6 February 2025
If you are covering Compass’ latest financial results, please find below a comment from Mamta Valechha, consumer discretionary analyst at Quilter Cheviot:
“Compass delivered a strong set of numbers in its first quarter to the end of December, with revenue growth up 9.2%, ahead expectations. Compass is currently significantly outperforming its peers with Sodexo and Aramark not getting above the 5% revenue growth mark. Much of this growth has been driven by net new business growth which has been supported by strong client retention, along with positive pricing and volume trends. All regions performed well, with positive outsourcing trends continuing and underpinning growth momentum.
“The company has left its 2025 guidance unchanged – organic revenue growth above 7.5% and high single digit underlying operating profit growth, with ongoing margin progression – but in light of these results this looks a fairly comfortable target. Compass is one of the most defensive stocks within the consumer discretionary landscape and will benefit as companies look for efficiencies in tough operating environments. The outsourcing market remains very attractive, driven by complexities such as increased regulation, sustainability, changing dietary expectations and inflation, all of which are here to stay, and Compass is primed to take advantage of.”
