SSP Group shares gained 10.3% in early morning trading on Tuesday following a 212.9% revenue growth to £803.2 million in HY1 2022 compared to £256.7 million the previous year.
The company credited the lifting of Covid-19 restrictions to the resurgence in travel, leading to an uptick in consumer demand at its units across UK bases.
Demand reportedly returned to 64% of 2019 levels in HY1 2022, which was boosted in the first six weeks of the second half to 83% of pre-pandemic rates.
SSP Group said approximately 80% of its estate was currently open, representing 2,200 operating units across the UK and Republic of Ireland.
“The business is recovering well from a hugely challenging period. We have seen a significant rebound in trade since the impact of Omicron, with revenues currently running at over 80% of pre Covid-19 levels and with a similar proportion of our sites now open,” said SSP Group CEO Patrick Coveney.
The airport caterer announced a £14.7 million EBITDA against an underlying EBITDA loss of £110.3 million year-on-year, alongside an operating profit of £26 million from a loss of £219.9 million.
SSP reported a pre-tax loss under IFRS 16 of £2.3 million compared to a loss of £299.7 million the previous year, with a £55.3 million loss on a pre-IFRS 16 basis against a £182 million loss in HY1 2021.
The company mentioned a basic loss per share of 4.1p under IFRS 16 from a 42.3p loss per share.
SSP Group highlighted a free cash outflow of £30.9 million against £140.9 million year-on-year, following a £41.9 million capital investment to support the mobilisation of its new unit pipeline which has seen 50 new units opened over the period.
The travel food company also noted a net debt of £1,154.6 million, including lease liabilities of £814.8 million.
The group confirmed a strong liquidity position with cash and undrawn committed facilities of £606.9 million at the close of March 2022, after the repayment of £300 million borrowed under the Covid Corporate Financing Facility.
The company also noted a pipeline of 230 secured new units, which it expects to open over the coming two years, adding a projected £300 million of annualised sales.
It further expects cumulative net gains secured from the end of FY 2019 to add £500 million to annualised revenue by 2025.
SSP Group commented that its outlook estimated HY2 2022 sales at 80-85% of pre-Covid-19 levels and for FY 2022 sales of approximately £2-2.1 billion, along with a FY EBITDA margin between 5% and 6%.
The food and beverages company warned that it anticipated short-term supply chain challenges across the next few months, and the sharper sting of inflation pressure to impact profit levels.
The firm predicted a strong summer with medium-term expectations to return to broadly pre-coronavirus rates of revenue and EBITDA margins on a pre-IFRS basis.
“SSP has a number of fundamental strengths, including very strong local business platforms around the world, industry-leading operational execution, as well as outstanding financial discipline,” said Coveney.
“We anticipate a full recovery in leisure travel, which drives the majority of our business, and are confident that we are well positioned for the months and years ahead.”
