Shooting Star Press; SSP Group plc Investment Guide

SSP Group plc is a foodservice firm, headquartered in the UK. The company owns and manages a number of different restaurant chains worldwide, taking the role of the concessionaire. In 2014, SSP Group was the subject of an Initial Public Offering; listed on the London Stock Exchange, the firm is a constituent of the FTSE 250 Index.

The firm doesn’t ‘own’ the majority of the brands in their stable; they act as an officially mandated franchisee of sorts, for internationally renowned brands, such as Starbucks, Burger King, Millie’s Cookies, Marks & Spencer Simply Food, YO! Sushi and Upper Crust. However, the firm has experimented successfully with minting their own brands since 2000 – Camden Food Co. and Caffè Ritazza.

Food companies are often regarded as supremely safe investments – after all, food is almost as fundamental to the daily existence of human beings as oxygen, or water. Individual restaurant chains and food brands can die, but the world population’s eternal need for food ensures the perpetual necessity and prospective longevity of businesses operating in the sector. As a favoured partner for many of the world’s most recognisable chains and outlets, SSP Group occupy a unique and enviable position in the food market. The firm’s own brands have achieved notable success of their own since their creation, with Camden Food Co. outlets spreading steadily across the UK; a number of branches have also opened in the US since 2010.

On paper, these successes make a compelling argument for purchasing SSP Group shares. As a company that has delivered apparently consistent successes and growth, the obvious implication is that SSP Group shares would be a source of consistent, high returns.
There are few universal rules in investment, but one of them is, of course, that no share is ever a must-buy or must-sell – and no rewards can ever be truly guaranteed. SSP Group is no exception to these principles; it would be foolhardy to invest in SSP without extensively researching the company’s fundamentals and growth prospects first.

An important thing to note is that SSP Group have been fairly slow to respond to economic growth in emerging markets. Whilst before the turn of the century a company could be forgiven for a sluggish approach to overseas expansion, all indicators point to regions such as South East Asia and Latin America as being future economic centres and leaders. Some Western companies have failed in their attempts to ‘crack’ these economies and paid dearly, but SSP are inversely suffering due to their apparent reticence. Many of the leading brands that comprise SSP’s stable have sought new partners in these areas, whether they be Western industry verticals or new regional contenders. Whether SSP can get up to speed remains to be seen, as of yearend 2014. Those wishing to make an immediate investment might not have the patience to wait, and others may not have the confidence to see – although others may wish to keep a keen eye on SSP Group’s future activities.

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This report does not constitute a personal recommendation and does not take into account your personal circumstances or appetite for risk.

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