PARIS: Elior, Europe’s third-largest catering group, predicted on Wednesday that organic sales growth would accelerate to at least 3 per cent in the 2017-18 fiscal year from 2.3 per cent achieved in the 2016-17 fiscal year ended Sept.30.

Elior, which competes with France’s Sodexo and Britain’s Compass, also predicted that its adjusted profit before interest, tax, depreciation and amortisation margin would remain stable in the current year after declining by 20 basis points in the 2016-17 fiscal year.

The company made the forecasts after reporting that revenues rose by a reported 8.9 per cent to 6.422 billion euros ($7.59 billion) in the year ended Sept.30, helped by acquisitions.

Closely watched organic revenue growth was 3.6 per cent, excluding the impact of voluntary contract exits, and 2.3 per cent, including the negative impact of these exits.

Elior’s adjusted EBITDA rose 5.9 per cent to 531 million euros, giving a margin of 8.3 per cent of revenue against 8.5 per cent a year earlier. This was in a line with toned-down margin target provided in November.

Elior added it would continue to eye acquisitions, notably in the United States, which is now its second-biggest revenue contributor.

Last month, Elior had issued a profit warning on its annual earnings, due to the start-up costs for new contracts, the impact of Hurricane Irma in September and a lower-than-expected contribution from a savings plan this year.

Reuters