Harry Ramsdens operator serves up new business

British catering giant Compass stuck by its growth targets for the financial year today after serving up £600m (€842.2m) of new business wins.

The group, which provides catering for companies, universities and hospitals and operates chains including Upper Crust, Caffe Ritazza and Harry Ramsden’s, wants a 6% rise in like-for-like turnover this year.

Compass hit the target during the six months to March 31 after winning new business worldwide and achieving a contract retention rate of 96%.

Among the £600m (€842.2m) of new deals in the first half, Compass struck a five-year contract with BAA worth £4m (€5.6m) in annual turnover to feed 5,000 construction workers at Heathrow’s Terminal 5 project.

Compass, which has a strong presence in UK airports and rail stations, saw group-wide turnover from continuing operations rise to £5.45bn (€7.65bn) in the six months period from £4.85bn (€6.8bn) a year earlier.

The figure in the UK was 10% higher at £1.21bn (€1.7bn) as strong new business gains in education offset the recent weakness in rail and air passenger numbers.

Group-wide operating profits rose to £327m (€459m) from £290m (€407m), while the UK performance was up 18% at £125m (€175m).

The figures do not include Little Chef and Travelodge after the two businesses were sold by Compass in February for a total of £712m (€999m).

Proceeds have been used to reduce borrowings and buy back up to £300m (€421m) worth of shares. And as previously pledged, Compass also sharply increased its interim dividend today, lifting the half-year payout 29% to 2.7p.