Compass Group's Outlook Is Positive But Currency Rates to Reduce Earnings

By Dimitrios Kontos

Compass Group PLC (CPG.LN) said Thursday that its outlook for fiscal 2018 is positive but if currency spot rates stay where they are for the rest of the year, they will have a negative impact on revenue and operating profit.

The U.K.-based company, which provides cleaning, property management and contract food services, said currency movements hurt first-quarter revenue, which was 288 million pounds ($400.7 million), and could negatively impact full-year revenue by GBP1.2 billion.

Foreign-exchange rates had a GBP24 million negative impact on profit in the quarter ended Dec. 31 and could impact full-year operating profit by GBP97 million, the company said.

Organic revenue in the first quarter grew 5.9%, the company said, citing new business wins, strong retention rates and good like-for-like revenue.

North America led organic revenue growth, with an 8.2% increase, while Europe grew 2.1%. In the rest of the world organic growth rose 4%, the company said.

All regions are performing better than anticipated, and Compass Group now expects to be above the midpoint of its organic-growth target range of 4%-6% in the full year, it said.

Write to Dimitrios Kontos at [e-mail]

(END) Dow Jones Newswires

February 08, 2018 02:49 ET (07:49 GMT)

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