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Aramark Delivers Fiscal Fourth-Quarter Beat on Strength in US Food, Support Services; Sets Full-Year Outlook

12:14PM ET 11/16/2021 MT Newswires
Aramark's (ARMK) fiscal fourth-quarter results came in higher than expected as food and support services in the US helped boost overall revenue, while the company expects full-year revenue to approach pre-pandemic levels.

Adjusted earnings totaled $0.21 per share in the three months to Oct. 1, compared with a $0.35 loss a year ago. Analysts polled by Capital IQ expected normalized EPS of $0.19. Revenue jumped 32% to $3.55 billion, topping the consensus of $3.29 billion.

Food and support service sales in the US advanced 51% to $2.16 billion, while the international segment added 22% to $765 million, according to the company. Uniform and career apparel logged a 2% slide in revenue.

In-person learning resumed in the US, though a recovery in on-campus retail and catering volumes slowed from last year, the company said. But fans returned to stadiums for Major League Baseball and the leisure business benefited from increased activity at national parks, it added.

Also, US employees continued to return to offices while patient care began to normalize, though retail and catering remained impacted, Aramark said. Consolidated sales were at 90% of pre-COVID-19 levels, driven by new clients, re-opening activity and pricing action.

Aramark expects organic revenue growth of 23% to 27% for fiscal 2022, with consolidated sales approaching pre-pandemic levels. The company projects a full-year COVID-19 revenue headwind of $1.6 billion to $1.9 billion, likely to be partially offset by net new business and pricing pass-through.

"Fiscal '22 is just underway with new client wins already occurring as well as a robust pipeline of opportunity ahead," Chief Executive John Zillmer said on a conference call, according to a Capital IQ transcript. "We're confident in our ability to build upon the momentum that we're creating."

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