Half year results announcement for the six months ended 31 March 2021
|Underlying1 results||Statutory results|
|HY 2021||HY 2020||Change||HY 2021||HY 20202||Change|
|Earnings per share||9.6p||35.9p3||(73.3)%3||5.6p||36.7p||(84.7)%|
|Free cash flow||£359m||£186m||93.0%|
|Operating cash flow||£563m||£545m||3.3%|
1. Reconciliation of statutory to underlying results can be found on pages 32 to 34.
2. Prior period comparatives have been restated as required by IFRS 5 'Non-current assets held for sale and discontinued operations' to account for joint ventures and associates using the equity method retrospectively when they cease to be classified as held for sale. Additional information is included in note 10.
3. Measured on a constant currency basis.
4. Organic revenue growth.
Margin recovery continues; looking ahead with confidence
Strategy – positioning for the future
1. Annual revenues of new business wins compared with 2019.
Dominic Blakemore, Group Chief Executive, said:
“During the first half of this financial year, by controlling the controllable, we delivered continued margin progression, strong cashflow and excellent client retention. This was despite further lockdowns and limited volume recovery.
With the gathering pace of vaccination rollouts across our major markets, we are working closely with our clients to prepare to reopen their sites safely, although the picture across the world remains mixed. Whilst we expect any revenue recovery to be gradual, we remain confident in our ability to return to a Group underlying margin above 7% before we return to pre COVID volumes.
Over the last six months, the “flight to trust” continued as clients sought quality partners with health and safety expertise, supply chain resilience, and financial stability. As a result, new business wins have increased due to the acceleration of first time outsourcing, which now accounts for about half of our growth. We remain committed to supporting future growth by investing in attractive opportunities to enhance our competitive advantages and further consolidate our position as the industry leader in food services.
Throughout the pandemic, we continued to develop our digital culinary platforms. These concepts complement the traditional on-site restaurant and now provide us with a variety of solutions from which to create a truly bespoke client offer. Along with digital innovation, COVID has also heightened client focus on diversity and inclusion and decarbonisation initiatives, reflecting and reinforcing our own strategic framework of People, Performance and Purpose. In the past week our UK and Ireland region has announced its commitment to be Net Zero by 2030, while today we are also announcing that the Board has decided to repay the funds our employees benefited from in the half year under the UK Government’s Coronavirus Job Retention Scheme.
We are now a stronger, more agile business with new client propositions, improved digital capability and a more flexible cost structure. These factors, underpinned by a robust balance sheet, have created a strong platform from which the business will continue to recover and grow. In the longer term, we remain excited about the significant structural growth opportunities globally, the potential for further revenue and profit growth and shareholder returns over time.”
Results presentation today
A recording of the results presentation for investors and analysts will be available on the Company’s website today, Wednesday 12 May 2021, at 7.00 am. There will be a question and answer session at 8.00 am, accessible via the Company’s website, www.compass-group.com, and you will be able to participate by dialing:
UK Toll Number: +44 330 336 9105
UK Toll-Free Number: 0800 358 6377
US Toll Number: +1 323 794 2093
US Toll-Free Number: +1 866 548 4713
Participant PIN Code: 3024541
Please connect to the call at least 10-15 minutes prior to the start time.
Agatha Donnelly & Helen Javanshiri
+44 1932 573 000
Tim Danaher & Fiona Micallef-Eynaud, Brunswick
+44 2074 045 959