The contract catering and foodservice group achieved robust revenue growth in its key North America market, with its European and Rest of the World segments also posting strong sales and profits
Compass Group provides food catering services across 35 countries | Photo credit: via Shutterstock
Compass Group has credited a record year of new business wins and strong client retention as driving strong full-year sales.
The UK-based contract catering and foodservice specialist achieved 19% revenue growth for the 12 months ended 30 September 2023 to reach £31.3bn ($39bn), while operating profit increased 30% to £2.1bn ($2.6bn).
Compass Group, which provides catering services to offices, universities and sports stadiums across 35 countries, said higher sales in its key markets was driven by £2.7bn ($3.3bn) of new business and a client retention rate of 96.5%.
North America contributed nearly 68% of total sales during the period, having increased 17% to £21.1bn ($26.3bn). Compass Group said sales were boosted by its $108m acquisition of US workplace coffee provider Parks Coffee in March 2023.
Compass Group’s European segment posted 21% sales growth to reach £7bn ($8.8bn), driven by strong performances in the UK, Germany and Turkey, while its Rest of the World division achieved 22% growth to £3.1bn ($3.9bn).
“2023 was a strong year for Compass. North America continued its long track record of excellent growth whilst Europe delivered a second year of net new growth in the 4-5% range. During the year, we continued to successfully capitalise on the dynamic outsourcing trends, resulting in another record year of new business wins and continued strong client retention. The business is in great shape operationally and financially and well positioned for a more focused growth phase,” said Dominic Blakemore, Group CEO, Compass Group.
Compass Group exited nine underperforming markets during the year, including five in Central and Eastern Europe, to focus on significant structural growth opportunities in core markets.
“We are confident that the focus on our core markets, the ongoing investment in our market-leading offer and our proven processes will support high single-digit organic revenue growth in 2024,” Blakemore added.