Upper Crust owner boosted by airport disruption but rues rail strike hit
The owner of the Upper Crust sandwich chain and Ritazza coffee shops has revealed a boost to its revenue from chaos facing passengers at airports globally but admitted sales damage from UK rail strikes.
SSP, which also has the Cabin and Camden Food co-brands in its stable of offerings, told investors it expected annual sales and profit to be at the upper end of its previous outlook.
It credited a recovery in air and rail travel in all its markets since COVID restrictions were eased but said that revenues during its third quarter to 30 June remained at 87% of 2019 levels.
The group said it expected to deliver sales in the region of £2.1bn for the financial year as a whole.
The aviation sector’s struggles to recruit, which has knocked flight reliability worldwide this year as passenger demand gathered pace, meant airport outlets “benefitted from longer passenger dwell times”, SSP said in its update to investors.
“Geographically, we have seen a strong recovery across all divisions, led by continental Europe, where sales in the third quarter averaged 93% (of 2019 levels), and North America, averaging 91%.
“In the UK, sales averaged 82% for the quarter, driven by a further strengthening of sales in Air, whereas trading in Rail was impacted by the recent industrial action.”
SSP reported “very low” levels of passenger traffic in China because of the country’s tough stance on coronavirus outbreaks.
It said of the outlook: “We are well positioned to benefit from the continued recovery of the travel sector, notwithstanding the current challenges of airport disruption, labour shortages and industrial action across certain air and rail markets.
In common with the entire hospitality sector, we continue to face widespread and increasing inflationary pressures impacting our supply chain, labour and energy costs, and these are anticipated to persist well into next year.
“However, we are confident in our ability to manage these pressures through productivity and pricing initiatives and expect to mitigate the impact on profit, whilst sustaining the positive momentum in consumer demand.”