Sodexo Announces + 7.7% Revenue Growth with + 5.2% Organic Growth for the First Nine Months of Fiscal 2011

Confirmation of objectives for full-year Fiscal 2011: revenue growth around 4.5% and 10% increase in operating profit (excluding currency effects)


Organic growth analysis

  • On-site Service Solutions: + 5.1% driven by comprehensive service solutions contracts and emerging countries
  • Motivation Solutions: + 6.2% reflects continuing momentum in Latin America

Sodexo (PARIS:SW) (OTCBB:SDXAY) (NYSE Euronext Paris FR0000121220 – SW OTC:SDXAY), global leader in Quality of Life services, today announced revenues for the first nine months of Fiscal 2011, which ended May 31, 2011.

Revenue by activity and geographic region

In millions of euro  

9 months

Fiscal 2010


9 months

Fiscal 2011









  Total change
On-site Service Solutions
-- North America 4,512 4,801 + 4.0% + 2.4% - + 6.4%
-- Continental Europe 4,073 4,257 + 3.8% + 0.8% - 0.1% + 4.5%
-- UK and Ireland 887 908 - 0.2% + 2.6% - + 2.4%
-- Rest of the World   1,577   1,922   + 15%   + 7.5%   - 0.6%   + 21.9%
Total   11,049   11,888   + 5.1%   + 2.6%   - 0.1%   + 7.6%
Motivation Solutions
    489   532   + 6.2%   + 2.7%   -   + 8.9%
Intra-group eliminations   - 13   - 12                
Consolidated total   11,525   12,408   + 5.2%   + 2.6%   - 0.1%   + 7.7%

Organic growth: increase in revenues at constant scope and excluding exchange rate effects.

Commenting on the figures, Sodexo CEO Michel Landel said:

"Since the beginning of the fiscal year, our activities have accelerated, with double-digit growth in emerging markets. This good performance gives us confidence in our ability to achieve organic growth of 4.5% for the full fiscal year. While we remain vigilant in the current macroeconomic environment, our teams continue to have multiple opportunities for differentiation through the development of our Quality of Life services."

Analysis of Group organic growth

In millions of euro  

Nine months

Fiscal 2010


Nine months

Fiscal 2011

  Organic growth
Corporate   5,251   5,764   + 6.7%
Health Care and Seniors   2,946   3,104   + 3.4%
Education   2,852   3,020   + 3.9%
On-site Service Solutions – total   11,049   11,888   + 5.1%
Motivation Solutions   489   532   + 6.2%
Eliminations   - 13   - 12    
TOTAL   11,525   12,408   + 5.2%

On-site Service Solutions

Organic growth in Corporate was + 6.7%, reflecting Sodexo’s momentum in emerging markets and the significant impact from the ramp-up of comprehensive service solutions contracts in Justice Services and Defense and with corporate clients. Sodexo achieved 20% organic growth in Justice Services and 16% in Defense for the first nine months of the fiscal year.

In Education and in Health Care and Seniors, Sodexo continued its steady progression during the past quarter in line with previous quarters.

Motivation Solutions

Organic revenue growth in Motivation Solutions was + 6.2% for the nine months, a result of increased business development in Brazil and France during the 3rd Quarter.

Currency impact evolution

There was a positive currency impact of + 2.6% for the first nine months of the year, mainly from the strengthening of the U.S. Dollar, the Pound Sterling and the Brazilian Real against the Euro.

Analysis of organic growth: On-site Service Solutions

North America
In millions of euro  

Nine months

Fiscal 2010


Nine months

Fiscal 2011

  Organic growth
Corporate   925   961   + 1.1%
Health Care and Seniors   1,653   1,783   + 5.5%
Education   1,934   2,057   + 4.1%
TOTAL   4,512   4,801   + 4.0%

Organic growth in Corporate was driven by the start-up of comprehensive service solutions contracts for clients such as GlaxoSmithKline, Henkel, British Aerospace and Colgate. Patronage levels on foodservices sites remained comparable to the same period last year, reflecting the absence of a true recovery in terms of hiring by clients.

Recent contract wins include General Electric Aviation (Ohio), Discover Financial Services and Guardian Life Insurance Company of America.

In Health Care and Seniors, organic growth accelerated to + 5.5%, reflecting excellent client retention in Fiscal 2010 and higher comparable unit growth, driven by an expanded offer on some contracts and slight inflation.

Among recently won contracts are Jackson Memorial Hospital (Florida), Crozer Chester Medical Center (Pennsylvania), and Bethesda Memorial Hospital (Florida).

Organic revenue growth in Education is mainly a result of increasing enrollment on university campuses and in schools. During the 3rd Quarter, Sodexo also started a major new contract for the 136 public schools of the city of Detroit (Michigan) to provide technical maintenance services, cleaning services and maintenance of buildings and green spaces. This is one of the largest Education contracts ever won by Sodexo in the United States.

Continental Europe
In millions of euro  

Nine months

Fiscal 2010


Nine months

Fiscal 2011

  Organic growth
Corporate   2,287   2,431   + 5.3%
Health Care and Seniors   1,031   1,047   + 1.1%
Education   755   779   + 2.8%
TOTAL   4,073   4,257   + 3.8%

Revenues in Corporate for the 3rd Quarter reflect improved comparable unit growth, partly a result of rising inflation which offset the end of the positive effect from the ramp-up of the French Ministry of Justice contract.

Contract wins during the 3rd Quarter included, in particular, the major Public Private Partnership project to construct, equip, operate and maintain the future Paris headquarters of the French Defense Ministry on a 400,000 m² site (to be operational December 2014). Sodexo will be responsible for foodservices, management of accommodations, reception services, security, cleaning services, concierge services (new stands and hair salon), maintenance of green spaces and waste treatment.

Sodexo also won contracts with Kraft Foods in Belgium, Atlas Copco Rock Drills and Bombardier Transportation Sweden AB in Sweden and The M. Pire building complex in Germany.

In Health Care and Seniors, organic growth reflects moderate comparable unit volumes and weak development in the unfavorable economic environment.

Recently signed contracts include the Association for Youth and Adults with Disabilities (APAJH) of Val d'Oise (6 sites) in France and Tilkka Hospital in Finland.

In Education, organic growth continued in France and Italy and benefited from recent contract wins in Sweden, including schools in the cities of Helsingborg and Katrineholm. Among Sodexo’s many other recent successes were a major contract for 314 schools in the city of Marseilles and a contract with OSEKK (Oulu Regional Education Authority) in Finland.

UK and Ireland
In millions of euro  

Nine months

Fiscal 2010


Nine months

Fiscal 2011

  Organic growth
Corporate   618   640   + 1.1%
Health Care and Seniors   177   170   - 6.5%
Education   92   98   + 3.1%
TOTAL   887   908   - 0.2%

In Corporate, organic growth essentially reflects the contribution of contracts with the ministries of Defense and Justice but also in Corporate for clients such as Johnson & Johnson and GlaxoSmithKline.

The decline in Health Care and Seniors is a result of the non-renewal last year of some of the services provided at Kings Hospital as well as weak business development.

Organic revenue growth in Education reflects successful development at universities, particularly in the management of accommodation services on the Solent, Medway, Lincoln and Southampton campuses. Recently signed contracts include Birmingham City University.

Rest of the World (Latin America, Middle East, Asia, Africa, Australia and Remote Sites)
In millions of euro  

Nine months

Fiscal 2010


Nine months

Fiscal 2011

  Organic growth
Corporate   1,421   1,732   + 15.2%
Health Care and Seniors   85   104   + 12.5%
Education   71   86   + 13.9%
TOTAL   1,577   1,922   + 15.0%

Growth in Latin America and Asia continued to accelerate during the first nine months, a result in particular of strong development in Brazil (Natura, Petrobras Fafen, Vale Norte), Chile (Excon SQM), Peru (Plus Petrol Norte and Southern Peru Copper Corp. / Cuajone-Toquepala) and Australia (Karara Mining, Western Turner). Among the numerous new contract wins in India and China, where Sodexo holds uncontested leadership positions, were Shimano Bicycle Parts in China and Renault Nissan in India.

Analysis of organic growth: Motivation Solutions

Issue volume for Motivation Solutions increased 10.5% compared to the same period last year reaching nearly 10.4 billion euro. Organic growth was + 8% and there was a positive currency effect of + 2.4%, a result in particular of the Brazilian Real’s appreciation.

Revenue was 532 million euro with organic growth of + 6.2%:

  • + 13.7% in Latin America (which represents 52% of revenues), reflecting increases in the number of beneficiaries and in face value, contracts won by Sodexo teams and a slight positive impact from interest rate changes;
  • a slight decrease of -0.9% in Europe. The situation remains difficult in Central Europe and lower sales of Eco-Pass(1) in Belgium (the prior period having benefited from its launch) were almost fully offset by improved performance in France, in particular from the CESU contract signed with the General Council of Hautes-Pyrenees.

The difference between issue volume and revenue growth results from the strong increase in issue volume from the ONEM contract in Belgium (universal services vouchers similar to the CESU in France). This trend does not translate into an equivalent increase in revenues, given the size and model of this contract.

Recent contract wins include for Restaurant Pass, Audi Motor in Hungary, Santander Consumer Bank in Germany, BBVA Comercializadora in Chile, for Food Pass, Servicio Nacional Integrado de Administración Aduanera y Tributaria in Venezuela, and for Incentive Pass, Anhanguera Educacional in Brazil.

(1) Eco-Pass is an employer-provided voucher that employees can use to purchase environmentally-friendly products or services such as insulating materials, low-energy consumption light bulbs and bicycles.

Human Resources

We continue to make progress in developing our human resources. We carefully follow our action plans to improve the retention, internal promotion and engagement of our employees.

The engagement of our employees is a reflection of their confidence in Sodexo's strategy and future.

Financial situation

Aside from the refinancing of 600 million U.S. dollars at the end of March 2011 as part of a private placement with U.S. investors, noted in the interim financial report published on April 21, there was no significant change in the financial structure or the level of Group debt as of May 31, 2011.

Fiscal 2011 outlook

Sodexo confirms its full year Fiscal 2011 objectives:

  • organic revenue growth of around 4.5%.
  • an increase in operating profit of around 10%, excluding currency effects.

About Sodexo

Sodexo, world leader in Quality of Daily Life Solutions

Quality of Life services play an important role in the progress of individuals and the performance of organizations. Based on this conviction, Sodexo serves as the strategic partner for companies and institutions that place a premium on performance and well-being, as it has since Pierre Bellon founded the company in 1966. Sharing the same passion for service, Sodexo’s 380,000 employees, in 80 countries, design, manage and deliver an unrivaled range of On-site Service Solutions and Motivation Solutions. Sodexo has created a new form of service business that contributes to the economic, social and environmental development of the communities, regions and countries in which it operates and to the fulfillment of its employees.

Sodexo key figures (as of August 31, 2010)


Sodexo in the world

15.3 billion euro consolidated revenue

380,000 employees

34,000 sites

50 million consumers served daily

80 countries

21st largest employer worldwide

8.5 billion euro market capitalization (as of July 5, 2011)

Financial communications calendar

Fiscal 2011 results: November 9, 2011. Publication by press release prior to the opening of Paris Euronext, followed by a briefing for analysts and journalists.

This date is indicative only and remains subject to change.

This press release contains statements that may be considered as forward-looking statements and as such may not relate strictly to historical or current facts. These statements represent management's views as of the date they are made and we assume no obligation to update them. You are cautioned not to place undue reliance on our forward looking statements.

First Quarter (September to November)

In millions of euro   Fiscal 2011   Fiscal 2010
On-site Service Solutions   4,108   3,701
North America   1,733   1,522
Continental Europe   1,436   1,373
UK and Ireland   315   295
Rest of the World   623   511
Motivation Solutions   164   166
Eliminations   - 4   - 5
TOTAL   4,268   3,862

Second Quarter (December to February)

In millions of euro   Fiscal 2011   Fiscal 2010
On-site Service Solutions   3,819   3,477
North America   1,523   1,389
Continental Europe   1,372   1,311
UK and Ireland   298   288
Rest of the World   626   488
Motivation Solutions   187   154
Eliminations   - 4   - 4
TOTAL   4,001   3,626

Third Quarter (March to May)

In millions of euro   Fiscal 2011   Fiscal 2010
On-site Service Solutions   3,961   3,871
North America   1,545   1,601
Continental Europe   1,449   1,388
UK and Ireland   294   304
Rest of the World   673   578
Motivation Solutions   182   170
Eliminations   - 4   - 5
TOTAL   4,139   4,036

9 months Fiscal 2011

In millions of euro   Fiscal 2011   Fiscal 2010   % Variation






On-site Service Solutions   11,888   11,049   + 7.6%   + 5.0%
North America   4,801   4,512   + 6.4%   + 4.0%
Continental Europe   4,257   4,073   + 4.5%   + 3.7%
UK and Ireland   908   887   + 2.4%   - 0.2%
Rest of the World   1,922   1,577   + 21.9%   + 14,4%
Motivation Solutions   532   489   + 8.9%   + 6.2%
Eliminations   - 12   - 14        
TOTAL   12,408   11,525   + 7.7%   + 5.1%
1€ =  

Average rate

9 months Fiscal 2011


Average rate

9 months Fiscal 2010

US Dollar   1.3743   1.4017
Pound Sterling   0.8623   0.8871
Brazilian Real   2.292   2.498

It should be noted that, contrary to exporting companies, the revenue and expenses of Sodexo subsidiaries are denominated in the same currency. Consequently, foreign exchange variations do not have operational risk.

Fiscal 2011 – Nine months

On-site Service Solutions



Maersk Container Industry Dongguan Ltd., Dongguan, China (2,800 people)

Shimano Bicycle Parts (Tianjin) Co., Ltd., Tianjin, China (1,100 people) and Kunshan, China (2,500 people)

Discover, Financial Services, multiple sites (Arizona, Ohio, Illinois and Delaware), USA (10,047 people)

GE Aviation, Evendale, Ohio, USA (7,200 people)

RIE Quadrants, Guyancourt, France (600 people)

Bombardier Transportation Sweden AB, Vasteras, Sweden (1,200 people)

JANSSEN CILAG Gmbh, Neuss, Germany (900 people)

The M.PIRE, Munich, Germany (2,000 people)

Kraft Foods LU, Herentals, Belgium

Atlas Copco Rock Drills AB, Orebro, Sweden (1,700 people)

Upplands Väsby kommun (Multihuset), Stockholm, Sweden

Aéroport de Paris Immobilier, Paris, France (750,000 m²)

Knesset, Israel

Renault Nissan, Oragadam, India (5,000 people)

Edison International, Rosemead, CA, USA (4,500 people)

The Guardian Life Insurance Company of America, multiple sites (New York, NY; Bethlehem, PA; Pittsfield, MA; Appleton, WI; Spokane, WA) USA (4,825 people)

Plaza Indonesia Mall, Indonesia


Health Care and Seniors


Crozer Chester Medical Center, Upland, Pennsylvania, USA (653 beds)

St. Bernard Hospital, Chicago, Illinois, USA (198 beds)

Bethesda Memorial Hospital, Boynton Beach, Florida, USA (362 beds)

Augusta Health, Fishersville, Virginia, USA (255 beds)

Bayou Manor, Houston, Texas, USA (227 beds)

Présence Verte Services, Région de Poitiers, France (800 people)

Région Skane, Lund, Sweden

Lunds kommun, Lund, Sweden

Tilkka Hospital - Etera – Esperi, Helsinki, Finland (400 beds)

Association APAJH 95, 6 sites, Val d'Oise, France (350 beds)

CAS de Paris, Paris, France (28,000 meals per month)

Henry Mayo Newhall Memorial Hospital, Valencia, California, USA (167 beds)




The International School of Macau (TIS), Hong Kong, China (935 students)

Dalian Maple Leaf Educational Systems, Dalian, China (316 students)

Lewisville Independent School District, Lewisville, Arkansas, USA (1,000 students)

Belvidere Community United School District 100 - K-12 Nutrition, Belvidere, Illinois, USA, (8,800 students)

Oconee County School District - K-12 Nutrition, Walhalla, South Carolina, USA (10,729 students)

Rogers State University - Campus Dining, Oklahoma, USA (4,154 students)

OSEKK, Oulu, Finland (3,500 students)

City of Marseilles, France (2,065,760 meals/year)

NSW Police College, Goulburn, Australia (3,000 students)

Birmingham City University, United Kingdom (25,000 students)

Harris Academy Falconwood, London, United Kingdom


Remote Sites


EXCON (SQM), Antofagasta, Chile (650 people)

Campamento Sierra Gorda, Antofagasta, Chile (6,250 people)

Pluspetrol Norte, Iquitos, Peru (2,300 people)

SERPETBOL FLOWLINE, Cusco, Peru (720 people)

SOUTHERN Peru Copper Company, Cuajone-Toquepala, Peru (1,500 people)

AZUCA HOCHSCHILD, Arequipa, Peru (500 people)

Polyus Gold Natalkinskoe mining field, Magadan, Russia

The Floatel Jascon 31 (TOTAL), Angola (460 people)

Ocean Rig – Leiv Eriksson, Denmark (120 people)

Evans Landing, Australia (210 people)



Motivation Solutions



Santander Consumer Bank, Germany (Meal Pass, 770 beneficiaries)

AZ Turnout Sint Elizabeth Campus, Belgium (Meal Pass, 800 beneficiaries)

EVN Bulgaria Elektrorazpredelenie AD, Bulgaria (Food Pass, 3,300 beneficiaries)

Audi Motor, Hungary (Meal Pass, 5,800 beneficiaries)

“Police” Chemical Plant, Poland (Gift Pass, 3,000 beneficiaries)

Amboseli, Czech Republic (Meal Pass, 200 beneficiaries)

Reckitt Benckiser, Romania (Incentive)

APA Canal 2000, Romania (public water services) (Meal Pass, 640 beneficiaries)

Sberbank, Russia (Gift Pass, 5,000 beneficiaries)

Ericsson Microelectronics R & D Center, Turkey (Meal Pass, 45 beneficiaries)

BASF chemical, Turkey (Meal Pass, 40 beneficiaries)


Latin America


Brazilian company cartridges, Brazil (Food Pass, 845 beneficiaries)

Anhanguera Educacional, Brazil (Incentive, 800 beneficiaries)

BBVA Comercializadora, Chile (Meal Pass, 450 beneficiaries)

GlaxosmithKline, Chile (Meal Pass, 190 beneficiaries)

Servicio Nacional Integrado De Administracion Aduanera y Tributaria (Seniat), Venezuela

(Food Pass, 11,150 beneficiaries)

National Institute for land management, Venezuela (Food Pass, 3,080 beneficiaries)

Criminal Investigation Management and Interpol, Colombia (Mobility Pass, 210 beneficiaries)

Communications and Transportation Secretary, Mexico (Mobility Pass, 280 beneficiaries)



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