SSP Group plc

On a pre-IFRS 16 basis, SSP grew revenue by 6% to GBP 1.8 billion, increased underlying operating profit by 18% to GBP 50 million, and expanded operating margin by 30 basis points. Earnings per share improved to 1.1p from a loss of 0.4p last year. Reported operating profit was GBP 62.6 million, including about GBP 11 million of non-underlying items pre-IFRS 16, of which about GBP 6 million were cash. Free cash flow before dividends and share buyback was an outflow of GBP 176 million versus GBP 117 million a year earlier, and net debt/EBITDA was 2.2x, unchanged year on year. For FY '26, management expects EPS in the range of 13.6p to 14.8p, free cash flow before dividends and buyback of over GBP 100 million, and further improvement in ROCE from last year's 18.7%.

Patrick Coveney framed the first half as resilient progress against the 'Focus 26' plan, with management controlling what it can and pushing operational, margin, and cash improvements across the group. He emphasized that Continental Europe is being structurally reset, North America is improving both sales and shareholder conversion through lower minority interests, and the European rail business will be smaller but more profitable after the review. His tone was constructive but cautious, especially on the Middle East, where he said visibility remains limited and outlook assumptions depend on current trading conditions.

Geert Verellen highlighted the hard numbers: revenue up 6% to GBP 1.8 billion, underlying operating profit up 18% to GBP 50 million, operating margin up 30 basis points, and EPS at 1.1p versus a 0.4p loss last year. He said reported operating profit was GBP 62.6 million and non-underlying items were about GBP 11 million pre-IFRS 16, with about GBP 6 million cash. On cash, he pointed to a GBP 176 million H1 free cash outflow before dividends and buyback, driven by seasonality, working capital outflows, and timing items, while saying the GBP 100 million free cash flow target for the year remains intact. He also noted leverage at 2.2x net debt/EBITDA and said CapEx was GBP 93 million in the half, with full-year CapEx expected to be under GBP 200 million.

Analysts pressed on how much of the cash improvement would come from working capital, the sustainability of current like-for-like growth, the margin and timeline implications of the European rail exit, and the sharp decline in North American minority interests. Management said it is not breaking out the working-capital contribution but remains confident the annual GBP 100 million free cash flow target is achievable, and described the rail review as a 2- to 3-year self-funding reset that exits about 110 units and reduces future CapEx. On North America, Patrick said the minority-interest decline reflects both airport mix and structural changes that should continue to reduce the share of profits going to partners. He also said current trading does not show meaningful differences in aggregate consumer behavior across the U.K., North America, or Continental Europe, despite the Middle East disruption.