maxingvest-ar14 vorne-engl · 006 tchibo is the market leader for roasted coffee in germany,...

14

14

Annual Report

Ann

ual R

epor

t

berseering 18 22297 Hamburg www.maxingvest.com

001

MAXINGVEST AG

is the holding company for the Tchibo and Beiersdorf operating companies.

maxingvest ag holds a 100% stake in Tchibo GmbH and controls more than 50% of the voting rights of Beiersdorf AG. As a management holding company, maxingvest ag monitors and supports its subsidiaries, which operate independently.

maxingvest ag is committed to

PRESERVING AND ENHANCING ADDED VALUE

and increasing it in the long term. As a management holding company, we maintain strategic oversight of our equity investments, monitor their financial indicators and provide an economic foundation, allowing our operating companies to concentrate on their operating business.

002

TCHIBO

Revenues: 3,377 million

Employees: 12,500*

Tchibo GmbHHamburg, Germany

Eduscho (Austria) GmbHVienna, Austria

Tchibo (Schweiz) AGWallisellen, Switzerland

Tchibo Coffee Service GmbHHamburg, Germany

* annual average

BEIERSDORF

Revenues: 6,285 million

Employees: 17,157*

Beiersdorf AGHamburg, Germany

Beiersdorf Ges mbHVienna, Austria

La Prairie Group Deutschland GmbHBaden-Baden, Germany

tesa SEHamburg, Germany

KEY COMPANIES OF THE MAXINGVEST GROUP

DATA AND FACTS

in million 2014 2013

Revenues 1) 9,663 9,611

thereof domestic revenue 2) 3,877 3,895

thereof foreign revenue 2) 5,786 5,716

EBIT 992 1,080

Net profit 1) 674 748

Total assets 1) 13,643 13,670

Shareholders equity 1) 8,566 8,232

thereof minority interests 3,232 3,117

Equity ratio in % 63 60

EBIT margin in % 1) 10.3 11.2

Number of employees (annual average) 29,712 29,078

1) The prior-year figures have been adjusted due to the application of IFRS 11. Please refer to the disclosures in the section entitled Changes in accounting policies.2) By domicile of company.

003

CONTENTS

MANAGEMENT AND SUPERVISORY BOARD 4

Letter from the Management Board 4

Boards of maxingvest ag 5

PRESERVING ADDED VALUE 6

GROUP MANAGEMENT REPORT 8

CONSOLIDATED FINANCIAL STATEMENTS 43

AUDITORS REPORT 116

FURTHER INFORMATION 117

Corporate Governance at maxingvest ag 117

004

LETTER FROM THE MANAGEMENT BOARD

LADIES AND GENTLEMEN

The maxingvest Groups operating companies recorded a mixed performance in financial year 2014. Tchibos

revenues and earnings were down year-on-year. Beiersdorf improved its revenues and earnings adjusted for spe cial

factors compared with the previous year.

Tchibo had defined the following growth areas for the next few years in its Zukunft braucht Herkunft strategy

(Building Our Future on Tradition): its online and Eastern Europe business, the espresso/caff crema segments

and the single-serving coffee systems segment. Negative effects from exchange rate changes, the weaker con-

sumer merchandise business and the ongoing decline in footfall and revenues in the branches meant that the

forecast revenue growth was not achieved. The online business and the coffee business had a positive impact on

revenue.

Beiersdorfs business performance in 2014 shows that it is on the right track. The Consumer business segment

made successful progress thanks to the systematic implementation of Beiersdorfs corporate strategy, which is

based on its Blue Agenda. This strategic compass aims to make Beiersdorf more competitive and enhance its

economic success. Its success can be seen particularly in the performance recorded by the emerging markets and

the launch of new, high-selling products. The tesa business segment further expanded its business both in the

indus trial markets and in the consumer business.

The maxingvest Groups equity ratio rose to 63% in the reporting period, and net financial assets also improved

year-on-year. This means that maxingvest ag has a solid basis for reacting to potential uncertainties and further

increasing the market presence of its two brand groups. The maxingvest Group is well positioned thanks to its

strong brands, its clear strategy programmes and, in particular, its committed employees. Our special thanks go to

our staff for their hard work. Our Groups success is rooted in our customers trust and our employees dedication.

Michael Herz Thomas Holzgreve

MANAGEMENT AND SUPERVISORY BOARD

005

BOARDS OF MAXINGVEST AG

Supervisory Board

Prof. Dr. Reinhard Pllath, Munich

Chairman

Lawyer

P+P Pllath + Partners Rechtsanwlte

und Steuerberater mbH

Friedrich-Karl Wrede*, Hamburg

Deputy Chairman

Chairman of the Company Works Council, Tchibo GmbH

Ulrich Dalibor*, Berlin

Head of National Retail Group

ver.di National Administration, Commerce Department

(from 26 June 2014)

Prof. Dr. Eva Eberhartinger, Vienna

University Professor

Vienna University of Economics and Business, Austria

(from 26 June 2014)

Sebastian Fischer-Zernin, Hamburg

Lawyer

Weiss Walter Fischer-Zernin Rechtsanwlte

(until 26 June 2014)

Peter Franielczyk*, Ockholm

Trade Union Secretary, ver.di


Wolfgang Herz, Hamburg

Member of the Management Board

Participia Holding GmbH

Dr. Arno Mahlert, Hamburg

Chairman of the Supervisory Board, GfK SE,

Non Executive Director

Helmut Mller*, Ltjenbrode

Regional Manager, Shop Technician, Tchibo GmbH

Ralf Neumann*, Hamburg

Coordinator of Technical Administration

Tchibo Manufacturing GmbH & Co. KG

* Employee representative

Tomas Nieber*, Stade

Chairman of the Board, Economic

and Industrial Policy Department, IG BCE

Dr. Wolfgang Peiner, Hamburg

Independent German Public Auditor

Stefan Pfander, Berg

Management Consultant

Invent Group GmbH


Thomas-Bernd Quaas, Hamburg

Retired, former CEO of Beiersdorf AG

(from 26 June 2014)

Prof. Manuela Rousseau*, Rellingen

Head of Corporate Social Responsibility, Beiersdorf AG

Regina Schillings*, Hamburg

Inventory Accounting Clerk

Beiersdorf Shared Services GmbH

Prof. Dr. Wulf von Schimmelmann, Berg-Leoni

Chairman of the Supervisory Board

of Deutsche Post AG

Volker Schopnie*, Halstenbek

Technician, Deputy Chairman of the Company

Works Council, Beiersdorf AG

Ann-Christin Wagenmann, Hamburg

Retired, former General Manager

Beiersdorf Consumer Products (PTY) LTD.

Management Board

Michael Herz, Hamburg

(Member of the Management Board)

Thomas Holzgreve, Bad Oldesloe

(Member of the Management Board)

006

TCHIBO is the market leader for roasted coffee in Germany, Austria, Poland, the Czech Republic and Hungary. It combines this

expertise in coffee with an innovative, weekly changing range of

consumer merchandise and services such as travel, mobile communi-

cations services and green energy. Tchibo sells its products using a

sophisticated multichannel distribution system with its own branches,

an extensive retail presence and a strong online and mail order

business.

For Tchibo,

PRESERVING ADDED VALUE

means building on its experiences for the future and taking environmental and social responsibility. Tchibo is taking the best of its successful, long-standing business model into the future. Tchibo stands in particular for enjoyment and quality and aims to meet its high standards with sustainable products and processes.

MAXINGVEST AG

007

BEIERSDORF is a global company with two separate business segments. The Consumer business segment, with its strong skin and

body care brands, is its main business. The tesa business segment is

one of the worlds leading manufacturers of self-adhesive products

and solutions for industry, craft businesses and consumers.

For Beiersdorf,

PRESERVING ADDED VALUE

means concentrating on its core competency, skin care. In line with its strategic compass, the Blue Agenda programme, the company maintains a clear focus on its core categories and markets. In particu-lar, it concentrates on strengthening its brands above all NIVEA increasing its innovative power, systematically expanding its presence in the emerging markets and reinforcing its position in Europe, and on the people at Beiersdorf.

008 GROUP MANAGEMENT REPORT

FUNDAMENTAL INFORMATION ABOUT THE GROUP

GROUP STRUCTURE AND BUSINESS MODEL

The maxingvest Group consists of the holding company maxingvest ag and the operating companies, Tchibo and

Beiersdorf. In addition, the holding company is the parent of certain subsidiaries that are primarily engaged in asset

management. The holding is family-owned and concentrates on strategic business management.

Tchibo combines the ultimate in coffee expertise, coffee enjoyment in its own coffee bars and innovative, weekly

changing consumer merchandise with services such as travel, mobile communications offerings and green energy.

Its products are marketed via an integrated, centrally managed distribution system. Customers purchase products

on the Internet, in branches, at specialist retailers and in supermarket outlets. The different channels are increas-

ingly being integrated. In addition, Tchibo Coffee Service provides a specialist delivery service for commercial cus-

tomers such as offices and catering establishments.

Beiersdorf is a global leader in the consumer goods industry and has over 17,000 employees in more than 150

subsidiaries worldwide. It has two business segments: the Consumer business segment, whose strong brands focus

on the international skin and body care markets, is the main business. The tesa business segment is a pioneering

manufacturer of self-adhesive products and solutions for industry, craft businesses and consumers.

100% 82.5%

BBG

50.46%

maxingvest ag holds 100% of Tchibo GmbH. BBG Beteiligungsgesellschaft mbH, Gallin, a subsidiary of maxingvest

ag, holds 50.46% of Beiersdorf AG. Furthermore, maxingvest ag held additional shares amounting to 0.23% of

Beiersdorf AGs share capital as at the reporting date. As a result, maxingvest ag controls more than 50% of

the voting rights of Beiersdorf AG. Beiersdorf AG is the parent company of Beiersdorf. tesa is managed as an

inde pend ent subgroup within Beiersdorf.

009

CORPORATE STRATEGIES

Strong brands are the foundations of the maxingvest Group. The Tchibo brand enjoys a high degree of popularity

and extensive brand awareness in German-speaking countries and in many parts of Eastern Europe. The Tchibo,

Eduscho and Davidoff Caf brands, as well as local brands such as Jihlavanka in the Czech Republic, also compete

successfully at an international level. On the roasted coffee market, Tchibo is the market leader in Austria, Poland,

the Czech Republic and Hungary in addition to Germany, and is also extremely strong in the Slovakian market.

Every day, millions of consumers trust Beiersdorfs innovative, high-quality skin and body care products. Its success-

ful international brand portfolio is tailored to meet the individual needs and wishes of consumers, as well as

regional requirements. The ongoing development of the subgroups strong brands is the basis for this closeness to

consumers and markets, and hence for Beiersdorfs success. Its three core brands are NIVEA, Eucerin and La Prairie.

The brand portfolio also includes other brands such as Hansaplast/Elastoplast, Labello, Florena, 8x4, Hidrofugal,

atrix, Aquaphor, SLEK and Maestro. Beiersdorfs tesa subsidiary provides innovative self-adhesive products and

system solutions. The manufacturer is a global market leader in a large number of application areas due to its many

years of experience in coating technology and developing adhesive masses.

In the reporting period, Tchibo continued to follow its Zukunft braucht Herkunft (Building Our Future on

Trad ition) strategy. The aim is to consciously invest in the brand core and to ensure sustainable growth. The

success factors that create the unique Tchibo brand are part of Tchibos DNA and cover the following overarching

areas:

Coffee expertise

Non-food concept

Distribution system

Marketing

Corporate culture

Tchibos DNA sets out the success factors that give the company its strength and that should be preserved. The

growth areas for the next few years were also derived from this its online and Eastern Europe business, the

espresso/caff crema segments and the single-serving coffee systems segment. Specific projects were set up in the

reporting period in order to drive forward development in the growth areas within a project-based organisation.

The espresso/caff crema growth area and single-serving coffee systems recorded a strong performance. Tchibo

launched its new capsule machine, Cafissimo LATTE, in March. In addition to espresso, caff crema and filter

coffee, the fully automatic capsule machine can be used to prepare coffee specialities such as cappuccinos or latte

macchiatos with freshly foamed milk at the touch of a button. One particularly practical feature of this machine is

a removable milk container which allows milk to be kept fresh in the refrigerator. Tchibo saw another increase in

revenues for single-serving coffee systems in the reporting period. The espresso/caff crema segment also

con tinued to perform well. Tchibo remains the strongest branded provider in this category and the market leader

on the roasted coffee market overall.


Developments in Eastern Europe fell short of expectations. Total revenues were below the previous year. Exchange

rate effects and the uncertain political situation had an impact on the business in Eastern Europe.

Tchibo increased revenues in its online business again, but failed to meet its own expectations. The number of

German-speaking online visitors and orders both rose. In Eastern Europe, the number of visitors declined.

In August of the reporting period, Tchibo launched its Favourites shop. This supplements the popular weekly

changing themes offering new surprises for limited periods with classics from the Tchibo range that will be per-

man ently available in the future. The Favourites range currently consists of 300 products covering nine categories.

It meets the wishes of Tchibos online customers for key articles from the range to be available permanently. This

is because while Tchibo customers visiting the branches like to be surprised by what they find, online customers

tend to be looking for something very specific around 80% of online purchases are planned.

Tchibo mobil celebrated its ten-year anniversary in the reporting period. Established in October 2004, it is a part-

nership with TELEFNICA Germany GmbH & Co. OHG for marketing and selling hardware and mobile phone tariffs

under the Tchibo brand. With attractive offers such as the 9 cent basic tariff, the smartphone tariff, or the data

tariff, Tchibo mobil offers fair terms, making it a good entry point for mobile phone and Internet services. In

particular, it values clarity and transparency and provides offerings to suit various customer needs. Tchibo mobil is

easy for actual and potential customers to access thanks to its availability in Tchibos own branches, in the online

shop and in supermarket retail outlets.

In the reporting period, Tchibo entered into a partnership with Helene Fischer. The singer and entertainer has been

the face for its fashion, accessories and jewellery since October. In her first appearance since the start of the col-

laboration, Helene Fischer selected 16 favourites from the Tchibo collection and modelled Tchibos Christmas

jewellery collection in November.

Beiersdorf aims to be the No. 1 skin care company in its relevant categories and markets. The companys Blue

Agenda clearly defines the way to achieve this long-term objective. It consists of the following strategic focuses:

Strengthening Beiersdorfs brands first and foremost NIVEA,

Increasing Beiersdorfs innovative power,

Expanding Beiersdorfs presence in the emerging markets and consolidating its market position in Europe,

The people at Beiersdorf.

Beiersdorf continued to make substantial progress towards these objectives in the reporting period something

that is also reflected in its key figures for financial year 2014. Beiersdorf recorded sustainable, profitable growth

and saw a further increase in revenues and adjusted earnings. This was achieved by increasing its share of a market

that grew by about 3%.

Beiersdorfs consistently disciplined brand strategy further increased its brand presence in 2014, as can be seen

from the positive performance by its three core brands NIVEA, Eucerin, and La Prairie. The rollout of the new

NIVEA logo and design, which began in 2013, was successfully completed in the year under review. This created a

more consistent and eye-catching brand image, which has strengthened the brands identity and positioned NIVEA

011

successfully and sustainably. In addition, Beiersdorfs newly created Pearl Brands unit generated new momentum

for the Labello, 8x4, Hidrofugal and Florena brands. Beiersdorfs goal is to strengthen their brand profile and hence

leverage their economic potential and in doing so, further strengthen the companys brand portfolio.

The increase in Beiersdorfs innovation capacity substantially contributed to its success in the year under review.

Beiersdorf focuses both on developing and launching new products and on enhancing and supporting existing

major innovations. Beiersdorfs NIVEA Deo Black & White, NIVEA Body In-Shower and NIVEA Face Cellular Anti-

Age set long-term trends in different segments, enabling the company to extend its market position in the relevant

categories and countries in 2014.

For example, NIVEA Face Cellular Anti-Age was also successfully launched in Latin America in the year under

review. The NIVEA Body In-Shower product line, which is a big hit in Europe and Brazil, was expanded in 2014 and

will be available worldwide in 2015. Moreover, Beiersdorf again set new standards in the mass market in the

important face care category with its NIVEA Q10 pearls: a special pearl technology makes it possible to blend

innovative Q10 plus serum pearls with hydrogel in a patented anti-wrinkle serum. This is the first time that this type

of technology has been made accessible to a wider consumer group.

Each and every innovation begins with the specific needs of consumers in the different regions. Being close to

consumers at a local level is crucial to being able to incorporate changing expectations into product development

flexibly and quickly, thus securing Beiersdorfs market share in the long term. In the year under review, Beiersdorf

sustainably increased its brand presence and impact in the emerging markets with targeted investments in region-

al development and production capacities, and strengthened its position on the established European markets.

In July 2014, Beiersdorf opened a production facility and a regional laboratory in Silao, Mexico, in order to meet

growing demand in Latin America. The factory was the first facility in the cosmetics industry ever to be awarded

Leadership in Energy and Environmental Design (LEED) platinum standard. Beiersdorf also began constructing a

production facility in Sanand in order to strengthen its local footprint in India. Production is expected to start in

early 2015.

Beiersdorfs corporate culture is inextricably bound up with dedicated and motivated employees, who make a

crucial contribution to the companys success. In 2014, employees and managers worked together to reinterpret

Beiersdorfs core values which have shaped the company for over 130 years and documented these in a

common understanding:

Care at the heart of Beiersdorfs business. The companys responsibility towards its employees, consumers

and brands as well as to society and the environment.

Simplicity making clear, consistent and quick decisions and always remaining focused on priorities.

Courage setting ambitious targets, taking the initiative and approaching change as an opportunity.

Trust genuine, respectful and reliable relationships with employees and consumers.

In order to ensure the core values are lived both now and in the future, Beiersdorf will integrate them even more

strongly into its employees day-to-day working practices in the future.


INTERNAL CONTROL SYSTEM

The objective of the maxingvest Groups strategic corporate management is to achieve a sustained increase in

enterprise value. maxingvest ag is committed to pursuing a long-term growth strategy.

Tchibo and Beiersdorf use the EBIT margin and changes in market share as the performance indicators for their

internal management. The overall Group is managed on the basis of earnings before interest and taxes (EBIT) and

the EBIT margin. Active cost management and efficient business activities help ensure that the subgroups generate

profits and competitive returns.

RESEARCH AND DEVELOPMENT AT BEIERSDORF

Beiersdorfs expertise in the area of research and development has driven the companys success for more than 130

years. The Consumer business segment develops innovative skin care products that are tailored to meet the needs

and wishes of consumers worldwide. The tesa business segment develops top-quality self-adhesive system and

product solutions, and is a world leader in its field.

Beiersdorf is globally known for its leading-edge skin care expertise. Beiersdorfs scientists continually expand their

knowledge of the complex skin processes using the latest internal and external scientific findings. Research and

development activities focused on skin ageing processes and the development of ways to improve skin elasticity

and firmness.

The companys Research and Development unit has integrated third-party knowledge since its inception. The Open

Innovation initiative allows the company to involve leading research institutes, universities and suppliers in its

research and development activities at an early stage. Open Innovation combines two approaches: technology

scouting a targeted search for ideas and solutions for Beiersdorfs unsolved research and development problems

and the Pearlfinder initiative, launched in 2011. Researchers, institutes and companies can present innovations on

a secure online platform. This initiative enables Beiersdorf to build relationships with a growing number of new

partners from a variety of industry sectors.

The Consumer business segment applied for patents for 76 innovations in the reporting period. Key launches

included NIVEA Q10 plus Anti-Wrinkle Serum Pearls, for example. Using this product with its innovative pearl

technology helps replenish the skins own Q10 stores. NIVEA In-Shower products are among the most popular

body care products. In addition to the classics, new varieties were added to the successful product range in 2014,

including In-Shower Soft Milk and In-Shower Body Lotion Cocoa Indulging.

013

MACROECONOMIC PARAMETERS

MACROECONOMIC ENVIRONMENT

According to the Kiel Institute for the World Economy (Institut fr Weltwirtschaft IfW), the economy picked up

over the course of 2014. Global GDP growth was muted in the first half of the year before rising more significant-

ly in the third quarter. However, the growth rate remains moderate compared with the medium-term trend. The

global economy grew by 3.4% year-on-year.

At 0.8%, GDP growth in the eurozone was marginal in the reporting period Europe has been suffering from weak

growth for years. According to the European Commission, the modest increase is attributable to geopolitical risks

such as the conflicts in the Middle East and Ukraine. In addition, the economy is still suffering from the conse-

quences of the financial crisis, in the form of high unemployment, high debt levels and low capacity utilisation.

According to the Federal Statistical Office (Statistisches Bundesamt), the German economy was stable. GDP adjust-

ed for inflation was up 1.5% on the previous year and benefited in particular from strong domestic demand.

Consumer spending was again the most important growth driver for the German economy. Positive momentum

was also generated by investments and external trade, albeit to a lesser extent. Following the negative impact of

the net exports on GDP in the previous year, growth in external trade picked up somewhat, although the environ-

ment for foreign trade remained challenging. Overall, Germany exported 3.7% more goods and services in real

terms than one year earlier; however, imports rose almost just as strongly by 3.3%.

THE GERMAN RETAIL TRADE

According to the Federal Statistical Office, German retail sales rose by 1.4% in real terms in 2014. Nominal retail

growth was up 1.7% year-on-year. The environment in particular the number of people in employment, but also

the low level of inflation and low interest rates remained favourable for consumer spending in the reporting

period. Consumer savings rates in Germany fell to an all-time low. On the other hand, the German Retail Federation

(Handelsverband Deutschland HDE) points out that the markets are saturated and that consumer households are

well equipped. As a result, pressure in the competition for market share is continuing to rise.

The market research company (Gesellschaft fr Konsumforschung GfK) reports for the food retail sector that the

quantity of food being purchased has been declining for years. On the one hand, this is due to demographic trends;

on the other, consumers are becoming increasingly conscious of how they spend their money. In the non-food

retail sector, textiles suffered at the end of the year from the unfavourable weather conditions, ultimately recording

a year-on-year decline of 2%.

The structural shift in the retail sector continued in 2014. Conventional retailers continue to face a decline in foot-

fall. In contrast, Internet vendors generated revenues of 39 billion in 2014, growing by 17% year-on-year.


GERMAN COFFEE MARKET

Sales of roasted coffee to German households in the reporting period amounted to 635 million pounds in weight,

4% below the prior-year level of 660 million pounds. Once again, the espresso/caff crema and single-serving

markets saw year-on-year growth. The filter coffee segment continued to decline; at 7%, this has in fact accelerat-

ed compared with previous years.

An ongoing drought in Brazils largest coffee-growing region dominated the beginning of 2014 and led to substan-

tial harvest losses for the Arabica variety. Raw Arabica coffee prices increased significantly due to the reduction in

supply, but also because speculative hedge funds increased their exposure following this news. Supply of the

Robusta variety of raw coffee was not affected, meaning that the price increase was comparatively lower. Although

coffee prices fell again at the end of 2014 due to higher shipments of existing stock, purchasing prices remained

significantly above the prior-year figures as at the reporting date. In addition, the appreciation of the US dollar had

an impact on purchasing prices.

INTERNATIONAL BODY CARE MARKET

The growth rate in the cosmetics market the market relevant for Beiersdorf remained flat year-on-year at a

global level. The Asia, South Africa, Middle East and Latin America regions were the main growth drivers although

the pace of growth has slowed. The saturated markets in Western Europe and North America continued last years

growth path, while Eastern Europe was unable to match its prior-year growth. The industrial sales markets

experienced a recovery in Europe and further strong growth in Asia and America in 2014. A slight positive trend

emerged in Europe as the year progressed. Asia and North America continued to benefit from a strong economic

per form ance, while Latin America in contrast suffered domestic currency instability and a slowdown in real growth.

In 2014, raw material and packaging prices were, overall, relatively flat as forecast. The significant reduction in

global crude oil prices seen in the last quarter was not anticipated, but has not significantly affected prices of either

plastics or fossil fuel-based raw materials.

OVERALL ASSESSMENT OF THE ECONOMIC SITUATION

The structural shift in the retail sector and political developments in Eastern Europe impacted Tchibos business.

Despite its growth, the online business was unable to offset the decline in footfall in the branches. This, together

with losses in the Eastern Europe business, led to a decrease in revenues.

The global cosmetics market maintained the previous years level of growth, although growth rates in some indi-

vidual markets eased. Beiersdorfs Consumer business segment recorded another increase in revenues in this

challenging economic environment. Sales by the tesa business segment rose again on the back of the recovery in

its industrial sales markets in Europe as well as further growth in Asia and the Americas. The consumer business

and the distribution business aimed at craftsmen also performed well in Europe.

015

RESULTS OF OPERATIONS

CONSOLIDATED REVENUES UP YEAR-ON-YEAR

In financial year 2014, consolidated revenues amounted to 9,663 million (previous year: 9,611 million). In nom-

in al terms, revenue was up slightly on the prior year, by almost 1%. Organic revenue improved by over 2%. The

prior-year figure was adjusted due to the application of IFRS 11 Joint Agreements. Further details can be found

in the section of the notes to the consolidated financial statements entitled Changes in accounting policies.

60% of revenues were generated abroad. As in previous years, the majority of this was attributable to Beiersdorf.

REVENUES MAXINGVEST GROUP in million

Tchibo

Beiersdorf

Holding

2014

3,377

6,285

1

2013

3,469

6,141

1

14 13 Total 9,663 9,611

Tchibos revenues fell by almost 3%, from 3,469 million to 3,377 million. Its organic revenues were down by

nearly 2% year-on-year. Revenues declined in all regions. This was due to negative effects from exchange rate

changes, the weaker consumer merchandise business and the ongoing decline in footfall and revenues in the

branches. The online business and the coffee business had a positive impact on revenue.

In financial year 2014, additional steps were taken to further optimise the distribution area and locations were

reviewed on an ongoing basis. In Germany, the number of branches declined slightly year-on-year. In Eastern

Europe, the distribution area was expanded to include additional branches.

Once again, online sales increased in importance. The www.tchibo.de website is one of the four most frequently

visited online shops in Germany. More visitors from German-speaking countries and a larger proportion of com-

pleted orders lifted revenues, although these remained below expectations.


SHARE OF REVENUES BY REGION TCHIBO 2014 in per cent

Germany 76

Abroad 24

Beiersdorf improved its revenues from 6,141 million to 6,285 million. The company achieved organic revenue

growth of almost 5%. Consolidated revenues saw a nominal increase of a good 2% year-on-year. The increase

came from both business segments. The Consumer business segment achieved revenues of 5,209 million (pre-

vious year: 5,103 million), exceeding the previous year by 2% in nominal terms and 5% organically. The tesa

business segment improved its nominal revenues by almost 4%, from 1,038 million to 1,076 million. tesas

organic growth was slightly over 4%.

The healthy organic revenue trend is proof of the systematic implementation of Beiersdorfs corporate strategy as

set out in its internal Blue Agenda programme. Thanks to its strong innovations and outstanding marketing con-

cepts, Beiersdorf increased its market share in both the saturated markets of Europe and the emerging markets,

where it achieved double-digit growth rates in some cases. Its three core brands NIVEA, Eucerin and La Prairie

once again achieved encouraging growth rates.

SHARE OF REVENUES BY REGION BEIERSDORF 2014 in per cent

Europe 54

Africa/Asia/Australia 28

Americas 18

017

The key growth drivers for NIVEA were NIVEA Deo, NIVEA Shower and NIVEA Body. Eucerin generated strong

growth, thanks in particular to the Eucerin Body Care and Eucerin Aquaphor categories. In the exclusive cosmetics

segment, the La Prairie brand recorded positive growth rates, driven in particular by the launch of the Cellular Swiss

Ice Crystal Collection and the continued positive performance of the Skin Caviar Collection.

tesa generates almost three-quarters of its revenues in the industrial segment and one-quarter through its

con sumer products and craft businesses. In the industrial segment, both the direct customer business and the

distribution business in all regions contributed to growth. Business growth was significant in Asia, the USA and

Europe. tesa expanded its market share in the consumer products and craft businesses.

EBIT MARGIN DOWN SLIGHTLY YEAR-ON-YEAR

The maxingvest Groups EBIT amounted to 992 million in the reporting period (previous year: 1,080 million). The

Group achieved an EBIT margin of 10.3% (previous year: 11.2%).

The cost of goods sold increased by 2%. At Tchibo, the cost of goods sold declined at a lower rate than the

decrease in revenues. At Beiersdorf, the cost of goods sold rose faster than revenues. This change was mainly due

to the stronger increase in Consumer revenues in the emerging markets, which generally entail a higher ratio of

product costs to sales, and a change in the product mix. In some countries, exchange rate changes also had a

negative impact on the companies procurement costs.

Gross profit saw a minimal decline. Marketing and sales expenses were 3,950 million in the reporting period,

down 1% on the prior-year figure of 3,985 million. At Beiersdorf, marketing and sales expenses remained almost

constant year-on-year, while they decreased slightly at Tchibo.

Other operating income declined as against the prior-year period, from 384 million to 302 million. The change

is primarily attributable to higher income from the reversal of provisions in the previous year.

Other operating expenses decreased by 13 million to 268 million (previous year: 281 million). This was mainly

the result of a decline at Beiersdorf, where the majority of other operating expenses were also incurred. This item

at Beiersdorf primarily comprises additions to provisions for litigation and other risks, as well as miscellaneous other

operating expenses. The amortisation and impairment losses on intangible assets are also included in this item.

At 191 million, Tchibos earnings before interest and taxes were down on the prior-year figure of 220 million in

the reporting period. The EBIT margin was 5.7% (previous year: 6.3%).


Beiersdorfs EBIT amounted to 796 million (previous year: 820 million). The Beiersdorf Groups results of oper-

ations are assessed on the basis of the operating result (EBIT) excluding special factors. This figure is not part of

IFRSs and should be treated merely as voluntary additional information. The special factors listed are one-time,

non-operating transactions. EBIT excluding special factors rose to 861 million (previous year: 814 million) at

Beiersdorf, while the EBIT margin was 13.7% (previous year: 13.2%). The Consumer business segment generated

EBIT excluding special factors of 678 million (previous year: 638 million); the EBIT margin reached 13.0% (previ-

ous year: 12.5%). EBIT in the tea business segment rose from 176 million in the prior year to 183 million in the

past financial year; the EBIT margin was 17.0% (previous year: 16.9%).

Special factors of 65 million (previous year: 6 million) at Beiersdorf related to the Consumer business segment.

Due to an adjustment to the long-term revenue and earnings outlook for the Chinese hair care business, Beiersdorf

performed an impairment test as at 30 September 2014. This led to the hair care brands being written down by

67 million to a residual carrying amount of 21 million. In addition, provisions that had been recognised in con-

nection with the realignment of corporate structures in the past but were no longer required were reversed.

Prior-year special factors related to both business segments at Beiersdorf.

The Holding divisions EBIT for the reporting period amounted to 5 million (previous year: 40 million). The high

figure for the previous year was primarily due to the reversal of provisions in connection with previous equity

investments.

EBIT MAXINGVEST GROUPin million

Tchibo

Beiersdorf

Holding

2014

191

796

5

2013

220

820

40

14 13 Total 992 1,080

TAXES

Tax expenses at the maxingvest Group amounted to 332 million in 2014 (previous year: 328 million). Deferred

tax income was 24 million in the reporting period (previous year: 19 million). Current income taxes amounted to

356 million (previous year: 347 million).

019

CONSOLIDATED NET PROFIT DOWN YEAR-ON-YEAR

Consolidated net profit amounted to 674 million (previous year: 748 million), down 10% on the prior-year figure.

The decrease is mainly attributable to the Holding division. In addition to the reduction in EBIT, the Holding

div isions net profit was affected by higher tax expenses. Tchibos net profit amounted to 160 million, down on

the prior-year figure of 164 million. Beiersdorfs net profit reached 537 million, slightly below the prior-year

figure of 543 million.

NET PROFIT MAXINGVEST GROUPin million

Tchibo

Beiersdorf

Holding

2014

160

537

23

2013

164

543

41

Total 674 74814 13

EARNINGS PER SHARE

Earnings per share in accordance with IFRSs after non-controlling interests amounted to 103.67 (previous year:

123.86). Earnings per share were again calculated on the basis of the average number of 3,660,001 no-par-value

shares in the reporting period.


NET ASSETS AND FINANCIAL POSITION OF THE GROUP

BALANCE SHEET STRUCTURE AND EQUITY RATIO

The maxingvest Groups total assets amounted to 13,643 million at the balance sheet date (previous year: 13,670

million). The prior-year figure was adjusted due to the application of IFRS 11 Joint Agreements. Further details

can be found in the section of the notes to the consolidated financial statements entitled Changes in accounting

policies.

At 8,003 million, non-current assets were up on the previous year (7,531 million). Of these non-current assets,

67% are intangible assets and consist mainly of goodwill and the adjusted carrying amounts of the trademarks that

were identified during the initial consolidation of Beiersdorf AG, as well as the Chinese hair care brands that were

acquired when the shares of Beiersdorf Hair Care China were purchased.

Current assets decreased from 6,139 million to 5,640 million. The decline in current assets is primarily attribut-

able to a reduction in the Holdings securities. A significant proportion of the securities was used for the scheduled

repayment of financial liabilities.

Equity rose by 4% in the reporting period, from 8,232 million to 8,566 million. The equity ratio was 63% as at

the reporting date (previous year: 60%).

Non-current liabilities amounted to 2,134 million, down 354 million on the prior-year figure (previous year:

2,488 million). This item was primarily impacted by two offsetting effects. On the one hand, provisions for pen-

sions and other post-employment benefits increased from 554 million to 842 million. This was mainly attribut-

able to Beiersdorf, where provisions for pensions and other post-employment benefits rose due to a decrease in

the discount rate. On the other, a liabilities to banks item was reclassified from non-current financial liabilities to

other current financial liabilities due to the change in its maturity date. In addition, maxingvest ags bond was

repaid in October of the reporting period and hence derecognised under the other current financial liabilities item.

Current liabilities amounted to a total of 2,943 million, slightly below the prior-year figure of 2,950 million.

ASSETS AND CAPITAL STRUCTURE MAXINGVEST GROUP as per cent of total assets

2013 2014 AssetsEquity and liabilities 2014 2013

Non-current assets 55 59 Equity 63 60

Current assets 23 25 Non-current liabilities 16 18

Securities, cash and cash equivalents 22 16 Current liabilities 21 22

13 14 14 13

021

FINANCIAL POSITION GROUP

Cash flows from operating activities amounted to 414 million, down 239 million on the previous year.

Cash flows from investing activities were 375 million in the reporting period (previous year: 256 million).

Capital expenditure of 398 million was offset by net cash inflows of 631 million from the sale of securities,

income of 42 million from the sale of assets and 100 million in interest and proceeds from other financing

activities.

At 789 million, free cash flow was above the prior-year figure of 397 million.

The net cash outflow from financing activities amounted to 820 million (previous year: 231 million). Of this

amount, 589 million was used to repay loans, which mainly related to the repayment of the bond. A total of

140million was distributed to shareholders.

Cash and cash equivalents decreased by 15 million to 1,220 million (previous year: 1,235 million).

The maxingvest Groups net financial assets increased to 2,764 million in the reporting period (previous year:

2,580 million). The increase is mainly attributable to the Holding division.

CAPITAL EXPENDITURE BY THE MAXINGVEST GROUP

The maxingvest Group invested a total of 387 million in intangible assets and property, plant and equipment in

2014 (previous year: 311 million).

Of this capital expenditure, 86 million (previous year: 84 million) was invested by Tchibo mainly in property,

plant and equipment. The bulk of these investments were in connection with the improvements made to IT, the

out-of-home markets coffee business and coffee production. 301 million (previous year: 227 million) was attrib-

utable to Beiersdorf, 283 million of which was invested in property, plant and equipment. This capital expenditure

primarily related to the new Consumer facility in Mexico and to tesas new headquarters in Norderstedt.


MAXINGVEST AG (HGB SINGLE-ENTITY FINANCIAL STATEMENTS)

BASIS OF ACCOUNTING

The annual financial statements of the maxingvest Group include the financial statements of maxingvest ag pre-

pared in accordance with the International Financial Reporting Standards (IFRS). The following explanations relate

to the annual financial statements of maxingvest ag prepared in accordance with the German Commercial Code

(Handelsgesetzbuch HGB) and the German Stock Corporation Act (Aktiengesetz AktG). In accordance with

section 315(3) HGB, the management report of maxingvest ag has been combined with the management report

of the maxingvest Group, as the risks and opportunities of the parent company and its expected development

cannot be separated from those of the Group.

NET INCOME BELOW THE PRIOR-YEAR LEVEL

maxingvest ags revenues from sales of consumer merchandise amounted to 0.1 million (previous year: 0.2 million).

Other operating income fell by 72 million to 13 million. This was mainly due to lower income from the sale of

interest rate hedges and the reversal of provisions. In the previous year, higher income was generated from the

reversal of provisions in connection with previous equity investments.

Other operating expenses rose by 7 million to 17 million. The increase in operating expenses in the reporting

period was attributable to higher losses from the disposal of securities classified as current assets.

At 159 million, income from investments was 143 million below the prior-year level. Income from investments

mainly consisted of a distribution of 67 million (previous year: 85 million) by BBG Beteiligungsgesellschaft mbH

and the earnings contribution from Tchibo GmbH of 83 million (previous year: 207 million).

Dividends from Beiersdorf AG totalling 89 million (previous year: 89 million) received by our subsidiary BBG

Beteiligungsgesellschaft mbH are included in the latters result.

Net interest income improved by 14 million to 23 million in the reporting period. This was due on the one hand

to the 6 million increase in interest income to 25 million, and on the other to the 8 million reduction in interest

expenses to 48 million.

maxingvest ags net income for the financial year amounted to 112 million (previous year: 271 million). The

decrease in the result was primarily due to lower operating income and a decline in income from investments.

A significant proportion of the cash held (securities and cash at banks) and the cash funds generated in the report-

ing period were used for the scheduled repayment of financial liabilities. As a result, cash held fell by 283 million

to 393 million as at the reporting date.

The subscribed capital remains unchanged at 125 million. As in the previous year, it is composed of 3,660,001

no-par-value shares.

023

A total of 90 million was transferred to the revenue reserves from the net retained profits for the previous year,

while 55 million was transferred from net income for the financial year. maxingvest ags equity amounted to

2,308 million (previous year: 2,244 million). The equity ratio as at the reporting date improved to 57% (previous

year: 51%).

Provisions fell by 29 million to 49 million, mainly due to the utilisation and reversal of provisions in connection

with tax audit risks.

Liabilities decreased from 2,097 million to 1,669 million during the year under review. The main reasons for this

were the scheduled repayment of maxingvest ags ten-year euro debut bond, which had a total volume of 700

million, in October 2014, as well as the partial repayment of liabilities to banks in the amount of 100 million. By

contrast, liabilities to affiliated companies increased by 379 million to 1,209 million (previous year: 830 million).

Liabilities to banks amounted to 460 million as at the reporting date (previous year: 560 million).

DEPENDENT COMPANY REPORT OF THE MANAGEMENT BOARD

In compliance with section 312 of the German Stock Corporation Act (Aktiengesetz AktG), the Management

Board has issued a dependent company report, which concludes as follows:

Our Company received appropriate consideration for each transaction listed in the dependent company report

and suffered no disadvantage from the measures undertaken or omitted listed therein. This assessment is based on

all the relevant circumstances that were known to us at the time the transactions were performed or the measures

were taken or not taken.


EMPLOYEES

TCHIBO

The number of employees (quarterly average) remained almost unchanged compared with the previous year, at

12,500 (previous year: 12,458).

As a family-owned company, Tchibo is convinced that its employees are its most important resource. This is why it

supports them in balancing professional and family goals, as well as in maintaining their physical and mental health.

Tchibo became the first retail company to be certified by berufundfamilie gGmbH in 2010 with the goal of sup-

porting a healthy worklife balance. An action plan was agreed, comprising a large number of measures that were

examined by berufundfamilie gGmbHs audit arm in the spring of 2013, which confirmed that the plan had been

implemented exceptionally successfully. The positive impact that this had in the company, coupled with conviction

of the importance of continuing these measures, led to it being re-certified. Additional measures, in particular on

management skills and working hours, have been set out in a mandatory action plan that runs until 2016. The first

results were already seen in 2014 and include individual part-time working opportunities, unpaid leave, workplace

flexibility and the compilation of a new management handbook.

The occupational health management programme MOVE not only monitors the physical health of Tchibo employ-

ees, but also their mental well-being. The foundations were laid in 2013 by recording, analysing and prioritising

health measures at individual sites and functions, while the reporting period saw the implementation of health-

promoting measures focusing on mental health, medical advice, occupational health and safety, exercise and

nutrition.

A further employee survey was conducted in the reporting period together with an external service provider. As in

the 2012 survey, the aim was to ascertain employees commitment and emotional ties to Tchibo. The results were

not yet satisfactory. Employee commitment did not improve compared with the previous survey. The measures

taken to date were revised on the basis of the results.

NUMBER OF TCHIBO EMPLOYEES 2014 (annual average)

Germany 8,581 69%

Abroad 3,919 31%

Total 12,500 100%

025

BEIERSDORF

Beiersdorf employed a quarterly average of 17,157 people worldwide (previous year: 16,573).

Consumer

The Blue Agenda emphasises the importance of the people at Beiersdorf for the companys long-term success: they

manage strong brands, develop innovative products and inspire consumers around the world. Strengthening an

engaging working environment remained a top priority in 2014, too. In the year under review, the following topics

addressed by Beiersdorfs Human Resources department are particularly worth mentioning:

Introducing Beiersdorfs core values as a long-term company culture project. Beiersdorfs four core values

care, simplicity, courage and trust are deeply rooted in its more than 130 years of corporate history. The employ-

ees high level of identification with these values provides an excellent opportunity to debate, review and improve

leadership quality and management effectiveness. 2014 marked the starting year of this long-term culture project

with the active participation of all units and all employees. The core values have also already been incorporated

into Beiersdorfs continuous employee dialogue process and into its global leadership development programmes.

Sustaining efforts to foster an open feedback culture: Beiersdorf conducted its global employee engagement

survey for the second time in 2014. A very high level of employees 92% took part in the survey and the overall

employee engagement index increased significantly against the previous year. Results were openly presented

throughout the company and discussed in more than 1,000 teams, with follow-up activities being facilitated and

their implementation monitored by the local HR departments.

Extending diversity engagement: diversity is a strong asset that contributes to Beiersdorfs global success. In

2014, Beiersdorf continued its systematic global diversity action programme launched in 2013. On gender diversity,

Beiersdorfs mentoring and networking programmes promoting womens career development continued into a

second wave. In practice, the first examples of job sharing at managerial level have been progressing successfully.

Beiersdorf is well on its way to increasing the percentage of women in management positions in Germany to 30%

by 2020: at the end of 2014, this figure stood at 27.5% (previous year: 25.5%). On international diversity, Beiersdorf

further increased the number of international employees at its Hamburg headquarters to 13% by the end of 2014

(previous year: 12%). The number of senior managers with international experience remained on a high level: about

half of them have long-term overseas working experience.

Supporting company-wide social collaboration: in 2013, Beiersdorf created BluePlanet an internal platform

for communication and collaboration that makes cross-border and cross-functional teamwork more efficient. In its

first full year, BluePlanet has already become a vital part of employees work life, with an average of 6,000 active

users per month.


Improving Beiersdorfs global talent management system: global talent management is a strategic priority:

talent and people development is an integral part of every Management Board meeting. Talent development at

Beiersdorf consists of a variety of face-to-face exchanges such as coaching, mentoring, or round table events. In

addition, annual Talent Days are held in which young executives discuss current business issues directly with the

Management Board. In the year under review, process integration was the centrepiece of improvement initiatives:

firstly, the integration of all essential aspects of career development into one documented process chain covering

performance, potential, individual development and career planning. Secondly, the integration of local, regional

and global activities, creating a single, streamlined global process.

Introducing a new global leadership development architecture: Beiersdorfs leadership development concept

consists of on-the-job learning, mentoring and coaching, and classroom training elements. It puts particular

emphasis on authenticity and self-reflection, decoding leadership into the management of human relationships. In

2014, two newly-designed development programmes were launched in conjunction with the core value initiative:

a Base Camp for first-time leaders and a Step-up Camp for middle and senior level managers. Both pro-

grammes combine face-to-face modules with complementary coaching and experiential learning in-between over

a total period of six months, and also closely involve the participants team leaders.

tesa

The focus of Human Resources work in the year under review was the launch of the new competency model. For

the first time, this took the form of a uniform competency model for all tesa employees and managers worldwide

that will serve as the basis for recruitment, training, succession planning and promotion in the future. It was

developed with extensive international involvement from many employees and was met with great interest across

the company. tesa intends to use the model to further professionalise succession planning and to promote and

enhance the companys open culture in line with the tesa Strategy 2020. Together with its employees, tesa identi-

fied the key competencies required in order to achieve its corporate goals going forward and to clearly differentiate

tesa from the competition. In order to ensure that these new ideas are also incorporated into employee manage-

ment, the competency model will be integrated into the annual employee dialogue worldwide.

In the year under review, tesa SEs employees in Hamburg prepared for the upcoming move to the companys

newly constructed headquarters in Norderstedt, which also features an integrated research and technology centre

(the one tesa project). The move is scheduled to take place in 2015 and is a milestone in the companys long-term

growth. Consolidating the business units and the Research and Development function in a single space should

significantly contribute to tesas ability to respond more quickly and flexibly to market requirements from 2015

onwards. A large number of design details regarding the new working environment were agreed with employee

representatives in the year under review. The design and layout of the building was based on a modern employer

branding concept, which positions tesa as an attractive employer.

027

NUMBER OF BEIERSDORF EMPLOYEES 2014 (annual average)

Europe 10,093 59%

Africa/Asia/Australia 4,565 27%

Americas 2,499 14%

Total 17,157 100%

SUSTAINABILITY

Corporate social responsibility is a well-established part of the maxingvest Groups policy. Tchibo and Beiersdorf

have integrated corporate responsibility into their management systems, with the aim of improving their perform-

ance in this area from year to year.

TCHIBO

A focus on long-term success and the example provided by the German concept of the honourable Hanseatic

merchant have been the guiding principles of the Tchibo family business for over 60 years.

Building on this foundation, Tchibo made sustainability an integral part of its long-term business strategy back in

2006, thus helping to actively meet current challenges. As societies evolve, public awareness of issues such as

climate protection or working conditions across global supply chains increases, meaning that viable ways of

addressing these problems are needed.

Tchibo considers taking responsibility and initiating change as its corporate duty. Firstly, because Tchibos business

model, its expertise and also its size enable it to make a difference, for example in the cultivation and processing

of coffee, cotton and wood. Secondly, because the company is convinced that sustainable business policies will

largely determine its future economic success.


Sustainability performance 2014

Tchibo continued to make progress in 2014 in structuring its corporate social responsibility activities, again taking

significant steps towards its goal of making its business activities fully sustainable.

The coffee value chain

Tchibo has been offering its customers coffee of the highest quality for over 60 years. In order to live up to this

claim in the future, too, the company doesnt just emphasise aroma and flavour it is also committed to protecting

the environment and to improving living conditions in the coffee-growing regions. Sustainable coffee cultivation as

defined in Tchibos sustainability concept means that both current and future generations will be able to make a

permanent living from growing coffee in the country of origin.

As part of its commitment towards becoming a fully sustainable business, Tchibo aims in the medium term to sell

only coffee varieties that have been cultivated in line with its ecological, social and economic standards, and that

therefore offer coffee farmers a long-term livelihood. In order to achieve this goal, the company is pursuing a

comprehensive approach to enhancing both coffee supply chains and the coffee sector as a whole. For example,

the share of the total raw coffee used for Tchibos domestic and foreign business that is accounted for by raw

coffee included in Tchibos sustainability concept increased from 25% in 2012 to approximately 35% in 2014. As in

previous years, Tchibo works together with all internationally recognised standards organisations. These are the

Rainforest Alliance, Fairtrade, UTZ Certified and the organisations behind the EUs organic farming logo. The base-

line standard of the 4C Association (Common Code for the Coffee Community) is used to organise the coffee

farmers and to make them aware of the need for sustainable coffee cultivation. Since 2009, Tchibos coffee bars

have only offered coffee from certified sources. All the original Tchibo Privat Kaffee varieties and the coffee for the

Tchibo Cafissimo capsules were switched to 100% certified coffee grades in 2012. In 2014, preparations were

made to expand the capsule range: since January 2015, Tchibo has offered customers tea capsules in the form of

Cafissimo Teatime. Here, too, there is a commitment to quality and sustainability the tea leaves in the tea capsules

are sourced exclusively from Rainforest Alliance or UTZ-certified farms, or controlled organic farms.

The consumer merchandise value chain

Tchibo offers its customers a weekly range of consumer merchandise that is celebrated for its variety and quality.

The company works with a network of global business partners to manufacture the products.

Since 2007, the company has used the WE (Worldwide Enhancement of Social Quality) qualification programme

developed by Tchibo and the Gesellschaft fr Internationale Zusammenarbeit (GIZ German Society for Inter-

nation al Cooperation) to ensure fair working conditions at Tchibos consumer merchandise production facilities and

to continually improve them, particularly in Asia. The focus of this is on building up a trusting, results-oriented

dialogue between employees and managers, at the production facilities and with Tchibo purchasing agents. The

dialogue concentrates on improving working conditions, environmental standards and efficiency in the factories.

By the end of 2014, 320 producers were involved in the WE programme. Tchibo already supports well over one-

third of its non-food producers in implementing international standards in particular with regard to working

conditions and by doing so covers over two-thirds of the range. Tchibo helped to develop the Bangladesh Fire

and Building Safety Accord in 2012 and was therefore one of the first two signatories to it. Other large inter-

nation al clothing companies signed the agreement in 2013.

029

In 2014, Tchibo took another important step by including the DETOX standard, which is designed to prevent

un desired chemicals in textile production, in its sustainability management activities.

Tchibo places great emphasis on the environmentally and socially sustainable sourcing of the raw materials used in

its consumer merchandise. As part of its commitment to sustainability, Tchibo aims to continually increase the

proportion of cotton, wood and cellulose that comes from responsibly managed sources.

In sales year 2014, the majority of Tchibos textiles made from or with cotton used validated or certified sustainable

sources. Tchibo currently cooperates with three partners in its use of sustainable cotton. Firstly, Tchibo is a member

of the non-profit organisation Textile Exchange (OCS 100/OCS Blended), which promotes the global cultivation of

organic cotton. Secondly, the company is involved in the Better Cotton Initiative (BCI), which is committed to

achieving a large-scale, global shift from conventionally to sustainably grown cotton. In addition, Tchibo supports

the Aid by Trade Foundations Cotton made in Africa (CmiA) initiative by purchasing CmiA cotton, and as a part-

ner in education projects. In 2014, Tchibo took the next step in its cotton strategy by performing self-certification

in line with the Global Organic Textile Standard (GOTS).

Many Tchibo products are made of wood. In order to ensure that forests are preserved for future generations, the

company makes sure that this valuable raw material comes from responsibly managed sources. The same also

applies to the paper used: Tchibo has consistently increased the proportion of environmentally friendly paper

grades used over the past few years. Tchibo started printing its magazines, catalogues and advertising materials in

Germany, Austria and Switzerland on FSC-certified paper in 2012. These have also been printed on FSC-certified

paper at Tchibos subsidiaries in the Czech Republic and Slovakia since 2013, and in Turkey, Poland and Hungary

since 2014.

Environmental protection

An intact environment is a key precondition for Tchibos future viability and for that of the economy as a whole.

Further extending climate protection and resource conservation along the value chain, to the locations and to the

transportation and dispatch of products is therefore one of Tchibos priorities.

Tchibos long-term fleet strategy pursues the goal of continuously reducing CO emissions in the area of transpor-

tation. Further progress was made in 2014 in converting Tchibo GmbHs fleet to fuel economy-optimised and

electric vehicles. As a result, the company received the Grne Karte fr glaubwrdiges Umweltbewusstsein

(Green Card for Credible Climate Awareness) award from Deutsche Umwelthilfe e.V. for the third consecutive

time. The prize assesses the average fleet CO emissions for listed and selected medium-sized companies in

Germany, along with their strategies for reducing emissions.

More detailed information can be found in Tchibos Sustainability Report at www.tchibo-sustainability.com.


BEIERSDORF

For Beiersdorf, care is a core value and part of its core business. This encompasses not only skin care and protec-

tion, but also responsibility towards our fellow human beings and our environment. Sustainability is a living com-

ponent of Beiersdorfs corporate culture and is strategically anchored in all its business processes. Beiersdorfs goal

is to continue to combine success and responsibility.

Consumer

The We care. sustainability strategy that Beiersdorf developed in 2011 focuses on three fields of activity:

Products, Planet and People. The company has defined clear, long-term objectives for each area. By 2020,

Beiersdorf aims to:

generate 50% of its sales from products with a significantly reduced environmental impact (base year 2011),

have reduced its CO emissions by 30% per product sold (base year 2005),

reach and improve the lives of one million families (base year 2013).

In 2014, Beiersdorf continued to drive forward the implementation of projects in all three strategic areas through-

out the company.

For example, Beiersdorf introduced a new global sustainability management system susy (sustainability

system) in the year under review to measure progress towards its ambitious sustainability goals on an even

broader basis and to facilitate reporting in accordance with GRI (Global Reporting Initiative) standards, among

other things. Efficient and transparent data management enables Beiersdorf to respond dynamically to and accom-

modate constantly changing stakeholder demands, new European directives and developments in the field of

sustainability. In addition, improved control mechanisms ensure that these are optimally integrated with its internal

processes.

Products

Beiersdorf uses life cycle assessments (LCAs) to measure and reduce the environmental impact associated with

each stage of the product life cycle. The assessment model complies with the independent ISO standards for LCAs

(14040 and 14044) and covers raw materials, in-house manufacturing processes, transportation, product use,

recycling and disposal.

Beiersdorf made important progress in the year under review using LCAs: the new packaging for NIVEA Face Care

products achieves CO savings throughout the entire product life cycle since the jars are made out of two plastics,

polyethylene terephthalate (PET) and polypropylene (PP). The LCA found that switching from glass to PET reduces

the products carbon footprint by up to 16%, and switching from glass to PP by as much as 28%.

Planet

In 2014, Beiersdorf rolled out a software programme to calculate and manage its logistics emissions in Europe. The

software is linked to susy, the new sustainability management system. Among other functions, it presents emis-

sions for annual reporting purposes in accordance with the GRI and the Carbon Disclosure Project (CDP).

031

The new factory in Silao (Mexico) was awarded platinum Leadership in Energy and Environmental Design (LEED)

certification, the highest sustainability standard for buildings, in the year under review. So far, only four production

facilities worldwide have received platinum LEED certification the one in Silao is the only one to date in the Latin

American region and the only one to date in the cosmetics industry. Beiersdorf aims to achieve gold LEED certifi-

cation for the expansion of its factories in Chile and Thailand. The company has also been extending its Blue

Production Center initiative to its production facilities in the Far East since 2013. The initiative focuses on energy

and water efficiency, water treatment and waste management.

Water is an increasingly scarce resource, not least in light of climate change and global population growth. This is

why Beiersdorf attaches great importance to using water efficiently in its business activities and to continually

reducing its water consumption. Unlike CO emissions, water consumption is a regional issue. Some regions of the

world do not have adequate access to drinking water. Beiersdorf has therefore launched its first local projects to

assess water supply system risk and to implement appropriate measures.

People

Beiersdorf aims to further improve workplace safety and to reduce the number of work-related accidents with its

company-wide zero accidents initiative. For example, behavioural based safety (BBS) principles are being drawn

up to make employees aware of possible sources of danger in the workplace and safe working practices such as

by defining clear behavioural patterns expressed in terms of I will and I will not rules. The concept was extend-

ed to include additional countries in 2014.

NIVEA supports families all over the world with long-term, locally relevant projects through its global NIVEA cares

for family initiative. The initiative focuses on three areas: developing childrens skills, supporting mothers and

giving families the opportunity to spend time with each other.

The idea of strengthening families reflects Beiersdorfs tradition of social engagement and the core values of all of

Beiersdorfs brands, especially NIVEA.

Childrens experiences in the first few years of life are central to their development. NIVEA Brazil has launched a

partnership with childrens charity Plan International that aims to help around 85,000 families in Brazil by 2020.

Among other measures, the initiative offers workshops for parents on topics such as motivation, and gives women

the opportunity to obtain advice on income security. It is also building recreational facilities to encourage families

to play together. Many of these projects are being supported by NIVEA volunteers. The partnership is scheduled to

last for seven years and is initially starting in So Paulo and Itatiba before being extended to north-east Brazil. It

will be reviewed annually for efficiency and sustainability.

Hansaplast/Elastoplast cooperates with local Red Cross organisations around the world to strengthen everyday first

aid under the motto Bringing First Aid Home. Germany, France, the United Kingdom, Canada, the Netherlands,

Austria and Spain are already participating in the initiative. Hansaplast has been working with the German Red

Cross since September 2014 under the motto Erste Klasse Erste Hilfe (First Grade First Aid). The partnership

aims to familiarise elementary school children with basic first aid measures and to foster a desire to help at an early

age.

Additional information can be found at www.beiersdorf.com/sustainability.


tesa

In 2014, tesas priorities were again to make a significant contribution to social development and to enhance the

companys environmental management system. tesa has been systematically establishing its environmental

management system since 2001 and regularly exceeds its environmental protection goals. For example, its produc-

tion locations around the world have cut emissions of volatile organic compounds (VOCs) by more than half since

2001 and have significantly reduced the amount of waste produced, CO emissions and solvent usage. All of the

companys production facilities are certified in accordance with ISO 14001, the international environmental

standard.

tesas environmental management activities continued to focus on reducing energy consumption and CO emis-

sions in the year under review. Energy management at tesas Hamburg and Offenburg locations was boosted by

the installation of state-of-the-art energy monitoring systems. Offenburg has generated its own environmentally

friendly electricity from a combined heat and power plant since July 2014, and Hamburg is expected to follow suit

starting in 2015. The energy management systems at both locations are to be certified according to ISO 50001 in

the first quarter of 2015.

tesa actively identifies and determines the ecological value drivers in the production process. The eco-balance

method is used to analyse the environmental impact of individual products throughout their life cycle in order to

further enhance their environmental compatibility. In the process, tesa constantly searches for more environmen-

tally friendly alternatives for certain product components or packaging.

All tesas activities are documented in an annual progress report that is available at www.tesa.com/responsibility.

OVERALL ASSESSMENT OF THE GROUPS ECONOMIC POSITION

The maxingvest Groups operating companies recorded a mixed business performance in 2014. Tchibos revenues

amounted to 3,377 million (previous year: 3,469 million), down 3% year-on-year. EBIT amounted to 191 million

(previous year: 220 million). The EBIT margin was 5.7% (previous year: 6.3%).

Tchibo defined the following growth areas for the next few years in its Zukunft braucht Herkunft (Building Our

Future on Tradition) strategy: the online and Eastern Europe business, the espresso/caff crema segments and the

single-serving coffee systems segment. Negative effects from exchange rate changes, the weaker consumer

merchandise business and the ongoing decline in footfall and revenues in the branches meant that the forecast

rev enue growth was not achieved. The online and coffee business had a positive impact on revenue.

033

Comparison of actual and forecast business developments at Tchibo

Forecast for 2014 in 2013 Annual Report Result in 2014

Revenue growth on a level with the previous year 3%

EBIT on a level with the previous year 191 million

Beiersdorfs business performance in 2014 shows that it is on the right track. Both the Consumer business segment

and the tesa business segment recorded encouraging growth rates. Beiersdorf achieved revenues of 6,285 million

(previous year: 6,141 million). Organic growth amounted to almost 5% (previous year: 7%). EBIT declined to 796

million (previous year: 820 million). After adjustment for special factors, EBIT amounted to 861 million (previous

year: 814 million). The EBIT margin excluding special factors amounted to 13.7% (previous year: 13.2%).

The Consumer business segment made successful progress thanks to the systematic implementation of Beiersdorfs

corporate strategy, which is based on its Blue Agenda. This strategic compass aims to make Beiersdorf more com-

petitive and enhance its economic success. Its success can be seen particularly in the performance recorded by the

emerging markets and the launch of new, high-selling products. The tesa business segment further expanded its

business both in the industrial markets and in the consumer business.

At almost 5%, Beiersdorfs organic revenue growth was within the target range of 46% that was forecast for

financial year 2014. In the Consumer business segment, the expansion of the segments impact and presence in

the emerging markets was a particular contributing factor. At tesa, the healthy trend in the automotive and elec-

tronics growth markets was a key growth driver. The EBIT margin increased in financial year 2014, as forecast.

Comparison of actual and forecast business developments at Beiersdorf

Forecast for 2014 in 2013 Annual Report Result in 2014

Revenue growth (organic) 46% 5%

EBIT margin (excluding special factors) slightly above prior year (13.2%) 13.7%

These developments resulted in revenues of 9,663 million (previous year: 9,611 million) for the maxingvest

Group. The revenue increase is therefore in line with the slight improvement in revenues that was forecast. A slight

improvement was also forecast for earnings before interest and taxes in the 2013 Annual Report. As the maxingvest

Groups performance depends primarily on that of its operating subsidiaries, the decline in earnings before interest

and taxes at Tchibo and Beiersdorf had an impact on EBIT. In addition, the forecast change at the holding compa-

ny influenced earnings before interest and taxes. At 992 million, EBIT was down 88 million on the prior-year

figure of 1,080 million, meaning that our forecast was not met.


REPORT ON OPPORTUNITIES AND RISKS

INTEGRATED RISK AND OPPORTUNITY MANAGEMENT SYSTEM

The maxingvest Group operates in various business fields, both nationally and internationally, in which new oppor-

tunities are continuously arising. In addition, it is exposed to a variety of business risks, which are monitored and

managed using corresponding systems and processes. The maxingvest Groups risk and opportunity policy aims to

leverage opportunities, but to accept the related risks only if the expected increase in value clearly more than

compensates for the risks.

A key component of the maxingvest Groups risk management system consists of analysing risks by distinct

clusters short-term operational risks, non-recurring risks and strategic risks. These risk clusters use appropriate

forecast periods for each cluster. The forecast period for short-term operational risks and non-recurring risks is one

year, while that for strategic risks is up to five years.

TCHIBO OPERATES A COMPREHENSIVE OPPORTUNITY AND RISK MANAGEMENT SYSTEM

Tchibos opportunity management system is closely aligned with its corporate strategy, which is focused on

ensuring long-term customer loyalty by differentiating itself from national and international competitors. Regular

ana lyses of customers and the competition enable it to react in a timely manner to the dynamic marketplace.

Concrete market opportunities are derived from the knowledge gained and are used in the continuous planning

processes together with the defined success factors.

To monitor the risk situation, Tchibo uses a risk management system that identifies the key business risks and limits

them by taking countermeasures. Uniform standards and central mechanisms for coordination ensure that risk

management functions effectively. All key risks are periodically recorded as part of extensive risk inventories. Risks

are broken down into the above-mentioned risk clusters to ensure their systematic capture. Within these clusters,

a further distinction is made into logical categories. In addition, acute risks are immediately reported to corporate

management when they arise. This enables potentially threatening risks to be closely tracked and brought under

control.

Up-to-date information on changes in the risk situation is incorporated in Tchibos management and planning

systems in the course of the year, and is a component of decision-making and control processes. The integration

of the risk inventory and planning processes enables the risk management system to be continuously enhanced and

anchors risk awareness across the Group. In terms of communication, regular risk reports are used to inform both

Tchibo GmbHs Management Board and its Supervisory Board of the risk situation. The effectiveness of the risk

management system is audited by the Internal Audit unit.

035

As a retailer, Tchibo is basically subject to the risk of saturation in individual markets, which could lead to flat or

declining sales. This risk is monitored and is counteracted by an innovative product policy, which closely monitors

trends and sentiment in the relevant sales markets and reacts accordingly. This ensures that growth potential in any

new, specific national and international markets is exploited.

The constantly changing retail landscape currently dominated by growing retail concentration, increased compe-

tition among physical retailers and the ongoing trend towards e-commerce represents challenges for Tchibo.

Tchibo counters these risks by modernising and enhancing its physical retail presence, building up its e-commerce

business and focussing even more strongly on cross-channel activities.

Since the foundation of the company, the Tchibo name has become a brand that customers associate with a

pleas urable experience, expertise, quality and trust. This image allows Tchibo to build long-term customer relation-

ships. However, all factors that could damage the brand name represent a risk for Tchibo. This risk is effectively

mitigated by a judicious communication policy, careful quality controls and compliance with social and environ-

mental stand ards. Tchibos long-term brand image is dependent on its spirit of continuous innovation, together

with its ability to identify market trends and analyse the risks and opportunities associated with launching new

products, taking into account its target groups. There is a risk that Tchibo will lose its relevance as a brand if it

fails to maintain this creative competitive edge. To prevent this, Tchibo is expanding its portfolio of first-class

suppliers. This ensures quality, innovation and compliance with its corporate social responsibility standards. Tchibo

also fosters ongoing employee development and is establishing responsive and dynamic product development

processes.

Specific production and warehousing locations, including their IT infrastructure, form an integral part of Tchibos

retail system business. Operational stoppages can have a significant effect on supply chains, for which time is of

the essence. Emergency plans, adaptive measures and specific insurance solutions are used to limit this business-

related risk.

OPPORTUNITY AND RISK MANAGEMENT FORMS AN INTEGRAL PART OF CORPORATE MANAGEMENT AT BEIERSDORF

Risk management is also an integral part of central and local planning, management and control processes within

Beiersdorf and conforms to consistent standards across the Group. Open communications, the risk inventory

carried out at regular intervals and the planning and management system ensure that the risk situation is

presented transparently. Risk management is coordinated at Group headquarters.

The Internal Audit unit monitors risk management and compliance with the internal control system by means of

systematic audits. The department is independent of the Groups operating activities, and regularly reviews its

business processes, the systems installed and the effectiveness of the controls put in place. In addition, the external

auditors audit the risk early warning and monitoring system. They report their audit findings to the Management

Board, the Supervisory Board and in particular the Audit Committee of the Supervisory Board, which regularly

focuses on these topics.


Risk management is also designed to protect brand assets and leverage the associated opportunities. Beiersdorfs

compliance with high standards of product quality and safety is the basis for consumers continued trust in its

brands. Innovations and prudent brand management ensure consumer acceptance of products, and their appeal.

Beiersdorf performs in-depth safety assessments, which take into account consumer feedback on earlier products,

when developing new products. All products are subject to the strict criteria laid down in the quality management

system. The potential created for the various brands is safeguarded and expanded by registering and managing

intellectual property rights. Strong brands that balance innovation and continuity are the response to fierce global

competition on price, quality and innovation. By developing and implementing the Consumer Insights process,

Beiersdorf has laid the groundwork for identifying consumer wishes even faster and reflecting them in the products

it develops. This also counteracts the growing retail concentration and the regional emergence of private label

products.

Beiersdorf is subject to procurement risk with regard to delivery reliability, the cost of raw materials and upfront

expenditures on purchased goods and services. It counteracts these risks by continuously monitoring its markets

and suppliers and ensuring active management of its supplier portfolio, as well as by app

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