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Catering group Elior eyes slower sales growth in 2018/19

Catering group Elior eyes slower sales growth in 2018/19
FILE PHOTO: The logo of Europe's third-largest catering group Elior is seen on top of the company's headquarters in the financial and business district in La Defense at Courbevoie near Paris, France. REUTERS/Charles Platiau/File Photo   -   Copyright  Charles Platiau(Reuters)
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PARIS (Reuters) – Elior <ELIOR.PA>, Europe’s third-largest catering group, predicted that organic sales growth would slow in the current 2018-2019 fiscal year from 3 percent in 2017-2018, partly due to its exit from non-profitable contracts in Italy.

Elior, which competes with Sodexo <EXHO.PA> and Compass <CPG.L> and has made several profit warnings over the last year, also predicted its adjusted EBITA (earnings before interest, tax and amortisation) margin would stabilise after falling to 4.3 percent in 2017/2018 from 5.3 percent the previous year.

Elior is reviewing several options, including the separation of its concessions business which includes airport catering, as part of a broader plan to boost its growth.

Chief Executive Philippe Guillemot said on Tuesday that a decision would be taken during the first half of 2019.

The 2017/18 results had already been well flagged after Elior confirmed last month preliminary targets which included organic growth of 3 percent and an adjusted EBITA margin of 4.3 percent.

(Reporting by Dominique Vidalon; Editing by Sudip Kar-Gupta)

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