Compass North America posts 48% revenue growth in first half of FY2022

Compass Group PLC reported that in the first half of its 2022 fiscal year, organic revenues for its North American unit grew 47.9%, outpacing its European (28.3% increase) and company total (37.9% increase) numbers. The results basically mirror what contract rival Aramark reported the day before of a 51% revenue increase for its U.S. Food & Support Services division in its second fiscal 2022 quarter that followed a 68% increase in the first quarter. The third major multinational “Big Three” firm, Sodexo, had reported a 27.1% first fiscal year 2022 half increase for its North American operations at the beginning of last month.

Together, the results for the three largest broad-market contract foodservice operators in the U.S. seem to indicate a broad continuing recovery in the onsite dining market as a whole from the COVID pandemic, despite continued challenges in labor availability/cost and supply channel issues, though some segments are recovering more successfully than others. For instance, K-12 schools and colleges for the most part are resuming in-person instruction—albeit with diminished overall enrollment numbers—promising increased participation in their onsite meal services while hospitals and medical centers are beginning to reinstate pre-COVID visitor policies, meaning more retail dining sales, and fans are coming back to live events, bringing their concessions purchase dollars with them.

Related:5 things: Health system sues to change meal break rules

The market that remains softest is corporate dining, where a general return to offices, and hence to patronizing onsite dining outlets, remains a work in progress.

In its fiscal report, Compass noted that during the first half of the year, North American revenues were 103% of 2019 levels, up from 90% in Q4 2021. “All sectors are now operating above or around 100% of 2019 levels, with the exception of Business & Industry,” it said, adding that reported new business was at 11.2%, “with double digit new business growth in Business & Industry and Sports & Leisure.

Among individual markets, Sports/Leisure boomed by 438% in 1H 2022 compared to 1H 2021 while Education grew 56%, B&I increased 51% and Healthcare/Senior Living increased 10.5% over the period. In its discussion of individual sectors, the report read…

“Our Sports & Leisure sector maintained its momentum from the second half of 2021, continuing to benefit from strong attendance and per capita spend, although some events continued to be postponed due to COVID-19. Our Education sector continued to perform well, reflecting higher numbers on campus. The return to the office has been gradual and our Business & Industry sector remains impacted by the pandemic, with revenues at 84% of 2019 levels for the first half, although there has been further improvement during recent months. Our Healthcare & Senior Living business has been resilient throughout the pandemic, particularly in support services, with new business strong especially in community living.”

Related:5 tech things: Drone flies over road construction to deliver tacos to Florida family