July 9 (Bloomberg) -- Sodexo fell the most in more than a year in Paris trading after the world’s second-largest catering company cut its 2014 revenue forecast because of delayed starts to some major contracts.
The stock slid as much as 3.7 percent to 75.99 euros, the steepest intraday drop since May 23, 2013.
Sales will increase 2.2 percent to 2.5 percent on an organic basis in the year through August, down from an earlier forecast of 2.5 percent to 3 percent, Issy-les-Moulineaux, France-based Sodexo said today in a statement.
The reduced forecast came as the company reported nine-month revenue growth that missed analysts’ estimates. All regions other than the U.K. were softer than estimated, analysts at Barclays Plc said in a note.
Among contract delays were “certain new integrated multisite services contracts in North America,” Sodexo said in the statement. Work arranged with nursing home provider HCR ManorCare Inc. was among items delayed, it said.
Revenue from services to schools declined 3.1 percent in Europe in the first nine months after Sodexo canceled contracts in several countries, including Italy, to reduce costs.
Nine-month revenue reached 13.8 billion euros ($18.8 billion), the French company said, trailing the 13.9 billion-euro median of nine analysts’ estimates. So-called organic growth was 2.3 percent, compared with the 2.6 percent median estimate of 11 analysts compiled by Bloomberg.
Sodexo reiterated its forecast for 11 percent growth in full-year adjusted operating profit, with an operating margin of 5.6 percent.
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