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Sodexo FY Profit Down 9.0%; Launches Strategic Venture Capital Fund

Sodexo (SDXAY.PK) reported that its profit attributable to equity holders of the parent for fiscal year 2016 declined 9.0 percent to 637 million euros from 700 million euros in the previous year.

Net profit before non-recurring items net of taxes totaled 721 million euros, up 5.2% excluding the currency effect.

Operating profit before exceptional expenses rose to 1.203 billion euros, up 8.2% excluding the currency effect, due to a combination of increased productivity, SG&A control and the first results of the Adaptation and Simplification program which delivered 32 million euro of savings in its first year.

Annual revenues amounted to 20.2 billion euros, up 2.2% on Fiscal 2015 and organic growth of 2.5%. Organic growth for the On-site Services activity was up 2.4%.

The Group said it is confident in achieving organic revenue growth of around 3%; 8% to 9% growth in operating profit, excluding the currency effect and exceptional expenses related to the Adaptation and Simplification program, for fiscal 2017.

The Group confirms its medium-term objectives of average annual revenue growth, excluding currency effect, of between 4% and 7%; average annual growth in operating profit, excluding currency effect, of between 8% and 10%.

The company noted that Adaptation and Simplification program is on track to deliver 200 million euros of annual savings in Fiscal 2018.

The company anoounced proposed dividend of 2.4 euros representing an increase of 9.1% and a 300 million euros share repurchase program (around 1.9% of capital) for cancellation purposes.

As part of the resolutions at the AGM on January 24, 2017 the Board will propose to shareholders the renewal as Directors of Ms. Patricia Bellinger and Mr. Michel Landel.

Mr. Paul Jeanbart, whose mandate ends after the AGM on January 24, 2017, has taken the decision not to seek reelection. The Board warmly thanks him for the quality of his contribution over many years to the Group's development.

Finally, the Board will propose the appointment as Director of Ms.Cécile Tandeau de Marsac, who currently holds the position of General Manager of Human Resources at Solvay. She will bring to the Board her Human Resources experience in large international Groups.

With these changes, the percentage of women on Sodexo's Board increases to 50% Separately, Sodexo announced the launch of Sodexo Ventures, a 50 million euro venture capital fund, whose investments will combine agility and creativity with the Group's investment capacity, skills and expertise in sectors as varied as Food-Tech, health and wellness, data, mobility and smart buildings.

Sodexo Ventures will invest in start-ups with high growth potential in line with Sodexo's current or future activities. This investment strategy will allow Sodexo to closely monitor, anticipate and respond to evolutions in its rapidly moving sectors and markets.

by RTT Staff Writer

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