Sodexo Nine-Month Sales Rise, Boosted by Facilities ManagementClementine Fletcher
Sodexo, the world’s second-biggest catering firm, said nine-month revenue rose as demand for facilities management services offset slower growth in health care and education services.
Revenue climbed 2.3 percent excluding the effect of currency fluctuations and acquisitions in the nine months through May, the French company said today in a statement. That compares with the median 2.2 percent growth estimate of nine analysts surveyed by Bloomberg News.
First-half sales rose 2.1 percent on the same basis, it said in April, missing estimates as lackluster demand in Europe weighed on growth. Nine-month total revenue rose to 14.2 billion euros ($18.1 billion) from 13.7 billion euros a year earlier.
Growth “remained satisfactory in a challenging global environment,” Chief Executive Officer Michel Landel said in the statement, saying its services are “well aligned with the needs of our clients, who are looking for an extensive range of services for their facilities around the world.” The company also sees “strong growth potential” from emerging markets.
Sodexo is cutting costs across Europe and restructuring operations to drive profitability, and is expanding further into facilities management, including contracts to look after sites from oil rigs to hospitals. The Issy-les-Molineaux-based company predicts “stable” earnings before interest and taxes this year, it reiterated today, and expects annual revenue on an organic basis to increase 1 percent to 2 percent.
It aims for a consolidated operating margin of 6.3 percent by the end of the 2015 fiscal year.