Compass Group has increased its full-year profit guidance after reporting a 12% year-on-year underlying operating profit jump in the six months to 31 March, totalling $1.84bn.

The contract food service group reported that its revenue increased by 9% in this period to $25bn, with new business wins rising by 14% year-on-year to $4.1bn.

The business wins were led by its business and industry sectors, which delivered double-digit growth across a "diverse client base".

Compass stated that it is investing in "competitive advantages" to support long-term growth, with highly attractive structural growth opportunities with addressable market having increased by 5% per annum.

Furthermore, its integration of Vermaat is progressing well, strengthening its European growth platform, and it has also recently acquired Pro Care Management in Germany for $270m, meaning that it is now operating group purchasing organisations in five of its top 10 markets.

Group chief executive at Compass, Dominic Blakemore, stated: "Compass operates in a highly attractive market, with sectors that are expected to benefit from continued structural growth. Our total addressable market has historically grown at around 5% per annum and could reach c.$600bn by 2035. Clients face increasing complexity, such as regulation, allergens and data-led insights, and these factors are driving demand for outsourcing across all sectors.

"Today's results demonstrate consistent execution and the strength of our business model as our services become increasingly integral to our clients' operations, supporting strong recurring revenues."

Following the results, the food service company increased its profit guidance for the full year, and now expects underlying profit growth to be above 11% in 2026.

It stated that this reflects organic revenue growth of around 7% and 2% growth from M&A and ongoing margin progression.

Following the update, shares in Compass increased by over 3%.

Investment director at AJ Bell, Russ Mould, said that the firm has demonstrated its "steadiness and resilience" in the current uncertain environment.

He concluded: "The company is benefiting from a long-term shift from businesses and other large organisations doing their catering in-house to having third parties do the job. This is reflected in a strong set of first-half results which are accompanied by increased guidance for the full year. Equally as important as winning new business is holding on to existing clients and Compass got this part right too – with retention rates remaining healthy.

"While acquisitions have been a part of the growth story, organic growth in the first half was solid. As the leading operator in this market, Compass’ scale allows it to achieve significant operational efficiencies and strike attractive deals with suppliers, and this is reflected in profit growing faster than revenue. This lends encouragement to the view that Compass can deal with any inflationary pressures associated with the Iran war and resulting energy price shock."

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