SSP Group shares fall on CEO departure even as FY results shine

(Reuters) - SSP Group Plc <SSPG.L>, which operates food and beverage stores in travel locations, said Kate Swann is stepping down as chief executive officer and would be replaced by Simon Smith, currently head of its UK & Ireland region.

Shares of the company fell as much as 9 percent in early trading as investors focused on Swann's departure and shrugged off a better-than-expected 19.8 percent rise in full-year underlying operating profit.

The operator of restaurants and bars in airports and railway stations also proposed a special dividend of about 150 million pounds on Wednesday.

Swann did not disclose the specifics surrounding her departure from the company when contacted by Reuters.

"There is never a perfect time to leave the business, but the thing that matters to me is that I'm leaving the business when it's in really good shape," Swann said.

Analysts' at brokerage Jefferies said that "part of SSP's valuation premium is clearly linked to the reputation and consistent delivery of Kate Swann."

SSP has benefited since the British pound weakened after the 2016 Brexit vote, making Britain a more attractive holiday destination for foreign tourists.

That trend bolstered full-year results with revenue rising 7.8 percent to 2.56 billion pounds and operating margins up 80 basis points to 7.5 percent. Like-for-like sales grew 2.8 percent in the year ended Sept. 30, helped by more passengers travelling globally.

Underlying operating profit of 195.2 million pounds also beat analysts' estimates of 192 million pounds.

The company said its new financial year had started in line with its expectations, but cautioned of uncertainty around passenger travel in the short term.

SSP expects operating margins growth near 20 basis points in 2019, with like-for-like sales rising between 2-3 percent.

Swann, whose retail career spanned Tesco Plc <TSCO.L>, Coca-Cola Schweppes and Dixons Retail Plc, will step down from the top job on May 31 after more than five years in the role.

Smith, who has more than 20 years of experience in the retail and catering sector, will succeed her the next day and will be paid a salary of 650,000 pounds per year and an annual bonus of up to 175 percent of his salary.

SSP shares were down 6.3 percent at 637.5 pence at 0812 GMT.

(Reporting by Karina Dsouza in Bengaluru; Editing by Bernard Orr)