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Dec 27, 2024
Aramark Q1 2025 Earnings Report
Aramark's Q1 2025 performance reflected strong profitable top-line growth, accelerated AOI growth, and strategic capital structure leveraging.
Key Takeaways
Aramark reported a positive start to fiscal year 2025, marked by revenue growth, increased profitability, and strategic capital allocation. The company's focus on profitable growth strategies and operational efficiencies drove strong financial results.
Revenue increased by 3%, with organic revenue growth of 5%, marking the highest revenue quarter in Global FSS history.
Operating Income rose by 30%, and Adjusted Operating Income (AOI) increased by 13%, achieving a record AOI for a first quarter in Global FSS history.
GAAP EPS saw a significant increase of 264% to $0.39, while Adjusted EPS grew by 25% to $0.51, reflecting the execution of profitable growth strategies.
The company expanded its global supply chain footprint with the completion of a GPO acquisition in Europe, increasing supply chain spend by $500 million, and commenced share repurchases as part of a $500 million program.
Forward Guidance
Aramark anticipates accelerating revenue growth and reaffirms its performance expectations for fiscal year 2025, driven by significant new business pipeline and client retention.
Positive Outlook
- Expects revenue growth to accelerate, particularly in the second half of the year, resuming double-digit top-line growth.
- Confident in its ability to achieve Net New of 4% to 5% of prior year revenue with retention levels above 95% in fiscal 2025 and beyond.
- New business pipeline across the organization remains significant, including in first-time outsourcing.
- Completed the acquisition of Quantum Cost Consultancy Group, strengthening its position as a leading global professional procurement and supply chain services provider.
- Global Supply Chain spend now exceeds $20.5 billion with enhanced capabilities in key geographies.
Challenges Ahead
- The fiscal 2025 outlook reflects management's current assumptions regarding numerous evolving factors that are difficult to accurately predict.
- Unfavorable economic conditions could affect the results.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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