SSP Group, the leading operator of food and beverage outlets in travel locations worldwide, has announced trading for the first quarter of its financial year ending 30 September 2015, covering the period from 1 October 2014 to 31 December 2014.
Douglas Jack of Numis commented:
“In Q1, LFL sales rose 2.7%, slightly below the c.3.3% rate that the company generated throughout 2014. In our view, the importance of LFL sales is dwarfed by the company’s opportunity to grow margins materially from the current low base. Although the valuation is high, so too is the growth and upgrade potential.”
Trading in the first quarter of the 2015 financial year
The Group’s overall trading in the first quarter has been in line with expectations.
On a constant currency basis, total Group revenues for the period from 1 October 2014 to 31 December 2014 increased by 2.9%, with like-for-like sales growth of 2.7%, compared with the same period last year. At actual currency rates, given the strengthening of Sterling compared with the prior year, total Group revenues decreased by 0.1% year-on-year.
Like-for-like sales growth benefited from strong performances in the U.K., North America, the Middle East and Asia Pacific, although, as expected, trading has remained challenging in some parts of Continental Europe, notably France and Germany. In terms of new business, good progress is being made in developing the pipeline, and SSP continues to expect a stronger net contract gains performance in the second half of this financial year.
Outlook
The outlook for the Group remains unchanged from that given in the full year 2014 results on 27 November 2014. Whilst a degree of uncertainty continues to exist around passenger numbers in the short-term, the Group remains well positioned to capitalise on the underlying positive trends in its markets.