British catering and facilities services group, Compass Group, has reported an 18% increase in operating profit for the year ended 30 September 2017.
The company made a pre-tax gain of £1.6 billion for the last 12 months, up from £1.4b the year before, with overseas operations in North America and Europe credited with boosting sales.
Overall revenue across the company rose to £22.6b from £19.6 billion in 2016.
Operating profit in North America was up 6.9% with revenue growing from £11.1b to £13.3b thanks to new contract wins and a 96% retention rate across the region where the firm’s clients include Twitter and Google.
European revenue was up 1.5% but rest of the world sales, a division which includes China, Brazil and India, went backwards with a 2.5% decline at constant currency rates. Richard Cousins, group chief executive, said: “Compass had another strong year. North America continues to deliver excellent growth, we are continuing to make progress in Europe and in Rest of World, with trends in our commodity related business improving. “We continue to drive operating efficiencies around the business which, combined with the end of the restructuring in our Offshore and Remote business, resulted in margin improvement of 20bps [basis points] in the period.
“Given our excellent cash generation and the strength of the business, this year we returned £1.6b to shareholders via ordinary and special dividends and share buybacks. This reflects our commitment to return surplus cash to shareholders whilst maintaining an efficient balance sheet.
“Our expectations for FY2018 are positive, with growth and margin improvement weighted to the second half. The pipeline of new contracts is encouraging and our focus on organic growth, efficiencies and cash gives us confidence in achieving another year of progress.
“In the longer term, we remain excited about the significant structural growth opportunities globally and the potential for further revenue growth, margin improvement, as well as continued returns to shareholders.”
Cousins announced in September that he will be stepping down as Compass’s chief executive officer in March 2018 after 11 years in the role.