(Update: details on strategy and outlook)
PARIS (Agefi-Dow Jones)–Ahead of its Capital Markets Day, which is being held in Paris on Wednesday, Sodexo presented its financial objectives for 2025.
The collective catering and prepaid service voucher giant has confirmed that it expects for the 2023 financial year ending at the end of August on organic growth, i.e. excluding the effect of exchange rates and scope, in its turnover. business between 8% and 10% and an operating margin close to 5.5% at constant exchange rates.
Organic growth had increased by 15.7% in 2022, supported by the post-Covid recovery. The operating margin was 5%.
For the 2024 and 2025 financial years, the group forecasts organic revenue growth of between 6% and 8%. For the 2025 financial year, the operating margin is expected above 6%.
Sodexo’s strategy is based on three pillars: refocusing on food services and being more selective in “Facilities Management” services, accelerating the profitable growth of Benefits & Rewards Services, which manages the issuance of prepaid services, and strengthening the impact of the group’s societal and environmental contribution.
To implement this strategic plan, a tight “Leadership Team” will oversee a simplified and more efficient organization, Sodexo said in a press release.
“Towards a simplified and more efficient model”
Regarding Benefits & Rewards Services, Sodexo expects organic growth of between 12% and 15% and an operating margin of around 30% for the 2023 financial year. For fiscal 2024 and 2025, the group is targeting the low end of double-digit organic growth and an operating margin above 30% for fiscal 2025.
“To support this strategy, Sodexo will continue to have a disciplined investment policy, with gross investments increasing from 2.3% of sales in 2022 to 2.8% in 2025 and accretive targeted acquisitions, in line with the group’s strategy,” the group said.
As part of its new roadmap, Sodexo is changing its organization “towards a simplified and more efficient model”.
For on-site services, operational responsibility is transferred to regions and countries, consolidated into three geographical areas: North America, Europe and Rest of the World, including Asia-Pacific, Middle East, Africa (APMOA) , Brazil and Latin America.
“This will bring more autonomy, speed in decision-making and responsiveness at the local level”, commented Sodexo.
-Pierre-Jean Lepagnot, Agefi-Dow Jones +33 (0)1 41 27 48 19; [email protected] ed: ECH
Agefi-Dow Jones The financial newswire
Dow Jones Newswires
November 02, 2022 03:09 ET (07:09 GMT)