compass group plc (CPG) Snapshot

Outgoing Diageo chief executive Paul Walsh is believed to have been lined up as the new chairman of Compass. Compass chairman Sir Roy Gardner, a senior adviser to Credit Suisse who is also a fellow of the Royal Society of Arts, has been at the helm since 2006 and will retire following its annual meeting.

Waterbury Hospital is changing food service providers June 2013, bringing in the Compass Group. The Compass Group replaces Sodexo on June 20. Sodexo told hospital officials last year it intended to terminate the existing contract, which began in 2011. In addition to food service, the Compass Group's contract also covers environmental and patient transport services. The changeover will mean that the union will have to negotiate a new contract with The Compass Group.

Compass Group PLC reported unaudited earnings results for the six months ended March 31, 2013. For the period, the company reported revenue of £8,804 million against £8,550 million for the same period a year ago. Organic revenue growth for the period was 4.1%, after adjusting for the impact of acquisitions and disposals, comprising new business of 8.8%, retention rate of 94.0% and like for like growth of 1.3%. Underlying operating profit from continuing operations was £650 million against £617 million in 2012, an increase of 5.3% over the prior period. On a constant currency basis, underlying operating profit increased by £40 million, 6.6%. Total operating profit was £615 million against £604 million for the same period a year ago. Operating profit has increased by 5% to £650 million, including a further £40 million of profit from organic growth. Profit before tax was £575 million against £581 million or 22.5 pence per basic share for the same period a year ago. Profit attributable to equity shareholders of the company was £424 million against £427 million for the same period a year ago. Basic earnings per share were 23.1 against 22.5 pence for the same period a year ago. Free cash flow from continuing operations totaled £343 million against £337 million in 2012. Gross capital expenditure was £234 million against £187 million in 2012. Net debt increased to £1,310 million against £973 million as at September 30, 2012. Net cash from operating activities was £478 million against £491 million for the same period a year ago. Net cash from operating activities of continuing operations was £478 million against £510 million for the same period a year ago. Purchase of intangible assets was £95 million against £68 million for the same period a year ago. Purchase of property, plant and equipment was £138 million against £117 million for the same period a year ago. Underlying free cash flow was £386 million against £368 million for the same period a year ago. Diluted earnings per share from underlying continuing operations were 24.4 pence against 22.3 pence for the same period a year ago. For the full year, the company expects operating profit of £50 million remains unchanged. The company expects the cash tax rate to be a few percentage points higher, increasing in the medium term to average in the mid 20's.