LSG Sky Chefs again boosts revenues and earnings
Neu-Isenburg, Germany – Once again, LSG Sky Chefs was able to close its business year with an increase in revenues and earnings. Thanks to positive demand, consolidated revenues rose by 3.3 percent (nominally 0.4 percent) after currency adjustments. Changes in the group of consolidated companies led to a revenue decrease of 74 million EUR compared to the previous year. The operating profit of the LSG Sky Chefs Group totaled 105 million EUR, meaning that it rose stronger than revenues (4 percent) in 2013. Earnings improved again for the fifth consecutive year despite higher restructuring costs.
“LSG Sky Chefs is very well positioned,” said Chief Executive Officer Walter Gehl. “This is thanks to the optimization of our activities in the mature markets of Europe and North America, ongoing expansion in growth markets and the enhancement of our products and services portfolio. At the same time, we continue to work on making our business models increasingly flexible in order to meet the diverse requirements at our more than 200 locations worldwide and protect our competitive position.”
The makeup of the company’s network was also altered in 2013, following entry into new and emerging markets and the closing of three units in Germany. In Russia, the company expanded its leading presence by entering the Moscow-Domodedovo and Chelyabinsk markets. In addition, construction of a state-of-the-art production facility began in Auckland, New Zealand. Furthermore, LSG Sky Chefs succeeded in reentering the Spanish market in Madrid. In Brussels, Belgium, it acquired the catering activities of a competitor.
Despite intense price and competitive pressure, the company was able to boost its business in airline catering and renew and expand major customer contracts. These include the extension of the worldwide catering agreements with Lufthansa, United Airlines and LATAM. At the same time, cooperation with Middle Eastern airlines grew further. After its successful new brand launch, equipment subsidiary SPIRIANT (formerly LSG Sky Chefs Catering Logistics) was able to win new customers, such as Singapore Airlines, Gulf Air and EVA Air with its innovative designs. They will also continue servicing Virgin Atlantic.
Progress was also achieved in adjacent markets. The Thalys and Eurostar high-speed trains in Belgium, and the Franco-German joint venture Alleo in Germany became new customers in train services. In the U.S., the retail business grew with the 7-Eleven convenience stores and expanded to include Circle K.
In the 2014 business year, LSG Sky Chefs anticipates a slight improvement in revenues and earnings compared to the previous year. This positive trend will likely continue because of the sustained rise in passenger numbers, continuing expansion in growth locations and the solidifying of various customer relationships. Furthermore, the company will pursue targeted partnerships that will make its portfolio even more robust. The increased focus on innovation and sustainability will lead to added customer value, the enhancement of existing business relationships and the acquisition of new customers. At the same time, LSG Sky Chefs will maintain its strict cost management and further standardize and optimize processes and business models.
“We will stay on this successful path, emphasizing innovation and sustainability and are confident that we will secure our market leadership by delivering high-quality products and services. This will enable us to meet changing customer and consumer demands with our groundbreaking and flexible portfolio,” added Walter Gehl.