SSP Group continues to struggle with diminished footfall at travel hubs worldwide as annual revenues fall significantly – but the company says it remains on track to recover to pre-pandemic levels by 2024
Increased European air passenger numbers and returning commuters boosted SSP Group in the second half of 2021 | Photo credit: via Shutterstock
Reporting its full-year results to 30 September 2021, SSP Group said revenues were £834.2m ($1.1bn), down 41.8% on 2020 levels and 70.1% versus 2019.
Operating losses were £309.2m compared to £363.9m in 2020, the owner of the Upper Crust and Caffè Ritazza brands added.
Despite sustained challenging trading at travel hubs worldwide, SSP highlighted a ‘steadily improving’ revenue trend, with first half revenues recovering from 21% of 2019 levels to 53% of 2019 levels in the second half of 2021. This was led by a recovery in domestic and short-haul leisure traffic, the company added.
Returning demand across its portfolio had also enabled the concession operator to reopen a further 800 units since the beginning of June 2021, with around 1,950 stores, or 72% of its global store count, now open for business.
SSP said it was now in a strong position to benefit from an expected recovery of the travel market over the medium-term. In particular, the company highlighted higher air passenger numbers in the UK and Continental Europe driven an extended summer holiday period and increased rail commuter traffic as many workers returned to offices.
“Though still in the recovery phase, SSP has made strong progress, particularly during the second half of the year, when we delivered positive underlying EBITDA and strong free cash flow generation,” said Jonathan Davies, Deputy CEO and CFO of SSP Group.
“Over the past year, we’ve continued to re-invest in and strengthen important areas of the business which we believe will underpin our long-term growth, including our customer offer, our people strategy and our technology platforms, and we’ve made real progress in further embedding sustainability into our business,” Davies added.
Looking to the year ahead, SSP said it had a growing pipeline of new business comprising approximately 200 new units, which are expected to add a 15% to revenues by 2024.
The company also highlighted new travel hub business partnerships around the world, including a recently announced joint venture with ADP
for Paris Charles De Gaulle and Orly Airports in France and Suvarnabhumi Airport
‘Whilst there remains some uncertainty in the immediate outlook over the winter months, particularly over the potential impact of the Omicron variant on travel restrictions, we are confident in our ability to manage any near-term volatility. Our medium-term expectations remain unchanged, which are for a return to like for like revenue at broadly similar levels to 2019 by 2024’, the company wrote.
In November 2021, SSP Group announced
it had appointed former Greencore CEO Patrick Coveney to lead the group from March 2022 after outgoing SSP CEO Simon Smith announced he would be stepping down in July 2021.
SSP Group operates around 2,800 food and beverage outlets at 300 railway stations and 180 airports in 36 countries. It runs its own café brands, such as Caffè Ritazza, Upper Crust and Camden Food Co., in addition to licensed brands including Starbucks, Pret A Manger, and Burger King.