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Travel food-to-go specialist SSP Group (SSPG) has announced its CEO Kate Swann is to step down next year after it posted 22.7% surge in full year underlying operating profit and revenue growth of 9.5%.

After more than five years at the group, the former WH Smith boss will leave SSP Group on 31 May 2019, to be succeeded by its current UK & Ireland CEO Simon Smith.

The news comes as SSP Group posted a 22.7% rise in constant currency underlying operating profits to £195.2m for the year to 30 September – a rise of 19.8% at actual exchange rates.

Total sales were up 9.5% on a constant currency basis in the period to £2.56bn, driven by like-for-like sales growth of 2.8%, acquisition benefits of 1.6% and net contract gains of 5.1%.

Sales were up 7.8% at actual exchange rates.

Like-for-like sales growth has been driven by increased passenger numbers in the air sector, whilst trading in the rail sector has remained softer.

Net contract gains in the year were 5.1% benefitting from the full year effect of some significant contracts which opened in the second half of 2017, including new openings at Chicago Midway and JFK T7 Airports in North America.

Contract wins during the year included Montparnasse station in Paris, a portfolio of 29 Starbucks in railway stations across the Netherlands, and 22 motorway service areas across Germany.

Looking forward to 2019, SSP Group said it expects year on year operating margin growth across the group to be nearer to 20 basis points, driven by like-for-like sales growth and on-going operational improvements.

The group said that “with the on-going level of geopolitical and economic uncertainty” it continues to “plan conservatively”, anticipating like-for-like sales growth to continue to be between 2% and 3%.

As a sign of confidence, the has increased its dividend for the 2018 financial year, maintaining a payout ratio of 40% of net income, while it will also pay a second special dividend of £150m. The final dividend will be paid in March 2019 and the special dividend in April 2019.

Swann said: “SSP has delivered another strong performance in 2018. We have continued to expand our global footprint, materially extending our presence in North America, delivering excellent growth in India and entering the important Latin American region with two contracts in Brazil.

The new business pipeline is encouraging and underpins our confidence in future growth. The new financial year has started in line with our expectations and, whilst a degree of uncertainty always exists around passenger numbers in the short term, we continue to be well placed to benefit from the structural growth opportunities in our markets.”

On her departure, she added: “Today we’ve announced another record set of results… so I am stepping down at a time when the business is clearly in great shape, with a strong senior management team and enormous future growth potential.

“I look forward to working closely with Simon in the next six months to ensure a smooth handover, and I am confident that he will lead the group to even greater success in the future.”

Simon Smith added: “”SSP is a fantastic business with excellent on-going growth potential. We have a strong senior management team and thousands of dedicated colleagues around the world, and I am confident that together we will continue to build on the success achieved.”

Chairman Vagn Sorensen commented: ” In the past five years, Kate has transformed SSP into an industry leading Food Travel Retail business, which has grown significantly around the world, and she has generated significant returns for our shareholders.

“Succession planning is deeply embedded into the Group and following a thorough process, we are delighted with Simon’s appointment. Simon joined SSP Group in 2014 and has contributed significantly to the performance of the Group as CEO of UK & Ireland for the past four years. Since joining, Simon’s role has expanded and he has taken on wider global leadership responsibilities, most recently looking after the integration and development of our joint venture business in India, which has delivered excellent results.

“Simon’s strong leadership skills combined with his considerable experience in the food travel and retail space, as well as his track record at SSP, make him well placed to lead SSP to continued future success. Simon will work alongside our CFO Jonathan Davies who has provided excellent support to Kate and will continue to bring his wealth of experience to the Board.”

SSP Group shares have plunged 7.6% back to 633.9p on this morning’s news.

Morning update

Specialist cake maker and bakery group Finsbury Food Group (FIF) Finsbury Food Group has issued a trading statement ahead of its AGM later this morning.

Chairman Peter Baker will tell shareholders: “We continue to trade in a difficult environment with sustained inflationary pressures. Despite this, our ongoing investment programme, underpinned by our strong cash flow, continues to drive operational efficiency and alongside this, we are mitigating cost inflation through price recovery.

“Whilst weaker customer demand over the summer season has resulted in sales being weighted to the second half, current trading is underpinned by a number of significant contract wins heading into the strong Christmas trading period which will deliver sales growth in both the first half and beyond.”

Therefore, the group expects performance to be in line with expectations for the 2019 financial year.

Its Ultrapharm acquisition integration is “progressing well” and additional capacity will be delivered by the end of the existing fiscal year in both Poland, with a new factory lease signed, and in Wales.

Baker will add: “Overall, the group continues to deliver on its strategy, focused on driving growth organically and through M&A.

“We continue to strive to achieve our vision of being a leading speciality bakery group, producing a broad range of high-quality products that deliver growth and differentiation for our customers, while fulfilling the needs of end consumers, both in the UK and in Europe.”

On the markets this morning, the FTSE 100 has recovered 0.6% back to 6,989.1pts. 

Early risers include Premier Foods (PFD), up 2.4% to 38.9p, Marston’s (MARS), up 1.6% to 100p and Associated British Foods (ABF), up 0.9% to 2,483p.

Fallers include Finsbury Food Group (FIF), down 1.6% to 111.2p, WH Smith (SMWH), down 1.6% to 1,896p and British American Tobacco (BATS), down 1% to 2,699p.

Yesterday in the City

The FTSE 100 dropped a further 0.8% yesterday to solidify its drop below 7,000pts, ending the day at 6,947.9pts.

Markets across the world were in the red yesterday as investors remained cautious amid concerns over US-China trade relations, the ongoing Brexit saga and the political environment in Italy.

Consumer stocks, however, largely escaped the worst of the market downturn, with some notably FTSE 100 risers.

Compass Group (CPG), jumped 5.4% to 1,673p after yesterday reporting a 5.5% jump in full year organic sales to £23.2bn, driven by rapid growth in North America.

Also on the up were Reckitt Benckiser (RB), up 1.8% to 6,580p, Marks & Spencer (MKS), up 1.1% to 297.5p and Just Eat (JE), up 3.1% to 550.4p.

Other risers included PZ Cussons (PZC), up 3.4% to 234.6p, TATE & Lyle (TATE), up 2.9% to 702.2p, B&M European Value Retail (BME), up 1.5% to 350.3p and Glanbia (GLB), up 2.6% to €16.35.

Notably fallers included FeverTree Drinks (FEVR), which plunged 6.6% back to 2.679p, while retail chain McColl’s (MCLS) lost 6.7% to fall to 125p.

SSP Group (SSPG) fell 2.5% to 684.8p ahead of this morning’s annual results.

Other fallers included C&C Group (CCR), down 4.1% to €3.13, PureCircle (PURE), down 2.7% to 292p, Cranswick (CWK), down 2.2% to 2,918p, Coca-Cola HBC (CCH), down 1.8% to 2,244p and WH Smith (SMWH), down 0.9% to 1,926p.

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