(Alliance News) - Contract caterer Compass on Tuesday said it booked record new business wins and client retention in financial 2021 but still saw revenue drop in the year as a whole.
In the 12 months that ended September 30, revenue was down 10% to GBP17.91 billion from GBP19.94 billion the year before.
Compass, which was badly hurt by pandemic-related restrictions on activity, noted its underlying revenue recovered to 88% of 2019 revenue by the fourth quarter. Full-year underlying revenue was 77% of financial 2019's.
"Whilst we have made progress recovering revenue in the second half, driven by strong net new business, the pandemic continued to affect performance for the year. Our Healthcare & Senior Living and Defence, Offshore & Remote sectors performed well above pre-pandemic revenues, and we experienced a strong recovery in Education and Sports & Leisure in the fourth quarter. Revenues in our Business & Industry sector have remained subdued due to the delayed return to offices in our major markets," Compass explained.
Pretax profit doubled to GBP464 million from GBP210 million. Operating profit jumped 85% to GBP545 million from GBP294 million.
Compass reinstated its dividend, declaring an annual payout of 14 pence per share.
Looking ahead, Compass expects financial 2022 organic revenue growth of between 20% and 25%.
Compass shares were down 1.6% early Tuesday.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 0.4% at 7,226.99
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Hang Seng: down 1.1% at 24,684.21
Tokyo market closed for Labour Thanksgiving Day
S&P/ASX 200: closed up 0.8% at 7,410.60
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DJIA: closed 7.27 points higher at 35,619.25
S&P 500: closed down 0.3% at 4,682.94
Nasdaq Composite: closed down 1.3% at 15,854.76
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EUR: down at USD1.1253 (USD1.1263)
GBP: down at USD1.3400 (USD1.3412)
USD: flat at JPY114.71 (JPY114.74)
Gold: down at USD1,807.20 per ounce (USD1,818.94)
Oil (Brent): down at USD79.20 a barrel (USD79.86)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Tuesday's key economic events still to come
Japan Labour Thanksgiving Day. Financial markets closed.
0930 CET Germany flash purchasing managers' index
1000 CET EU flash PMI
0930 GMT UK CIPS-Markit flash manufacturing and services PMI
0945 EST US flash manufacturing PMI
0945 EST US flash services PMI
1630 EST US API weekly statistical bulletin
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UK Prime Minister Boris Johnson had his Commons majority slashed as a significant number of Tory MPs rebelled to vote against a change to social care reforms amid anger over how it will hit poorer pensioners. Johnson narrowly succeeded in getting members of Parliament to back his new policy to cap care costs in England on Monday evening, which senior Tories declined to back amid criticism the plans were being watered down. Ministers were unable to say whether the change to the GBP86,000 cap on care costs would fulfil an election pledge to guarantee no-one would have to sell their home to pay for care. And backbench Tory critics joined experts and Labour MPs in warning the move to count only individual payments towards the cap, and not local authority contributions, would cost poorer recipients more in assets than the wealthy. The government worked to see off a potential defeat in the Commons on Monday evening and MPs backed the amendment 272 votes to 246, a majority of 26.
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The US is imposing additional sanctions in connection with Nord Stream 2, the controversial German-Russian natural gas pipeline project, the State Department said Monday. A State Department report submitted to the US Congress lists two vessels and one Russia-linked entity, Transadria Ltd, involved in the Nord Stream 2 pipeline. Transadria will be sanctioned under Protecting Europe's Energy Security Act, and its vessel, the Marlin, will be identified as blocked property, US Secretary of State Antony Blinken said in a statement. With Monday's action, the Biden administration has now sanctioned eight people and identified 17 of their vessels as blocked property in connection with the pipeline project.
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BROKER RATING CHANGES
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BERENBERG RAISES BARRATT DEVELOPMENTS TO 'BUY' (HOLD) - PRICE TARGET 810 (850) PENCE
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JPMORGAN RESUMES MEGGITT WITH 'NEUTRAL' - TARGET 800 PENCE
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SOCGEN CUTS HAMMERSON TO 'SELL' (HOLD) - PRICE TARGET 2,750 (3,800) PENCE
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COMPANIES - FTSE 100
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Water utility Severn Trent saw profit grow in the first half of its financial year, attributed to improved efficiency while meeting its customer outcome delivery incentives. "We've made another strong start to the year as we focus on delivering for stakeholders across our region and delivering for customers in the areas that matter most to them, all while driving the financial performance of our business," Chief Executive Liv Garfield said. In the six months that ended September 30, pretax profit increased to GBP146.9 million from GBP126.5 million. Revenue rose to GBP958.2 million from GBP887.6 million. Regulated Water & Waste Water revenue was up to GBP893.9 million from GBP829.9 million. Severn upped its interim dividend by 5.7%, increasing the payout to 40.86 pence from 40.63p a year before.
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Building materials firm CRH reported an 11% annual rise in sales in the nine months that ended September 30 to USD22.8 billion. Earnings before interest, tax, depreciation and amortisation was USD3.9 billion, up 15%, with an Ebitda margin of 17.1%, up 50 basis points. The Dublin-based company said it expects to book full-year Ebitda in excess of USD5.25 billion, well ahead of 2020. CRH said it share buyback programme continues, with USD800 million completed so far in 2021.
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COMPANIES - FTSE 250
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Pet products seller Pets at Home attributed its growth in the first half of its financial year to sustained growth in new pets. In the 28 weeks to October 7, pretax profit nearly doubled to GBP70.6 million from GBP38.9 million a year before. Revenue improved by 18% to GBP677.6 million from GBP574.4 million. Total customer revenue, which includes joint ventures, rose 20% to GBP867.6 million from GBP724.7 million. Retail like-for-like revenue growth was 22%, while Vet Group like-for-like revenue growth was 26%. "Strong growth in pet ownership continues, reflected in the elevated level of customer registrations across our Puppy and Kitten club, and the performance across our retail and veterinary operations continues to be robust, notwithstanding some widely reported challenges in the near-term operating environment relating to supply, logistics and labour availability," Pets at Home said. The pet supplies retailer is guiding for annual underlying pretax profit to be at the top end of the current range of analyst expectations of GBP128 million to GBP135 million.
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Online electricals retailer AO World is feeling the squeeze from supply chain blockages. In the six months to September 30, AO swung to a pretax loss of GBP10 million from a GBP18 million profit a year before. Total revenue increased 6.0% to GBP760 million from GBP717 million. AO World said its revenue growth was stunted by the nationwide shortage of delivery drivers in the UK and the ongoing disruption in the global supply chain. What's more, the German online market has seen significantly increased competition. The company said it has hired about 500 new drivers recruited to meet peak period demand. "As we now look to the second half, we continue to see meaningful supply chain challenges with poor availability in certain categories, particularly in our newer products where we have less scale, experience and leverage. In addition, shipping costs, material input prices and consumer price inflation remain challenging uncertainties," AO said. AO is now guiding for annual revenue to be flat to minus 5% compared to the year before.
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COMPANIES - MAIN MARKET AND AIM
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Premier Miton confirmed it has made an approach for fellow asset manager River & Mercantile. No bid has been made yet, but Premier Miton noted any deal would be made through the issue of shares. "Any combination with River & Mercantile would be conditional on the successful completion of the proposed sale of its Solutions business to Schroders and the subsequent distribution of the net cash proceeds to River & Mercantile's shareholders," Premier Miton added. River & Mercantile confirmed the approach and a similar one from AssetCo, which is chaired by Martin Gilbert, the co-founder of Aberdeen Asset Management.
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COMPANIES - GLOBAL
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Air Canada has agreed to pay a USD4.5 million settlement with the US government over delays in reimbursing passengers for flights cancelled or changed during the Covid-19 pandemic, American officials said Monday. The agreement, still pending legal approval, shows that transport authorities are "holding airlines accountable by ensuring that they treat passengers fairly", the US Department of Transportation said in a statement. Of the USD4.5 million agreed upon, USD2.5 million will be used to refund passengers who purchased a non-refundable ticket for a flight to or from the US that they then decided not to take. The remaining USD2 million would be paid to the US Treasury. The deal marked the agency's aviation protection division's highest settlement amount with an airline.
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Tuesday's shareholder meetings
JKX Oil & Gas PLC - EGM re delisting
JPMorgan UK Smaller Cos Investment Trust PLC - AGM
Orient Telecoms PLC - AGM
Physiomics PLC - AGM
PZ Cussons PLC - AGM
Scancell Holdings PLC - AGM
Transense Technologies PLC - AGM
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By Tom Waite; thomaslwaite@alliancenews.com
Copyright 2021 Alliance News Limited. All Rights Reserved.
Barratt Developments (BDEV)
CRH (CRH)
Hammerson (HMSO)
Compass Group (CPG)