Sodexo: strong growth in net profit, mid-term objectives confirmed
At the Board of Directors meeting held on November 14, 2017 and chaired by Sophie Bellon, the Board closed the Consolidated and Company accounts.
Sodexo’s Chief Executive Officer Michel Landel presented the Group’s performance for the fiscal year ended August 31, 2017.
- Revenues up +2.2%, and organic growth of +1.9%
- On-site organic growth at +1.7%, or +1.6% excluding the offsetting factors of the Rugby World Cup (RWC) base effect and the 53rd week contribution in North America.
- Solid growth in Benefits & Rewards Services activity at +7.7%.
- An operating margin of 6.4%, up +40 basis points, excluding currency effect and before exceptional expenses
- Net profit +13.0% before non-recurring items and excluding currency effect.
- Proposed dividend of 2.75 euros representing an increase of +14.6%.
- Fiscal 2018 guidance of +2 to +4% revenue organic growth excluding the 53rd week impact and a flat underlying operating margin, at 6.5% new indicator defined in page 25.
- Medium-term objectives confirmed.
"In Fiscal 2017, Sodexo has delivered on its operating profit guidance, improving margins, generating cash and increasing the dividend, despite lower than expected growth in revenues."
"The Group has also significantly reinforced its investments in, sales development, digital transformation and external growth as demonstrated by the recent acquisition of Centerplate. We have doubled the size of our Sport & Leisure segment, and particularly in North America. External growth for Fiscal 2018 is accelerating, and should reach at minimum 2.5%, The trends in the Energy & Resources segment and France have reversed and developing economies are sustaining high single digit growth. However, net development in Europe and Education and Health Care in North America is not as high as expected.
The Adaptation and Simplification program is on track to deliver 220 million euro of annual savings in the current year. This will help finance investments to drive future growth.
We are continuing the implementation of our reorganization as expected. We are focused on improving the Quality of Life of those we serve and enhancing our clients’ performance. We are confident that for Fiscal 2018 we can aim for +2% to +4% organic revenue growth excluding the 53rd week impact and maintain the underlying operating profit margin."