Vending

Aramark delivers strong Q3 2023 results, beats expectations

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August 8, 2023

Aramark Corp. delivered sales and earnings gains for Q2 2023 against the prior year period, driven in part by pricing action and new business growth, according to a press release.

Highlights include:

Sales rose 15% from $4.13 billion in Q3 2022 to $4.75 billion for Q3 2023, driven by net new business, pricing actions and base business growth. Revenue growth results included an incremental $47 million contribution from Union Supply Group, which was acquired in June 2022. A stronger dollar in the period also impacted revenue by $21 million.
Net income rose from $40.48 million to $338.55 million in the comparative quarters.
Basic EPS rose from 16 cents to $1.30 while diluted EPS rose from 16 cents to $1.29.
Adjusted EPS rose 48% to 36 cents.
Organic revenue, which adjusts for the effect of currency translation and certain acquisitions, grew 14% year-over-year compared to the prior year period.
U.S. food and facility service sales rose 15% from $2.48 billion to $4.89 billion, driven by the ongoing maturity of new business, supply chain purchasing normalization and initiatives and disciplined above-unit cost management across the entire segment.
International food and facility service sales rose 19% from $978 million to $1.16 billion, benefiting from scaling new business, leverage from higher base business volumes, improved supply chain economics and reduced above-unit costs from actions taken earlier in the fiscal year.

The company approved a quarterly dividend of 11 cents per share of common stock. The dividend will be payable on Aug. 29, 2023, to stockholders of record at the close of business on Aug. 16, 2023.

Shares traded today at $40.36 against a 52-week range of $30.72 to $45.72.

The $4.75 billion in quarterly revenue beat analyst expectations by $160 million and the non-GAAP EPS of 36 cents beat expectations by two cents, according to Seeking Alpha.

"Aramark's third quarter results reflect our continued focus on profitable growth across the organization," CEO John Zillmer said in the press release. "With signs of inflation moderating, and our pricing actions taking hold, we are increasingly confident in the ramp in profitability as we finish the fiscal year."