The LSG Group: Realignment progressing rapidly
Neu-Isenburg, Germany – The LSG Group achieved a series of important milestones in the realignment of its business model in the first half of 2018.
The company generated consolidated revenues of EUR 1.6 billion in the first half of the year, a fall of 2.8 percent year-over-year. The decline was mostly due to negative currency effects and the company’s voluntary withdrawal from certain markets and customer contracts. Adjusted for currency-related factors, revenues grew by 4.4 percent. Changes in the group of consolidated companies increased revenue by EUR 12 million. Adjusted EBIT for the period was EUR 40 million, over 200 percent higher than in the first half of 2017, primarily due to lower transformation costs. EBIT rose by 186 percent to EUR 40 million.
“Our earnings situation continues to be burdened by the high costs of restructuring our activities in view of changing customer requirements,” said Dr. Kristin Neumann, Chief Financial Officer. “However, our operating business is developing very well worldwide, and we see great success in the global expansion of our onboard-retail activities in particular.”
In the first half of the year, LSG Sky Chefs extended substantial airline-catering contracts with United Airlines, American Airlines, LATAM and Cathay Dragon. Meanwhile, Retail inMotion won a contract to manage the onboard-retail activities for Etihad Airways. Furthermore, the company’s catering joint venture in Luanda, Angola, was extended ahead of schedule. In addition, the facility in Brussels, Belgium, received the QSAI Excellence Award for the best catering facility in Europe. SPIRIANT received the IF Design Award for the development of a new premium porcelain concept. For their part, the Culinary Excellence Team of the LSG Group demonstrated its far-reaching expertise in the development of meals especially prepared for astronauts aboard the International Space Station (ISS).
An important milestone in the transformation of the operating model was achieved with the approval to build two regional production facilities, one in the Czech Republic and a second one in western Germany. Additionally, the company’s transformation into a process-oriented organization continues to advance.
“In view of the increasing passenger numbers worldwide and our very clear successes in creating innovative service concepts – both in classic catering and in the growing onboard-retail segment – we are and will remain well positioned,” commented Erdmann Rauer, CEO and Chairman of the Executive Board. “We are very focused on investing in the restructuring of our activities and the expansion of our portfolio in order to successfully and sustainably secure the long-term future of the LSG Group.”