Shares in upper crust owner ssp surge as profit soars

SSP Group, the owner of Upper Crust bakery chain, has reported growth across several business areas in its half-year report, with revenue soaring despite some challenges in Europe. The FTSE

250 company posted an operating profit of £45m, marking a 20 per cent increase from the first six months of 2024, as reported by City AM. Shares jumped nearly four per cent to 173.40p in

early trading on Tuesday. This was fuelled by a nine per cent surge in group revenue to £1.7bn, which helped counterbalance operating costs of £1.6bn. In the UK, sales rose by nine per cent,

pushing its operating profit margin – a crucial measure of how much profit a company generates from its core business operations before accounting for taxes and interest payments – up 120

basis points year-on-year. North American sales also saw a 13 per cent rise, following its acquisition of the Midfield concessions business. Greg Johnson, equity analyst at Shore Capital,

commented: "We see today's interim results as encouraging and supportive of the medium-term view that SSP can deliver 'through the cycle' double-digit CAGR EPS

growth." He added: "We do not believe that the current low teens PER valuation fairly reflects the structural attractions of the global travel market whilst the outlook for cash

generation has strengthened, which should be further supportive of the rating as well as shareholder friendliness." SSP NOTES MACROECONOMIC UNCERTAINTY Despite reiterating its full-year

guidance, SSP noted a "not withstanding a greater level of macroeconomic uncertainty". The group forecasts annual revenue to be in the region of £3.7 billion to £3.8 billion, with

operating profit projected between £230 million and £260 million. In its report for the first six months, the firm acknowledged that performance in Continental Europe had not met

expectations. Revenue in Europe decreased slightly by 0.2 per cent and the group faced a loss of £3.1m. "The scale of our contract renewal programme, and a number of operational

challenges, including the slower recovery post Covid in the rail sector," were cited as reasons for the financial setback by the company. For the latter half of 2025, enhancing

profitability in Continental Europe and improving profit margins are earmarked as critical objectives. Chief Executive of SSP Group, Patrick Coveney, expressed: "We recognise the

importance of driving enhanced performance, and we are executing against our agenda to achieve this... As a result, notwithstanding the higher level of macroeconomic uncertainty, we are

maintaining our full-year guidance." He further added, "Given the resilience of our business and the strong foundations that we have built in growing food travel markets across the

world, we continue to see significant opportunities for SSP to drive compounding growth and to build margins and returns in the medium and long term." LIKE THIS STORY? WHY NOT SIGN UP

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