Issy-les-Moulineaux,
- Organic revenue growth +17.5%
- Activity back up to 95% of pre-Covid levels
- Good control of inflation during the quarter
Q1 Fiscal 2022 revenues
REVENUES (in millions of euro) | Q1 FY22 | Q1 FY21 | RESTATED ORGANIC GROWTH | ORGANIC GROWTH | EXTERNAL GROWTH | CURRENCY EFFECT | TOTAL GROWTH | |||||||||
Business & Administrations | 2,617 | 2,185 | +19.5 | % | +19.6 | % | -2.0 | % | +2.1 | % | +19.8 | % | ||||
Healthcare & Seniors | 1,339 | 1,161 | +7.4 | % | +12.3 | % | +0.7 | % | +2.3 | % | +15.3 | % | ||||
Education | 1,126 | 918 | +28.7 | % | +21.0 | % | -0.4 | % | +2.1 | % | +22.7 | % | ||||
5,082 | 4,264 | +17.9 | % | +17.9 | % | -0.9 | % | +2.2 | % | +19.2 | % | |||||
Benefits & Rewards Services | 183 | 169 | +7.0 | % | +7.0 | % | 0.0 | % | +1.2 | % | +8.2 | % | ||||
Elimination | (1) | (1) | ||||||||||||||
TOTAL GROUP | 5,264 | 4,432 | +17.5 | % | +17.5 | % | -0.9 | % | +2.1 | % | +18.8 | % |
Commenting the performance,
“The recovery in the first quarter has been strong. The Group reached 95% of pre-Covid levels this quarter with Benefits & Rewards services, Healthcare & Seniors, Schools and Facility Management services now well above pre-Covid levels and strong improvements in Sports & Leisure, Universities and Corporate Services. Recovery is accelerating in Food Services. All geographies are contributing to this growth and particularly
We have signed new contracts with innovative offers to help our clients attract consumers back on site through more convenient and flexible services.
Our business model allows us to pass the inflation on to clients progressively. Cost plus contracts, negotiations with clients and mitigation action plans are also helping to compensate inflation.
While the new reinforced sanitary measures are being deployed in many countries to contain the spread of Omicron, our teams are fully mobilized on-site to ensure that action plans are in place. It is too early to estimate whether there will be an impact on guidance. At this stage, we maintain our annual guidance and remain confident in the continued recovery.”
Highlights of the period
- First quarter Fiscal 2022 consolidated revenues reached 5.3 billion euro, up +18.8% year-on-year including a net contribution from acquisitions and disposals of -0.9%, more than compensated by a currency impact of +2.1%. As a result, organic growth was +17.5%.
- On-site Services revenue organic growth was +17.9%. The ongoing recovery is visible in all segments, geographies and services. Healthcare & Seniors and Schools segments are now well above pre-Covid levels at respectively 105% and 104% of Fiscal 2019 revenues, adjusted for currencies. Corporate Services, Sports & Leisure and Universities all increased very substantially during the quarter, as employees returned to their offices, students to their universities and stadiums and convention centers reopened. As a result, Food Services also recovered strongly in the quarter, to reach 83% of Fiscal 2019 levels.
- Benefits & Rewards Services is also now back on a growth path, relative to the pre-Covid levels at 107% of Fiscal 2019. Revenue organic growth was +7.0%, with
Europe, USA andAsia up +6.9%, now well above Fiscal 2019 levels, andLatin America up +7.3%, with a strong recovery inBrazil , in particular. - During this first quarter,
Sodexo continued to reinforce its commitments to reduce its environmental footprint.- In
October 2021 ,Sodexo in theUnited Kingdom &Ireland has announced a comprehensive roadmap to net zero and decarbonization of its business. Having already exceeded Group’s target to reduce carbon emissions by 34% by 2025 (compared to a 2017 baseline), the region has set its next steps,- to become Carbon Neutral in its direct operations by 2025.
- to reduce carbon emissions across all three scopes by 55% by 2030.
- to decarbonize
United Kingdom andIreland business, with 90% of all carbon emissions cut across all three scopes, by 2045.
- Once again, Sodexo’s commitments were recognized by the 2021 Dow Jones Sustainability Indices (DJSI),
Sodexo remaining at the top of its industry for the 17th consecutive year.
- In
Outlook
The strong recovery in the first quarter provides a solid start to the year with organic growth at the high end of the range. With regards to Omicron, the recent sanitary measures taken by Governments will have an impact on activity, but it is too early to assess whether it is significant or not. So, at this stage, excluding potential impact if any of accounting changes1, we maintain annual guidance of:
- Fiscal 2022 organic growth expected between +15 and +18%.
- Fiscal 2022 Underlying operating margin of close to 5%, at constant rates.
Looking further out, we expect On-site services to exceed pre-Covid levels and the performance of Benefits & Rewards Services to accelerate out of the crisis. Our aim is that the Group rapidly returns to regular and sustained growth and over the pre-Covid Underlying operating margin. Accelerated growth in
1 Implementation of the IFRIC decision providing details on the accounting for configuration and customization costs of SaaS type software for which the analysis is in progress.
Conference call
- From the
UK : +44 2071 928 338, or - From
France : +33 1 70 70 07 81, or - From the US: +1 646-741-3167,
Following by the access code 23 96 830.
The press release and presentation will be available on the Group website www.sodexo.com in both the « Latest News » section and the « Finance – Financial Results » section.
Fiscal 2022 financial calendar
Fiscal 2022 1st half Results | |
Fiscal 2022 3rd quarter Revenues | |
Fiscal 2022 Annual Results | |
Fiscal 2022 Annual Shareholders Meeting |
These dates are indicative and may be subject to change without notice.
Regular updates are available in the calendar on our website www.sodexo.com
About
Founded in
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Contacts | |
Analysts and Investors | Media |
+33 1 57 75 80 56 virginia.jeanson@sodexo.com | Mathieu Scaravetti +33 6 28 62 21 91 mathieu.scaravetti@sodexo.com |
Q1 Fiscal 2022 Activity Report
Revenues: Strong recovery continues
REVENUES BY ACTIVITY | ||||||||||||||||
REVENUES (in millions of euro) | Q1 FY22 | Q1 FY21 | RESTATED ORGANIC GROWTH | ORGANIC GROWTH | EXTERNAL GROWTH | CURRENCY EFFECT | TOTAL GROWTH | |||||||||
Business & Administrations | 2,617 | 2,185 | +19.5 | % | +19.6 | % | -2.0 | % | +2.1 | % | +19.8 | % | ||||
Healthcare & Seniors | 1,339 | 1,161 | +7.4 | % | +12.3 | % | +0.7 | % | +2.3 | % | +15.3 | % | ||||
Education | 1,126 | 918 | +28.7 | % | +21.0 | % | -0.4 | % | +2.1 | % | +22.7 | % | ||||
5,082 | 4,264 | +17.9 | % | +17.9 | % | -0.9 | % | +2.2 | % | +19.2 | % | |||||
BENEFITS & REWARDS SERVICES | 183 | 169 | +7.0 | % | +7.0 | % | 0.0 | % | +1.2 | % | +8.2 | % | ||||
Elimination | (1) | (1) | ||||||||||||||
TOTAL GROUP | 5,264 | 4,432 | +17.5 | % | +17.5 | % | -0.9 | % | +2.1 | % | +18.8 | % |
First quarter Fiscal 2022 consolidated revenues reached 5.3 billion euro, up +18.8% year-on-year including a net contribution from acquisitions and disposals of -0.9%, more than compensated by a positive currency impact of +2.1%. As a result, organic growth was +17.5% and activity is back up to 95% of Fiscal 2019 revenues at constant rates.
The ongoing recovery is visible in all activities, segments, services and geographies. The performance in the first quarter reflects a very strong recovery in
The performance of the main segments and activities relative to Fiscal 2019 revenues is as follows:
AT CONSTANT RATES | % of Fiscal 2019 revenues | |||||||||||||
Q3 FY2020 | FY2020 | Q1 FY2021 | Q2 FY2021 | Q3 FY2021 | Q4 FY2021 | Q1 FY22 | ||||||||
Business & Administrations | 71 | % | 70 | % | 78 | % | 78 | % | 78 | % | 82 | % | 91 | % |
Of which Corporate Services | 73 | % | 74 | % | 79 | % | 78 | % | 75 | % | 79 | % | 87 | % |
Of which Sports & Leisure | 16 | % | 9 | % | 14 | % | 17 | % | 22 | % | 43 | % | 64 | % |
Education | 46 | % | 64 | % | 72 | % | 68 | % | 79 | % | 85 | % | 92 | % |
Of which Schools | 52 | % | 78 | % | 87 | % | 84 | % | 88 | % | 99 | % | 104 | % |
Of which Universities | 41 | % | 52 | % | 61 | % | 54 | % | 72 | % | 71 | % | 84 | % |
Healthcare & Seniors | 88 | % | 92 | % | 97 | % | 100 | % | 96 | % | 100 | % | 105 | % |
On-site Services | 70 | % | 75 | % | 81 | % | 81 | % | 83 | % | 87 | % | 95 | % |
Benefits & Rewards Services | 77 | % | 95 | % | 99 | % | 94 | % | 96 | % | 97 | % | 107 | % |
Group | 70 | % | 75 | % | 81 | % | 82 | % | 83 | % | 87 | % | 95 | % |
On-site Services
The recovery of the previous quarters continued in On-site Services, with organic revenue growth of +17.9% in First quarter Fiscal 2022, with revenues, reaching 95% of pre-Covid levels.
Facilities Management services were up +6.5% in the quarter and are now 22% above pre-Covid levels. The recovery in Food Services was particularly strong, up +26.8% compared to the previous year and back up to 83% of pre-Covid levels against only 73% in the fourth quarter of Fiscal 2021.
Development, retention, and same site sales growth are all improving during the quarter compared to First quarter Fiscal 2021 and the pipeline remains strong.
The inflation contribution to same site sales growth is slightly above 2% during this quarter.
ON-SITE SERVICES REVENUES BY REGION | ||||||
REVENUES BY REGION (in millions of euro) | Q1 FY22 | Q1 FY21 | RESTATED ORGANIC GROWTH | |||
2,205 | 1,688 | +28.2 | % | |||
2,023 | 1,808 | +11.2 | % | |||
854 | 768 | +11.5 | % | |||
ON-SITE SERVICES TOTAL | 5,082 | 4,264 | +17.9 | % |
The recovery in
The +11.2% growth in
Business & Administrations
REVENUES | ||||||
REVENUES BY REGION (in millions of euro) | Q1 FY22 | Q1 FY21 | RESTATED ORGANIC GROWTH | |||
643 | 423 | +48.6 | % | |||
1,208 | 1,080 | +13.5 | % | |||
766 | 682 | +11.3 | % | |||
BUSINESS & ADMINISTRATIONS TOTAL | 2,617 | 2,185 | +19.5 | % |
First quarter Fiscal 2022 Business & Administrations revenues totaled 2.6 billion euro, up +19.5% organically.
Organic growth in
In
In
Healthcare & Seniors
REVENUES BY REGION (in millions of euro) | Q1 FY22 | Q1 FY21 | RESTATED ORGANIC GROWTH | |||
693 | 653 | +4.2 | % | |||
578 | 443 | +11.3 | % | |||
67 | 65 | +10.1 | % | |||
HEALTHCARE & SENIORS TOTAL | 1,339 | 1,161 | +7.4 | % |
Healthcare & Seniors revenues amounted to 1.3 billion euro, up +7.4% organically.
In
In
In
Education
REVENUES BY REGION (in millions of euro) | Q1 FY22 | Q1 FY21 | RESTATED ORGANIC GROWTH | |||
869 | 612 | +39.9 | % | |||
237 | 285 | +0.2 | % | |||
20 | 21 | +28.6 | % | |||
EDUCATION TOTAL | 1,126 | 918 | +28.7 | % |
First quarter Fiscal 2022 revenues in Education were 1.1 billion euro, up +28.7% organically.
In
In
Benefits & Rewards Services
First quarter Fiscal 2022 Benefits & Rewards Services revenue amounted to 183 million euro, up +7% organically.
Employee benefits organic growth was +9.6% compared to an issue volume (
REVENUES BY ACTIVITY (in millions of euro) | Q1 FY22 | Q1 FY21 | ORGANIC GROWTH | |||
Employee benefits | 148 | 130 | +9.6% | |||
Services Diversification* | 35 | 39 | -1.7% | |||
BENEFITS & REWARDS SERVICES | 183 | 169 | +7.0% |
* Including Incentive & Recognition, Mobility & Expenses and Public Benefits.
In
In
REVENUES BY REGION (in millions of euro) | Q1 FY22 | Q1 FY21 | ORGANIC GROWTH | ||
120 | 112 | +6.9% | |||
63 | 57 | +7.3% | |||
BENEFITS & REWARDS SERVICES | 183 | 169 | +7.0% |
Operating revenues were back up to sustainable high single digit growth at +7%. There was a further acceleration in the digitalization of the services, up 6 points in one year. Financial revenues are now trending positively due to the significant increase in interest rates in
REVENUES BY NATURE (in millions of euro) | Q1 FY22 | Q1 FY21 | ORGANIC GROWTH | ||
Operating Revenues | 172 | 159 | +7.0% | ||
Financial Revenues | 10 | 10 | +7.2% | ||
BENEFITS & REWARDS SERVICES | 183 | 169 | +7.0% |
Financial position
Apart from the seasonal changes in working capital, the payment of the dividend which was brought forward to December from January in the previous years, and the early redemption in October of
Principal risks and uncertainties
There were no significant changes to the principal risks and uncertainties identified by the Group in the Risk Factors section of the Fiscal 2021 Universal Registration Document filed with the AMF on
Currency effects
Exchange rate fluctuations do not generate operational risks, because each subsidiary bills its revenues and incurs its expenses in the same currency. However, given the weight of the Benefit & Rewards activity in
1€= | AVERAGE RATE Q1 FY 2022 | AVERAGE RATE Q1 FY 2021 | AVERAGE RATE Q1 FY 2022 VS. Q1 FY 2021 | CLOSING RATE FY 2022 AT | CLOSING RATE FY 2021 AT | CLOSING RATE VS. | ||||||
1.161 | 1.179 | +1.6 | % | 1.136 | 1.183 | +4.1 | % | |||||
Pound Sterling | 0.854 | 0.904 | +5.9 | % | 0.852 | 0.859 | +0.8 | % | ||||
Brazilian real | 6.363 | 6.601 | +3.7 | % | 6.376 | 6.139 | -3.7 | % |
The positive currency impact of +2.1% is linked to the increase in the
The currency effect is determined by applying the previous year’s average exchange rates to the current year figures except in hyper-inflationary economies where all figures are converted at the latest closing rate for both periods when the impact is significant.
Alternative Performance Measure definitions
Growth excluding currency effect
The currency effect is determined by applying the previous year’s average exchange rates to the current year figures except in hyper-inflationary economies where all figures are converted at the latest closing rate for both periods when the impact is significant.
Issue volume
Issue volume corresponds to the total face value of service vouchers, cards and digitally delivered services issued by Benefits & Rewards Services for beneficiaries on behalf of clients.
Organic growth
Organic growth corresponds to the increase in revenue for a given period (the “current period”) compared to the revenue reported for the same period of the prior fiscal year, calculated using the exchange rate for the prior fiscal year; and excluding the impact of business acquisitions (or gain of control) and divestments, as follows:
- for businesses acquired (or gain of control) during the current period, revenue generated since the acquisition date is excluded from the organic growth calculation;
- for businesses acquired (or gain of control) during the prior fiscal year, revenue generated during the current period up until the first anniversary date of the acquisition is excluded;
- for businesses divested (or loss of control) during the prior fiscal year, revenue generated in the comparative period of the prior fiscal year until the divestment date is excluded;
- for businesses divested (or loss of control) during the current fiscal year, revenue generated in the period commencing 12 months before the divestment date up to the end of the comparative period of the prior fiscal year is excluded.
Underlying operating profit margin
The underlying operating profit margin corresponds to Underlying operating profit divided by revenues.
Underlying operating profit margin at constant rates
The underlying operating profit margin at constant rates corresponds to Underlying operating profit divided by revenues, calculated by converting 2022 figures at Fiscal 2021 rates, except for countries with hyperinflationary economies.
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Attachment
- PR
Sodexo Q1 Fiscal 2022 Revenues ENG
© OMX, source