SSP Group exceeds 2019 revenues in first half as travel recovery gathers momentum

INTERNATIONAL. Travel restaurateur SSP Group has reported strong first half financial results (to 31 March 2023), with revenues of £1,318.4 million (US$1,634.76 million), up +64.1% against the same period of last year. This was up by +4% on 2019 levels for the same period.

The company also reported underlying EBITDA of £90.5 million (on a pre-IFRS 16 basis), driven by very strong performances in the North American and Rest of the World divisions, and underlying operating profit of £34.4 million (on a pre-IFRS 16 basis). On a reported basis (under IFRS 16) operating profit stood at £48.6 million and profit before tax at £15.8 million.

SSP noted that the encouraging H1 results come as the global travel market continues to recover, “putting us in an even stronger position to benefit from the long-term structural growth in the industry”.

A strong performance in US airports was a key driver of strong H1 SSP revenues

The company also revealed that in the first six weeks of H2, sales have continued to strengthen, reaching 111% of 2019 levels (c.34% above 2022 levels) including a strong Easter period, with increasing levels of holiday and leisure travel in the approach to summer.

SSP also noted a high level of contract renewal activity and net new business wins running ahead of pre-COVID levels. Notable contracts wins in H1 came at airports in Calgary, Ontario, New York (JFK), Kuala Lumpur and at Rome rail station, with Italy becoming the company’s 37th market.

CEO Patrick Coveney says SSP has enhanced its customer proposition in a number of key areas

The pipeline of net new SSP business strengthened, with approximately £75 million net new business won since the preliminary results in December 2022. This increased the expected annual sales value of net gains since 2019 from c.£550 million to c.£625 million, once fully mobilised by 2026.

SSP also shared good progress on its strategic priorities. Accelerated growth in North America and Asia Pacific has been underpinned by an increasing pipeline of net gains, with two thirds within North America and the Rest of the World.

The acquisition of the concessions business of Midfield Concession Enterprises Inc. in North America will add 40 new units across seven airports, four of which are new locations to SSP.

The company also noted the strengthening of its business capabilities including customer proposition, its digital technology platform, and also its sustainability and people programmes.

Regional performance

The strongest performing region for SSP in H1 is North America, where revenues are now at 124% of 2019 levels, which it said reflects the growth of domestic air travel and the scale of net gains in the region. In Continental Europe, revenues are at 116% of 2019 levels.

In the Rest of the World, revenues rose to 112% of 2019 levels in the face of further improvements in passenger numbers in Asia, most notably in India, Thailand and Australia, all led by domestic air travel.

In the UK and Ireland, sales strengthened materially to 94% of 2019 levels, reflecting strong airport sales over the Easter period.

SSP revenues in the UK & Ireland are closing in on 2019 levels (Photo: Whiskey Bread bar at Dublin Airport)

Commenting on the results, SSP Group CEO Patrick Coveney said: “This has been a strong first half for SSP, and the ongoing revenue momentum across the business means that we are now expecting our performance for 2023 to be at the upper end of our previous assumptions.

“We are continuing to deliver against our strategic priorities. Firstly, we are increasing our focus on the higher growth markets of North America and Asia Pacific.

“North America is our strongest performing region with revenues in the first half at 127% of 2019 levels, and we were delighted to announce the acquisition of 40 units across seven airports in the USA from Midfield Concessions earlier this month.

“Secondly, the ongoing enhancement of our capabilities across our customer proposition, digital technology, people and sustainability is driving like-for-like revenue growth and helping us to win more new business. Thirdly, we are revitalising our efficiency programme to support profit conversion.

“As ever, I would like to thank our clients and brand partners and not least our outstanding teams around the world for their contribution to this performance. Their ability to provide compelling food propositions for both clients and customers across the world is what sets this business apart.

“This deeply ingrained skill set, along with the long-term structural growth trends in the travel markets that underpin our business model, means that we continue to look to the future with confidence.” ✈

Note: The Moodie Davitt Report publishes the FAB Newsletter, which features highlights of openings, events and campaigns from around the world of airport and travel dining. Please email Kristyn@MoodieDavittReport.com to subscribe.

The company also hosts The Airport Food & Beverage (FAB) + Hospitality Conference & Awards, which will take place on 12-13 September in Bangkok, Thailand after a four-year COVID-driven absence. Notably, FAB’s remit has been extended this year to feature wider airport hospitality services, including hotels and lounges.

For all partnership, speaker, content and other enquiries please contact Jeannie Wong, The Moodie Davitt Report Asia Bureau Chief and Head of Marketing & Events at Jeannie@MoodieDavittReport.com

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