Compass plans further £500m share buyback

Kasmira Jefford
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COMPASS launched its third buy-back in two years yesterday as the world’s biggest catering company posted a nine per cent rise in full-year profits to £1.2bn.

The FTSE 100 company, which serves one million meals a day in over 50 countries, said it would return £500m to shareholders next year, taking the total returned to investors to £1.4bn in three years.

It also announced a 12.7 per cent increase in its dividend to 24p per share, sending shares higher in trading yesterday.

New contract wins in the US and emerging markets, particularly its deals with Ascension Health and Texas A&M University, helped to drive revenues up by 4.3 per cent to £17.6bn in the year to 30 September.

The company, which already caters to Silicon Valley technology giants such as Twitter and Google, said it has also signed a new contract with LinkedIn as well as the Massachusetts Institute of Technology and AEGON USA.

Compass also reported its highest ever operating margin of 7.1 per cent, helped by it closing businesses and exiting uncertain contracts across Europe.

“Economic conditions in Europe and Japan remain challenging but the actions we’ve taken have enabled us to manage these and improve profit and margins,” chief executive Richard Cousins said.

In Europe and Japan sales fell three per cent to £6bn but rose by eight per cent to £8.2bn in North America and by 10.2 per cent to £3.4bn in its business focused on fast growing and emerging markets.

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