Compass Group apologises to the City for Chartwells free school meal boxes fiasco

The catering giant told shareholders it has made “several corrective measures that include improved supply chain processes, additional guidance and resources for our employees, and stronger quality assurance checks”

Chartwells provides free school meal boxes to eligible family homes during lockdowns (PA)

Naomi Ackerman @nomiackerman

4 February 2021

Compass Group formally apologised to the City for the free school meal fiasco that damaged its reputation just as the catering giant’s sales were being hit hard by the pandemic.

Chartwells, one of Compass’ subsidiaries, faced national fury last month after the meagre contents of free school meal boxes it provided to British schoolchildren were exposed by parents and labelled “unacceptable” by campaigning footballer Marcus Rashford.

It is not the first time the world’s biggest catering company — which supplies meals at prisons, hospitals and schools as well as offices and stadiums —has been forced into an apology. In 2006 the group was responsible for the nutritionally lacking turkey twizzlers made infamous by Jamie Oliver’s school dinners campaign.

In a trading update issued ahead of its AGM today, the group said that "in light of the recent events around the provision of free school meal food parcels by our Education sector, we recognise that the quality and quantity of some food parcels fell short of our usual high standards". It added: "We have apologised to everyone who has been affected."

Executives said that after a thorough investigation the company has made “several corrective measures that include improved supply chain processes, additional guidance and resources for our employees, and stronger quality assurance checks”.

The company also reiterated promises to cover the costs of providing free and improved breakfast and lunch parcels over the half term break.

It came as the group reported organic sales down nearly 34% in the three months to end December.

Compass, which completed a £2 billion cash raise last June to help it see out the pandemic, reported a near 70% drop in operating profits for the full year to September 30.

Today the firm, which laid off 7000 UK workers as part of cost-saving measures last year, warned “although the news around vaccinations is encouraging, the pace of volume recovery remains uncertain”.

But the company said it was encouraged by the strong pipeline of new business in sectors such as healthcare and education, and that they are “confident in our ability to rebuild our group underlying margin above 7%, before we return to pre-Covid volumes”.

Hargreaves Lansdown analyst, Sophie Lund-Yates, said: “People will be wondering why quality control measures weren’t in place already. From an investment perspective, this chapter has been an unwelcome addition to what is a torrid time for Compass, and won’t have done the company’s reputation any favours.”