Vending

Aramark improves sales, earnings for Q4 2021, nearing pre-COVID levels

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November 16, 2021

Aramark Corp. improved its revenue and earnings for the fourth quarter of 2021, with organic revenue reaching 87% of pre-COVID levels, according to an earnings release.

Consolidated revenue rose 32% from $2.69 billion in Q4 2020 to $3.55 billion in the quarter ending Oct. 1, 2021.

Organic revenue, which adjusts for the effect of currency, the Next Level Hospitality acquisition and the 53rd week of operations in the prior year, improved 37% year-over-year.

An accelerated pace of new client wins, combined with improving business reopening activity and pricing pass-through, resulted in revenue at 90% and organic revenue at 87% of pre-COVID levels, led by the facilities services U.S. segment.

Fourth quarter fiscal 2021 GAAP results improved across all metrics compared to the prior year as the business continued to recover from the impact of COVID-19. On a GAAP basis, revenue was $3.55 billion, operating income was $132 million, net income attributable to Aramark stockholders was $35 million, diluted earnings per share was 14 cents and adjusted EPS was 21 cents. These results included the contribution from the Next Level Hospitality acquisition that occurred in June 2021.

Comparatively, fourth quarter 2020 revenue was $2.7 billion, operating loss was $94 million, net loss attributable to Aramark stockholders was $149 million, diluted loss per share was 59 cents and adjusted loss per share was 35 cents.

Facilities services international grew organic revenue 21% year-over-year driven by stronger performance in Canada and Europe. Sports and entertainment, higher education and white-collar business and industry reported improved business activity with the pace of re-openings behind the U.S.

The $3.55 billion in quarterly revenue beat analyst expectations by $26 million while the non-GAAP EPS of 21 cents beat expectations by 2 cents and the GAAP EPS of 14 cents beat expectations by 3 cents, according to Seeking Alpha.

Shares traded at $37.38 today against a 52-week range of $31.22-$43.12.

"Our fourth quarter and full year results reflected the progress we have made across our business as organic revenue reached 87% of pre-COVID levels," CEO John Zillmer said in the press release. "The company achieved record net new business performance across lines of business, geographies, and client size — demonstrating the execution of our strategic growth initiatives, which we are confident will position Aramark to drive higher sustainable growth and create meaningful value for our stakeholders."

In fiscal 2022, the company expects organic growth between 23% and 27%, with revenue expected to approach pre-COVID levels by year-end. Revenue outlook reflects a continued impact from COVID-19 in fiscal 2022 of approximately $1.6 billion to $1.9 billion, or approximately 10% to 12% of pre-COVID revenue, partially offset by net new business and pricing.

For an update on how the coronavirus pandemic is affecting convenience services, click here.