Upper Crust owner SSP’s share price falls as chief executive set to step down
The chief executive of SSP Group, which owns popular food and beverage brands such as Upper Crust, Millie's Cookies and Ritazza, is set to step down next year.
City veteran and former WH Smith chief Kate Swann will leave the firm at the end of May, to be succeeded by current UK and Ireland regional head Simon Smith.
Its share price fell more than 10 per cent as markets opened this morning, despite the company announcing a significant jump in profits.
The figures
Revenue for the full year ending in September 2018 was reported at £2.6bn, rising 7.8 per cent compared to 2017's £2.4bn.
Profit before tax jumped to £182.9m, at an increase of 26.3 per cent compared to the same period in 2017 at £144.8m.
Like-for-like sales rose 2.8 per cent, which the company said was driven by growth in air passenger travel revenue and retailing initiatives. This was slightly less than last year's achievement of 3.1 per cent growth.
Capital expenditure rose 25.4 per cent to £144.2m, driven by an increase in contracts across the year as the business invested in expansion across Latin America, North America and continental Europe, as well as an acquisition in India.
Dividends per share rose 25.9 per cent to 10.2p, up from 8.1p last year. SSP said it has proposed a special dividend to close out of the year of around £150m, underpinning its confidence in the business.
Heading into the 2019 financial year, the company said it continues to operate in line with expectations. However due to "geopolitical and economic uncertainty", SSP is anticipating full year like-for-like sales growth to remain within two to three per cent.
Why it's interesting
Although the market has reacted negatively to news of Swann's departure, analysts at Shore Capital Markets have assured investors that this is due to SSP's largely stellar performance under her tenure.
The concessions operator, which runs outlets for brands such as Starbucks, M&S Simply Food and Burger King around the world, has outperformed expectations on profits every year since it listed in London in 2014. Shore upgraded its expectations on the company four times this year alone.
"Kate Swann and her team have consistently and diligently delivered against a plan that is quite focused, nay dull at times, in its detail but exciting in the amalgam," said Shore's Clive Black and Greg Johnson.
"Although we expect a negative reaction from the market today… we see many similarities with WH Smith, where the culture embedded should see the group continue to deliver further efficiencies against a backdrop of favourable structural growth opportunities in global travel."
What SSP said
"Today we've announced another record set of results," said chief executive Kate Swann.
"So I am stepping down at a time when the business is clearly in great shape, with a strong senior management team and enormous future growth potential."
"I look forward to working closely with Simon in the next six months to ensure a smooth handover, and I am confident that he will lead the group to even greater success in the future."