France's Edenred expects profit growth to accelerate over the next three years and revenue to more than triple by 2030 as employers use its meal tickets and fuel cards to help staff cope with inflation, the company said on Tuesday.
Digitalisation, changed work practices and the energy transition, combined with declining purchasing power, staff shortages and the need to control expenditure, should help Edenred to grow despite warnings of recession, it said.
Edenred has benefited this year from staff shortages and rising inflation that have pushed employers to spend more on workers' benefits. Shares have climbed by more than 40%.
"There is often a gap between the level of inflation and the increase in salaries and a way to actually close this gap is to use our employee benefit portfolio," chairman and CEO Bertrand Dumazy told a call with media.
The French government last month lifted by 4% the tax-free ceiling for employers' vouchers.
"What is important to note is that the benefits are still under-utilised, the markets are under-penetrated," Dumazy added.
The company forecast like-for-like annual growth of more than 12% in its core profit for 2022-2025 and said it is targeting revenue of 5 billion euros ($4.9 billion) by 2030.
The revenue target is more then triple the 1.63 billion euros the company reported last year and the new EBITDA target tops the 10% annual growth expected under the 2019-2022 plan.
Edenred raised its 2022 core profit target for a second time this year and has plans including strengthening its presence in the small and medium enterprise segment, investing in technology with the help of 2 billion euros in cash for possible acquisitions, and growing its dividend, it said.
Morningstar analyst Michael Field says Edenred's plan was decent but not "mind-blowing" and there was a lack of detail on how it would achieve it.
Shares were down 1% at 1059 GMT, underperforming a 0.29% rise on Paris' SBF 120 index.
