NYSE$ARMK

Aramark · Q2 2022 earnings

Q2 2022 earnings · · Investor relations

Briefing

Aramark's financial performance strengthened with double-digit organic revenue growth in each segment and record-breaking pace of new client wins.

Aramark reported a strong second quarter with revenue up 37% and organic revenue up 35%. The company saw double-digit growth across all segments, led by FSS U.S. and is positioned for a second consecutive year of record-breaking Net New Business.

  • Revenue increased by 37%, with organic revenue up by 35%.
  • Double-digit growth was achieved across all segments, led by FSS U.S.
  • Operating Income increased by $137 million, and Adjusted Operating Income (AOI) increased by $138 million.
  • EPS increased to $0.14, and Adjusted EPS increased to $0.22.

Headline financials

Total Revenue

$3.86B

Previous: $2.82B+36.9%
EPS (adj)

$0.22

Previous: -$0.24+191.7%
Organic Revenue Growth

35.0%

No prior period
Free Cash Flow

$35.7M

Previous: -$77.6M+146.1%
Net Income

$35.7M

Previous: -$77.6M+146.1%
Operating Income

$142M

Previous: $5.35M+2556.0%
Gross Profit

-$3.62B

Previous: -$2.73B-32.8%
Cash & Equivalents

$429M

Previous: $1.4B-69.3%
Total Assets

$14.7B

Previous: $14.5B+1.2%
Stock-Based Comp

$23.3M

Previous: $16.6M+40.3%

Revenue & EPS history

Aramark · Revenue · Quarterly

$3.86B

Q2 2022+36.9%vs Q2 2021
Beat estimate in 9 of 16 quarters(56%)
ActualEstimate

Forward guidance

Aramark's full-year performance expectations for fiscal 2022 are as follows: Organic Revenue Growth at or very near 27%, Annualized Net New Business $650M - $750M, AOI Margin at or very near 5%, Free Cash Flow $300M - $350M.

Tailwinds

  • Higher pricing pass-through to clients to recover incremental costs due to inflation
  • Stronger contributions from Net New Business
  • Better-than-expected new account wins, while maintaining last year's improved retention rates
  • Robust sales pipeline, with steadily increasing close rates
  • Continued quarterly progression with Q4 exit near mid-6%

Headwinds

  • Start-up costs associated with better-than-expected new business wins
  • Continued temporary reliance on off-program procurement related to supply chain complexities
  • Percentage margin impacted near-term by higher pricing to recapture elevated cost inflation
  • Slower conversion back from cost-plus contracts to profit & loss (P&L) contracts, primarily in Business Dining
  • Working capital investment associated with slower conversion back to P&L contracts, primarily in Business Dining

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 19 quarterly earnings reports · overlaid with Q2 2022

Historical avgQ2 2022

+0.4%

Avg return

Earnings day

+1.5%

Avg return

5 days after

+3.4%

Avg return

30 days after

50%

27 / 54 earnings

Positive

+9.8%

Q2 2025

Best reaction

-9.0%

Q1 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q2 2026+1.1%+19.3%+22.4%
Q1 2026+5.6%+0.5%+3.1%
Q4 2025-5.2%-0.5%-0.7%
Q2 2025+9.8%+12.2%+16.2%
Q1 2025-2.1%-0.9%-7.6%
Q4 2024-2.8%-4.5%+4.2%
Q3 2024+1.8%+4.4%+13.0%
Q2 2024+0.8%+5.3%+3.4%
Q1 2024-1.8%+3.7%+7.5%
Q4 2023-5.2%-2.8%-3.3%
Q3 2023+9.0%+3.2%-3.4%
Q2 2023+7.2%+8.9%+19.0%
Q1 2023-9.0%-12.3%-18.3%
Q4 2022+4.2%+4.6%+7.4%
Q3 2022+3.1%+5.8%+4.7%
Q2 2022-4.4%-1.8%-1.5%
Q1 2022+3.3%-1.4%-4.3%
Q4 2021+0.3%-3.9%-12.2%
Q3 2021+0.5%+1.5%-4.7%
Q2 2021-3.5%+3.9%-0.3%
Q1 2021-0.7%-2.7%+12.5%
Q4 2020-3.3%+1.0%+7.9%
Q3 2020+1.8%+12.4%+37.7%
Q2 2020-7.0%+2.1%+10.5%
Q1 2020-1.9%-7.0%-23.3%
Q4 2019-0.4%-1.9%-0.5%
Q3 2019+8.0%+9.2%+20.4%
Q2 2019-2.6%+0.0%+12.4%
Q1 2019-1.4%-5.4%-11.4%
Q4 2018+2.4%+6.6%-5.4%
Q3 2018+5.1%+4.6%+6.0%
Q2 2018+1.1%+2.6%+6.1%
Q1 2018-4.8%-7.1%-6.8%
Q4 2017-7.0%-4.7%-2.0%
Q3 2017+0.7%-1.1%+1.3%
Q2 2017+2.9%+1.5%+9.1%
Q1 2017+6.0%+6.1%+8.5%
Q4 2016-8.7%-6.6%-0.6%
Q3 2016+5.5%+5.0%+4.3%
Q2 2016-3.2%
Q1 2016-0.6%
Q4 2015+9.2%
Q3 2015-0.1%
Q2 2015+1.6%
Q1 2015-3.4%
Q4 2012-1.5%
Q4 2014+4.3%
Q3 2013-0.3%
Q3 2014-0.3%
Q2 2013-2.0%
Q2 2014-2.0%
Q4 2013+3.4%
Q1 2014+3.4%
Q1 2013+3.4%
Q3 2012

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