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Compass Group Q1 Organic Revenue Up 5.9%; Affirms Positive Outlook For 2018

Food and support services company Compass Group Plc. (CPG.L,CMPGF.PK) said Thursday that its organic revenue for the first quarter grew by 5.9 percent, driven by strong levels of new business wins, excellent retention and good like-for-like revenues.

In a trading update ahead of its AGM to be held today, Compass Group said it continues to generate efficiencies through its management and performance or MAP programme.

In addition, the company is taking actions to offset above average cost pressures in the UK, the benefits of which will come through in its operating margin in the second half of the year.

For the first three months to 31 December 2017, organic revenue in North America increased by 8.2 percent. In Europe, organic revenue grew by 2.1 percent, due to good growth in UK Business & Industry, and a favourable calendar in Sports & Leisure.

Organic revenue in Rest of the World increased by 4.0 percent, driven by strong performances in Turkey and some of the company's Spanish speaking Latin American businesses.

The company's Offshore & Remote business declined by 1.6 percent, which was better than expected due to delays in the transition from construction to production at certain sites. Growth in Rest of World excluding Offshore & Remote was 6.1 percent.

Looking ahead, Compass Group said its outlook for 2018 is positive. The company now expects to be above the middle of its target 4 percent to 6 percent organic growth range for the full year.

The company also expects modest margin progression on a full year basis, albeit second half weighted.

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