Lekkerland Group positions itself for the future

Management level of Lekkerland in Germany to be restructured

3. May 2016

  • Convenience 2020” successfully further implemented
  • Important customer contracts concluded
  • New warehouses and new services rolled out
  • Increase in sales, gross profit and result from operations before financial result

The Lekkerland Group looks back on a gratifying year 2015. The concentrated implementation of the strategy “Convenience 2020” is yielding results: Sales at the Lekkerland Group increased by 4.2 % to 12,484.4 million euros in a challenging market environment characterised by fierce competition. The gross margin increased by 23.8 million euros to 595.8 million euros. In spite of extraordinary expenses within the framework of the strategic implementation, further optimisation of the cost structure enabled EBIT to be improved by 12.9 million euros to 66.5 million euros. “The business figures for 2015 bear testimony to the fact that we are on the right track and the first successes are being posted,” explained Michael Hoffmann, Chief Executive Officer of the Lekkerland Group. “We are safeguarding the current and future success of Lekkerland with ‘Convenience 2020’ – and this also ensures ongoing success for our customers.”

Lekkerland succeeded in expanding customer relations in all countries. In this context, acquiring Starbucks as a customer was particularly notable, as the first large international Quick Service restaurant chain in Germany. Furthermore, numerous contracts were extended with existing customers, for example with Westfalen Group in Germany or with Zena Group in Spain, a leading restaurant chain. The customer base was significantly expanded in Switzerland with the takeover of competitor Contadis, initiated in the previous year and meanwhile completed.

Range of service packages further expanded

Lekkerland is continuing to work intensively on the vision of becoming the holistic full-service concept provider for all channels in on-the-go consumption. Numerous services were also established and expanded in 2015 in order to continue satisfying the changing needs of customers. These include, for example, a “360-degree fitness test” for shops, new coffee and bistro concepts, improved functionalities of the web shops, the SO/OK in-house brand concept and new, innovative electronic value products. “During all activities we engage in, we are always focused on the challenges confronting our customers, the shop operators. Our aim is to find the best possible way of converting these challenges into new and successful products and concepts,” explained Michael Hoffmann.

The realignment of Lekkerland initiated over the course of the past several years is tangible in all divisions of the company. Further investments were made in logistics with one new warehouse coming on stream in Germany and one warehouse in Spain. Further advances were also made in harmonising business and IT processes throughout the Group. “In addition, we also want to make even better use of the opportunities derived from changes in the marketplace and increasing digitisation,” added Michael Hoffmann. “We have created the best possible organisation and conditions for this in 2015. Transformation programmes, which have already been running successfully in Germany and the Netherlands, have now been planned for Belgium and Austria. They will be launched in 2016. The strategic measures were completed by introduction of a new management structure in Germany, which is designed to lead to greater flexibility and agility.

All segments are able to increase sales

Sales again increased in the Germany segment. Revenues went up by 3.2% compared with 2014 to 7,682.9 million euros. In the segment Rest of Western Europe, growth in sales was even stronger with an increase of 5.7 % to 4,801.5 million euros.

Also, all three product ranges at Lekkerland – tobacco goods, food / non-food and commissions on electronic value (e-va) / miscellaneous succeeded in expanding their revenues. The tobacco goods product group increased by 4.0 % to 9,939.7 million euros, sales in the higher margin food / non-food product group went up by 4.6 % to 2,433.5 million euros, and the Lekkerland Group was able to increase sales in the commissions on electronic value (e-va) / miscellaneous product range by 5.1 % to 111.2 million euros[1].

Sales of the system customers channel grew disproportionately overall in 2015 with an increase of 6.5 % to 4,112.6 million euros. The filling stations channel increased proportionately to the overall expansion of sales by 4.2 % to 6,372.2 million euros, while the regional customers channel stagnated with sales of 1,999.6 million euros by comparison with the previous year.

Outlook: Continuing profitable growth

“We made significant progress towards our objective – to be the preferred partner for all aspects of the convenience business – in the year 2015,” commented Michael Hoffmann. “We are therefore able to look to the future with confidence and we will consistently pursue our roadmap for the realignment.” Sustainable growth while simultaneously reducing costs forms the platform for this. The aspirations of customers and the needs of consumers are always the focus of our activities. “We have put measures in place in each of the national companies in order to ensure that our customers will continue to receive optimum and fast support in the future,” added Michael Hoffmann. This also includes, for example, a holistic project for the future of the filling station shops.

The initiated transformation will also play a key role for Lekkerland during the current year. Lekkerland expects a slight increase in sales and gross margin for the business year 2016 by comparison with the business year 2015. As a result of the implementation of the initiated change programme, a further moderate increase in EBIT and EBITDA is also expected.

Profile of the Lekkerland Group

Lekkerland AG & Co. KG is the multinational partner for all retail formats which enable people to participate conveniently in on-the-go consumption. This includes filling station shops, kiosks, convenience stores, fast-food chains, tobacco shops, food retailers, beverage markets, department stores, bakeries and canteens. Customers with more than 90,000 sales outlets in six European countries put their trust in the broad product range, flexible logistics and tailor-made services of Lekkerland. Lekkerland supplies tobacco goods, food-to-go, non-food products, drinks, electronic value and much more. Sales amounted to 12.5 billion euros in the business year 2015.

[1] Only commissions received and not the nominal values of credits are recognised.

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