Sodexo (SW) H1 2026 earnings summary

Executive summary

• Organic revenue growth reached 1.7% in H1 FY26, with total revenues of €12.0bn, down 3.7% year-over-year due to a negative 5.3% FX impact, mainly from the US dollar.

• Underlying operating profit margin fell to 3.7%, down 140-150bps year-on-year, reflecting execution challenges, contract reviews, and increased investments.

• Group net profit dropped 56.7% year-over-year to €188m; underlying net profit was €285m, down 36.7%.

• Leadership changes and organizational simplification were implemented to accelerate decision-making and restore competitiveness.

• Strategic priorities include a reset strategy, Shift and Grow program, and accelerated investment in technology and commercial capabilities.

Financial highlights

• Revenues: €12,017m (H1 FY26) vs €12,475m (H1 FY25), down 3.7% reported, up 1.7% organic.

• Underlying operating profit: €442m, down 32.1% year-over-year.

• Free cash flow: -€243m, broadly stable year-over-year.

• Net debt increased to €3.6bn, with a net debt/EBITDA ratio of 2.7x.

• Net financial expense rose to €64m, up from €40m, due to higher debt costs.

Outlook and guidance

• FY26 organic revenue growth expected between 0.5% and 1%, with underlying operating profit margin at 3.2%-3.4%.

• Full-year currency impact on revenue expected at -3%; M&A impact at +0.5%.

• Net debt/EBITDA ratio expected to end FY26 above the 1-2x target range.

• Other operating income and expenses for FY26 expected around -€300m, about half from restructuring.

• Investor update scheduled for July 16, 2026, to present mid-term ambitions.