Sodexo Q1 Fiscal 2024: strong organic revenue growth at +8.2%

Jan. 05, 2024
PR - Q1 Fiscal 2024 Revenues

High single digit Underlying growth in all zones
Full year Fiscal 2024 guidance maintained

Q1 Fiscal 2024 Revenues

Note 1: These numbers exclude any contribution from Pluxee which as a discontinued activity is consolidated only at the net profit level.

Note 2: The impact from Q4 2023 of the accounting change related to revenue recognition in a large Energy & Resources contract in Rest of the World is offset by the contribution of the Rugby World Cup in Europe. Underlying organic growth was +8.1% in Rest of the World and +7.6% in Europe.

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"First quarter growth has remained strong in all geographies, due to pricing, new contract ramp-ups and continued volume growth, particularly in Corporate services, Sports & Leisure and Education.

We have had a good start to the year in terms of activity and we are solidly on track with our strategic plan to be the world leader in sustainable food and valued experiences.

The Pluxee spin-off plan is progressing well, with the next step being the Capital Markets Day on January 10, ahead of the first quotation expected February 1, 2024."

Sophie BellonSodexo Chairwoman and CEO

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Highlights of the period

Sodexo (excluding Pluxee) first quarter Fiscal 2024 consolidated revenues reached 6.3 billion euros, up +3.1% year-on-year including a negative currency impact of -4.8%, a net contribution from acquisitions and disposals of -0.3% and organic revenue growth of +8.2%. The negative currency impact, resulting from the appreciation of the euro against most currencies from beginning of calendar year 2023, is expected to subside progressively over the fiscal year, assuming current rates going forward.
Organic growth has been positively impacted by the contribution from a successful Rugby World Cup and negatively impacted by the accounting changes on certain project works in Energy & Resources in the Rest of the World, offsetting each other. The effect of pricing is progressively reducing, to around +4.5% in the quarter. New business ramp-ups, cross-selling and ongoing volume growth continue to trend at close to +4%.
- Organic growth in the quarter was driven by Food services, up +10.0% organically, while FM services were up +4.7%.
- Net new development momentum remained solid year to date.
- All geographies had high single digit underlying organic growth.
In line with its ambition to be the world leader in sustainable food and valued experiences:
- Sodexo and Harris Interactive revealed the results of the first international sustainable food barometer. Outcomes are fully supporting Sodexo’s ambition as 75% of people surveyed have a positive perception of sustainable food, and 79% believe that adopting more sustainable behaviors is an urgent matter.
- Sodexo has organized the second edition of its Sustainable Chef Challenge. Our Chefs showcased their skills and passion to create healthy, delicious and low carbon meals (less than 0.9 kg CO2e). The winners were Chef Sharon McConnell (from Northern Ireland) with her Pistachio crusted celeriac steak and Vegan chocolate mousse with dates and nuts and Chef Ricardo Machado (from Brazil) with his Sautéed banana peel medallion with sweet potatoes and Banana and coconut mash.
- Sodexo has earned the leadership position in the 2023 Workplace Pride Global Benchmark for the 4th year in a row recognizing Sodexo's performance and commitment to high standards of LGBTQ+ inclusion.

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Outlook

First quarter 2024 activity was in line with expectations and the strategic plan. As a result, the Sodexo (excluding Pluxee) Fiscal 2024 and 2025 guidance is maintained:

Organic revenue growth should be between +6 and +8% per annum;
Underlying operating profit margin should continue to grow by +30-40bps per annum, at constant rates.

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Conference call

Sodexo will hold a conference call (in English) today at 9:00 a.m. (Paris time), 8:00 a.m. (London time) to comment on its Q1 Fiscal 2024 revenues.

Those who wish to connect:

From the UK: +44 121 281 8004, or
From France: +33 1 70 91 87 04, or
From the US: +1 718 705 8796,

Followed by the access code 07 26 13.

The live audio webcast will be available on www.sodexo.com

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Financial calendar

Fiscal 2024 First half Results: April 19, 2024
Fiscal 2024 Third quarter Revenues: July 2, 2024
Fiscal 2024 Full year Results: October 24, 2024
Fiscal 2024 Annual Shareholders' Meeting: December 17, 2024

These dates are indicative and may be subject to change without notice.

Regular updates are available in the calendar on our website www.sodexo.com

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