SSP Group, the owner of the Upper Crust chain, has forecasted annual operating profit to be slightly below expectations due to lower summer travel in North America, which overshadowed growth in the UK. Shares fell 5% in early trading.
The ongoing conflict in the Middle East is affecting air travel and airline capacity, impacting SSP’s operations at airports and train stations. While demand remains strong among wealthier US tourists, budget travelers are scaling back due to rising ticket prices driven by increased fuel costs. Major airlines like American, United, and Southwest have also reduced flights to cope with these costs.
SSP expects an annual operating profit of around £230 million, below analyst expectations of £239 million, citing subdued passenger numbers during the summer peak. RBC analysts warned that high jet fuel prices could dampen near-term travel demand in the region.
In contrast, SSP reported a 9% increase in like-for-like sales in the UK and Ireland, while North America saw only a 2% increase. CEO Patrick Coveney remains optimistic about meeting earnings per share expectations due to the company’s diversified portfolio, despite challenges in the Asia Pacific and Eastern Mediterranean regions. However, passenger volumes in Gulf markets have rebounded to 90% of last year’s levels.
