Compass Group net worth reflects its strength in the global foodservice market.
As an Ando Money writer, my aim here is to explore Compass Group’s financial performance, diving deep into how this company generates its revenue and its profit margins.
Let’s dive in to better understand what drives the financial success of this industry leader.
Quick Facts
| FACT | DETAIL |
|---|---|
| Name | Compass Group |
| Full Name | Compass Group PLC |
| Industry | Foodservice and Support Services |
| Traded as | LSE: CPG |
| ISIN | GB00BD6K4575 |
| Founded | 1941 |
| Founders | Jack Bateman |
| Country/Territory | United Kingdom |
| Headquarters | Chertsey, Surrey, England |
| Chief Executive Officer | Dominic Blakemore |
| Number of Employees | 480,000 (2024) |
| Market Cap | $53.77 billion (October 2024) |
| Total Assets | $20,264 million (March 2024) |
| Total Equity | $6,539 million (March 2024) |
| Revenue | $20,887 million (HY 2024) |
| Net Income | $1,008 million (HY 2024) |
What is the Net Worth/Market Cap Of Compass Group in 2024?
As of October 2024, Compass Group’s market capitalization stands at $53.77 billion. This valuation places it in the upper echelon of global foodservice companies.
Compared to others in its sector, Compass Group is a significant player, showcasing a notable financial foothold.
The net worth gives a perspective on its stability and its influence in the market. For context, here are some other well-known brands and companies related to Compass Group:
- Sodexo
- Aramark
- Elior Group
- G4S
- Serco Group
- Sodexo North America
- ABM Industries
- CH&CO
- HOFMANNs
If you’re curious about the wealth of leading corporations, visit our list of the world’s most successful companies.
Compass Group’s financial position is estimated and regularly updated with the latest data.
Compass Group Financial Performance Overview
Compass Group generates its revenue primarily from foodservice and support services. The company serves sectors such as healthcare, education, and sports, all contributing to significant revenue streams.
North America is Compass Group’s leading market, accounting for the largest share of income, followed by Europe and the Rest of the World.
Notably, Business & Industry and Healthcare sectors are key areas, with revenue contributions that demonstrate how diversified and resilient its portfolio is.
Major Investments Driving Financial Growth
Compass Group’s ability to sustain growth heavily relies on its strategic investments. One significant investment is in capital expenditures, accounting for 3.3% of total revenue for HY 2024.
This level of spending enables infrastructure improvements, equipment upgrades, and operational efficiency enhancements.
Additionally, Compass Group has made substantial investments in acquisitions such as CH&CO, which enhances its sector-specific capabilities, and HOFMANNs, which provides a flexible operating model to cater to different client needs.
Strategic disposal of non-core assets also plays a role in refining its business focus, making Compass Group more streamlined and effective in allocating resources where they are most beneficial.
Organic Revenue Growth Strategies
Compass Group’s approach to organic growth is a cornerstone of its strategy. By focusing on key regions—North America, Europe, and the Rest of the World—it ensures a balance in growth.
The company prioritizes specific sectors such as Healthcare and Business & Industry, where it sees the most potential for organic expansion.
These sectors, combined with its geographic focus, enable Compass Group to build a solid growth foundation while also investing in emerging opportunities.
Profit Margins and Operating Efficiency
The profit margins of Compass Group reveal a consistent growth trajectory.
In HY 2024, the operating profit margin rose to 7.1% from 6.6% in HY 2023. This increase reflects improved efficiency, streamlined operations, and cost management.
When broken down by region, North America demonstrates an 8.2% operating margin, contributing significantly to the overall performance.
Comparatively, Europe and the Rest of the World maintain margins of 5.8% and 5.3%, respectively.
Compass Group’s focus on operational efficiency through standardized practices and leveraging its scale benefits has allowed for better year-on-year margin improvements.
Role of Mergers and Acquisitions in Expansion
Compass Group relies heavily on mergers and acquisitions (M&A) to drive growth, expand capabilities, and strengthen its market presence.
The recent acquisitions of CH&CO and HOFMANNs showcase a strategic focus on expanding sub-sector capabilities and adapting to client-specific needs.
Acquisitions not only help the company reach new market segments but also ensure a significant presence in emerging sub-sectors, such as flexible vending solutions in the U.S.
These M&A activities are a direct response to evolving market needs and are key to driving financial expansion.
Return on Capital and Shareholder Value
Compass Group maintains a strong return on investment through its Return on Capital Employed (ROCE), which is currently double the Weighted Average Cost of Capital (WACC).
This showcases the efficiency with which it manages its assets and generates profits.
The company also maintains a progressive dividend policy, with an interim dividend per share of 20.7 cents for HY 2024, compared to 17.9 cents the previous year.
Such policies reflect a commitment to returning value to shareholders, balancing reinvestment in the business with shareholder payouts.
Key Financial Metrics Affecting Revenue
One key financial metric for Compass Group is the relationship between revenue and free cash flow. In HY 2024, free cash flow was recorded at $704 million, almost identical to the previous year’s $703 million.
This consistency indicates the company’s ability to convert revenue into cash efficiently.
Additionally, Compass Group’s management of net debt, standing at $5,295 million, plays a critical role in maintaining financial health.
Maintaining a healthy debt-to-EBITDA ratio is essential for leveraging growth opportunities without overburdening the balance sheet.
FAQs About Compass Group
What Sectors Does Compass Group Serve?
Compass Group serves sectors like Business & Industry, Education, Healthcare, Sports & Leisure, among others. These sectors are diverse, allowing for a stable revenue flow across different economic conditions.
How Many Employees Does This Company Have?
As of 2024, Compass Group employs approximately 480,000 individuals globally. This significant workforce supports its expansive operations across various sectors and regions.
How Does Compass Group Drive Its Revenue Growth?
Revenue growth is driven through organic expansion in specific markets, strategic acquisitions, and investments in infrastructure and capabilities. The company is also keen on disposing of non-core assets to refine its focus.
What Is Compass Group’s Geographic Reach?
They operates across North America, Europe, and the Rest of the World. North America remains the largest contributor, followed by Europe.
What Role Do Mergers and Acquisitions Play in Compass Group’s Strategy?
Mergers and acquisitions are vital for Compass Group, helping it acquire new capabilities and expand into sub-sectors. Recent acquisitions like CH&CO have enhanced growth in specific sectors.
Conclusion
Compass Group’s financial strength is evident through its diverse revenue streams and effective growth strategies. If you want to delve deeper, share your thoughts or check out more of our content at Ando Money.
