French catering and site facilities company Sodexo followed its warning Wednesday of a fall in revenue by highlighting that its food service clients in Europe are continuing to downsize, even amid reports the euro zone has returned to growth.
In particular, business in France and the Netherlands is "very tough" as companies are attempting to rationalize and boost their own competitiveness, group chief financial officer, Sian Herbert-Jones told CNBC Thursday.
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"In terms of some of our larger contracts, it is proving to take time to implement and transition larger contract deals, in whatever geography," Herbert-Jones said.
"In food service, generally we are still seeing that our clients are continuing to downsize and seeking to improve their own competitiveness, so our food service volumes are globally still down around 3 percent," she said.
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The French firm's stock slid as much as 3.7 percent following its growth forecast Wednesday and was trading 0.5 percent lower on Thursday.
Sales will increase 2.2 percent to 2.5 percent on an organic basis for the fiscal year 2014, down from an earlier forecast of 2.5 percent to 3 percent.
The group said this was a due to the delayed start-up of certain major contracts.
The group said it was seeing strong growth in emerging Europe and Russia. Conditions are "not bad" in Germany and "improving" in Spain.
