This opportunity
presents several risks including to data privacy and confidentiality.
Risk management continued
MAP 1: Client sales and marketing
Increased risk
Static risk Decreasing risk New risk
MAP 2: Consumer sales and marketing MAP 3: Cost of food MAP 4: In-unit costs MAP 5: Above-unit overheads
Link to
See page 4
Alignment with our strategic focus areas
People Performance
Purpose
28 Strategic Report
Viability statement
Viability statement
In accordance with provision 31 of the UK Corporate Governance
Code 2018, the directors have assessed the Group’s viability,
considering its current trading performance, financial position,
financing, strategic plan and principal risks.
Business prospects
The Board has considered the long-term prospects of the Group
based on its business model, strategy and markets as set out on pages
2 to 11. Compass is a global leader in food services and the
geographical and sector diversification of the Group’s operations
helps to minimise the risk of serious business interruption or
catastrophic damage to its reputation. The Group’s business model
is structured so that it is not reliant on one group of clients or sector.
The Group’s largest client constitutes 2% of underlying revenue,
with the top 10 clients accounting for 9%.
Assessment
The directors have determined that a three-year period to
30September 2027 is an appropriate period over which to provide the
Group‘s viability statement on the basis that it is the period reviewed
by the Board in its strategic planning process and is aligned to the
typical length of the Group’s contracts (three to five years). The
directors believe that this presents the Board and readers of the
Annual Report with a reasonable degree of confidence over this
longer-term outlook.
The Board’s assessment of the Group’s viability comprises the
following business processes:
– Risk management process: The Group operates a formal risk
management process under which the Group’s principal risks
are assessed and prioritised biannually. Risks and corresponding
controls and mitigations are reviewed by country and regional
leadership teams on an ongoing basis. The findings of the risk
reviews, including the principal risks and any developing trends,
are reported to the Board twice a year. In making its viability
assessment, the Board carried out a robust evaluation of the
emerging and principal risks facing the Group (see pages 24 to 28),
including those that would threaten its business model, future
performance, solvency or liquidity.
– Strategic planning process: The Board considers annually a
three-year, bottom-up strategic plan and a more detailed budget
which is prepared for the following year. Current-year business
performance is reforecast during the year. The plan is reviewed
and approved by the Board, with involvement throughout from
the Group CEO, Group CFO and the executive team. The Board’s
role is to consider the appropriateness of key assumptions,
taking into account the external environment and business strategy.
The most recent three-year plan was approved by the Board
in November 2024.
– Headroom and covenant analysis: At 30 September 2024, the
Group had $2.7 billion of undrawn committed bank facilities and
$0.6 billion of cash net of overdrafts. Term debt maturities in the
three-year period total $1.4 billion. Based on the forecast cash
flows in the strategic plan, the maturing debt is expected to be
refinanced during the three-year period to 30 September 2027
to maintain the desired level of headroom. The $2.7 billion of
committed bank facilities mature in 2026, but are expected to
be refinanced during 2025. The Group’s long-term (A/A2) and
short-term (A-1/P-1) credit ratings and well-established presence
in the debt capital markets provide the directors with confidence
that the Group could refinance the maturing debt and facilities
as required.
A reverse stress test has been undertaken to identify the
circumstances that would cause the Group to breach the headroom
against its committed facilities or the financial covenants on its US
Private Placement (USPP) debt. At 30 September 2024, the
nominal value of USPP debt outstanding totalled $700 million
(2023: $1,052 million). The reverse stress test, which removes
discretionary M&A expenditure as a mitigating action, shows that
underlying operating profit
1
would have to reduce by more than
55% of the strategic plan level throughout the three-year
assessment period before the Group’s committed facilities are
reached. The refinancing requirement is not accelerated in the
reverse stress test as a mitigating action given the strong liquidity
position of the Group.
The principal risks that would have the most significant impact
on the Group’s business model, future performance, solvency
or liquidity are another pandemic and associated containment
measures and geopolitical tensions, and these, together with the
other principal risks identified on pages 24 to 28, have been
considered as part of the viability assessment. Specific scenarios
based on the principal risks have not been modelled on the basis
that the level of headroom to absorb the occurrence of such risks is
substantial and there is a range of other actions available that could
be implemented to mitigate the potential impact.
Substantial mitigating actions were identified and implemented
as part of the Group’s COVID-19 pandemic response in 2020,
including reducing capital expenditure, resizing the cost base,
renegotiating client contracts, pausing M&A activity and
shareholder returns, raising equity, negotiating covenant waivers
and securing additional committed funding. These actions
illustratethe flexibility the Group has to mitigate the impact of
adverse events.
In the event that the financial covenants were to come under
pressure, mitigating actions include repaying the loan notes from
available liquidity, refinancing in advance of their maturity or
negotiating covenant waivers.
Conclusion
Based on the results of this analysis, the Board has a reasonable
expectation that the Group will be able to continue in operation
and meet its liabilities as they fall due over the three-year period
to 30September 2027.
Petros Parras
Group Chief Financial Officer
26 November 2024
1. Alternative Performance Measure (APM) (see pages 207 to 214). The Group’s APMs are defined in note 34 (non-GAAP measures) and reconciled to GAAP
measures in notes 2 (segmental analysis) and 34 to the consolidated financial statements.
29Compass Group PLC Annual Report 2024
We have around 580,000 people in the Group, who provide positive
experiences to our businesses’ clients and consumers around the
world, every day. These great people are the heartbeat of our
business, and our people agenda is designed to identify, attract,
develop, support and retain the strong talent that helps us deliver
our goals. Our ambition is to give a lifetime of opportunities to
diverse people from the communities we serve, working in a positive
and safe environment, within a culture which is supported by
empowered teams and connected leaders, and underpinned by
respect, teamwork and growth.
Delivering on our people agenda means providing development and
learning that enables employees to achieve their full potential.
Training is available for our colleagues, and programmes are in place
to maintain appropriate levels of recruitment for success and growth
at all levels and sectors of the business. In seeking new talent, we
consider the recruiting needs for each sector and level of the
organisation and tailor our requirements accordingly. For example,
our North America business uses a range of targeted campaigns,
process automation, artificial intelligence and other tools to help them
identify the right candidates and make it easier for them to engage
with the selection process in their preferred language, and at a time
that suits them.
By prioritising talent development and training, we support business
growth and help our people thrive so that, whoever they are and
whatever their background, they have the opportunity to achieve their
full potential at Compass.
People
A caring, winning culture
People
Culture, vision and values
Our vision is to be a world-class provider of contract food and support
services, renowned for great people, great service and great results.
To realise this, our people embrace the five Compass values that
support our caring, winning culture:
Openness, Trust and Integrity
Passion for Quality
Win Through Teamwork
Responsibility
Can-do Safely
Our aim is to build a diverse and inclusive workforce at all levels drawn
from the communities we serve. We want to treat people fairly and
with respect, and give them opportunities to grow, develop and work
in a positive, supportive environment throughout their careers. We
recognise that everyday life can be challenging, and that is why we
offer a range of help and support to protect our people’s wellbeing,
including their physical, financial and mental health.
Engagement, inclusion and wellbeing
Compass is committed to actively engaging with the communities
where it operates and creating an inclusive culture of diverse talent by
empowering its people to ‘be the difference’. At the 2024 Be the
Difference conference in the USA, now in its fourth year, members of
the US business discussed the importance of fostering a culture of
belonging, making a difference through Diverse Talent and Inclusive
Culture initiatives, and an evolved talent strategy, which enables the
business to assess people’s potential and remove barriers to progress.
Among other achievements, the Women in Food network in the UK&I
business created a specially designed maternity uniform that provides
proper support and comfort to help pregnant and post-partum women
so they can thrive in the workplace. The Women in Food network also
supported a review of the Menopause Policy in the UK&I business.
This global community of female leaders and professionals, including
both culinary and non-culinary members from within Compass, was
formed to ensure we nurture our female talent.
We care about the physical and mental wellbeing
of our colleagues. Our people perform at their best
when they are feeling well, so we have a variety of
programmes and initiatives which support their
physical and mental health throughout their careers.
The UK&I’s You Matter network has built greater awareness of mental
health issues alongside wider training for mental health first aiders.
The launch of our Global Health and Wellbeing Forum is an example of
our commitment to bringing our unique expertise in health and
nutrition to our employees.
Deborah Lee
Group Chief People Officer
30 Strategic Report
Respect
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Delivering on our people agenda means
providing development and learning
opportunities that enable every
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31Compass Group PLC Annual Report 2024
People continued
Engagement survey
Listening to colleagues through employee engagement surveys,
townhalls, community meetings, social platforms, and
maintaining close relationships with formal employee
representative groups and unions are just some of the ways
employees can have their say on the topics that matter most to
them, and contribute to our strategy and success.
This year’s global engagement survey heard the voices of
colleagues across 31 countries. Overall engagement scores
held steady despite significantly higher participation levels from
countries where we have traditionally seen lower average
engagement. We were also pleased to see positive progress in
our employee net promoter score.
Our results pointed to the many positive aspects of our culture:
a strong commitment to safety; customer-focused and
teamwork-oriented; enjoyment of the work; and feeling
respected. However, it also highlighted where we can further
enrich the lives of our teams by improving their experience of
working at Compass and by enabling them to access career
opportunities.
32 Strategic Report
Compass offers a suite of training programmes across all aspects of its
front-line, support teams and administration functions. Our core
global programmes are Mapping for Action, which embeds processes
for unit managers, and Mapping for Value for management, which is
about delivering value for the business. Over the years, a network of
certified trainers have trained significant numbers of our people on
these programmes to reinforce and keep focus on our distinct
Management and Performance (MAP) framework.
By fostering a culture of continuous learning and growth, we can build
the skills and capabilities we need to succeed while also equipping our
people to adapt, innovate and excel in an ever-evolving landscape.
Pay equity
Equal work deserves equal pay and our aim is to make sure that
employees with the same job functions receive the same
compensation regardless of their gender, ethnicity or background. As
reported in the 2024 Compass Group UK Gender and Ethnic Minority
Pay Gap Report, the UK business has reduced its median gender pay
gap to under 10% for the first time. The 2024 report also confirmed
the business had a median ethnicity pay gap of zero. We are proud of
this progress, but we know there is more to do. In line with the Social
Promise launched in 2022, the business continues to look at where it
can remove barriers to further reduce the gender pay gap and
enhance the development of those from ethnic minority backgrounds.
Read Compass UK&I’s Gender and Ethnicity Minority Pay Gap Report:
https://www.compass-group.com/gender-ethnicity-pay-gap-report.pdf
2024 female representation
2024
1
2023
Board 43% 38%
Executive Committee
2
44% 40%
Senior leaders 35% 34%
All management 46% 46%
Total workforce 56% 56%
1. Figures stated as at 30 September 2024.
2. Due to a change in Executive Committee membership between
30September 2024 and the date of this Report, female representation on
theExecutive Committee has increased from 40% to 44%.
3. The gender breakdown disclosures required in the Strategic Report pursuant
to section 414C(8)(c) of the Companies Act 2006 are made on page 121
andare incorporated by reference into the Strategic Report.
Learning and development
From entry-level employees to leadership, Compass invests in its people to help them succeed. Around the world, Compass businesses run a wide
range of programmes that identify and nurture a diverse cohort of leaders from within their existing teams, helping our people to find valuable
training that meets their needs and that they can apply to their job.
Human rights
Everyone has the right to be treated fairly, and with dignity and
respect. Compass is committed to its businesses upholding human
rights in their operations, their supply chains, and the communities in
which they operate. Compass’ businesses conduct their business
activities ethically and with integrity, and our Code of Business
Conduct and Global Supplier Code of Conduct reflect our commitment
to respecting human rights and the values that guide our actions and
behaviours. We are also guided by our Human Rights Policy, which
was reviewed in September 2024, reinforcing our belief that everyone
is entitled to basic rights and freedoms, whoever they are and
wherever they live. For more information, see pages 39 and 40.
We remain firmly committed to playing our part in eradicating modern
slavery in all its forms, which remains a serious global issue that
affects vulnerable individuals and communities worldwide. As a
Group, we continue to work hard to identify and address modern
slavery risks across our businesses and their supply chains.
For more information, you can read our Modern Slavery Statement
and Human Rights Policy here: www.compass-group.com/en/
sustainability/people/human-rights-and-ethical-trade.html
The Compass Group Foundation
Our people contribute their time and expertise to support the
Compass Group Foundation, an independent charity registered with
the Charity Commission in England and Wales. The Foundation funds
initiatives that expand job opportunities for disadvantaged groups
through training and career development in the food service industry,
while also supporting small suppliers within the food sector.
Since 2022, the Foundation has provided approximately $2 million in
grant funding to support initiatives aligned to its priorities across
various countries where Compass’ businesses operate.
In 2024, the Foundation funded 21 initiatives across seven countries,
supporting efforts to help individuals, including people with
disabilities, women affected by domestic abuse, and survivors of
human trafficking, overcome employment barriers. These initiatives
also empower farmers and small businesses by improving access to
information and training, enabling them to become more sustainable
and enhance their economic opportunities in the food supply chain.
www.compass-group.com/en/compass-group-foundation.html
First-time/
Front-line leaders
Multi-unit leaders
Emerging leaders
Executive leaders
– RISE
– Global Gender Leadership Programme
– Mapping for Value
– 30% Club Mentoring Programmes
– Global Gender Leadership
Programme
– Impact Leadership
– Consumer-led Growth
– Europe and Middle
East Academy
– Go Fluent
– Mapping for Value
– 30% Club Mentoring Programmes
– Consumer-led Growth
– Mapping for Action
– Leadership Labs
– Go Fluent
– Leadership in Action
– Mapping for Action
– Leadership Labs
Leadership and
career development
33Compass Group PLC Annual Report 2024
Our Planet Promise
At Compass, we are building a sustainable future for all. We channel
our passion for food, champion responsible sourcing and reduce food
waste at scale to drive global change and enrich lives. Through
culinary innovation, collaboration and partnership, we are committed
to reaching climate net zero across our global business by 2050.
This is our Planet Promise.
There is no single solution – we work towards this objective by
constantly reviewing and improving our practices across the Group
to increase our impact and accelerate our journey towards our
sustainability goals.
Being an ethical, sustainable and inclusive business is
an essential part of our identity. By embedding these
values, we can make a real difference and have a
positive impact on the world. Our customers and
partners increasingly share these values, which are key
to our growth aspirations and long-term success.
Purpose
Striving to be an
ethical, sustainable
and inclusive business
One of the most important ways in which we have put these values
into action is by demonstrating our expertise in reducing our carbon
impact and food waste. These capabilities are helping to attract
and retain a growing number of clients who rely on Compass to offer
delicious, healthy, less wasteful plant-forward menus that help them
achieve their sustainability goals.
Our actions are guided by the United Nations Sustainable
Development Goals (UN SDGs), a shared blueprint for peace and
prosperity for people and the planet. To take the most effective action,
we have aligned our sustainability strategy with the nine UN SDGs
where we can have the greatest impact, such as a reduction in food
waste – an essential target for a food business of our reach and scale
and which is covered in detail on page 38. Our sustainability strategy
also prioritises care for the health and wellbeing of our people and
consumers, animal welfare and carbon reduction, as we work towards
climate net zero by 2050.
Compass UK&I has committed to achieving climate net zero by 2030.
It has set out how it plans to achieve this by reporting its progress and
results in its transition plan, which is aligned to the UK Government-
backed Final Disclosure Framework final guidance. This makes
Compass UK&I one of the first companies in its sector to share
a detailed transition plan aligned to this framework.
We also demonstrated our commitment to putting our Planet Promise
values into practice by carrying out a new materiality assessment in
2023. This helped us further understand how our actions impact the
planet and society as well as understanding potential financial risks
and opportunities related to a wide range of environmental, social and
governance (ESG) topics. The process enabled us to recognise the
impact we can have as an organisation, and the knowledge will be
used to further refine our strategies and ensure we focus our efforts
on the initiatives where we can have the greatest impact.
Data transparency is an integral part of our philosophy and our Task
Force on Climate-related Financial Disclosures (TCFD) report (see
pages 41 to 52) includes disclosure of our climate-related risks and
opportunities for 2024.
Embedding sustainability through training
We help build sustainability into our processes by providing training
for our people that makes sustainable behaviour part of everyday
practice.
Compass UK&I has incorporated a bespoke climate net zero training
module into its mandatory e-learning for front-line kitchen staff.
The module shows how their teams can reduce energy consumption,
waste and water usage, and prevent pollution. The training module
has been completed over 29,000 times in 2024 as part of Compass
UK&I’s comprehensive Climate Net Zero Toolkit. The module is
helping to integrate sustainability into day-to-day operational tasks
at a site level.
Celebrating our Planet Promise Change-Makers
Because sustainability is an essential part of our identity, our teams
are always working to drive improvements in sustainability across our
operations. We want to celebrate the Compass employees making
a real change for the better across the Group.
We call them our Planet Promise Change-Makers and we highlight
their achievements, both to give them the recognition they deserve
and to further develop sustainability across our organisation by
engaging and inspiring others to drive change.
Their work is also brought to the attention of the executive leadership
team in their region. Our Planet Promise Change-Makers are at the
forefront of delivery in support of our sustainability priorities, leading
on food waste reduction, creating delicious and innovative better-for-
the-planet menus, collaborating with suppliers and influencing the
behaviour of consumers.
Purpose
Shelley Roberts
Group Chief Commercial Officer
34 Strategic Report
Materiality assessment topics and actions
Environment
Climate change adaptation and mitigation Nature and biodiversity Waste
Taking action to reduce the Group’s
direct and indirect greenhouse gas
emissions (Scope 1, 2 & 3) and adapting
the supply chain to be resilient to the
effects of climate change.
Establishing policies, standards and
programmes to minimise the impact of
sourcing on natural ecosystems including
preventing deforestation, overfishing and
biodiversity loss.
Reducing food waste throughout our
value chain, from source to kitchen, and
reducing the amount of plastic packaging
used in operations and, where possible,
investing in sustainable alternatives.
Governance
Business ethics and integrity Bribery and corruption Cyber security, privacy and data security
Implementing the Code of Business
Conduct and other Group policies
(including the Business Integrity Policy
(BIP)), reinforced by Compass’ global
Ethics and Integrity (E&I) programme.
Upholding a strong culture of integrity,
promoted through the E&I programme
and its independently operated SpeakUp,
We’re Listening helpline and web
platform. Focusing on preventing,
detecting and responding to emerging
risks and incidents, and mandatory
training and awareness programmes.
Assessing cyber risk and monitoring and
managing the maturity of Compass’
enterprise infrastructure, platforms and
security controls. Ensuring appropriate
crisis management procedures are in
place and implementing principles-based
rules for the use of AI.
Social
Inclusive talent attraction and retention Health, safety and wellbeing Workers’ rights
Creating an environment in which our
people thrive and feel valued, building a
diverse, equitable and inclusive workforce
to reflect the communities in which our
businesses operate. This includes ensuring
fair working conditions and wages.
Fost