SSP Group | Financial figures

Strong recovery as travel sector rebounds

Passengers queuing at Frankfurt Airport: The continued improvement in trading performance in recent months has been driven by the rapid recovery in leisure travel, with business related travel recovering more slowly, notes SSP.
IMAGO / Ralph Peters
Passengers queuing at Frankfurt Airport: The continued improvement in trading performance in recent months has been driven by the rapid recovery in leisure travel, with business related travel recovering more slowly, notes SSP.

SSP Group, a leading operator of food and beverage outlets in travel locations worldwide, has announced its financial results for the first half of its 2022 financial year, covering the six months ended 31 March 2022. The company records a strong recovery, which even strengthens in the following weeks.

SSP reports revenues of £803.2m (2021: £256.7m), up 212.9% vs 2021 (back to 64% of 2019 level, i.e. pre Covid-19). In the first six weeks of the second half sales were further strengthening to 83% of 2019 levels, as Covid-19 restrictions have been lifted, led by leisure travel in both the air and rail sectors and the return of commuters to the workplace.

“The business is recovering well from a hugely challenging period.  We have seen a significant rebound in trade since the impact of Omicron, with revenues currently running at over 80% of pre Covid-19 levels and with a similar proportion of our sites now open”, comments Patrick Coveney, CEO of SSP Group.   

Operations were managed in response to the highly variable levels of passenger demand during the first half of the financial year with approximately 2,200 units currently open, representing over 80% of the estate. According to SSP, around 50 new units opened in the first half.
Further new business was won during that period –   approximately 80 units with estimated annual revenues of £75m, increasing the expected annual sales value of net gains since 2019 to around £500m (from previously announced £425m), once fully mobilised over the next 2 years.
Mid-may, SSP announced that it will expand its business in Spain, operating a further eight units in Spanish airports.
SSP
Mid-may, SSP announced that it will expand its business in Spain, operating a further eight units in Spanish airports.

SSP also reports further investment in the customer proposition, with the launch of several new innovative brands and concepts, as well as the accelerated roll out of order and pay digital technology across the Group.
 

Rapid recovery in leisure travel

SSP comments: “The continued improvement in our trading performance in recent months has been encouraging, and has been driven by the rapid recovery in leisure travel, with business related travel recovering more slowly.”
 
“The second half has started well with sales strengthening further to an average of 83% of 2019 levels in the first six weeks, led by Continental Europe and North America where revenues are back to well above 80%, driven by a very strong recovery in domestic and leisure demand. In the UK, sales are back to 82% of pre Covid-19 levels, with the air sector boosted by strong leisure demand, and the rail business helped by the return of commuters in increasing numbers. In the Rest of the World, the picture remains more mixed with strong recoveries in the Middle East, India, Australia and Thailand being offset by very limited travel activity in China and Hong Kong, which we expect to continue in the near term.”
  

Prospects remain uncertain

“Our current expectation is for sales in the second half of the year to be around 80-85% of pre Covid-19 levels and for full year sales to be in the region of £2.0bn to £2.1bn. Whilst the final profit outturn will be dependent on a number of external factors, including the trajectory of the recovery and inflationary cost pressures, we would expect the full year EBITDA margin (on a pre-IFRS 16 basis)3 to be between about 5% (at the lower end of the sales range) and c.6% (at the higher end). This is consistent with the previously indicated range of 25% to 30% profit conversion on the reduced sales compared to 2019,” the company statement concludes.
stats