Autogrill, the world's biggest airport retailer, expects flat results this year as weakness at its motorway-dependent food and beverage unit will be offset by a rise in its smaller but more-profitable duty free business.
The manager of roadside and airport restaurants from Canada to New Zealand said in a statement on Wednesday higher raw materials and lower traffic on motorways across Europe hit 2011 margins at the group's food and beverage unit - which accounts for two-thirds of total sales.
But bigger duty-free spending at airports helped offset the pressure on margins.
A similar trend was also evident in the first eight weeks of 2012 as bad weather and higher oil prices hit sales at Autogrill's roadside restaurants and cafes, leading the group to expect a stagnating first half for food and beverage.
"How much of that is due to the crisis, how much is due to the weather, it's difficult to say," chief executive Gianmario Tondato Da Ruos told analysts.
"Italy is the centre of the problem, it's really worsened everything. But it's now improving day after day," he said. Italy accounted for 23 percent of the group's sales in 2011.
Autogrill's net debt fell to EUR€1.55 billion (USD$2 billion) at end-2011, from EUR€1.57 billion at the same time the year before.
It posted a 3.8 percent rise in earnings before interest, taxes, depreciation and amortisation (EBITDA) to EUR€617 million in 2011. Sales rose at a similar pace meeting the company's guidance at EUR€5.845 billion.
OPEN TO PARTNERSHIPS
The CEO said no acquisitions were on the cards for 2012, but that he was willing to look at partnerships. He said Autogrill was "carefully" looking at China, but said the group was more focused on its growing Indian business.
The group will pay a dividend of 0.28 euros per share for the 2011 fiscal year, up from a dividend of 0.24 euros the year before.
The motorway retailer also said it will end its old partnership with espresso producer Segafredo this year and offer a new, "secret" blend of coffee made by another Italian partner on roadside stores in Italy in the next few weeks, before a possible launch abroad.