SSP Group resumes dividends as revenue and profit surge

Shares in SSP Group (LSE: SSPG) were up nearly 4% in early trade this morning after the UK transport hub food service provider said it would resume dividend payments on the back of a strong recovery in revenue and profit.

In a trading update for the year ended 30 September 2022, SSP reported pretax profit more than tripled to £88.1m from £25.2m last year. Revenue rose 38% to £3.01bn.

The FTSE 250 company declared a final dividend of 2.5p per share, its first payout since 2019.

SSP said revenue growth reflected “significant further recovery” that surpassed pre-pandemic levels. However, recovery in its UK and Continental Europe unit was partly offset by slower rail travel recovery amid strikes.

Chief Executive Patrick Coveney said resuming dividends marked “an important step” in SSP’s “strong financial, operational and strategic progress”.

Looking ahead, SSP expects demand to hold up despite economic uncertainty. It forecast revenue of £3.4bn-£3.5bn for 2023, representing 6-10% like-for-like growth.

Mr Coveney said SSP is “in very good shape” to deliver “compounding growth and returns” in coming years thanks to travel demand growth, client relationships and its business model.

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SSP suspended dividends in 2020 before registering a £299.2m loss for that year as the pandemic decimated travel.

The group runs food and beverage outlets at airports and railway stations worldwide. Its shares have fallen 6.5% year-to-date.