LEI:213800QGNIWTXFMENJ24
26 February 2020
SSP GROUP PLC
SSP AGM and update on the COVID-19 virus
SSP ("SSP" or "the Group"), a leading operator of food and beverage outlets in travel locations worldwide, will today hold its Annual General Meeting and, ahead of this, issues an update to the market on current trading and the impact of the COVID-19 virus (Coronavirus).
In the current financial year trading in the UK, Continental Europe and North America, which together account for approximately 86% of Group revenue, has been in line with our expectations. In the Rest of the World, which accounts for 14% of group revenue and comprises the Asia Pacific region, India and the Middle East, we have seen an impact from the COVID-19 virus.
Since the escalation of the virus during January, our immediate priority has been the health and safety of our colleagues, customers and partners based across China and the Asia Pacific region. We have worked closely with our teams and local authorities to implement a range of additional health and safety policies and protocols covering hygiene, travel and quarantine periods, in order to keep people fully informed and as well protected as possible against infection.
In terms of the impact at the airports in which we operate across the region, in China we have seen sharp declines in both domestic and international air passenger numbers, which are currently running c. 90% lower YOY. In Hong Kong passenger numbers are c. 70% lower YOY and across a number of our other Asia Pacific countries, including Singapore, Thailand, Taiwan and the Philippines, passenger numbers are between 25% and 30% lower YOY. Elsewhere, we have also seen some impact at our airports in Australia, as well as at major travel hubs in the Middle East and India, although to date this has been less severe.
In response to the sharp fall in sales in China and across the Asia Pacific region, we have been working with our clients to maintain appropriate service levels, whilst taking all the necessary action we can to reduce costs, including the temporary closure of units and reduced operating hours.
In terms of the financial impact of COVID-19, our expectation is that for the month February sales across the Asia Pacific region (which accounts for approximately 8% of SSP Group revenues) will be approximately 50% lower YOY. Together with the impact in the Middle East and India, this is expected to reduce overall Group revenue in February by approximately £10m - £12m, with a corresponding reduction in operating profit of approximately £4m - £5m.
Summary and outlook
Clearly the duration of the COVID-19 virus and its impact on global travel is uncertain at this stage, as are its consequences for our financial performance for the full year. We will continue to take all the necessary action as appropriate. Our strategy remains unchanged, and we continue to be well placed to benefit from the significant structural growth opportunities in our markets over the medium term and to create ongoing value for our shareholders.
CONTACTS
Investor and analyst enquiries
Sarah John, Director of Investor Relations, SSP Group plc
+44 (0) 203 714 5251; E-mail: [email protected]
Media enquiries
Peter Ogden / Lisa Kavanagh, Powerscourt
+44 (0) 207 250 1446; E-mail: [email protected]
NOTES TO EDITORS
About SSP
SSP is a leading operator of food and beverage concessions in travel locations, operating restaurants, bars, cafés, food courts, lounges and convenience stores in airports, train stations, motorway service stations and other leisure locations. With over 50 years of experience, today we have more than 39,000 employees, serving approximately one and a half million customers every day. We have business at approximately 180 airports and 300 rail stations, and operate more than 2,800 units in 35 countries around the world.
SSP operates an extensive portfolio of more than 550 international, national, and local brands. Among these are local heroes such as Brioche Doree in Paris, LEON in London, and Hung's Delicacies in Hong Kong. Our range also includes proprietary brands created for the travel sector including Upper Crust, Cabin Bar and Ritazza, as well as international names such as M&S, Burger King, Starbucks, Jamie's Deli and YO! Sushi. We also create stunning bespoke concepts such as Five Borough Food Hall in JFK, New York and Norgesglasset Bar in Oslo Airport.
www.foodtravelexperts.com
