Compass Group PLC

Good morning and welcome to our 2025 half year results. We've delivered another strong first half performance. A double digit increase in profit was driven by 8.5% organic revenue growth and further margin progress. And in line with our algorithm, we're continuing to achieve profit growth ahead of revenue growth. Importantly, net new business was 4.4%, within our 4-5% target range for the fourth year running now. Our client retention rate continues to be strong, at above 96%, and the outsourcing market remains buoyant, with 45% of new business wins now coming from first-time outsourcing. We are investing for growth and have acquired attractive businesses to help expand our addressable market through further subsectorization. Following the reshaping of our portfolio, we're now an even more focused business. Our diverse sector portfolio, wide-ranging client base, flexible operating models, and significant local purchasing scale all provide the business with significant resilience. We have flexibility to mitigate macroeconomic challenges, and we're well-placed to capitalize on any increased outsourcing opportunities that may arise. I'll come back with more details on how we're successfully executing our strategy later. But first, over to Petros to give you more details on the financials.

Thanks, Dominic. Good morning, everyone. We've made great progress across our key metrics in the first half, delivering another strong financial performance. We were pleased to deliver double-digit growth in operating profit and earnings per share. Let's start by looking at the components of revenue growth. Mobilized net new business continues to be excellent and in the middle of our 4-5% target range. Like for likes remains strong at around 4%, with pricing and volumes normalizing as expected. We continue to expect positive volume growth driven by our attractive value proposition, increased use of technology, and additional events. And whilst we are not immune to micro-pressure, our significant value gap to the high street drives higher participation in our restaurants, helping to mitigate any potential volatility. As you know, following our portfolio reshaping, we combined the rest of the world with Europe to form a new international region. Both North America and international delivered strong organic revenue growth and margin progression with double-digit growth in operating profit. Operating profit was up by nearly 12% to over $1.6 billion. Interest increased to around $150 million, mainly due to higher debt. We continue to expect our interest charge to be around $300 million for the full year. As anticipated, our effective tax rate was 25.5%. This is also expected to be the rate for the full year. Earnings per share were up by nearly 11% in constant currency. Turning to cash now, CAPEX was 3% of revenue and we continue to expect CAPEX to be around 3.5% of revenue for the full year. The working capital outflow reflects the usual seasonality of our business and the timing of events in sports and leisure. We expect our working capital position to improve in the second half and be broadly flat for the full year. Our strong cash generation and balance sheet gives us the most capacity in the industry to invest in growth. In the first six months, we invested $1.7 billion in CapEx and M&A. During the period, we acquired Depor in France and Forest Service in Norway, which accounted for most of our M&A spend. Leverage ended the period at 1.5 times net debt to EBITDA, as we expected. We anticipate leverage to reduce at the full year, depending on the M&A activity. M&A is integral to our strategy of unlocking further growth opportunities in our core markets. Targets are normally sourced locally, having been known to us for several years. We've already established relationships with them, and they are a good cultural fit to Compass. We look for quality brands with complementary capabilities and entrepreneurial management teams. They typically come with strong revenue growth, synergy benefits, and attractive cash flows. As you know, in recent years we've increased our M&A focus on Europe. Recent acquisitions such as CH&Co in the UK and Hoffmans in Germany are performing well and are delivering their investment cases all better. Our capital allocation model is consistent and well-known. As a growth business, our priority is to continue to invest in the business through CAPEX and M&A. After paying an ordinary dividend, we then distribute any further surplus capital to shareholders, whilst maintaining a strong balance sheet. Our fiscal year 2025 guidance is unchanged. We continue to expect high single-digit operating profit growth, driven by organic revenue growth above 7.5%, with continued margin improvement. Now, back to Dominic.

Thanks, Petros. We operate in an attractive market where changing consumer trends and increasing complexities help us unlock first-time opportunities. Many organizations that are facing cost pressures are looking for efficiencies, and as experience has shown, this can trigger further outsourcing. The market opportunity plus our unique competitive advantages such as sectorization, procurement scale and operational expertise give us the best combination to continue gaining market share. Looking ahead, emerging megatrends are offering further growth opportunities in all sectors. Whether it's personalized integrated nutrition, aging populations, lifetime learning, or the global reach of major sports and events franchises, these trends are creating growth pathways for us in the future. For some time now, we've been expanding our market in North America through the organic creation of 14 mini sub-sectors with niche expertise. They capture parts of the market we couldn't reach before. Our sectorisation is being further enhanced through strategic M&A, which supplements or supports our existing capabilities within core markets. Recently, we've added DuPont and 4Service to our portfolio in Europe, following our blueprint of buying best-in-class businesses with exciting growth potential. Over time, we've proven M&A creates value by accelerating growth, increasing procurement scale and removing overhead costs. It's a key part of our business model as value compounds year after year. We have a resilient business mix with many different clients across multiple industries. Our diverse portfolio of sectors benefits from mostly captive audiences and limited exposure to discretionary spend. History has shown us that pressures in the short term often leads to more outsourcing and higher win rates. as clients and consumers look for help navigating cost pressures. Our value gap to the high street continues to grow, from procurement scale and operational expertise, providing an even more attractive offer to consumers. North America has a resilient operating model. With the vast majority of procurement sourced locally, the market is well insulated from import tariffs. Our chefs have full autonomy over the menu and work together with our procurement experts to find alternative ingredients or to price it accordingly. In healthcare and education, the majority of our clients are privately funded and therefore mostly insulated from potential federal spending cuts. Technology and data are transforming the client and consumer experience, reducing friction and increasing personalization. There's even greater potential in our back of house processes. Advanced digital tools are optimizing performance by integrating processes such as fully costing meals, on-demand labor scheduling, and real-time management information. Some of you may be familiar with the Intuit dome, home to the LA Clippers. Facial recognition technology powers the entire fan experience. Through our partnership with the stadium, we leverage camera technology for all food and drink purchases, offering a seamless experience with no need for a device. Positive market trends and ongoing investments in growth will continue to drive strong new business wins. The annualized new signings stands at $3.6 billion, and the pipeline is attractive with a blend of first-time outsourcing and market share gain opportunity. With our focus on pre-empting initiatives and the improvements in Europe, retention is trending above 96%. It's the combined strength of these factors which underpins our expectation for net new business growth to remain within the 4-5% range. We've said before, margin growth is incremental and continues to rebuild back to our peak and beyond. The improvement is driven by scale, retention, overhead leverage and unit performance. There's potential everywhere to leverage fixed costs and back-of-house tech solutions. Europe will continue to benefit from expanding scale, retention gains and growth maturity. In summary, our resilient business model and favourable market dynamics give us confidence in our medium-term growth algorithm. We expect mid to high single-digit organic revenue growth, with margin progression back to our peak and beyond, leading to profit growth ahead of revenue growth, as we continue to deliver long-term, compounding shareholder returns. Our strong half-year results highlight the resilience of our business model. Our competitive advantages, enhanced by our world-class talent, create a powerful circle of growth and value creation. With significant growth opportunities, clear priorities, and energized teams, we're excited for the future. Now over to Q&A. The operator will share instructions on how to ask questions. Please remember that you must be connected by phone to ask a question. Operator, over to you.