UK: Compass bucks sluggish foodservice trend

Compass, fast-growing UK foodservice company, remains staunchly optimistic and says it is confident of “slow growth” over the next 12 months. Owner of a number of high-street foodservice formats including Little Chef, Moto, Harry Ramsden’s and Upper Crust, Compass’ sector outlook contrasted favourably with last week’s profits warning issued by French rival Sodexho.

May 22, 2002

Compass, fast-growing UK foodservice company, remains staunchly optimistic and says it is confident of “slow growth” over the next 12 months.

Owner of a number of high-street foodservice formats including Little Chef, Moto, Harry Ramsden’s and Upper Crust, Compass’ sector outlook contrasted favourably with last week’s profits warning issued by French rival Sodexho.

Francis Mackay, chairman of Compass, said the US economy had “plateaued”, while the UK was steady and the rest of European would evidence just slow growth. However, the group remains confident about the second half.

Compass reported underlying sales up 7% for the six months to 31 March, well within the target range of 6-9%. Pre-tax profits were ahead of market forecasts at £258m (2001: £234m), while turnover rose 23% to £5bn.

CEO Michael Bailey denied the group had any interest in bidding for catering group Brake Brothers or Diageo’s Burger King, as neither deal would make strategic sense. In fact, Bailey said future acquisition activity was expected to be negligible.