SSP Group PLC (LSE:SSPG) announced on Thursday that it expects full-year earnings per share to come in line with market forecasts despite a slowdown in passenger growth during the second half of the year. Alongside its earnings update, the company unveiled a £100 million share buyback program, signaling confidence in its growth trajectory.
For fiscal year 2025, SSP reported revenue of roughly £3.7 billion, an 8% increase year-on-year at constant currency. Operating profit is expected to reach approximately £230 million, representing an 11% rise. The company anticipates EPS of around 11.5p at actual exchange rates, a 15% improvement compared to the prior year, helped by lower-than-expected tax and interest costs.
“We have delivered a resilient Q4 performance against an unsettled macro-economic and softer demand environment in some of our key travel markets,” said Patrick Coveney, CEO of SSP Group. “Our UK and Asia Pacific businesses have traded particularly well and, taken in aggregate, our performance in the quarter across the portfolio leaves us on track to deliver earnings per share for FY25 in line with current market expectations.”
Fourth-quarter revenue climbed 4% year-over-year on a constant currency basis, below analyst forecasts of 6%, while like-for-like sales rose 2% against a 4% consensus estimate. The UK & Ireland and Asia Pacific segments outperformed, offsetting weaker results from Continental Europe and North America.
According to analysts at RBC, “Over the long term, we expect continued strong growth in Travel Retail, driven by further globalisation and growth in airport retailing capacity. We note a strong space growth story at SSP, although much of the expansion has been focused on the US, where the outlook for the travel segment looks tougher near term.”
RBC added that it expects European margins to gradually recover from a low base as SSP continues to restructure its operations. While labor cost inflation and emerging market currency risks remain concerns, analysts pointed to growing potential for operational leverage supported by investments in digital tools and data analytics.
The company acknowledged persistent margin challenges in its Continental Europe segment, particularly in France and Germany. Operating profit margin for FY25 in this region is expected to be about 2.0%, short of its 3% target. SSP aims to lift margins above 3% in FY26 through cost-saving measures, rent renegotiations, and more disciplined capital spending.
Financial leverage is also expected to improve meaningfully, with net debt to EBITDA projected to fall to around 1.6x at year-end from 2.2x at mid-year, supported by solid free cash flow generation. For fiscal 2026, SSP anticipates EPS will land within the current market range of 12.9p to 13.9p on a constant currency basis.
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