Catering giant the Compass Group said its sales have slowed across the year, partly due to the fall in corporate hospitality, despite an increase in its third-quarter profits.

Revenue growth on a constant currency basis was 1.8 per cent, and organic revenue growth was 0.8 per cent, the company reported in a trading update to June 30.

The group’s accelerated operating and overhead efficiencies led to a strong margin improvement in the third quarter. For the full year, revenue growth on a constant currency basis is expected to be around one per cent and organic revenue growth is expected to be broadly flat.

The strength of the company’s key currencies against the sterling boosted operating profit by about £105 million.

In a statement, it said: "Compass is continuing to perform well, delivering another quarter of strong growth in operating profit, margin and free cash flow.

"As expected, organic revenue growth has continued to slow as a result of the more challenging economic conditions.

"Encouragingly, the level of new business wins and underlying retention has remained strong and consistent with the levels seen in the first half of the year and the last financial year.”

Compass supplies food and catering services to offices, schools, hospitals and sports centres. It has more than 388,000 employees in 55 countries around the world, many of which supply corporate hospitality contracts which have suffered as companies look to cut back in the recession.

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