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Sodexo: Solid Revenue And Profit Growth In Fiscal 2012

Organic growth in Corporate increased to + 6.4%, despite the lack of a turnaround in employment at large companies; in addition, foodservices patronage on sites was unchanged. Revenue growth was led by the success of integrated service offers for clients such as Campbellā€™s Soup, General Dynamics, Circuit of the Americas (Texas), the Federal Aviation Administration (Washington, D.C.), General Electric Company and MIT Lincoln Library (Massachusetts).

In Canada, Sodexo won major new Remote Sites contracts with Suncor and Thomson Iron Mines/Bloom Lake.

In Health Care and Seniors, organic growth was + 2.7%, reflecting lower client retention, mainly a result of the loss of Ascension Health System and still modest business development. The size and complexity of certain contracts in this client segment tend to result in lengthy tender processes.

Clients that have recently chosen Sodexo include Wesley Willows retirement homes (Illinois), Holy Cross Hospital, Chilton Hospital (New Jersey) and Huntington Medical Hospital (Indiana).

Organic growth in Education was + 6.3%, reflecting the contribution of facilities management services contracts won in Fiscal 2011 (particularly Detroit and Lewisville) and increased university restaurant patronage.

Contracts won in Fiscal 2012 included Vermont State College (Vermont), Mount Ida College (Massachusetts), University of Wisconsin-La Crosse (Wisconsin) and California State University-San Marcos (California).

Operating profit

Operating profit was 346 million euro, up + 7.6% compared to the prior year, at constant rates.

On-site productivity gains and tight control of health and benefit plan costs helped to offset pressure from higher food prices and permitted further investments to enhance technical skills and expertise.

Operating margin was stable compared with the previous year, at 5.1%.

1.2 Continental Europe

Revenues
       
(in millions of euro)      

Fiscal 2012
     

Fiscal2011
     

Organic growth
      Acquisitions      

Exchange rate effect
     

Total growth
Corporate 3,346       3,183       + 2.2%                        
Health Care and Seniors 1,396 1,382 + 1.4%
Education       904       908       + 0.1%                  
TOTAL       5,646       5,473       + 1.6%       + 1.6%       0%       +3.2%

Revenues in Continental Europe were 5.6 billion euro, with modest organic growth of + 1.6%.

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