(News Bulletin 247) – The collective catering specialist delivered solid results for the financial year ended last August. Pluxee, its restaurant and gift voucher subsidiary, has performed well and Sodexo has confirmed that it will be listed on the Paris stock market early next year.

Sodexo brings a nice end to a fairly busy year, marked by strong growth and the announcement of its split.

Like Accor with Edenred thirteen years ago, the collective catering specialist has decided to list its “Pluxee” division separately, which brings together its activities known as “employee benefits and rewards”, i.e. say restaurant vouchers or gifts, via a distribution to its shareholders.

The idea being to give this division the means to develop to further compete with Edenred’s growth and technological advance, while crystallizing value.

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Pluxee will be Dutch… but not fiscally

This Thursday, Sodexo took the opportunity to provide more details on this IPO project. The company confirmed that this operation would be carried out in Paris and should take place “early 2024”.

Previously, a general meeting will take place to approve this project (but since the Bellon family holds 57.5% of the voting rights and Sophie Bellon is CEO of the company, the suspense is not very great). An investor day dedicated to Pluxee will take place before this general meeting in order to “detail its strategic plan and the next stages of its development”.

“Pluxee will be allocated part of Sodexo’s current debt of 0.6 billion euros and will have a capital structure corresponding to an investment grade rating (the investment category in the nomenclature of rating agencies, Editor’s note ) solid,” the company announced.

“The existing double voting rights of Sodexo shareholders will be maintained within Pluxee which will be registered in the Netherlands, thus allowing Bellon SA (the holding company of the Bellon family) to retain a role as long-term controlling shareholder in Pluxee. Pluxee’s tax residence will be maintained in France”, Sodexo also specified.

Growth above expectations

Pluxee contributed well to Sodexo’s results, which turned out to be good for this 2022-2023 vintage, with prospects raised during the year. Which did not prevent the company from overtaking them.

Over the entire fiscal year from September 1, 2022 to the end of last August, Sodexo generated revenues of 23.723 billion euros, a like-for-like growth of 11.6%, more than targeted by the group (11% ). In the fourth quarter alone, like-for-like growth stood at 9.4% according to Jefferies and Stifel, exceeding the consensus which was set at 8.9%.

Jefferies notes that the company benefited from the good dynamics of the business segment in North America which grew by 15.4% as well as the dynamics of Pluxee. According to the bank’s calculations, this subsidiary recorded growth of 32% in the fourth quarter, helped by the rise in interest rates, issuers of restaurant and gift vouchers placing the cash linked to the volumes of issues already released for their customers but not yet spent by their employees.

Remember that Pluxee only represents 4.6% of Sodexo’s revenues. But this very profitable division accounts for more than 37% of its operating profit, displaying a corresponding margin of 33.1%, which also increased by 4.5 percentage points over the 2022-2023 financial year. .

That of Sodexo as a whole appreciated by 60 basis points (0.6%) to 5.6% over one year, a little better than the 5.5% it expected.

Last line, the group’s net profit jumped 14.2% to 794 million euros.

Solid goals

Regarding its outlook, Sodexo has logically delivered forecasts for the 2023-2024 financial year as well as for the 2024-2025 financial year which exclude Pluxee. The company anticipates like-for-like growth of between 6% and 8% per year and an improvement in its operating margin of 30 to 40 basis points per year.

To give an idea, Sodexo excluding Pluxee recorded like-for-like growth of 11% and an operating margin of 4.3% over the last financial year.

In the end, the recipe delivered by Sodexo to the market seems to hit the mark. The group’s action appreciated by 6.4% this Thursday around 2:40 p.m., bringing its growth over the whole of 2023 to 15.3%.

Royal Bank of Canada appreciates “solid” results and “robust” prospects for the new Sodexo.

“Sodexo is maneuvering higher inflation, no longer losing market share and finally benefiting from the favorable winds of outsourcing in the sector,” underlines Jefferies for its part.