SSP Group returns to profit as recovery in leisure travel boosts Upper Crust and Caffè Ritazza owner
- SSP runs concessions for big names, including M&S, at airport and train stations
- It made pre-tax profits of £15.8m in its first-half, up from a £2.3m loss last year
- Full-year core profit is seen rising towards £280m, and revenue to near £3bn
SSP Group returned to profit in its first half and now expects full-year earnings to be at the top end of forecasts, as the recovery in passenger travel continues.
The company runs concessions for major brands, including M&S, Burger King, Starbucks and Yo Sushi, at airport and train stations across the world.
SSP Group, which also owns Upper Crust and Caffè Ritazza, reported pre-tax profits of £15.8million for the six months to the end of March, up from a £2.3million loss in the same period last year, with revenues up 64 per cent to £1.3billion.
SSP runs concessions for the likes of M&S and Burger King at airport and train stations
SSP told investors it started its second half with sales strengthening further thanks to a continued rebound in air and rail travel, in addition to price hikes.
Sales in the US and Europe have surpassed pre-Covid levels, but the UK has seen a slower recovery, with sales still at 94 per cent of pre-pandemic levels, partly as a result of increased industrial action in the UK Rail network.
Overall, sales were averaging around 111 per cent of 2019 levels in the first six weeks of its second half.
The group now expects full-year sales and profit to come in towards the top of its guidance, sending SSP shares surging almost 5 per cent to 277p in morning trade on Tuesday.
The stock has risen by around 17 per cent over the last year.
Chief executive, Patrick Coveney, said: ‘This has been a strong first half for SSP, and the ongoing revenue momentum across the business means that we are now expecting our performance for 2023 to be at the upper end of our previous assumptions.’
Profit for the full-year is seen rising towards £280million, compared with £142million in the previous year, with revenues close to £3billion.
The group struggled during the pandemic when travel ground to a halt, but it has now benefited from a rebound in the number of people going through airports and train stations.
AJ Bell’s investment director, Russ Mould, said: ‘Finally, after a few chaotic years for the business thanks to the pandemic, SSP is firmly in recovery mode with revenue, profit and margins moving higher.
‘We’re not quite there yet for dividends, but the company hints it is only a matter of time before the shareholder reward is reinstated.’
