SSP shares up as annual sales expected to be slightly ahead of guidance

(Alliance News) - SSP Group PLC on Tuesday said it expects annual sales and profit to be ahead of guidance, as business for its travel food and beverage outlets get closer to pre-virus levels.

Shares were up 3.6% at 219.40 pence each on Tuesday morning in London.

The owner of the Upper Crust, Camden Food Co and Ritazza chains said it expects sales of GBP2.17 billion for the year ending on September 30.

Pre-IFRS 16 earnings before interest, tax, depreciation and amortisation is expected to be about GBP140 million.

Both will be "slightly ahead of our previous full-year guidance", SSP noted.

Revenue will be nearly tripled from the GBP834.2 million recorded in the Covid-19 hit prior year, when SSP had suffered an underlying operating loss of of GBP209.0 million.

In the fourth quarter of the current year alone, revenue is expected be at roughly 91% of its 2019 level, driven by a "continued recovery of passenger numbers, notwithstanding some disruption to the travel sector over the summer", SSP explained.

It added that the recovery is being led by domestic and leisure travel across both the Air and Rail sectors, with business and commuter travel also recovering, "albeit more slowly".

Chief Executive Officer Patrick Coveney said: "Passenger numbers are rebounding across the global travel sector and - thanks to the commitment and hard work of our colleagues and support from our clients and brand partners - our trading has now recovered to near 2019 levels. As we look forward in this challenging macroeconomic environment, we remain confident in the ongoing resilience of the group's business model and continue to see significant potential for both near and long-term growth."

Looking ahead, SSP said its medium-term expectations for the recovery remain unchanged, which are for a return to broadly pre Covid-19 levels of like-for-like revenue and Ebitda by 2024.

It also anticipates capital expenditure to be broadly in line with its previous guidance of GBP150 million, increasing to about GBP200 million to GBP250 million in 2023, reflecting the accelerated mobilisation of the new business pipeline.

Full-year results are expected to be published on December 6.

By Xindi Wei; xindiwei@alliancenews.com

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