Compass Group (LSE: CPG) — the multinational foodservice and support services organisation — issued its first interim management statement for 2014 this morning, ahead of its Annual General Meeting, which is being held at noon today.
The company reports that it’s had a a good start to its new financial year, with organic revenue growth of 4% (on a constant currency basis), “good levels” of new business, a “stable” retention rate and “positive” like-for-like revenue.
Looking geographically, Compass says that the underlying trends in its three operating regions were consistent with H2 of 2013. Good levels of new business across all sectors and a high retention rate were reported by its North American operation.
But the company does, however, note that the economic conditions in Europe & Japan continue to be “difficult”, and that, despite some signs of stabilisation, overall organic revenue in those regions in the first quarter has remained negative.
Compass also says that its company-wide cost-reduction plans are “progressing well”, with its current focus on implementing a “management and performance” programme helping it to deliver further operating efficiencies, whilst also driving both new business and retention. Compass says that the efficiencies gained underpin its expectation of delivering improvements in its operating margin.
At the end of today’s AGM, and announced at last year’s AGM, Sir Roy Gardner will retire as chairman and a director of Compass. Paul Walsh — appointed as a non-exec in June 2013 — will assume the role of non-executive chairman.
The past year has seen Compass’s share price surge ahead of the FTSE 100, gaining almost 18%, compared to the index’s meagre 3.3%. The comparison over five years also favours Compass, with the company’s share price growing by 154%, comfortably besting the FTSE 100’s 51%.
Jon doesn't own shares in Compass Group.