Q2 preview: Momentum on the menu

Growth is set to accelerate in Q2, with results due on 12 November. We expect Q2 sales of € 676m (+8% yoy), accelerating from c. 5% yoy in Q1 as Middle East disruptions recede. EBIT is seen at € 61m (+12% yoy), implying a 9.0% margin (+0.3pp; eNuW).

Customer trends and premium demand support Airline Catering. While IATA reported a 0.8% yoy decline in global passenger traffic in August, other cross-reads relevant to DOC paint a more positive picture. Turkish Airlines' September passenger numbers rose 3.6% yoy (international: +4.8% yoy), with the seat load factor improving to 86.8% (+2.2pp yoy). Premium demand also remains encouraging: exemplary is Delta's Q3 premium revenue which increased 18% yoy on 6% more seats, with higher load factors. Growing passenger volumes and expanding premium cabins support catering demand (eNuW).

New contract starts provide an additional growth driver. New Air India and American Airlines business at Heathrow adds growth from September. Together with positive customer trends, this underpins our Q2 forecasts for Airline Catering of € 541m sales (+5% yoy) and € 47m EBIT (+8% yoy), implying an 8.7% margin (+0.3pp; eNuW). Further contract starts sustain momentum through H2: Emirates in Boston and Air Canada in Los Angeles follow from October, with American Airlines in Chicago from February 2027. Ongoing tenders offer further scope to broaden the customer base.

Higher fares reinforce the importance of premium service. American Airlines offset nearly half of its calendar Q2 fuel cost increase through higher fares. Preserving a strong onboard experience helps airlines justify higher premium prices and retain customers. We view quality catering as a visible way to reinforce the premium proposition at modest cost relative to the ticket price, supporting DOC's positioning as airlines balance cost discipline and customer loyalty (eNuW).

World Cup revenues and rising F1 hospitality demand to drive Event Catering growth. We expect sales of € 85m (+32% yoy) and EBIT of € 9m (+45% yoy), implying a 10.5% margin (+1.0pp; eNuW). Around 30% of World Cup sales fall into Q2 (c. € 10m), including the final in New York. At the same time Madrid's F1 debut supports the event mix. Earlier comments from F1 owner Liberty Media on higher Paddock Club attendance and hospitality revenues at recurring races suggest that F1 catering can continue to drive DOC’s event growth beyond the World Cup (eNuW). Qatar and Abu Dhabi remain on the calendar, although cancellation risk persists (eNuW: c. € -15m potential sales impact).

DOC combines structural growth with earnings resilience. Premium travel and global sports hospitality support growth, while c. 70% of sales under multi-year contracts and a c. 80% variable cost base provide visibility and flexibility. We conservatively retain our FY26/27 EBIT margin estimate at 8.8%, the guidance midpoint, with further contract ramp-ups leaving scope for H2 margins to match the 8.9% expected for H1 (eNuW). Reiterate BUY with an unchanged PT of € 255, on DCF.