SSP Group, the global travel food outlet operator behind brands like Upper Crust and Millie's Cookies, has initiated a major strategic review of its Continental European rail division. The move comes as the company grapples with a slow post-pandemic recovery in passenger numbers and heightened competition across the region's rail networks.
Financial Performance Amidst Sectoral Pressure
Despite the headwinds facing its European rail operations, SSP reported a robust financial performance for the year ending 30 September. The firm announced that underlying pre-tax profits climbed 8% to reach £193 million. This was supported by a 6% increase in group revenues, which totalled £3.6 billion. The positive results prompted an uplift in the company's profitability outlook for the new financial year, sending its shares soaring by 15% in Thursday morning trading.
Roots of the European Rail Review
The group, which runs food and beverage outlets in airports and train stations worldwide, stated it is considering "all potential options" for the business. It has appointed consultancy Alvarez & Marsal to support the "wide-ranging" assessment. SSP attributed the need for the review to a confluence of factors that have hampered returns.
"Since Covid, the slow return of passenger numbers, changing passenger profiles, with leisure travel increasing over commuting, a changing brand portfolio and an increase in food and beverage space and competition across the rail network, have all combined such that we have not delivered adequate returns on our rail investments in Continental Europe," the company explained.
The board expects to provide an update on the review on or before its interim results in May 2026.
Regional Performance and Future Confidence
Group Chief Executive Patrick Coveney noted that strong trading in three of its four geographic regions had driven the annual results, aided by a continued focus on cost efficiency. "However, we acknowledge there is more to do to strengthen our operational performance, most notably in Continental Europe where we have now reset our team, model and balance sheet," Coveney stated.
The company reported a particularly strong performance in the UK and Ireland, where like-for-like sales growth hit 7% over the past year. This was bolstered by new contract wins at airports including Bournemouth, Exeter, and Southampton. SSP also highlighted a successful shift towards experience-led concepts, such as the Peaky Blinders-themed Shelby & Co restaurant at Birmingham Airport.
Looking ahead, SSP struck an optimistic tone for the 2025-26 financial year. The group has seen a positive start, with like-for-like sales growth turning positive in all regions and tracking at 4% year-to-date. "This early momentum, together with the specific actions that we are taking to deliver sustained improvements in profit, cash and return on capital, gives us increasing confidence in our prospects for the coming year," Coveney added.
