Compass Group has said it expects to report a 5% increase in half-year sales.

In a trading update released this morning for the half year to 31 March, the catering giant said it had a “good” half-year.

Sales during the period had been driven by “good levels of new business wins and high rates of retention for the group overall”, it added.

It reported an expected 2.5% decline in sales across Europe and Japan and said its cost reduction plans were progressing well despite the “very challenging conditions”.

In North America, sales rose 8.5% thanks to its Ascension Health contract, which is expected to contribute nearly 2% to North America and just under 1% to group sales. In its ‘Fast Growing & Emerging’ division, which includes Australia, Brazil, Turkey, Russia, India and China, sales grew by more than 10%.

“Compass has had a good start to the year and our expectations for the full year remain positive and unchanged,” the company said in a statement.

“North America and Fast Growing & Emerging are continuing to perform well and we are making good operational progress in Europe & Japan. Furthermore, we remain positive about the significant structural growth opportunities in both food and support services globally and the potential for further revenue and margin growth.”