Compass Group has delivered a strong improvement in margins as chief executive Richard Cousins continues his work to refocus the giant on its core catering and service business.
In its interim results announcement today, Compass said operating margin had jumped 70 basis points in the six months ended 31 March to 5.1% as management continued to switch their attentions from growth through acquisitions to organic growth and retaining existing contracts.
Cousins said: “This positive trend is being achieved due to the underlying quality of the business combined with the introduction of a more transparent and intense management approach.”
He added that the company continued to be more selective about the new business it took on and more disciplined in its investment of capital.
Coupled with more focus on driving like-for-like revenue growth and more emphasis on cost management and cash control, this has delivered encouraging results,” Cousins said.
Operating profit in the half year jumped 14% to £267m (2006: £234m), while turnover was slightly down at £5.19b (2006: £5.28b).
At the weekend Compass announced the sale of its Selecta vending business for £772m.
Compass Group results ahead of expectations >>
Compass Group appoints specialist to strengthen its corporate governance procedures >> By Chris Druce
E-mail your comments to Chris Druce here.
| | Newswire
For the latest hospitality news, sign up for our e-mail news alerts. | |