SSP Group’s share price fell more than 7% in early trading on Tuesday after the food travel operator reported a weaker-than-expected sales performance.
SSP’s revenue grew 6% in constant currency during the third quarter, below analysts’ expectations of 7%.
In the UK, sales were up 7%, driven by strong like-for-like sales at the beginning of the quarter, helped by the timing of Easter.
However, this was less than expected, with the business affected by a cyberattack on M&S, for which it runs numerous travel stores. It said sales had since recovered.
SSP’s share price fell over 7% following the announcement, reversing some of the gains the FTSE 250 group earnt from the IPO of its Indian joint venture earlier this month.
Analysts at UBS previously warned of SSP’s outlook, suggesting its mid-term expectations now appeared “stretched” due to slowing airline capacity growth in the US and India.
It noted capacity in Europe and the UK appeared more stable, though it did not believe this was enough to offset weakness in the US and India.
SSP said sales in North America exceeded expectations in the quarter by growing 5%. Howewer, like-for-like sales were down 2%, with the group blaming “recent geopolitical events in the US, which led to a fall in air travel in late spring and early summer”.
In continental Europe, sales were flat due to weaker consumer spending, which hit the rail sector in particular.
Despite the challenges, SSP maintained its guidance for the year thanks to an acceleration of its cost-efficiency initiatives and improved trading at the start of the fourth quarter.
No comments yet