Compass shifts its trading to dollars

This report is from this week’s CNBC’s UK Exchange newsletter. Like what you see? You can subscribe here.

The dispatch

Compass is that rare beast —  a British company that is a genuine world leader in its field.

The world’s biggest contract caterer, which annually serves 5.5 billion meals in schools, colleges, workplaces, hospitals and sporting venues in more than 25 countries, is considered a well-run business.

Accordingly, its trading updates tend not to excite, routinely consisting of news on organic sales growth, margin improvements and — with workplace catering operations gradually being outsourced around the world — new business wins.

Last week’s update, though, brought something more eyebrow-raising as Compass announced that, from April 1, it will change the currency in which its shares are traded from sterling to the U.S. dollar.

The company explained that having reported in dollars since October 2023, the measure would align its share price trading currency with its reporting currency, “reducing FX volatility in the share price and simplifying the investment case for global investors.”

Cue hand-wringing over how Compass — which derives around three-quarters of its revenues in dollars — could be the next big U.K. company to abandon London for the New York Stock Exchange.

Protests from Compass that it would continue to pay dividends in sterling, unless shareholders elect to receive them in dollars, fell on deaf ears.

Compass was, in fact, taking advantage of a relatively recent change to the so-called “ground rules” governing membership of indices overseen by FTSE Russell, part of LSEG, the owner of the London Stock Exchange.

Announced in March 2025, and coming into force last September, it allowed for companies whose shares trade in dollars or euros “to be considered for potential inclusion to the FTSE U.K. Index Series.”

In doing so, London has shown considerably more flexibility than some other major financial centers. The New York Stock Exchange, for example, insists that all NYSE-listed shares are quoted, traded and settled exclusively in dollars.

The first company to take advantage of the rule change, in January this year, was InterContinental Hotels Group, the parent of the Holiday Inn and Crowne Plaza hotel brands, which derives some 80% of its revenues and operating profits in dollars. If anything, it is even more British than Compass, dating back 249 years in the country. It is also proud of having registered the U.K.’s first trademark — the famous Bass red triangle — in 1875.

‘The accounts were not acceptable’

In a sense, changing the currency in which a company’s shares are traded is the logical next step in a process that…