Vending

Compass Group expects 19% revenue dip for the year

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September 30, 2020

Compass Group PLC, which owns Compass Group North America and Canteen Vending Services, reported Wednesday it expects revenues for the year ending today to fall 19% from last year, according to a Reuters report.

Shares fell 40% this year and were down 4.5% today after the company reported a 36% preliminary fall in fourth-quarter revenue, according to the report. Shares closed at 15.21 pounds ($19.62) on Sept. 29.

Analysts expected operating profit for the year ending today to fall by nearly 70% to 597 million pounds ($769.15 million), according to Refinitiv Eikon data, compared to 1.89 billion pounds ($2.44 billion) for 2019.

Organic revenue in the fourth quarter improved as clients in the business and industry and education sectors returned to normal activity, the company said in a press release. The 36% fourth quarter decline compared favorably to the 44% decline in the third quarter.

North American sales improved in the fourth quarter as the education sector reopened and business and industry began to recover. Healthcare remained strong while health and leisure remained closed.

Improvement was reported for Europe and the Middle East for healthcare, education and business and industry.

The company said it was pleased with its progress in the quarter and is now at breakeven at a trading level. The pace of revenue and margin recovery remains unclear, however, due to the possible increase in lockdowns in the northern hemisphere through the winter.

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