North America

Our North American business has delivered an excellent performance

Our North American business (which includes our operations in the USA, Canada and Mexico) has delivered an excellent performance. Revenues were £5.9 billion (2008: £4.6 billion), with organic growth of 1.6%. Operating profit increased by £49 million, or 12.5% on a constant currency basis, to £441 million (2008: £392 million on a constant currency basis). A focus on driving efficiencies, particularly through the purchasing, logistics and production processes and initiatives to reduce overheads, contributed to a full year margin improvement of 60 basis points on a constant currency basis.

The Business & Industry sector has had another year of strong new business gains, including the World Bank Group. Despite the like for like pressures on volume, consumer demand for value offers and ‘grab and go’ increased. This, together with more focused promotions, has helped drive participation and spend. Tight cost management and further efficiency gains have enabled the sector to deliver another year of strong profit and margin growth. The acquisition of Kimco earlier in the year has enhanced our support services capability in this sector, enabling us to better serve our existing clients by offering a combined food and support services package.

In Healthcare, the ongoing integration of our recent acquisitions of Professional Services and Medi-Dyn, both specialist healthcare support service providers, has strengthened our support services offers and contributed to the delivery of strong revenue growth and excellent retention rates. For example, we have recently been appointed to provide support services to The Mount Sinai Hospital in Manhattan, one of the USA’s oldest and largest teaching hospitals.

We have seen good like for like volume growth in Education, driven by increasing enrolments and take up of board plans throughout the year. New business also remained very strong and we have delivered double digit organic revenue growth. We have recently won a contract with The University of North Carolina at Greensboro to provide both dining and vending services as well as contracts with Duval County Public Schools, the University of Pennsylvania and Bowling Green University.

In Levy, our Sports & Leisure business, our ability to quickly flex costs in line with demand and the delivery of further efficiencies have enabled us to improve margins. We continue to see a strong pipeline for new business opportunities and have had some exciting wins including significant contracts with the Palace of Auburn Hills (home to the Detroit Pistons of the NBA) and the United Center (home to the Chicago Bulls and Chicago Blackhawks).

In Canada, we have recently entered into an agreement with Suncor Energy to provide catering and support services to the new Firebag Village site. We have been partnered with Suncor Energy since 1967, when they started their first operations in the Oil Sands.