Richard Cousins
Age: 49
Company: Compass Group
Year named CEO: 2006
Company employees: 388,000
12-month stock performance: –4.8 percent
Compensation: £2.33 million ($4.23 million)*
When your company serves more than 10 million meals a day to everyone from staff at the U.S. Pentagon to Wimbledon tennis fans at the All England Club to school children from St. Louis to Turin, Italy, you’ve earned some bragging rights. But Compass isn’t just about scale. Since 2006, Richard Cousins, the company’s cricket-playing CEO, has whipped the world’s largest contract caterer into shape with a strict diet of corporate streamlining.
Drafted as CEO three years ago, when Compass was struggling with a bloated cost base, Cousins, the former CEO of building materials maker BPB, dropped peripheral businesses such as in-flight catering and food vending machines to concentrate on contract catering. He also drove efficiencies by standardizing operations across the group, which had grown big — and unwieldy — after a decade of acquisitions around the globe.
The results have been impressive. At a time when the worst economic crisis in decades was dominating the headlines, Compass reported a 36 percent jump in earnings per share in the first half of its financial year, which ended March 31, to 15.4 pence, and boosted the interim dividend by 10 percent, to 4.4p.
“Over the past three years, we’ve sold £3 billion of noncore businesses, exited 40-odd countries and launched an operational program to ensure that our 380,000 people around the world all speak the same language. That’s gone pretty well,” says Cousins with typical British understatement.
“Cousins is an operator,” says Paul Lee, director at Hermes Investment Management. “He gets into the nitty-gritty stuff and is driving the transformation of the company’s performance.”
Not that Compass is immune to wider economic trends. Adjusted revenues grew by just 1 percent in the quarter ended March 31, down from a rate of 4 percent in the preceding three months. When clients cut staff, that translates into fewer meals in the company dining hall.
“We could see a little bit of revenue contraction in the second half of our business year. We are noticing the new economy,” says Cousins.
Still, he is quick to point out that Compass has been adding new customers at a fast clip, ranging from the U.S. Senate to the U.K. Jockey Club Racecourses, which gave the company a ten-year, £500 million contract for 14 race tracks. Another source of growth is taking catering contracts to a global level for multinational clients, as Compass is doing for the likes of Google, Exxon Mobil Corp. and Nokia Corp.
* For the fiscal year ended September 30, 2008.
