(Alliance News) - SSP Group PLC on Wednesday said it had cut annual losses, even as revenue continued to be negatively impacted by the pandemic.
The operator of travel food and beverage outlets such as Upper Crust reported a pretax loss of GBP411.2 million in the year that ended September 30, narrowed from GBP425.8 million the year prior.
Revenue dropped by 72% to GBP834.2 million from GBP1.43 billion, but operating costs were cut by 17% to GBP309.2 million from GBP363.9 million.
The company's free cash outflow was reduced to GBP58.1 million from GBP394.9 million, "reflecting the group's continued tight management" of operating costs and working capital over the year.
SSP blamed a revenue decline on the continued negative impact of the pandemic on trading. Tougher comparatives, due to five months of the prior year being pre-pandemic, were also blamed.
Nonetheless, the travel foods and beverage outlet operator noted that revenue trends over the summer and autumn steadily improved.
Revenue had averaged 66% of pre-Covid 2019 levels in the first nine weeks of the new financial year, it said. Currently, around 72% of the units in the company's estate are open.
SSP said it plans to open 200 new outlets that have already been secured and are forecasting to add a further 15% to revenue by 2024.
Furthermore, the company expects like-for-like revenue and earnings before interest, taxes, depreciation, and amortisation margins to return to pre-pandemic levels by 2024.
"Though still in the recovery phase, SSP has made strong progress, particularly during the second half of the year, when we delivered positive underlying earnings before interest, taxes, depreciation, and amortisation and strong free cash flow generation. The group has continued to re-open units in line with passenger demand, with 72% of units currently open, and has delivered revenues of 66% of 2019 levels in the first nine weeks of the new financial year," Deputy Chief Executive & Chief Financial Officer Jonathan Davies said.
He added: "Against the backdrop of volatility and disruption in the travel sector, we've maintained strong operational controls and disciplined management of operating costs and cash flow, as has been evident from the financial performance of the business."
Separately, SSP appointed Apurvi Sheth and Kelly Kuhn as non-executive directors of the company. The change will take effect from January 1, 2022.
Shares were up 1.2% at 236.00 pence each on Wednesday morning in London.
By Abby Amoakuh; abbyamoakuh@alliancenews.com
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SSP Group (SSPG)