Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on SODEXO. We currently have 4 research reports from 1 professional analysts.
|17Nov16 06:01||GNW||Sodexo launches strategic venture capital fund, dedicated to accompanying innovative start-ups|
|17Nov16 06:01||GNW||Sodexo: another year of solid performance; positive outlook|
|17Oct16 12:16||GNW||Sodexo strengthens purchasing power with acquisition of PSL, leading procurement provider to the UK Hospitality Industry|
|14Oct16 08:42||GNW||Sodexo rolls out SKOOL programme across Europe to prevent food waste in schools|
|10Oct16 02:08||GNW||Sodexo scores two key business wins in energy sector|
|21Sep16 04:40||GNW||Sodexo Awarded Maximum Score on World Wildlife Fund Palm Oil Buyers Scorecard|
|08Sep16 10:22||GNW||SODEXO LEADS DOW JONES SUSTAINABILITY INDEX FOR 12th YEAR|
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North America and the Rugby World Cup offset the difficulties in Brazil
08 Jul 16
Sodexo has published its 9M 16 sales, up by 3.7% including 3.3% organic growth helped by the Rugby World Cup contract in the UK and Ireland (+2.5% growth excluding this impact). On a segment basis, On-site services (96% of sales) clocked organic growth of 3.2%, reflecting: 4% growth in North America, as expected in Corporate and Health Care; 18.1% growth in the UK with a €131m impact on sales due to Rugby and 8.4% growth of the other segments, especially in education with the end of the ramp up of big contracts; 1.8% growth in Continental Europe, which is still soft growth in spite of the positive effects of two extra working days in May, and reflecting a 2% decrease in France (c.15% of group sales) with the effects of [terrorist] attacks, strikes and bad weather. Note that the group has decided to be more selective and has cut some businesses in France; 3.9% decline in the Rest of the World with the effect of the continuing decrease in Remote Sites (+6.5% growth for the region excluding this element). Nevertheless, the group showed a stabilisation in Q3. The Benefits and Rewards Services is still a solid segment with 5.7% organic growth despite the slowdown in Brazil.
Strong prospects, despite a challenging Brazil and emerging countries
30 Nov 15
Sodexo posted upbeat FY15 results, pointing to an improvement in the operating leverage. The exit from unprofitable contracts, cost-cutting measures and the supportive momentum in North America have contributed to the rise in the EBIT margin (by 40bp to 5.8%). Organic sales came in 2.5% higher yoy, showing a sequential improvement throughout the year (+2.3% in Q1, +2.4% in H1, +2.2% in 9m), while reported sales jumped by +10%, fuelled by FX (+7.3% impact on FY15 sales). On-Site Services grew by 2.2%, on the back of popular integrated services, with a high facilities management component which made up for the slowdown in foodservices volumes. The Corporate Services division was the best performer (+3.9% lfl), boosted by the ramp-up of contracts in the UK which stood out, recording a +12.8% in sales lfl followed by North America (+1.5%, +17.9% reported). The poor trends in Foodservices reflects the pressure from clients which have been seeking to slash costs (headcount reductions, cost-cutting strategy), particularly in Europe (Continental Europe: +0.6% in sales lfl, -0.3% excl. FX). The Benefits & Rewards business performed well (+7.5% lfl in issue volume, +9.5% in sales), in spite of the poor momentum in LatAm. EBIT jumped by 18.3% reportedly (+11.9% excl. FX), backed by North America (+39.4% reported, +18.7% at CER) in particular which benefited from the deployment of standardised one-site contact management methods which helped to mitigate the impact of inflation. The UK & Ireland showed a 42.4% rise in EBIT reported (+28.8% excl. FX), fuelled by several major integrated services contracts which were in the start-up phase in FY14. The several cost-cutting measures announced as part of FY15 figures are expected to generate €200m of cost savings between 2015 and FY18, which should partially offset price pressures from clients. The group announced a €300m share buy-back programme in 2016 (c.2.4% of the share capital).
New York could join several US largest cities to increase the minimum wage
23 Jul 15
New York’s minimum wage for fast-food workers is set to almost double from $8.75 to $15 an hour (implying potentially 180,000 workers statewide) by the end of 2018 for the city and by mid-2021 for the rest of the state. This is what is claimed by a committee formed in May by the governor Andrew Cuomo and which does not need legislative approval but must be ratified by the state labour commissioner, which is highly expected. Several big US cities including Seattle, San Francisco and Los Angeles (and a month ago) have approved a minimum wage increase to $15 an hour (expected to be effective by 2021 in Los Angeles after growing progressively). Chicago is also considering raising its minimum wage to $15 an hour. This came after protests by low-wage employees of companies like Walmart (the largest private employer in the US) and McDonald’s swelled into several big US cities. The two groups have since pledged to increase their workers’ pay by $1-2 an hour, although contested by the $15 movement activists who see it as too small.
Poor visibility in Continental Europe and LatAm and flattish North America
08 Jul 15
Sodexo released its 9m consolidated revenues which highlighted a deceleration in the organic trend compared to H1's figure due to the challenging economic environment in Latin America and certain countries in Europe. The group's consolidated revenues delivered 2.2% LFL growth in 9m against +2.4% in H1. On-site Services (OSS, 96% of sales) experienced 1.9% organic growth in sales largely backed by the UK & Ireland (8.6% of On-site Services revenues), which showed acceleration throughout the year (+10% LFL vs +6.1% in Q1 and +8.4% in H1) where facilities management experienced strong demand, followed by the Rest of the World (+3.1%) as well as by the Corporate segment (+3.7% organic growth vs +0.4% and -0.3% for Healthcare & Seniors and Education, respectively). The North American region (39% of On-site Services sales) showed a flattish trend since the beginning of the fiscal 2015 year (+1.4% LFL vs +1.4% in Q1 and +1.5% in H1) despite solid dynamic growth in the corporate segment (+6% LFL), notably in Facilities Management which showed increased volumes. The region has also largely benefited from the strength of the dollar against the euro (+16.5% reported including a +15.4% impact from FX). In Continental Europe (33% of On-site Services sales), trends worsened and the region switched to negative territory although only moderately (-0.2% vs 0% in Q1 and -0.3% in H1 15). However, Latin America has been qualified as experiencing a particularly challenging environment, notably in Brazil and Chile. Benefits and Rewards Services (4.2% of sales but c.28% of group EBIT) delivered +9.1% growth LFL in sales and +14.5% reported, boosted by acquisitions (+3.7% impact on sales). The FY guidance has been maintained with an expected EBIT growth of +10% (excl. FX impact).
30 Nov 16
Abzena (ABZA): Interim results indicate happy customers (BUY) | Horizonte Minerals* (HZM): Fund raise completed (CORP) | SacOil* (SAC): Half-year trading statement (CORP) | Revolution Bars (RBG): New openings (BUY) | Amino Technologies* (AMO): Multi operator FUSION roll out (CORP)
N+1 Singer - Morning Song 30-11-2016
30 Nov 16
Sanderson has delivered full year results in line with expectations and the 19 October trading update after a strong finish to the year compensated for a slower start. A healthy level of pre-contracted recurring revenue (50%), incremental sales to existing customers and new customer wins at higher average order values helped deliver solid revenue growth in both the Digital Retail (+9%) and Enterprise (+12%) divisions. A decent order book and good sales momentum suggest that the company is on track to deliver on unchanged profit expectations for the current year. We continue to view the valuation (FY17 EV/EBITDA 8.6x) as undemanding given an attractive combination of accelerating growth potential, strong cash generation and growing dividends.
N+1 Singer - Morning Song 29-11-2016
29 Nov 16
Vp has reported another impressive set of interims, confirming strong growth in most markets and a positive outlook. Recent acquisitions are bedding in well and the full year outturn is set to exceed previous expectations (5%/6% EPS upgrades in FY17/FY18). The recent Capital Markets Day provided a reminder of Vp’s qualities (specialist focus, high returns, strong cash generation) and its growth potential, which in our view are not reflected in a modest <11x P/E rating. We firmly believe the shares are due a re-rating and see intrinsic value in excess of 800p.