January 9, 2020 / 6:54 AM / 17 days ago

Sodexo expects second-half hit from French strikes, Hong Kong unrest

FILE PHOTO: The logo of French food services and facilities management group Sodexo is seen at the company headquarters in Issy-les-Moulineaux near Paris, France, November 30, 2018. REUTERS/Gonzalo Fuentes/File Photo

PARIS (Reuters) - Sodexo (EXHO.PA) said it expects French strikes and unrest in Chile and Hong Kong to hit its second quarter results, knocking its shares 2% lower on Thursday.

The French food services group said the impact of fires ravaging Australia had yet to be assessed.

“We do not know yet what the impact of fires in Australia will be,” CEO Denis Machuel told a media call.

France has seen national protests against President Emmanuel Macron’s pension reform plans, while Hong Kong has been hit by at times violent anti-government protests.

In Chile, protests began in mid-October over a small hike in metro fares but quickly spun out of control.

Sodexo reported first-quarter revenue growth of 7.1% to 6.08 billion euros (5.15 billion pounds), boosted by its rugby World Cup partnership, offsetting contract losses.

“Revenue growth in the first quarter remains solid with a very successful rugby World Cup, which offsets the impact of contract losses and a decision to exit a Healthcare contract in North America,” Machuel said in a statement.

The company also stuck to its 2020 forecast of organic revenue growth of around 4% and a stable underlying operating margin, excluding the impact of currencies and IFRS 16 implementation.

Reported by Camille Raynaud; Editing by Arun Koyyur and Alexander Smith

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