By Catherine Reynolds
Investing.com -- SSP Group (LON:SSPG) stock defied another heavy full-year loss and fresh bad news from the U.K. economy to grind out a 1.7% gain by mid-session in London Wednesday.
The company, which operates a portfolio of food and drink outlets principally at rail and airport hubs, posted a 42% revenue drop in the year through September, against a backdrop of volatility and disruption in the Covid-hit travel sector.
SSP said the emergence of the new Omicron variant of Covid-19 hadn't changed its medium-term assumptions, which foresee a slow return to pre-pandemic conditions. It expects comparable sales and margins to return to 2019 levels only in 2024.
Revenue increased from 21% of 2019 levels at the end of the first half of the year to 53% of 2019 by the end of the second half. It's been running at 66% of 2019 levels in the nine weeks since the start of the new fiscal year, at a time when 72% of its units have been open.
The group's operating loss narrowed marginally to 309 million pounds in the year to September, thanks to a recovery in the second half driven by a rebound in domestic and short-haul leisure traffic.
The group, which recently announced that Patrick Coveney would take over as group chief executive in March 2022, reopened around 800 units since the beginning of June 2021 as demand has bounced back.
SSP expects to open another 200 units by 2024, expanding its network by 15%. It recently announced a new joint venture with Aeroports de Paris (PA:ADP) to run outlets at Paris' Charles de Gaulle and Orly airports, and is also expanding in Thailand and Malaysia.