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Profit Growth: Nearly 12% increase to over $3.3 billion.

Free Cash Flow: $2 billion, with conversion improved to 88%.

Net New Business Growth: 4.5%, within the 4% to 5% target range.

Interest Expense: $315 million, expected to rise to $350 million in fiscal year '26.

Effective Tax Rate: 25.5%, expected to remain the same in 2026.

Earnings Per Share: Up just over 11% in constant currency.

CapEx: 3.3% of revenue, expected to be around 3.5% in the coming year.

North America Organic Revenue Growth: Over 9%.

International Organic Revenue Growth: Nearly 8%.

Group Organic Revenue Growth: Nearly 9%.

Operating Margin: Increased to 7.3% in the second half of 2025.

Net Debt to EBITDA: 1.4 times.

Acquisitions Contribution to Profit Growth: Expected to add around 2% in 2026.

Business & Industry Sector Revenue Growth: Organic revenue up 11%.

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Release Date: November 25, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Compass Group PLC (CMPGF) delivered strong organic growth and margin progress, with profit up nearly 12% and free cash flow reaching $2 billion for the first time.

Net new business growth was 4.5%, supported by strong new business wins and a client retention rate of over 96%.

The company achieved a significant market opportunity, reinforcing confidence in the sustainability of its growth algorithm and ability to deliver long-term shareholder returns.

Operating profit increased nearly 12% to over $3.3 billion, with free cash flow conversion improving to 88%.

The company is investing in technology and data to support sales processes, procurement functions, and drive operational efficiencies, enhancing growth and margin.

Interest expenses increased to $315 million due to higher debt from acquisitions, with expectations of a further rise to $350 million in fiscal year 2026.

The effective tax rate was 25.5%, which is expected to remain the same in 2026, potentially impacting net earnings.

Leverage is likely to be above the target range in 2026 due to acquisitions, peaking at the half-year mark.

The company anticipates a moderation in growth in 2026 due to lower inflation, which could impact revenue growth rates.

There is a 200 basis point gap between North America and international margins, which the company aims to close, indicating current inefficiencies in international operations.

Q: Could you elaborate on the strong fourth-quarter organic sales growth and the guidance for 2026? A: Petros Parras, CFO, explained that the Q4 underlying rate was about 8%, driven by strong volumes in B&I, education, and sports and leisure. Some of this growth is considered one-time in nature. For 2026, the guidance assumes a lower rate of inflation and a 4% to 5% growth corridor, with profit expected to grow faster than revenue.

Q: How does Compass Group plan to mitigate the impact of AI on job losses and office meal demand? A: Dominic Blakemore, CEO, stated that AI is seen as a net positive, enhancing growth processes and operational efficiencies. The B&I sector is growing, with over 50% of growth from first-time outsourcing. New clients, especially in the tech sector, are focused on talent retention, and AI is creating new subsectors like data centers, offering opportunities for remote feeding and on-site services.

Q: Can you quantify the positive impact of AI on the business? A: Dominic Blakemore mentioned that while it's challenging to quantify AI's impact, it is generating 15% to 20% time efficiency, allowing for more value-creating activities. The secured new business of $3.8 billion, up 11% year-on-year, reflects a strong pipeline and growth potential.

Q: What is the mix of first-time outsourcing (FTO) in the new business wins, and how is the international region performing? A: Petros Parras noted that FTO accounts for around 45% of new business wins, reflecting complexity and client needs. The international region has shown consistent growth, with improved retention rates and opportunities for margin gains as the business becomes more sectorized.

Q: What is the expected timing for Vermaat's consolidation, and how does it affect the finance cost guidance? A: Petros Parras stated that Vermaat's contribution is assumed from the first quarter of 2026, with a finance cost of $350 million, including Vermaat and additional M&A. The deal is expected to be EPS accretive on a full-year basis.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.