CONTENTS 02 Letter from the Executive Board 04 LSG Group – Our Integrated Approach 06 LSG Group 2015 – Major Milestones 08 Markets and Competition 10 Business and Strategy 12 Sales and Customers 13 Partnerships and Joint Ventures 14 Products and Services 18 Revenues and Earnings 19 Awards 20 Quality and Food Safety 22 Worldwide Presence 26 Corporate Social Responsibility 27 Environmental Care OUR WILLINGNESS AND ABILITY 29 Environmental Successes TO ADAPT AT PAR WITH THE 30 Outlook RAPIDLY CHANGING MARKET 33 Consolidated Income Statement 34 Executive Board Responsibilities WILL REMAIN CRUCIAL TO OUR 35 Key Figures SUCCESS AND FUTURE. LETTER FROM THE EXECUTIVE BOARD yours sincerely, DEAR READER, In 2015, we continued to benefit from growing passenger volumes around the globe, albeit with regional fluctuations. As a result, demand for inflight services also grew, not only in terms of volume but in the level of quality catering provided for the network carriers’ premium classes. At the same time, we saw a significant upward trend in the number of requests for onboard-retail programs designed for their economy classes, as well as low-cost and charter airlines. In light of market changes in the more mature markets, we have also begun the transformation of our business model. This includes organizational changes in order to better respond to customers requiring leaner and more efficient services, as well as the acquisition of Retail inMotion, which enhances our skills and widens our portfolio in the increasingly important onboard-retail area. In addition, our adjacent market teams were able to further pursue their path of expansion by winning a number of high-profile train operators and convenience retailers as new customers. Going forward, a major priority will be to strengthen our existing partnerships and create new ones that will enable us to enter new markets or enhance our skills. Our willingness and ability to adapt at par with the rapidly changing market will remain crucial to our Erdmann Rauer success and future. In light of that, transformation will continue to be the name of the CHIEF EXECUTIVE OFFICER game throughout 2016. We know that we have the talent and commitment necessary to get this done across our worldwide network. Jochen Müller CHIEF OPERATING OFFICER Dr. Kristin Neumann CHIEF FINANCIAL OFFICER We look forward to continue working with you and defining mutually beneficial oppor- tunities. We would also like to thank you for your continued trust in our company. PAGE 02 | 03 ........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ LSG GROUP | ANNUAL REVIEW 2015 LSG GROUP – OUR INTEGRATED APPROACH The LSG Group’s rich portfolio includes catering, onboard retail, inflight equipment and logistics, consulting and lounge services for Retail inMotion focuses on the increasingly important onboard retail business, which drives airlines’ airlines. The Group’s dedication to ancillary revenues and reduces inflight costs. Its expertise culinary excellence and expertise encompasses the procurement and distribution of Media inMotion’s portfolio includes hard- in logistics has enabled it to sucess- buy-on-board products, complete management ware and software solutions for inflight retailment of buy-on-board programs and end-to-end IT support systems, which offer much more variety and The brand stands for the fully enter adjacent markets, like train LSG Group of those programs through proprietary software. choice than traditional inflight entertainment systems. services and convenience retail. combined power of the activities under www.retailinmotion.com These systems also integrate onboard shopping its umbrella. It represents the company’s capabilities, thus providing an additional sales integrated approach and elevates the channel to passengers, as well as broadening the contribution of all group brands. The main range of products and services offered for sale onboard. brands belonging to the www.mediainmotion.aero LSG Group are: is best known as the world’s largest LSG Sky Chefs Oakfield Farms Solutions specializes in airline-catering company, but actually does a lot more developing, designing and manufacturing pre-packaged than that. We support customers, such as airlines, railway boxed meals from central locations and distributing operators and retailers, with a wide range of services. them to end users within the travel-retail market. Meal These include retail capabilities, lounge management and boxes are designed to not only hold pre-packaged food, a substantial assortment of food solutions, from traditional The SPIRIANT brand was launched in 2013 to give a but also fresh choices like fruit cups or sandwiches. catering to frozen meals and packaged snacks. fresh face to our equipment division. The product range www.oakfieldfarms.com SCIS Air Security is the leader in airline-catering www.lsgskychefs.com features an array of creatively designed and intelligently security in the U.S. Its portfolio also includes airport engineered meal-service products, commodities, comfort operations area, aircraft and cargo security, personnel items and galley inserts. www.spiriant.com screening, inflight entertainment and point-of-sales solutions, duty-free and cash-management services. www.scisairsecurity.com SkylogistiX, our joint venture with international logistics provider Kuehne + Nagel, designs strategies to streamline logistics and supply-chain management. With a dedicated The Ringeltaube shops can be found at major German airports, online platform that integrates seamlessly with a company’s offering a huge variety of beverages, perfumes, cosmetics, travel accessories own IT system, an airline can easily monitor the entire inflight and gourmet food exclusively to airport and airline employees. supply chain. www.skylogistix.com www.ringeltaube.de PAGE 04 | 05 ........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ LSG GROUP | ANNUAL REVIEW 2015 LSG GROUP 2015 – MAJOR MILESTONES GOOD QSAI WTCE DEUTSCHE DESIGN INTEGRATED JFK MYANMAR BAHN AWARDS AWARD PORTFOLIO LOUNGES CONCESSION COOPERATION At the 2015 Quality and Safety SPIRIANT wins the GOOD DESIGN During the annual World Travel Catering The LSG Sky Chefs Lounge Team The company’s concession and Cooperation with Deutsche Bahn is Alliance In-flight Catering Program Award 2014-2015 for their work & Onboard Services Expo (WTCE), takes over the management of the license agreement at Yangon extended with the introduction of the (QSAI) Awards, the LSG Sky Chefs designing the Lufthansa Premium the LSG Group unveils its integrated Lufthansa lounges at New York’s Mingaladon Airport (RGN), Myanmar, new Intercity 2. LSG Sky Chefs is Munich Customer Service Center is Economy Class tableware. portfolio of products and services John F. Kennedy Airport. is extended by 10 years. responsible for serving passengers recognized with Medina’s Platinum across all aspects of the travel directly at their seats with a selection Award as the best catering facility chain that are customized to individual of freshly baked goods, sweet and salty worldwide. passenger lifestyles and needs. snacks, as well as hot and cold drinks. NEW RED VIRGIN GODDARD TAMPA ZEALAND DOT TRAINS JOINT CHICAGO OPENING OPENING AWARD SNACKS VENTURE OPENING A new state-of-the-art Customer LSG Sky Chefs’ newly built facility SPIRIANT receives the highly esteemed In the UK, Oakfield Farm Solutions The existing joint-venture contract A new CSC opens in the immediate Service Center opens in Tampa, in Auckland, New Zealand, officially Red Dot Award for the Lufthansa acquires new Virgin Trains business with Goddard Enterprises Ltd. is vicinity of Chicago’s O’Hare Airport. Florida, U.S., covering an area of celebrates its grand opening Premium Economy Class tableware. with an ambient snack-box concept. extended by an additional 20 years. The state-of-the-art facility serves more approximately 30,000 square feet after moving their operations into The trains connect major cities like It comprises 21 locations throughout than 500 flights per day, primarily for (2,700 square meters). the new facility at the end of 2014. London, Birmingham, Manchester, Latin America and the Caribbean. hub-customer United Airlines. Liverpool, Glasgow and Edinburgh. SANTIAGO STARBUCKS CIRCLE K OPENING CONTRACT BUSINESS RiM & MiM LSG Sky Chefs breaks ground on a new A new contract with Starbucks marks In the U.S., the company’s global Customer Service Center in Santiago, the company’s entry into the Chinese convenience-retail team acquires new LSG Group acquires the remaining Chile, with a capacity to produce 59,000 convenience-retail market. A new range business with Circle K in