Compass Group Raises Profit Guidance After Strong First-Half Growth

The Tip Desk · May 11, 2026 · 2 min read

The food services provider reported underlying operating profit growth of 11.7% on a constant-currency basis for the first half of 2026.

Compass Group Plc, a provider of quality food and targeted support services, has increased its full-year underlying operating profit growth expectations for 2026 to above 11%. The company said this outlook is underpinned by expected organic revenue growth of around 7%, approximately 2% growth from M&A, and ongoing margin progression.

For the six months ended 31 March 2026, the company reported underlying operating profit growth of 11.7% on a constant-currency basis. This result was driven by organic revenue growth of 7.2%, revenue growth from M&A of 1.5%, and a 20bps increase in underlying operating margin to 7.4%. Total revenue increased 10.7% to $24,983m.

Organic revenue growth was supported by net new business growth of 3.8% and client retention of 96%. The company reported that new business wins rose 14% year on year to $4.1bn, with the Business & Industry sector delivering double-digit growth.

Compass Group spent $2.3bn on net M&A during the period. This included $1.7bn for Vermaat, a premium food services business in the Netherlands, and $0.3bn for Pro Care Management, a food Group Purchasing Organisation in Germany. The company said these acquisitions enhance its European platform and support long-term growth.

Due to the level of M&A activity, leverage—measured as net debt to underlying EBITDA—was 1.7 at 31 March 2026, which is outside the company's target range of 1-1.5.

Cash flow generation remained strong, with underlying free cash flow increasing 11.0% to $825m. The company also approved an interim dividend of 25.5c per share, totaling $433m.

Looking forward, the company said it is confident in its ability to sustain mid-to-high single-digit organic revenue growth and profit growth that exceeds revenue growth. Management stated that the total addressable market, which has grown at around 5% per annum over the last 10 years, could reach approximately $600bn by 2035.