SSP Group PLC Third Quarter Trading Update (7703K)

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RNS Number : 7703K

SSP Group PLC

12 July 2017

12 July 2017

Third Quarter Trading Update

SSP Group plc, a leading operator of food and beverage outlets in travel locations worldwide, announces its trading update for the third quarter of its financial year ending 30 September 2017, covering the period from 1 April 2017 to 30 June 2017.

On a constant currency basis, total Group revenues for the period from 1 April 2017 to 30 June 2017 increased by 14.6%, with like-for-like sales growth of 3.6%, net contract gains of 7.6% and an additional 3.4% of revenue from Travel Food Services in India ("TFS"), compared with the same period last year. At actual exchange rates, given the weakening of Sterling against most currencies compared with the same period in the prior year, total Group revenues for the period increased 21.7% year-on-year.

Like-for-like sales in the third quarter increased by 3.6%, which included a positive benefit arising from the timing of Easter. Like-for-like sales growth in the air sector was driven by increased passenger numbers. Trading in the rail sector has remained softer. More recently, we have seen some further impact from the geopolitical activity in the UK and Continental Europe.

Net contract gains in the third quarter were 7.6%. This performance benefited from the commencement of operations at Chicago Midway airport, ahead of plan. On a temporary basis we are running all the food and beverage operations in Midway until re-development commences. In addition to this, we have benefited from the deferral of some planned unit closures in the quarter. Looking forward, we expect net contract gains for the full year to be around 5.0% - 5.5%. The anticipated operating profit contribution from new unit openings will, as normal, include the impact of pre-opening costs.

TFS has continued to perform well in the quarter, with strong sales, a little ahead of our expectations.

For the nine month period from 1 October 2016 to 30 June 2017, total Group revenues increased by 10.4% on a constant currency basis, including like-for-like sales growth of 3.2%, net contract gains of 4.8%, revenues from TFS of 2.8% and a negative impact of -0.4% arising from the additional leap year day in 2016. At actual exchange rates, total Group revenues increased 20.4% year-on-year.

Outlook

Looking forward, whilst a degree of uncertainty always exists around passenger numbers in the short term, particularly in the current environment, we are well placed to continue to benefit from the structural growth opportunities in our markets and to create further shareholder value.

Currency

Trading results from outside the UK are converted into Sterling at the average exchange rates for the period. The overall impact on revenue of the movement of foreign currencies (principally the Euro, US Dollar, Swedish Krona, and Norwegian Krone) during the first three quarters of 2017 compared to the 2016 average was 10.0%. If the current spot rates were to continue for the rest of 2017, we would expect a positive effect for the full year of around 7.0%.

2017 full year results announcement

The Group's results for the year ending 30 September 2017 are expected to be released on 22 November 2017.

CONTACTS

Investor and analyst enquiries

Sarah John, Director of Investor Relations, SSP Group plc

[phone]; E-mail: [e-mail]

Media enquiries

Peter Ogden / Lisa Kavanagh, Powerscourt

[phone]; E-mail: [e-mail]

NOTES TO EDITORS

About SSP

SSP is a leading operator of food and beverage concessions in travel locations, operating restaurants, bars, cafés, food courts, lounges and convenience stores in airports, train stations, motorway service stations and other leisure locations. With over 50 years of experience, today we have nearly 30,000 employees, serving approximately a million customers every day. We have business at approximately 140 airports and 280 rail stations, and operate more than 2,200 units in over 30 countries around the world.

SSP operates an extensive portfolio of more than 400 international, national, and local brands. Among these are local heroes such as MASH in Copenhagen, James Martin Kitchen in London, and Hung's Delicacies in Hong Kong. Our range also includes proprietary brands created for the travel sector including Upper Crust, Le Grand Comptoir and Ritazza, as well as international names such as Burger King, Starbucks, Hard Rock Café and YO! Sushi. We also create stunning bespoke concepts such as Five Borough Food Hall in JFK, New York and Walter at Zurich.

www.foodtravelexperts.com

This information is provided by RNS

The company news service from the London Stock Exchange

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July 12, 2017 02:00 ET (06:00 GMT)