Compass Group Expects 2Q 2021 Organic Revenue Fall

By Anthony O. Goriainoff

Compass Group said Thursday that it expects a 28% fall in organic revenue for the three months to March 31 as the company starts to lap the effect of the coronavirus pandemic on fiscal 2020 revenue.

The U.K. catering contractor said that there may be a possible 930 million pounds ($1.27 billion) hit on 2020 revenue and a GBP36 million hit on operating profit, stemming from negative foreign exchange rates.

"Trading results from our overseas operations are translated at the average exchange rates for the period. If current spot rates continue to March 31, 2021 foreign exchange translation would negatively impact the 2020 half year revenue by GBP456 million and operating profit by GBP38 million," the company said.

The company said that organic revenue for the first half of fiscal 2021--which ends March 31--is expected to be around 31% lower, and that in both the second quarter and half year the company has been operating at around 71% of its 2019 revenue.

"While the vaccination efforts around the globe are advancing, the pace of volume recovery remains uncertain. Encouragingly, the pipeline of new business and client retention continue to be strong," the company said.

Write to Anthony O. Goriainoff at [e-mail]

(END) Dow Jones Newswires

March 25, 2021 03:38 ET (07:38 GMT)

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