The business and industry (B&I) sector of the business was trading above 100% of 2019 revenues on a run-rate basis, while net new business growth was 6.9%, more than double the historical rate of 3%, and continues to be driven by increased first time outsourcing. The retention rate stands at 96.1%.
Net mergers and acquisitions (M&A) totalled £223m year to date as the company continued to expand its portfolio of brands, focus on digital innovation and delivered-in solutions.
In line with the half year results announcement, Compass Group purchased 13.7m shares at a total cost of £237m as part of its £500m share buyback programme.
Compass also recently launched a Sustainable Financing Framework to issue sustainable debt in the future, as part of its worldwide commitment to reach Climate Net Zero by 2050 and social mobility initiatives within the group.
Sustainable financing aligns with the expectations of our clients and shareholders and gives us the ability to play our part in combatting climate change.
Trading results from Compass overseas operations are translated at the average exchange rates for the period. If current spot rates were to continue for the remainder of the year, foreign exchange translation would positively impact 2021 revenue by £533m and operating profit by £33m.
Compass said: “All regions and sectors are executing well, and we are particularly pleased with the recovery in B&I, which is now trading above 2019 revenues on a run-rate basis. New business growth continued to accelerate, benefiting from an increase in first time outsourcing due to ongoing operational challenges and heightened inflation.
“Given the significant acceleration in growth and ongoing recovery of our base business, we are increasing our FY 2022 organic revenue growth guidance from around 30% to around 35%. We confirm our FY 2022 operating margin guidance of over 6% and now expect our exit margin to moderate slightly from around 7% due to the strong net new performance and ongoing inflationary pressures.
“While we are mindful of the challenging macroeconomic environment, we remain excited about the significant structural growth opportunities globally. With a clear strategy, operational scale, and market leading offer, Compass is very well positioned to capitalise on the increase in outsourcing opportunities.
“Longer term, we expect revenue and profit growth above historical rates, returning margin to pre-pandemic levels, and rewarding shareholders with further returns.”