Annual Report 2012 Report Annual Focus Changingworld

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Annual Report 2012 Report Annual Focus Changingworld Compas Annual Report 2012 s G ro up up PLC Compass Group PLC Compass House A Guildford Street nn Chertsey ual Repo Surrey KT16 9BQ United Kingdom rt 2012 Registered in England and Wales No. 4083914 Focus in a T +44 1932 573 000 F +44 1932 569 956 Find this Report online at www.compass-group.com/ar12 changing world WorldReginfo - f37502a4-6557-4363-9cc6-8fe724ed3e8b WorldReginfo - f37502a4-6557-4363-9cc6-8fe724ed3e8b Compass Group PLC Annual Report 2012 I 01 Compass Group PLC delivers to millions of people around the world every day. We innovate to find new and exciting ways to deliver, we source high quality products, we prepare delicious dishes, and we provide great food and support services to our clients. In a constantly changing world, we remain focused on delivering for all our stakeholders. Contents Financial highlights 01 Compass Group PLC Revenue 02 Regional performance 50 04 Business model Countries 12 £16,905m 06 Our sectors 11 £15,833m 10 Market perspective 10 £14,468m 12 Our strategy 16 Acting responsibly 22 Chairman’s statement Total underlying operating profit 24 Focus on risk 26 Our Board 12 £1,178m 28 Chief Executive’s 11 £1,091m statement 50,000+ 10 £1,003m 32 Regional reviews 38 Finance Director’s Different client statement locations Underlying operating margin 43 Index to Report 44 Governance 12 6.9% 66 Consolidated 11 6.9% financial statements 123 Parent Company 10 6.9% financial statements 131 Shareholder information Reported profit before tax 140 Index to the financial 509,000 statements Great people delivering 12 £789m great service 11 £958m 10 £913m Underlying basic earnings per share 12 42.6p 4bn+ 11 39.0p Meals served 10 35.7p a year Dividends per ordinary share 12 21.3p 11 19.3p 10 17.5p Underlying free cash flow 12 £760m See this Report and our full Corporate 11 £693m Responsibility Report online at www.compass-group.com/ar12 10 £744m WorldReginfo - f37502a4-6557-4363-9cc6-8fe724ed3e8b 02 I Compass Group PLC Annual Report 2012 Regional performance With the differing opportunities and challenges in each geographic region, we have evolved the Group’s regional management structure to bring a more incisive focus to each area. Global focus In line with the management changes we announced at our full year results in November 2011, we now see our business in three segments: North North America, Europe & Japan and Fast Growing & Emerging. In simple terms, the three segments comprise countries that are at similar America stages of development and display similar dynamics. We have had another excellent year in North America, with strong organic growth of over 8%, driven by significant levels of new business across £ all sectors. We have also made further good progress on the operating 7,517m margin, increasing it by 10 basis points and achieving 8% for the first time. Revenue (2011: £6,849m) Economic conditions in many parts of Europe, particularly in the south of the continent, have declined through the year, a trend that accelerated through the second half. Encouragingly, however, new business wins in some countries have been good. Trading conditions £ in Japan have substantially recovered. 598m Underlying operating profit 2012 has been a successful year in Fast Growing & Emerging with (2011: £538m) organic revenue growth of 12%. We have won excellent levels of new business with both international and local organisations and we have reinvested in the many growth opportunities we see. 44% % of Group revenue (2011: 43%) WorldReginfo - f37502a4-6557-4363-9cc6-8fe724ed3e8b Compass Group PLC Annual Report 2012 I 03 North America Europe & Japan Fast Growing & Emerging Europe Fast Growing & Japan & Emerging £6,243m £3,145m Revenue Revenue (2011: £6,217m) (2011: £2,767m) £397m £235m Underlying operating profit Underlying operating profit (2011: £400m) (2011: £207m) 37% 19% % of Group revenue % of Group revenue (2011: 39%) (2011: 18%) See page 39 for relevant definitions. WorldReginfo - f37502a4-6557-4363-9cc6-8fe724ed3e8b 04 I Compass Group PLC Annual Report 2012 Business model Everyone in Compass is committed to consistently delivering superior service in the most efficient way, for the shared benefit of our customers, employees, shareholders and other stakeholders. Focus on delivery Innovation is integral to our business. We are constantly striving to Health and safety is our number one operational priority and we improve what we do; from more efficient and sustainable ways of are committed to the highest standards of food hygiene and safe sourcing to maintaining and enhancing best practice standards. working practices. When the food arrives at one of our more than This gives our clients and consumers greater choice and the highest 50,000 locations, it is prepared by our highly trained and qualified levels of service. employees. Through initiatives such as our Trim Trax programme, we are able to limit the amount of waste we generate. We source from a range of local, national and international growers and distributors. The people we buy from undergo a robust quality Millions of people around the world rely on us every day to provide assurance process to ensure that the ingredients we use are of the their breakfasts, lunches and dinners, as well as keeping their highest quality. We can trace our products through each stage of environments clean and secure. Our delivery model in both food the supply chain, giving us detailed information on their provenance. and support services is based on self performance, meaning that, wherever possible, it’s our people looking after our clients’ people. 7.9% 8.8% 10.4% Group revenue growth Group operating profit growth Dividend growth (2011: 9.2%) (2011: 8.6%) (2011: 10.3%) Revenue and operating profit growth stated on a constant currency basis. WorldReginfo - f37502a4-6557-4363-9cc6-8fe724ed3e8b Compass Group PLC Annual Report 2012 I 05 Innovate 1 Find out more on page 08 4 How we 2 Provide Source deliver Find out more on page 14 Find out more on page 30 Prepare 3 Find out more on page 20 WorldReginfo - f37502a4-6557-4363-9cc6-8fe724ed3e8b 06 I Compass Group PLC Annual Report 2012 Our sectors Continuing to build on our sector expertise, and recognising that each of them has specific requirements, are key drivers of differentiation for our clients and fully underpin our drive for innovation and operating efficiency. Business & Industry Education Group breakdown We provide a choice of quality, nutritious and From kindergarten to college, we provide fun, 5 well-balanced food for employees during their nutritious dining solutions that help support working day. In addition, where clients seek academic achievement at the highest levels. 4 broader service offerings, the Compass Service Our simple set of commitments – Eat, Learn, 1 Framework enables us to deliver a range Live – helps us to educate young people about of support services to the highest standard, how to have a happy, safe and healthy lifestyle at the best value, on an international scale. while contributing to a sustainable world. 3 2 Major sector brands Major sector brands Revenue by sector 1 42% Business & Industry 2 16% Education 3 19% Healthcare & Seniors 4 10% Sports & Leisure 5 13% Defence, Offshore & Remote 42% 16% Group revenue Group revenue (2011: 42%) (2011: 16%) WorldReginfo - f37502a4-6557-4363-9cc6-8fe724ed3e8b Compass Group PLC Annual Report 2012 I 07 For consumers, this means speedier access to sector-focused best practices and market-leading innovations that are delivered by our people, from award winning chefs to service practice experts. Healthcare Sports Defence, Offshore & Seniors & Leisure & Remote We are specialists in helping hospitals in the Operating at some of the world’s most Through our relentless health and safety public and private sectors on their journey of prestigious sporting and leisure venues, culture, we are a market leader in providing managing efficiency and enhancing quality exhibition centres, visitor attractions and food and support services to major companies across a range of services. With a significant major events, we have an enviable in the oil and gas and mining and construction presence in the growing senior living market, reputation for providing outstanding industries, operating in some of the most we also provide care services to residential hospitality and true service excellence. demanding environments in the world. For our homes and home meal delivery services. defence sector clients, we are a partner who meets the challenges of running efficient operations outside of areas of conflict. Major sector brands Major sector brands Major sector brands 19% 10% 13 % Group revenue Group revenue Group revenue (2011: 18%) (2011: 11%) (2011: 13%) WorldReginfo - f37502a4-6557-4363-9cc6-8fe724ed3e8b 08 I Compass Group PLC Annual Report 2012 >1 Business model Trends don’t emerge one day and disappear the next; they continue to evolve and change. We respond as a global company with individual creativity and flair. nn Wherever we serve people, their demand for quality, choice and value is as discerning as you would find on any high street. Our consumer focus drives the development and innovation in our offers, brands and service to attract people to our restaurants and food outlets day in, day out. Compass is committed to providing our clients with innovations and concepts that will increase consumer participation, drive loyalty and improve satisfaction. Our goal is to provide quality food and service offers that align with the priorities of clients and consumers. In order to achieve this, we carry out extensive on-site research to ensure we understand our customer base and respond to overarching trends such as wellness and individualism. We ensure our people receive the training they need to deliver service excellence and increase customer satisfaction and we measure our success to make sure we get it right.
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