AGM Statement
Compass Group PLC
16 February 2004
16th February 2004
Compass Group PLC
Chairman's AGM Statement
Compass Group holds its AGM today at the Queen Elizabeth II Centre, London at
11.00am. At this meeting Sir Francis Mackay, Chairman of Compass Group PLC, will
provide shareholders with the following update:
'2003 was another challenging year in most markets around the world. However,
with Compass Group's geographic and sector diversity, the rapid and effective
response of our management teams, and our continued focus on client retention,
we are pleased to report that we have delivered on our goals. On continuing
activities, excluding goodwill amortisation and exceptional items, the Group
achieved turnover of £11.2 billion, an increase of 9%, or 6% on a like-for-like
basis; operating profit of £781 million, an increase of 11%; basic earnings per
share of 20.6 pence, an increase of 13%; and a 30 basis points improvement in
the like-for-like margin. We also achieved a 20% increase in free cash flow
generation, to £405 million and declared a dividend per share of 8.4p, up 18% in
the full year and 47% over the last two years.'
Current Trading
'2004 has started well and trading in the first four months of the current
financial year has been in line with expectations.'
Business Development
'The strong growth in new business in 2003 has continued in 2004 in all sectors
and geographies. The trends that we reported on at the Preliminary results in
December 2003 have remained broadly unchanged, with the ongoing outsourcing in
Healthcare and Education and increased activity in the Defence, Offshore and
Remote Site sector driving new business wins.'
'Today, we are announcing a number of significant contract wins and renewals
across the business. In North America, New York's Strathmore museum awarded
Restaurant Associates a new contract for ten years with annual turnover of £3
million. In France, the Public Hospital System of Marseille (APHM) awarded
Medirest a new contract for three years with annual turnover of £6 million.
Elsewhere in France, Les Chantiers de l'Atlantique awarded Eurest a new
five-year contract with annual turnover of £3 million. In Italy, the Ministry of
Defence has awarded Onama a new contract for three years with annual turnover of
£7 million.'
'In the UK, Nottinghamshire Healthcare NHS Trust extended its contract with
Medirest for a further three years with annual turnover of £3 million.
Additionally, National Grid Transco awarded Eurest a new three contract with
annual turnover of £3 million.'
'In Chile, the Administration of Corrections, San Juan has awarded Compass Group
a twenty-year contract with annual turnover of over £6 million. In addition, ESS
Support Services Worldwide has been awarded two contracts with the United
Nations. These two contracts have a combined annual turnover of £14 million.'
'Our two most significant recent acquisitions, Seiyo Foods in Japan and Onama in
Italy, are both delivering good results. Furthermore, in Italy, we are
continuing to develop our roadside business and we have recently been awarded
contracts to operate seven motorway service areas, bringing the total we will
operate in Italy to nineteen.'
Contract Retention and Throughput
'Strong new business growth has been accompanied by a continuation of our high
contract retention rate of 95%.'
'Throughput for the Group has remained broadly in line with that reported in
December 2003. Although we continue to see some signs of economic recovery in
certain geographies, it is too early to confirm this as a trend.'
Outlook
'The strong start to the year gives us confidence in re-iterating our full year
targets for 2004. We are well on track to securing the new business we need to
deliver at least 6% like-for-like turnover growth and the new business pipeline
remains encouraging.'
'We are continuing to benefit from our investment in the infrastructure needed
to extract cost savings from our operations. This, combined with margin
improvement in our most recently acquired businesses gives us confidence that we
are on track to deliver a 20 to 30 basis point improvement in like-for-like
margin, strong free cash flow and improving return on capital employed in 2004.'
Non Executive Directors
'Denis Cassidy is up for re-election today for a term of only one year due to
him having reached 70 years of age. Denis has been a marvellous contributor to
the success of the Group and I have no hesitation in recommending his
re-election. However, regrettably, he has indicated that he will not be seeking
re-election at the next AGM.'
ENDS
Enquiries:
Sarah Ellis Compass Group PLC 01932 573000
Timothy Grey / Pamela Small Brunswick 020 7404 5959
Note to Editors
Compass Group is the world's largest foodservice company with annual foodservice
revenues in excess of £11bn. Compass Group has over 400,000 employees working in
more than 90 countries around the world providing foodservice and vending. For
more information visit www.compass-group.com
This information is provided by RNS
The company news service from the London Stock Exchange
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