Annual Report
2006
Over the years, Munich Airport has matured
into a major international aviation hub.
Today, it offers flights that span the globe,
crossing borders, uniting continents and
bringing together people of every nation.
It has also come to stand for growth –
growth that focuses, above all, on future
generations.
What symbol could better reflect this spirit
of globalism and the promise of tomorrow
than the children of the world, pictured
throughout this report?
Introduction
Foreword
Highlights
Executive board and
heads of business divisions
3
4
9
The airport in figures
Traffic figures
Business figures
10
12
FMG Group structure and
business development
Group structure
Aviation/non-aviation sales
13
13
Aviation business
Aviation
Ground Handling
16
20
Non-aviation business
Corporate Real Estate Management
and Development
Retail and Services
26
28
Terminal 2
Personnel
Expansion plans
Communications and community relations
Aviation and climate protection
Safety and security
30
32
36
40
44
46
Financials and
business performance 2006
The FMG Group’s business performance
50
Consolidated financial statements 2006
Supervisory board’s report
Consolidated management report
Consolidated balance sheet
Consolidated income statement
Consolidated cash flow statement
Changes in consolidated equity
Annex to the consolidated financial statements
Independent auditor’s report
Additional information
53
54
62
64
65
66
67
77
78
2
Foreword
Looking back at 2006, two major events immediately stand out that will doubtless be remembered for a long time at Munich Airport. The
World Cup and Pope Benedict XVI’s visit both put
the airport front and center, attracting enormous
attention, not just here in Germany but all over
the world. And on both occasions, the airport
showed itself from its very best side.
We also enjoyed excellent approval ratings from
passengers. For the second year running, Munich Airport was not just picked as Europe’s best
airport in the world’s largest airline passenger
survey, we also succeeded in moving up a place
in the global rankings to the number three slot.
A new record high in passenger traffic also underscores just how highly appreciated Munich
Airport has become inside and outside Germany.
Growing 7.5 percent year on year, the number of
passenger movements hit 30.8 million, bypassing the 30 million mark for the first time in the
airport’s history. No other airport in Germany
saw passenger numbers increase on anything
like the same scale, and this exceptional growth
helped propel Munich Airport into seventh place
in the rankings of Europe’s foremost aviation
hubs.
The cargo boom, too, continued unabated in fiscal 2006. As in prior years, growth remained
firmly in double digits. The key factor behind this
outstanding performance has been our drive to
expand long-haul services from Munich.
Flughafen München GmbH’s business performance, too, has been more than commendable.
The entire Group – FMG and its subsidiaries – reported aggregate sales in excess of €900 million,
around 9 percent more than in the previous fiscal. And our after-tax profit in 2006 was well into
positive territory, up more than €50 million on
2005.
The most challenging task our company faces
right now from a business perspective is to successfully restructure our Ground Handling division. We mapped out a strategy last fiscal year –
one that calls for exceptional dedication and flexibility from our employees – and we hope that
this will ready our ground services for the rigors
and challenges of an increasingly competitive
business.
At the end of the day, though, the key to safeguarding jobs at Munich Airport in the longer
term is, of course, sustained traffic growth. Ensuring that aviation in Munich can continue to
grow rapidly means taking timely steps to create
the right conditions. The most important expansion project in this context at present is the addition of a third runway, as this will boost our capacity from 90 scheduled takeoffs and landings
an hour at present to at least 120.
Following a detailed survey and review of more
than 30 potential sites, we chose a runway location that seems to offer the best possible solution when it comes to avoiding negative impacts
on local communities. We submitted this location
for review in a regional planning process last
summer, and our choice was later ratified and
approved by the regional government of Upper
Bavaria in February 2007. This means that our
project is on schedule, and we still aim to begin
operating the new runway in 2011.
In summary, Flughafen München GmbH can look
back on an outstanding and highly rewarding
2006. Munich Airport succeeded in further
strengthening rather merely maintaining its position as a leading European center of aviation,
and, once again, we have come a good deal closer to achieving our goal of becoming Europe’s
most attractive and efficient hub airport by 2010.
Dr. Michael Kerkloh
President and CEO,
Flughafen München GmbH
3
Highlights
January 1, 2006
New EU guidelines requiring additional physical
screening to be carried out on employees at road
access points to ramp areas and on vehicles at
gates to the security area come into force – for
the most part, without any problem. The new security checks affect around 20,000 employees
from numerous different companies at Munich
Airport.
times a week. New additions to the timetable include two weekly flights by Air Transat to Vancouver, a destination also served by LTU. Etihad Airways flies to Abu Dhabi, five times a week
initially, then daily from July. In total, airlines had
coordinated more than 257,000 takeoffs and
landings for the period through to October 28,
2006 – 3 percent more than for the same period a
year earlier.
February 25, 2006
Following almost four months of remodeling
work, the information center at the Visitors’ Park
reopens to the public. It features a 700-squaremeter exhibition with theme zones, electronic information kiosks, and a 15-square-meter model
with information on how the airport operates.
There are also special kiosks designed for junior
visitors that offer a more accessible description
of airport operations for children. Admission to
the exhibition and aviation films in the new
movie theater is free.
March 29, 2006
FMG unveils details of a candidate site for a third
runway to the Communities Council, the stakeholder body formed in the summer of 2005 to
observe the runway planning process. The site,
chosen to minimize impact on local communities
and the environment, is 1,180 meters from the
north runway (center to center) and offset by
2,100 meters. Other potential sites were rejected
on the grounds of conflicting space requirements
or their inability to provide the requisite capacity.
March 26, 2006
The launch of the new summer timetable sees
further expansion of long-haul services from Munich. Deutsche Lufthansa widens its offering of
services to China with daily flights to Hong Kong
and Beijing. Star Alliance member Thai Airways
International continues operating five flights a
week to Bangkok. Air China, too, begins flying
from Munich to Beijing – daily from August 1.
Brazilian carrier Varig flies to Sao Paulo three
4
April 19, 2006
Flughafen München GmbH (FMG) opens a liaison office in Brussels to forge closer ties with
key European Union agencies responsible for
aviation in Europe. The Brussels office enables
FMG to inform and advise officials and decisionmakers more effectively on aviation issues.
May 26, 2006
FMG receives a silver award from Bavaria’s Ministry of the Environment, Public Health and Consumer Protection for its comprehensive workplace health management program. FMG
operates a raft of occupational health and safety
schemes, illness and injury prevention initiatives,
company-organized physical exercise programs,
and management-led health promotion campaigns. The company also runs awareness campaigns to promote healthy eating and provides
professional counseling on the management of
addictions, stress and social problems.
June 2006
Munich Airport is chosen as Europe’s best airport
again in the World Airport Awards 2006 competition. In the world rankings, Munich moves up
one place to third, behind Singapore Changi Airport and Hong Kong International Airport. The
award is based on a survey conducted by aviation researchers Skytrax among 7.2 million travelers from 93 countries to rate passenger-friendliness, service offerings, and hub quality.
June 2006
A comparative review in the business magazine
Capital picks Munich as Germany’s best airport.
The magazine had commissioned Treugast, a
firm of management consultants specializing in
the travel and leisure industry, to assess the
quality of service and the passenger experience
at German airports.
July 15, 2006
FMG announces the formation of an impact
fund to compensate local individuals and communities sustaining hardships as a result of the
construction of the airport’s third runway. The
fund is an entirely voluntary measure over and
above any statutory, judicial or otherwise official compensation obligations to be met by the
airport.
July 19, 2006
Flughafen München GmbH launches a new and
innovative technology project: Through to the
end of 2007, the company will switch 500 of its
1,400 ramp vehicles over to running on rapeseed fuel instead of diesel. The capital expenditure on converting the engines will pay for itself
in two years, as rapeseed oil costs a good third
less than diesel. The switch to the alternative fuel will benefit local farmers and rapeseed oil
producers in the airport’s region.
5
July 27, 2006
Munich’s IT service management unit becomes
the first at any airport to receive ISO 20000 certification. FMG is the first airport operator in the
world to be awarded the illustrious quality mark.
IT services ensure the rapid and reliable delivery
of data essential to controlling the complex handling processes at an international airport.
August 25, 2006
The government of Upper Bavaria’s embarks on
the regional planning process for the third runway at Munich Airport as requested by Flughafen
München GmbH on July 31, 2006.
September 5, 2006
Dr. Michael Kerkloh, Flughafen München GmbH’s
President and Chief Executive Officer, is honored
as “Airport Manager of the Year” at a ceremony
in Frankfurt following a survey commissioned by
Touristik Report, a respected travel and tourism
industry journal. The jury panel consisted of aviation journalists, management consultants, airline
managers and the nominated airport executives
themselves.
6
October 29, 2006
The start of the winter season: Airlines had coordinated more than 161,000 takeoffs and landings
at Munich Airport – around 10 percent more than
for the 2005/2006 winter timetable. Condor begins operating a service to Zanzibar via Mombassa; Air Mauritius reintroduces its service from
Munich to Mauritius from early December; and
LTU adds a second weekly frequency to Cape
Town. Egypt Air operates four flights a week on
its Cairo route, and Hapagfly begins offering a
new service from Munich, via Fuerteventura, to
the Cape Verde island of Sal. The are also new
services to destinations in Asia in the winter,
with Deutsche Lufthansa flying daily to Tokyo and
Dubai, and Star Alliance member Thai Airways International serving Bangkok from the beginning
of December. Qatar Airways offers a daily flight
from Munich to Doha, and LTU flies three times a
week to Bangkok and twice weekly to Phuket.
November 6, 2006
New EU security regulations come into force at
Europe’s airports, prohibiting travelers from carrying fluids in hand luggage. For the most part,
the new rules are adopted smoothly at Munich
Airport, because the majority of passengers are
well-informed and prepared for more stringent
security screening.
November 16, 2006
FMG presents the results of its most recent workplace survey. Based on data collected on June
30, 2006, the results show that the airport is
Bavaria’s second-largest place of employment,
with a total of 27,400 people working in 554 organizations and government agencies on campus – over 4,000 or around 18 percent more than
recorded in the previous survey at the end of
2003. The FMG Group is still the biggest employer at the airport. The number of people employed
by Flughafen München GmbH and its subsidiaries had risen by 2 percent to 7,415. A total
of 624 junior staff – 23 percent more than in 2003
– were training for 24 occupations at Munich Airport. The survey shows that the FMG Group is also the airport’s biggest provider of apprenticeship and trainee programs, with 234 young
people under contract.
December 15, 2006
Flughafen München GmbH’s supervisory board
extends Dr. Michael Kerkloh’s contract as President and Chief Executive Officer for a further five
years. The contract had been due to expire in the
summer of 2007. At the supervisory board meeting, chairman Dr. Kurt Faltlhauser, Bavaria’s finance minister, praised the accomplishments of
the 53-year-old airport CEO, who has headed personnel and industrial relations as well as the airport operating company since September 2002.
December 22, 2006
Munich Airport records more than 30 million passenger movements in a single year for the first
time. The 30-millionth passenger arrives to an official welcome, complete with fanfare and gifts.
November 28, 2006
Munich Airport opens a childcare center, the first
at any airport in Germany. The center, set up by
Flughafen München GmbH, can take up to 36
employee children a day and provides a day
nursery and kindergarten care, as well as afterschool homework support. It is open between
6:00am and 9:00pm on 348 days a year, including weekends and school vacations.
7
8
Executive board
Heads of
business divisions
Dr. Michael Kerkloh
President and Chief Executive Officer
Personnel Industrial Relations Director
Walter Vill
Vice President and Chief Financial Officer
Peter Trautmann
Chief Operating Officer
Rainer Beeck
Senior Vice President Corporate Real Estate
Management and Developement
Wolfgang Hammerstädt
Senior Vice President Ground Handling
Andreas von Puttkamer
Senior Vice President Aviation
Dr. Karl Heinz Schwarzmeier
Senior Vice President Terminal 2
Walter Vill
FMG executive board member
Senior Vice President Retail and Services
(for the interim)
9
Traffic figures
Air traffic
2006
2005
Passenger movements (total)
30,778,352
28,639,104
+
7.5 %
– Commercial traffic
30,757,978
28,619,427
+
7.5 %
– Scheduled and charter traffic
2006 / 2005
30,727,363
28,591,429
+
7.5 %
Aircraft movements (total)
411,335
398,838
+
3.1 %
– Commercial traffic
399,460
386,841
+
3.3 %
– Scheduled and charter traffic
386,128
374,626
+
3.1 %
Air freight handled (total, t)
404,409
356,844
+ 13.3 %
– Carried by air (t)
224,409
202,844
+ 10.6 %
– Carried by truck (t)
180,000
154,000
+ 16.9 %
13,667
15,205
- 10.1 %
12,049,518
11,319,219
Air mail handled (t)
Maximum takeoff mass (MTOM)
in commercial and
non-commercial traffic (t)
+
commercial traffic* (thousand)
31
40 0
370
360
26.81
27
26
350
25
280
260
16
250
15
240
14
230
13
321,756
220
97 98 99 0 0 01 02 03
10
262,446
270
280,067
290
17.89
19
302,412
30 0
330,888
24.19
310
19.32
20
17
320
253,109
21
18
330
21.28
22
23.16
23.13
23
23.65
340
24
343,027
28
390
380
28.62
29
370,534
30
399,460
Aircraft movements
commercial traffic (million)
30.76
Passengers (in + out + transit)
386,841
Ten-year overview
04
05
06
97 98 99 0 0 01 02 03 04 05 06
* excluding ferry flights
6.5 %
Munich in comparison
Traffic figures for German airports in 2006 (commercial sector)
Passengers
(in + out + transit)
Aircraft
movements
Air freight (t)
Air mail (t)
Frankfurt
52,810,683
482,399
2,031,311
96,485
Munich
30,757,978
399,460
224,409
13,667
Berlin (total)
18,506,506
224,039
17,791
9,895
Düsseldorf
16,590,055
206,893
59,327
106
Hamburg
11,954,117
145,572
31,571
6,048
Stuttgart
10,104,958
144,759
19,456
9,782
Cologne/Bonn
9,904,236
139,096
685,563
5,548
Hanover
5,699,299
76,255
5,068
10,589
Nuremberg
3,961,458
61,972
12,101
0
Hahn
3,704,633
37,006
112,291
0
Leipzig/Halle
2,339,989
33,610
26,519
0
Dortmund
2,019,651
32,785
37
0
Dresden
1,836,068
29,394
573
0
Bremen
1,697,883
31,837
1,006
14
Münster/Osnabrück
1,551,173
31,745
141
0
Saarbrücken
420,221
10,980
7
0
Erfurt
356,378
8,268
4,816
0
174,215,286
2,096,070
3,231,987
152,134
Total
Source: German Airports Association (ADV)
Passenger figures for Europe’s top ten airports in 2006 (commercial sector)
Ranking
Passengers (million)
2006 / 2005
London Heathrow
1
67.5
- 0.6 %
Paris Charles de Gaulle
2
56.8
+ 5.6 %
Frankfurt/Main
3
52.8
+ 1.1 %
Amsterdam
4
46.1
+ 4.4 %
Madrid
5
45.5
+ 8.1 %
London Gatwick
6
34.2
+ 4.2 %
Munich
7
30.8
+ 7.5 %
Rome Fiumicino
8
30.1
+ 5.2 %
Barcelona
9
30.0
+ 10.5 %
Paris Orly
10
25.6
+ 3.1 %
Source: Airports Council International (ACI)
Status: March 2007
11
Business figures
FMG Group
Financials
Ten-year overview
Group sales and
earnings (€ million)
2006
2005
Group sales
920.1
844.3
+
EBITDA *)
324.8
257.6
+ 26.1 %
EBIT *)
169.1
104.9
+
61.5
3.6
2006 / 2005
9.0 %
Group external sales (€ million)
950
+ > 100.0 %
90 0
875
850
844.3
Group net income
61.2 %
920.1
925
825
788.0
80 0
775
Profitability indicators
750
EBITDA margin (%)
35.3
30.5
+ 15.7 %
EBIT margin (%)
18.4
12.4
+ 47.9 %
70 0
5.2
3.1
+ 67.7 %
675
646.7
650
*) EBITDA excludes building leasing expense of €51 million in 2006
625
(2005: €48 million), EBIT excludes leasing interest.
525
555.8
550
532.9
575
reversal of accruals.
714.1
601.4
60 0
Figures for 2006 include an extraordinary gain of €27 million from the
672.7
ROCE (%)
679.7
725
50 0
Personnel
2006 / 2005
2006
2005
Personnel costs
(€ million)
294.3
285.8
+
3.0 %
Employees
(average for year)
7,186
6,775
+
6.1 %
97 98 99 0 0 01 02 03
04 05 06
Flughafen München GmbH (FMG)
Ten-year overview
Net sales (€ million)
675
60 0
494.0
50 0
425
Flughafen München GmbH
sales
40 0
375
350
325
2006
2005 2006 / 2005
698.1
656.2
2006
2005
2006 / 2005
Personnel costs
(€ million)
226.4
226.0
+ 0.2 %
Employees
(average for year)
4,739
4,827
- 1.8 %
Employees
(at Dec. 31, 2006)
4,747
4,789
- 0.9 %
Average employee
capacity
4,179
4,278
- 2.3 %
Personnel
455.6
450
442.9
475
555.5
525
529.8
550
557.5
575
593.3
625
628.4
650
656.2
70 0
698.1
Net sales (€ million)
+
6.4 %
30 0
275
250
97 98 99 0 0 01 02 03
12
04 05 06
Group structure
Finance and Controlling
Human Resources
Central divisions
Corporate Communications
Legal Affairs and Security
Corporate Development and Environment
Business divisions
Aviation
Corporate Real
Estate Management and
Development
Retail and
Services
Ground
Handling
Terminal 2
Engineering and Facilities
Information Technology
Support divisions
Corporate Services
Security
Flughafen München GmbH’s group structure organizes company functions into strategic business divisions, support divisions, and overarching central divisions.
business divisions with professional expertise
and specialized services. The central divisions are
responsible for the overall control of the FMG
Group of companies.
Whereas the business divisions operate independently within their markets, the support divisions primarily operate internally and provide the
Aviation/non-aviation sales
2006
2005
Aviation sales
53 %
53 %
Non-aviation sales
47 %
47 %
2006
Aviation sales
The balance between aviation and non-aviation
net sales essentially remained unchanged between 2005 and 2006. Non-aviation business
grew marginally faster than aviation business
compared to a year earlier. However, aviation
Non-aviation sales
business remains the dominant source of revenue across the FMG Group.
13
14
Aviation business
15
Aviation
New record highs at Munich Airport
With a record-breaking 30.8 million passenger
movements – around 7.5 percent or 2 million more
than a year earlier – Munich Airport continued its
rapid ascent in 2006, reporting what was easily
the greatest absolute increase in passenger numbers among commercial airports in Germany.
16
Thanks to its exceptional traffic growth, Munich
also succeeded in moving up a place in the rankings of Europe’s ten busiest passenger airports,
past Rome, to fill the number seven slot. At the
same time, the FMG Group came a major step
closer to achieving its strategic goal of developing Munich Airport into the most attractive and
efficient hub airport in Europe by the year 2010.
The airport also handled a record number of
takeoffs and landings. With almost 400,000 commercial aircraft movements, the volume of flights
was up more than 3 percent in comparison with
a year earlier.
More transfer passengers
One key indicator for Munich’s burgeoning popularity as a hub airport is the number of transfer
passengers, which in 2006 rose by 7.2 percent or
700,000 to exceed 10 million for the first time.
Proportionally, though, the number of transfers
remained unchanged year on year at 34 percent
of total passenger movements. Originating traffic
in 2006 was up by 7.8 percent or 1.4 million passengers compared to 2005.
Intercontinental traffic surges
Munich Airport offers air travelers from inside its
own catchment area and transfer passengers a
rich and attractive network of routes to destinations all over the world, and in 2006, the number
of long-haul flights increased by around 13 percent. With 3.8 million passengers – 9.0 percent
more than a year earlier – growth on intercontinental routes was outstanding.
With these figures, the passenger volume on
long-haul routes has increased more than threefold during the last ten years, and we expect to
see rapid growth continue in the short term as
we add popular destinations to the network of
routes we serve. In 2006, we recorded the highest numbers of passengers in the long-haul sector on services to and from Dubai, Chicago,
Washington and Bangkok.
Italy remains the frontrunner in the continental
sector
Continental traffic – flights to and from other European countries and North African and Asian
states on the Mediterranean – also swelled in
2006. Although the number of takeoffs and landings was just 3.6 percent higher, passenger numbers were up 9.9 percent. Traffic to and from
eastern Europe in particular expanded rapidly,
showing an exceptional plus of almost 17 percent.
Three-quarters of continental traffic – 13.3 million
passengers in total and 10.7 percent more than
in 2005 – was recorded on services to and from
destinations in the European Union. With a volume of more than 2.5 million passengers,
around 450,000 or 20 percent more movements
than a year earlier, routes to Italy were the
busiest in this category.
The three top-ranked airports based on passenger traffic remained unchanged in 2006, with
London Heathrow in the number one slot with
more than 1.02 million passengers, Paris Charles
de Gaulle (around 719,000) and Palma de Mallorca (more than 568,000). Fourth-ranked was Rome
Fiumicino (around 512,500), up from eighth place
a year earlier.
Low-fare traffic expands
Growth in the low-cost segment was strong, with
passenger numbers up by roughly 1 million to
4.6 million in total compared to 2005. Low fare
traffic now accounts for almost 15 percent of our
passenger traffic as a whole.
Domestic traffic shows solid growth
Although the number of takeoffs and landings on
domestic routes remained essentially flat year on
year at roughly 119,000, we registered 9.3 million
passenger movements on services within Germany, a slight but nonetheless better-than-average increase of 3.1 percent.
17
Services to and from Hamburg (with 1.6 million
passengers), Berlin Tegel, and Frankfurt carried
the greatest numbers of domestic air travelers.
More than 84,000 passengers a day
Our statistics for 2006 show a number of all-time
highs. On July 5, we recorded the largest number of aircraft movements in a day in the commercial sector – 1,311 takeoffs and landings (in
2005, the record was 1,257). The busiest day in
terms of passenger traffic was September 29,
with 112,314 movements (2005: 112,355). Per day,
the airport handled 84,268 passenger movements (2005: 78,409) and 1,094 takeoffs and landings (2005: 1,060) on average.
In 2006, 108 airlines operated services from Munich on a regular basis to a total of 246 destinations (22 domestic and 224 international) in 71
countries.
Sharp increase in landing-fee revenue
Revenue from aircraft landing and parking fees
was substantially higher in 2006 than a year earlier, rising 11.7 percent to €275 million. The rise
was driven by price adjustments in October 2005
and October 2006, a 7.5 percent increase in the
number of passengers, and 3.3 percent more
commercial aircraft movements. To mitigate the
costs of wider personnel security checks, security
charges were also raised in February 2006.
Revenue from the variable portion of landing
fees grew faster than revenue from weight-dependent landing fees, rising 25.5 percent in 2006.
This was due to an ongoing shift in the fee structure, away from fixed landing charges in favor of
variable landing charges. Revenue generated by
central infrastructure in Terminal 1 – the baggage
transportation system, for example – was marginally lower year on year, largely because of a
slight drop in the number of movements. Revenue from central infrastructure in Terminal 2 is
booked to FMG subsidiary Terminal 2 Betriebsgesellschaft, the terminal building’s operating company, and is not reported in Flughafen München
GmbH’s own yearend accounts.
Marketing: Support for airlines
FMG’s marketing efforts in 2006 again included
road shows, sales blitzes, and sales call initiatives designed to keep domestic and foreign tour
operators informed about changes in the air-
18
port’s timetable and destinations and to help airlines market their routes. Carriers benefiting
from our marketing support included Air Mauritius, Air Transat, Condor and CSA Czech Airlines.
We also launched an e-mail newsletter in early
2006, which we now send out five times a year to
some 4,000 recipients in the travel and tourism
industry.
Trade shows, training programs and a new film
By exhibiting at trade shows and holding workshops and other events, we helped to foster and
strengthen ties with the international travel industry. In 2006, these efforts centered on Sao
Paulo and other locations in South America, as
well as places in eastern Europe. In response to
the steadily increasing number of passengers on
services to and from Ukraine, Munich Airport exhibited for the first time at the Ukraine International Tourism and Travel Exhibition (UITT) in
Kiev. We also organized Bavarian evenings in
Tyumen and Voronezh to promote new routes
between Munich and Russia.
Munich Airport’s service facilities and infrastructure and their unique selling propositions (easy
transfers, for instance), were the focus of
Lufthansa call-center training programs conducted in Berlin, Brno, Istanbul, Dublin, Peterborough
(Canada), Melbourne and Shanghai.
FMG’s own film team produced a video on DVD
to Marketing’s specifications titled “30 Minutes
Minimum Connecting Time at Munich Airport”,
designed specifically for use at trainings like
these as well as at workshops and similar events.
Informal and entertaining, the film shows how
quickly and easily passengers can transfer between flights at in Munich.
Award for the best marketing
At the international airports and airlines conference Routes 2006, held in Dubai, Flughafen
München GmbH won the highly coveted Airport
Marketing Award for the eighth time in nine
years. In spite of a strong field, Munich’s marketing was picked as the best among airports with
more than 25 million passengers, tying for the
top award with Amsterdam. Airports were rated
on the quality of their marketing performance,
including presentation, initiatives to acquire new
business, and customer focus, care and support.
FMG’s marketing work was also honored with
the PATA Gold Award 2006 at the Pacific Asia
Travel Association (PATA) conference for the exceptional support given to airlines. The PATA promotes tourism in the Asia-Pacific region and represents businesses in the travel and tourism
industry.
Consulting services from FMG
Building on the enormous expertise acquired
during the process of relocating and opening
Munich Airport in 1992, Flughafen München
GmbH developed a strategy known as ORAT (Operational Readiness and Airport Transfer), which
today has acquired a firm place in major airport
infrastructure projects.
ORAT, designed to ensure that passenger terminals and entire airports open smoothly and efficiently, has helped Flughafen München GmbH to
achieve international market leadership in a
highly specialized area of consulting.
In 2006, we again completed a number of important consulting assignments for clients. One major project, commissioned by Thai airport operator AOT, was to assist with the opening of
Bangkok’s new Suvarnabhumi Airport on September 28, an event involving extensive trial operations up front as well as relocation to a new
site 50 kilometers away – also planned and organized by FMG.
Other projects included providing support services to Thai Airways, which operates out of
Bangkok’s new airport, and helping commission
Terminal 4 with a satellite for 35 million passengers at Madrid’s Barajas Airport.
In 2006, FMG also won new contracts to manage
the commissioning of passenger terminals at
Barcelona, Alicante and Malaga airports and to
help BAA, the UK’s airports authority, prepare a
relocation strategy for London Heathrow’s new
Terminal 5. We have also been hired to plan Hyderabad’s new airport in the Indian state of
Andhra Pradesh.
MediCare: In the service of health
FMG subsidiary MediCare Flughafen München
Medizinisches Zentrum GmbH is part of our Aviation business unit. MediCare operates Munich
Airport’s medical center and AirportClinic M. Besides delivering occupational healthcare services
and providing emergency care to airport employees, passengers and visitors, the company also
serves as a contact and intermediation point for
foreign patients at the airport. AirportClinic M
provides outpatient and inpatient treatment to
patients from Germany and abroad. Since June
1, 2006, the facility has been open to all health
insurance carriers’ patients rather just the privately insured. With its various businesses,
MediCare covers a comprehensive range of medical needs for airport personnel, passengers and
airport visitors.
In fiscal 2006, MediCare reported sales of €4.2
million and had a workforce comprising 38 fulltime employees and almost 40 additional staff on
short-term and part-time contracts. MediCare is
co-owned by Flughafen München GmbH with 51
percent and by MAHM-GmbH, a group of doctors, some of whom are based at Munich Airport,
with 49 percent.
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Ground Handling
A full-service offering
The Ground Handling division provides customers with a comprehensive range of landside
and airside services, including aircraft handling,
baggage and cargo handling, and passenger and
crew transports. In combination with the services
offered by FMG subsidiaries aerogate (specializing in passenger handling, operations, and supervision), Cargogate (cargo handling), mucground Services (aircraft and baggage handling),
and EFM (pushback, towing and de-icing), all of
which have been assigned organizationally to
Ground Handling since the FMG Group restructured in early 2005, the division operates as a
full-service provider, delivering an end-to-end
range of ground services to airline customers.
20
Flexibility, professionalism and reliability
Ground Handling’s core competency lies in coordinating and networking complex, time-critical
service processes reliably and punctually. We
support ramp-side hub operations for the Star Alliance at Terminal 2, tourist hub-and-spoke and
point-to-point operations for Condor, LTU, Hapagfly and Air Berlin, and long-haul traffic for upmarket carriers like Emirates, Etihad, and Delta
Airlines in Terminal 1. High-volume, low-fare carriers, too, like dba and well-known scheduled
carriers like Turkish Airlines, Aeroflot and El Al
are among Ground Handling’s long-standing customers. Our ability to ensure minimum connecting times and rapid turnaround times through
professional, reliable and flexible ramp services
forms the basis for trusting, enduring and successful partnerships with customer airlines.
Munich Airport’s ground handling services were
the first at any airport in Germany to receive DIN
EN ISO 2001 certification (in 1994); we also went
on to obtain IATA AHM 804 certification in 2003.
This underscores our commitment to quality and
innovation leadership. We focus on serving the
needs of customer airlines, delivering high-quality, continuously optimized services based on a
mature total quality management system, and
developing new products, such as baggage reconciliation services and direct transfer services,
in line with customer demand.
Extensive training programs
One major focus for Ground Handling is on providing employees with specialized training designed to maintain and advance quality standards and ensure that we optimize and
streamline our service processes. In 2006, we
held 613 training seminars with 2,545 attendees;
on average, these seminars scored an A+ when
rated by recipients, reflecting the emphasis we
place on quality in our trainings. The number of
attendee days of training delivered increased 8
percent, to 7,333, in comparison with 2005.
Key areas of training included courses on the
baggage identification system Eagle and ramp
equipment, both attended by 1,000 employees.
More than 400 qualified for the integrated handling process. And, to date, 740 Ground Handling
employees have successfully completed ramp
agent training and passed chamber of industry
and commerce exams to become certified aircraft handlers.
Quality assurance and satisfied customers
We operate a comprehensive quality management system that monitors service quality, speed
and customer satisfaction. This enables us to adjust our processes in line with customers’ needs
and to rapidly roll out precisely targeted improvements where necessary. Our customers appreciate this responsiveness. El Al, for example,
recently chose Munich Airport as one of its best
stations worldwide in terms of punctuality of
overall handling, friendliness of personnel at the
handling desk, and low numbers of lost baggage
items. And in a survey of 7.2 million passengers
carried out by respected London-based opinion
researchers Skytrax, Munich Airport ranked number one in Europe in the Baggage Delivery category.
21
In spite of liberalization of the market for ground
services in 1999 and the market entry of thirdparty service providers at Munich Airport, FMG’s
ground handling business has remained strongly
competitive, retaining a market share of roughly
90 percent in 2006. With a workforce of around
2,000, we handled 171,106 aircraft, 1.1 percent
more than in 2005, and 27,334,268 passengers,
up 4.8 percent on a year earlier. The MTOM volume grew 4.6 percent to 21.2 million tons, and
air cargo handled expanded 9.2 percent to
238,076 tons.
Fierce price competition driven by sharp drops in
air fares caused by low-cost carriers has led airline customers to pressure for lower ground handling charges in recent years, stoking the already
highly competitive situation in the ground handling sector. FMG has responded by thoroughly
optimizing processes and introducing major improvements to productivity and flexibility. Our
goal is to offset the decline in handling prices,
currently averaging out at around 5 percent per
year.
Restructuring strategy approved
To keep Ground Handling competitive in the
longer term and to keep offering our services at
realistic market prices, we continued to implement our restructuring strategy, launched in
2005, in collaboration with the works council.
FMG’s management road-mapped and approved
a restructuring program designed to continuously improve our Ground Handling division’s business situation during the years ahead.
The main pillars of the restructuring are the introduction of more flexible working models (involving alignment of personnel’s duty periods
with the volume of flights), process optimization
(including integrated handling, and baggage and
cargo integration), and the exploitation of potential cost savings. But, the importance of internal
optimization aside, the success of the restructuring depends, crucially, on our ability to establish
a viable long-term competitive framework and
create lastingly competitive cost structures.
22
aerogate: More ticketing revenue
The purpose of aerogate München – Gesellschaft
für Luftverkehrsabfertigungen mbH is to provide
passenger and aircraft handling services in those
sectors not already covered by ground services.
The company also operates a baggage delivery
service, as well as a ticketing service that has become an increasingly valuable source of revenue
in recent years.
Although competing ramp services operators
stepped up their activities, as did those airlines
that take care of their own ground handling,
aerogate succeeded in generating proceeds on
external sales of €7.1 million in 2006. With its
permanent workforce of 258 employees, the
company handled around 1.2 million passengers
and 16,006 flights.
Cargogate: Number one in air cargo
Wholly owned FMG subsidiary Cargogate Flughafen München Gesellschaft für Luftverkehrsabfertigungen mbH specializes in air cargo handling services at Munich Airport. Besides the
transshipment of cargo, these services include
storage and documentation of freight goods.
Customers also have the option of purchasing
partial service packages if they wish. In spite of
growing competition from other operators, Cargogate remained the largest independent cargo
handler at Munich Airport in 2006, providing handling services to the vast majority of airlines operating into Munich.
The company currently handles cargo for 83 carriers and also processes documentation for 51 of
them. In the past fiscal year, Cargogate had 226
employees and reported external sales of €10.6
million. The company handled over 100,400 tons
of goods in 2006, around 5,400 tons more than in
the year before.
EFM: Ready for the A 380
EFM - Gesellschaft für Enteisen und Flugzeugschleppen am Flughafen München mbH, coowned by GlobeGround GmbH (51 percent) and
Flughafen München GmbH (49 percent), pro-
vides aircraft pushback and maneuvering services on the apron and in the maintenance area, airconditioning, and de-icing services at Munich
Airport. The company’s fleet of 23 de-icing vehicles now includes two trucks equipped to de-ice
the Airbus A 380.
Due to the unusually harsh and long 2005/2006
winter, EFM and its 120 employees reported
record sales of €27.4 million. The company conducted close to 135,000 maneuvering operations
and almost 10,000 de-icing operations.
mucground: Additional handling services
With a workforce of 383 (averaged out over the
year), mucground – MUC Ground Services
Flughafen München GmbH, a wholly owned subsidiary of Flughafen München Holding GmbH,
supplies Ground Handling with additional aircraft
loading and unloading capacity and manpower
for the baggage transportation system during
peak traffic periods. mucground employees conducted around 33,580 handling operations in
2006.
With its competitive cost structures, mucground
is also able to provide other competitively priced
services, including a limousine service for
Deutsche Lufthansa HON and first-class passengers, much to customers’ satisfaction. Formed in
fiscal 2005, the company succeeded in generating sales of €19 million in the past fiscal year.
Air cargo: Double-digit growth
In 2006, cargo traffic in Munich again saw double-digit growth. Compared to a year earlier, the
freight volume was up 13.3 percent to more than
400,000 tons. Around 224,000 tons, 10.6 percent
more than in 2005, were carried by air, and
trucked freight totaled 180,000 tons, up almost
17 percent on the year before. On average, the
airport handled 615 tons of flown freight a day in
2006, compared to 556 tons in 2005.
Intercontinental traffic is driving cargo growth
The key factor in the exceptional growth in air
cargo is the expansion of long-haul traffic at Munich Airport. More than 70 percent of flown
freight is carried on long-haul routes, mostly as
bellyhold freight. Freight capacity has risen in
line with the sharp, 13 percent increase in intercontinental traffic, and takeup has been considerable among Bavaria’s exporting industries.
Services to China and Hong Kong carried the
most air cargo, followed by North Atlantic services to the U.S. and Canada, and flights to the Gulf
region.
Air mail: A nationwide decline
As in past years, the volume of air mail handled
at Munich Airport and other airports across Germany dropped once again in 2006. Munich transshipped a total of 13,667 tons, 10.1 percent less
than in 2005. On average, we handled 37 tons of
air mail a day in 2006, compared to 42 tons a
year earlier.
The causes behind this trend are the advance of
electronic communications and an increase in
the amount of air mail carried as air cargo by the
rapidly expanding express carriers.
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24
Non-aviation
business
25
Real Estate Management and Development
Departure lounges in Terminal 1
After two years of remodeling work, modules A
and B in Terminal 1 now have spacious lounge
areas with a redesigned layout. The new restaurant areas with views overlooking the apron have
proven extremely popular with passengers, as
has the wider retail offering with larger duty-free
and Travel Value stores and a new multi-label
fashion store. The hospitality and retail segments
both reported renewed sales growth in fiscal
2006, driven primarily by the completed remodeling work in all four Terminal 1 departure areas.
A new car hire center and lounge
In April 2006, a new car hire center and
pickup/return area were opened in car park P6 in
the Central Area. The new location is more central than its predecessor and is equally close to
both terminal buildings. The center is also better
equipped, allowing car hire companies to present a more differentiated offering for first-class,
VIP, preferred and Gold Club customers. Car hire
companies were allowed to design their customer service desks to their own specifications
and with their own distinctive branding.
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In June 2006, Dubai-based airline Emirates
opened a lounge for first- and business-class
passengers and Skywards Gold Members in
module C of Terminal 1. This move reflects Munich Airport’s importance in the carrier’s worldwide network of routes. The 620-square-meter
lounge has a relax zone with comfortable leather
chairs where guests can unwind, a restaurant
zone offering a broad selection of refreshments
and gourmet hot and cold food, and an entertainment and business zone equipped with phones,
fax machines, scanners, 11 internet access
points, five internet-connected PC workstations,
and televisions with DVD players.
Traffic growth drives new construction projects
In response to continued air cargo sector growth,
the airport is having to expand its cargo handling
facilities, and in 2006 we began planning and
preparing for a new forwarders’ building and
multistory car park. The facilities are slated for
completion in late 2007.
Online advertising on the airport’s web site
Thanks to constantly increasing traffic on the airport’s web site, marketing additional advertising
space on the site proved easy. The range of advertising options available is described at
www.munich-airport.com in the section on online advertising.
As numbers of tourists and business travelers
rise, hotel capacity at Munich Airport is becoming increasingly short and will likely reach its limits in the foreseeable future. We have embarked
on a new construction program to create additional capacity, beginning with a second airport
hotel, a three-star facility, with around 250
rooms.
Successful, market-driven advertising media
Although advertising revenues failed to live up
to our high expectations in the World Cup year
2006, Munich Airport nonetheless saw a marked
increase in airport media sales, thanks largely to
a sustained program to offer advertising space
aligned with market needs. The installation of
high-quality light boxes in particular boosted
purchases of ad space and helped us win new
advertising business, most notably from the international fashion industry.
Summer soccer spectacle and winter market
The program of events held on a regular basis in
the forum at the München Airport Center (MAC)
is the primary marketing instrument used by the
hospitality and retail sectors’ advertising association at Munich Airport. One of the highlights in
2006 was an extensive beer garden with a vast
LED wall, set up during the summer, where
countless soccer fans came to watch World Cup
football matches.
More than 700 tons of sand had to be brought into the forum to build three beach volleyball
courts for the Bavarian championships and the
Smart Beach Tour, featuring the FMG-sponsored
“Roten Raben” women’s volleyball team. Due to
the events’ huge success, beach volleyball tournaments will again be held at the MAC in 2007.
The Munich Airport Award: A long-standing
institution
The growing number of competition entries, the
high quality of the submissions, and the huge
popularity of the award event attended by more
than 1,000 guests from the media and advertising industries, reflect the exceptional standing
that the Munich Airport Award, presented for the
ninth time in 2006, has achieved over the years.
Intensive press work surrounding the award led
to extensive coverage in trade journals, an indication of the growing interest in airport advertising within the advertising industry.
Other 2006 highlights included “Flughafen live,”
an event offering a behind-the-scenes look at the
airport, as well as the now traditional winter market with its highly popular artificial ice rink. For
the first time, the market remained open beyond
Christmas through to the end of the holiday season on January 7, 2007, and included a vacation
program for school children.
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Retail and Services
Parking and customer services
Our parking and customer services business operates all of Munich Airport’s open-air and multistory car parks – with more than 32,000 parking
spaces in total – used by passengers, tenants,
and airport employees. In 2006, more than 5.6
million vehicles parked in these facilities, around
100,000 more than in 2005. FMG offers a range
of value-added parking services that have proved
especially popular with customers; these include
convenience and secure parking, XXL parking
with extra-wide bays, valet parking, and the option of booking discounted parking spaces
through the airport’s web site.
In early 2006, the care hire return area was
moved to a point closer to the center of the airport, from car park P5 to P6. The relocation was
accomplished successfully without negatively
impacting on operations.
Our parking and services business profits mainly
from originating passengers, and their numbers
increased by 7.8 percent in 2006. In comparison,
though, sales in this area rose faster, up 12.1 percent year on year.
Allresto: Dining for every taste
Allresto Flughafen München Hotel und Gaststätten GmbH operates the restaurants and bars in
both of Munich Airport’s terminals, plus four employee canteens, a Burger King fast-food restaurant, the “municon” congress center, and the airport hotel (managed by the Kempinski Group).
Allresto runs its hospitality operations itself, but
its hotel and casino activities are managed by
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third-party operators. With a workforce of 543
people, Allresto generated external sales of
€61.3 million in 2006, 13.1 percent more than in
2005, making the company Flughafen München
GmbH’s third highest-earning subsidiary.
In Terminal 1, with its decentralized structure, the
company operates bars in the arrival and departure areas in each of the modules. In addition,
there are snack bars, plus several restaurants, including Airbräu, Käfer, and Il Mondo. In Terminal
2, Allresto runs the Airbräu and Käfer restaurants, an Italian piazza, and a number of bars in
the pier area.
To meet customer needs and expectations better,
all of the bars in the Terminal 1 arrival areas were
completely modernized in 2006. In Terminal 2,
the original pier bar in the north pier now operates under the name Adelholzener Bar. The seating capacity here and in the piazza was increased. In the Central Area, the Airbräu restaurant, well-known and exceptionally popular with
local people for miles around, is an ideal venue
for all kinds of events, especially cabaret.
Allresto widened its offering with a new highlight
in early 2006, the Thai restaurant BaMee in module C of Terminal 1. The company also began remodeling Café Treffpunkt in the Central Area at
the end of 2006, which reopened as the Leysieffer restaurant in 2007 and serves up outstanding
world cuisine 24 hours a day.
eurotrade: Attractive offerings for customers
In 2006, retailers eurotrade again fared substantially better than would have been expected, given the overall state of the German economy.
With 732 employees, the company generated
€120.9 million in external sales, a year-on-year
increase of 16.8 percent, making the company
Flughafen München GmbH’s second highestearning subsidiary. Sales in the souvenirs segment were exceptionally high, thanks in part to
the World Cup and Pope Benedict XVI’s visit to
Bavaria.
eurotrade Flughafen München Handels-GmbH
runs a range of retail outlets at Munich Airport,
including duty-free and Travel Value shops,
newsagents, and stores selling travel goods,
souvenirs, cosmetics, clothing and toys. The
company also operates a number of restaurants
that add to Munich Airport’s unique and distinctive flair.
In Terminal 1, the company has to operate dutyfree, Travel Value, and newsagent outlets in every
module because of the building’s decentralized
structure, but in Terminal 2, these stores are located centrally for the most part. To meet the
constantly changing requirements of private and
business travelers, eurotrade remodeled, renovated, reopened and optimized stores in the public and restricted areas of both terminal buildings
in 2006. One special attraction is the Event Shop,
an open-plan retail outlet in Terminal 2, which restocks with different companies’ products every
two months.
eurotrade responded flexibly and at short notice
to the need for tighter security checks on passengers and their hand luggage by revising its retail
strategy and by closing and relocating stores.
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Terminal 2
The Terminal 2 joint venture
The Terminal 2 division comprises two companies, FM Terminal 2 Immobilienverwaltungsgesellschaft, which owns the terminal building, and
Terminal 2 Betriebsgesellschaft mbH & Co, the
terminal’s operating company. Both are coowned by FMG and Lufthansa with respective
holdings of 60 percent and 40 percent.
Coordinated services
FMG and Lufthansa stepped into new territory
with the T2 partnership. This is the first time anywhere in the world that an airport operator and
an airline company have teamed up to share the
entrepreneurial responsibility for the creation and
operation of a piece of airport infrastructure.
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Terminal 2 Betriebsgesellschaft does not operate
in a production capacity as such; instead, its two
corporate parents provide services, in particular,
landside and airside handling. Other services
needed in connection with marketing and operating the building are bought in, above all from
FMG. The terminal operating company’s role is to
coordinate services, to integrate operations, to
optimize processes, and to encourage and implement new advancements.
Partnering to build and operate the new terminal,
used exclusively by Lufthansa, its group companies, other partners, and fellow Star Alliance
members, has created a win-win situation.
Lufthansa has had the opportunity to co-develop
a terminal building tailored to its customers’
needs and its own handling processes, and can
continue to shape the facility’s future development. Lufthansa, Star Alliance members and other partners enjoy the benefits of an advanced
passenger-handling building designed specifically to meet the needs of international hub traffic.
And FMG now has substantial aircraft and passenger-handling capacity as well as a long-term
commitment to its airport from Germany’s leading carrier that will safeguard future growth.
Thirty-one airlines in Terminal 2
Terminal 2 is a unique success story. When this
advanced, highly efficient handling facility began
operating, it instantly doubled Munich Airport’s
capacity to 50 million passengers a year, and at
just 30 minutes, Terminal 2’s minimum connecting time is one of the shortest in the world. The
building is renowned for its outstanding architecture, is clearly structured and user-friendly. It also
has a rich retail and hospitality offering, so it is
hardly surprising that the terminal is extremely
popular with airlines and passengers.
This modern passenger handling facility has
been a major factor in Munich Airport’s selection
as the best airport in Europe in a 2006 survey
among 7.2 million air travelers conducted by independent researchers Skytrax – a success reflected in the recent rapid rise in our traffic figures.
Growth continued in 2006, with Terminal 2 handling a total of 287,200 takeoffs and landings, 6.0
percent more than a year earlier. The growth in
passenger movements was even higher, with
around 21.7 million air travelers using Terminal 2
in 2006, a year-on-year increase of 12.0 percent.
As a result of a new code-sharing agreement
with Lufthansa, Egyptair, due to become a full
member of the Star Alliance, moved across to
Terminal 2 in 2006. More than 30 carriers now
operate services out of Terminal 2, offering flights
to 169 destinations in total – 20 in Germany, 108
in European and Mediterranean countries, and
41 on other continents.
Shops, restaurants and lounges
In 2006, there were 84 retail and service outlets
in Terminal 2 (28 in the public area and 56 in the
restricted area) and 18 restaurants (six in the
public area and 12 in the restricted area). In the
past year, eurotrade added a number of retail
units in the restricted area: Private by Beate
Uhse, the Event Shop, a Behringer/Burberry
store, and a Multitronics outlet.
In the hospitality segment, Seafood Sylt, Piazza
Monaco and Pierbar Nord were all extended, as
were the Travel Value, Cartier and Valleverde units
in the retail and services segment.
The Wieners Kaffee coffee bar had to be closed
to make way for a larger Lufthansa first-class
lounge. The smart and exclusive lounge extends
across two floors and is scheduled to open in August 2007.
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Personnel
Headcount down slightly
At December 31, 2006, Flughafen München
GmbH had 4,747 employees, 0.9 percent fewer
than in 2005. Of these 4,747 employees, 4,531
had unlimited contracts. With the signing of a
new collective labor agreement for public service
workers on October 1, 2005, and contrary to previous practice, we no longer differentiate between wage and salaried employees in our reporting.
32
Foreign nationals numbered 698, accounting for
14.7 of the total workforce. The majority of these
foreign workers – 433 – were from Turkey; a further 51 were from Austria, and 43 from Italy.
The FMG Group as a whole had 7,186 employees,
6.1 percent more than a year earlier.
Completion of the M-Power project
In 2006 we finished our M-Power restructuring
project. Spanning two years, it focused on defining and implementing initiatives designed to
boost productivity throughout the FMG Group.
The project also had an impact on our headcount: In 2006 we again ran a tight hiring policy,
only replacing natural wastage to a limited degree, especially in the area of operations. As a result, FMG’s HR capacity dropped by 99 employee-years, or 2.3 percent, to 4,179. Nonetheless,
we handled 3.1 percent more aircraft and 7.5 percent more passengers than in 2005.
Personnel expense in 2006 increased by €0.4
million or 0.2 percent year on year. The rise was
mostly due to the formation of reserves for workforce retirement plans, service anniversaries, and
vacation and overtime entitlements.
Breakdown of personnel costs
(€ million)
Wages and salaries
(including travel
expenses and meal
subsidies)
Social security levies,
costs of retirement
plans and related
benefits
Total personnel expense
2006
2005
176.5
176.9
49.9
49.1
226.4
226.0
Vocational trainees total 234 across the FMG
Group
Eighty-six school-leavers embarked on vocational training programs with Flughafen München
GmbH and its affiliates in September 2006. Fifty
of them were assigned to FMG, which again reinforced its commitment to uphold the voluntary
apprenticeship pact between government and industry in Germany. A further 36 joined FMG subsidiaries aerogate, Cargogate, eurotrade, and Allresto. Group-wide, vocational trainees totaled
234 in 2006, with 154 assigned to corporate parent FMG.
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New bachelor’s program in aviation management
On September 1, 2006, FMG expanded its training portfolio to include a new bachelor’s program
in aviation management, which the company
spearheaded as part of a group of six partner organizations. Unique nationwide, this industryspecific degree program unites aviation’s three
key partner groups – airports, air-traffic control,
and airlines. Undergraduates spend each year of
their three-year degree program with a different
company while attending classroom training at a
technical college in Frankfurt/Main.
At the same time, other international airports’
employees, including retail specialists from Portuguese airport operator ANA - Aeroportos de
Portugal, employees from Malta International
Airport’s IT, passenger and traffic management
units, and vocational trainees from Vienna’s airport operating company, Flughafen Wien AG, had
the chance to spend time at Munich Airport to
see how their counterparts here work. We also
built stronger ties with airports and the aviation
industry in Japan and China by hosting workshops and management training programs and
receiving visits from delegations.
With this degree program, FMG hopes to deliver
training that provides future employees with a
strong grounding in business management as
well as a thorough understanding of typical aviation industry challenges and projects.
The EncourAGE pilot project
FMG is one of the organizations supporting EncourAGE, a Leonardo da Vinci pilot project that
has received around €340,000 in backing from
the European Union. The goal of the project is to
work with partner organizations to develop new
HR management instruments to prepare strategically for a demographic shift that will result in
fewer junior employees and greater numbers of
older employees in the workforce.
The EQJ and exchange programs
In 2006, FMG again took part in the EQJ program, set up to provide school-leavers unable to
win a place on a vocational program with training to help them find their way into a career. The
initiative was a resounding success, with all 19
young people assigned to FMG and its subsidiaries Cargogate and Allresto successfully
finding employment or vocational training opportunities.
For an international airport like Munich, a globally aligned employee training and education program is of great importance. As part of the
Leonardo da Vinci European educational and cultural exchange program, 20 of our vocational
trainees were given the opportunity to spend internships with partner airports in Vienna, Malta,
Helsinki, Turku, Lisbon and Faro. Engineering sector employees, too, were able to acquire valuable experience working at Lisbon Airport.
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New performance benchmarking
In 2006, our HR and organizational development
unit helped FMG divisions to introduce a new
system of performance benchmarking based on
the balanced scorecard. Communication boards
were used as a medium to instruct employees
clearly and in detail on the importance of accomplishing FMG’s mission.
Upward feedback and employee advancement
In 2006, we introduced 180° manager feedback
company-wide. This enables employees to score
their managers’ performance in an anonymous
questionnaire. The findings were reviewed with
managers in presentations and feedback meetings, and development measures were discussed
with them. Our next step will be to introduce a
paperless, IT-based 270° manager feedback system in which managers’ performance is rated additionally by their peers.
FMG has introduced another HR development
initiative, the advancement circle, designed specially for high potentials looking to develop in
their current positions and prepare for future
cross-disciplinary assignments. Working in close
collaboration with the Erding College of Applied
Management, we aligned course curricula with
the aviation sector, the airport’s own specific requirements, and with participants’ personal competency-building needs. Candidates for the advancement circle were chosen through an
assessment center.
Training for internal and external customers
In 2006, we again focused on delivering needsdriven employee development training and programs. Increasingly, we have also been providing personal education consulting and tailored
in-house seminars, parallel to our general training and education program.
In 2006, FMG came a step closer to achieving its
goal of forming a best-practices and knowledge
sharing network with other airports and organizations: The company began offering its training
programs to other airports, which led to an increase in the number of attendee-days of training
delivered from 5,850 in 2005 to 7,132 in 2006.
In appreciation of their services and with sorrow
we remember the following colleagues who
passed away in 2006. They will be sadly missed
by their fellow employees.
Lajos Baranyai
Alexandra Keller
Albrecht Fischer
Johann Hacker
Renate Bader
† February 18, 2006
† August 3, 2006
† August 30, 2006
† November 19, 2006
† December 2, 2006
35
Expansion plans
Planning for tomorrow: The third runway
Ranked as one of the top ten commercial airports
in Europe, Munich Airport enjoys a first-rate reputation among airport organizations, airlines and
passengers all over the world. Our excellent
standing has helped drive extraordinary growth
at the airport in recent years, and 2006 was no
exception: The number of aircraft movements increased by 3.1 percent year on year to more than
410,000, while passenger numbers surged 7.5
percent, bypassing the 30 million mark for the
first time in the airport’s history.
36
This growth will doubtless continue in the future.
According to forecasts by Intraplan Consult
GmbH, a firm of consultants hired as part of the
regional planning process, annual takeoffs and
landings could increase to 610,000 by 2020, with
passenger movements rising in tandem to almost 56 million a year over the same period.
Meeting tomorrow’s needs
To sustain Munich Airport’s rapid growth as a
competitive international hub, regional job engine and economic driver, we have to achieve a
capacity target of at least 120 takeoffs and landings an hour – a figure entirely beyond the capabilities of today’s two-runway system.
Two runways are not enough
The continuous traffic growth in past years has
regularly pushed Munich Airport’s twin runway
system, currently capable of processing 90
scheduled services an hour, to its capacity limits
at peak times, and will continue to do so in years
ahead. Even taking potential scope for fine-tuning flight handling operations into account, it will
be impossible to deliver the major increase in capacity needed to meet carriers’ demand for slots.
As a result, we can already expect to see long
waits and significant delays in the not-so-distant
future, and our ability to accommodate traffic
growth in line with real-life demand compromised.
The regional planning process
On July 26, 2005, Flughafen München GmbH’s
executives informed the supervisory board and
shareholders about the foreseeable capacity bottlenecks and explained the need to create additional runway capacity. The company’s shareholders authorized executive management to
begin planning the expansion of the current runway system and to quickly prepare and set in
motion the requisite regional planning process.
37
Minimizing impact
Following an in-depth review and the completion
of a runway configuration analysis by the German Center for Aerospace (DLR), six potential
runway locations – from a total of 31 reviewed –
were identified as capable of achieving the targeted minimum of 120 scheduled takeoffs and
landings per hour. Following additional assessments and an impact evaluation, the runway site
known as “5b” – 1,180 meters (center to center)
from the north runway, offset by 2,100 meters,
and 4,000 meters in length – emerged as the option with the lowest impact on local communities
and the environment.
Expert reports and studies
Based on this runway location and size, Flughafen München GmbH, submitted its application for
the regional planning process on July 31, 2006.
After an initial review of the application documents, the authorities initiated the process on
August 24, 2006. Besides explaining in detail the
grounds for expanding the airport, the application included 18 expert opinions and planning
documents, among them an air traffic forecast,
capacity analyses, an environmental compatibility study, technical planning, water management,
and landscaping assessments, and expert reports on the potential noise nuisance and the impact on air quality and climate.
38
The goal was to ensure that the chosen runway
location was the best option in terms of costs
and capacity as well as low negative impacts on
the airport region. The documentation comprised
eight ring binders containing several thousand
pages of information and more than a hundred
maps and drawings.
Government approval
On February 21, 2007, Upper Bavaria’s regional
government completed the regional planning
process for the third runway, and on March 8,
FMG received the desired notification of approval. In its official statement, the government
emphasized the importance and implications of
Munich Airport’s ability to operate efficiently
within the world’s aviation network.
The conditions stipulated in the Upper Bavarian
government’s approval document provided a
framework for preparing an application for zoning approval.
Zoning approval
In contrast to the regional planning process,
which examines a project’s importance and impacts at the regional level, a public zoning
process addresses a comprehensive catalog of
public and private issues and potential impacts
related to construction projects, including environmental compatibility. Besides assessing the
relevance and permissibility of a project, the zoning process also examines the need for follow-on
measures. Such measures as deemed necessary
to protect local communities and the environment are defined as binding by lawmakers and
the zoning agency.
FMG plans to submit an application for zoning
approval before the end of 2007. If the process
goes ahead as planned, the third runway, a factor
crucial to the future of Munich Airport and its
ability to compete effectively in the aviation marketplace, could go into operation in 2011.
Dialogue with local communities
As the expansion project goes forward, FMG is
eager to foster an open and constructive dialogue with local communities, and the Communities Council was formed specifically to provide
them with a platform through which they could
voice their legitimate interests. The council enables FMG to meet at intervals with local councilors, mayors, and stakeholders, as well as aviation industry representatives and members of
the local business community to hear their concerns. It ensures that stakeholders are kept informed about progress on planning and provides
them with an opportunity to put forward their
ideas and interests in connection with the airport’s expansion.
The scope of council discussions is not confined
to the third runway but also includes issues like
local transport infrastructure projects and the
voluntary impact fund to be set up by FMG and
its shareholders to help in cases of exceptional
hardship caused by the airport’s expansion initiatives. The Communities Council will play a major
role in framing specific projects and programs in
this context.
39
Communications and community relations
Reaching a wide target audience
Corporate Communications’ tasking in 2006
again centered for the most part on informing
the general public about events and changes at
Munich Airport and on publicizing the airport’s
importance for aviation and its host region.
40
We engaged in extensive media relations work,
including the publication of numerous news releases and press photos, in order to deliver our
messages through the news media. Two major
events focused the attention of the world’s media
on Munich Airport in 2006: the Football World
Cup and Pope Benedict XVI’s visit. In both cases,
members of the German and foreign press were
on site at the airport to cover the visitors’ arrival
and departure. The extensive preparations and
media support provided by FMG on both occasions resulted in a strong image gain for Munich
Airport.
External and internal communications
To keep passengers, visitors, and the interested
public informed about the airport, we produced a
number of publications, including M terminal, a
newsletter published every two months, and the
environmental statement Perspectives, which
won first prize in an award competition held by
the Berlin Chamber of Auditors. We also published information on the airport’s web site and
on the FMG Group’s newly expanded portal.
Dedicated and well-informed employees are a
key capital asset for any company, and FMG
does its best to keep its people informed. Internal communications media include Flughafen
Report, a monthly employee newsletter, the corporate intranet, and flyers and posters on key
topics. Entertainment and group activities, including the employee party and the company
run, also play an important role in internal communications.
Working with neighboring communities
We believe in fostering strong ties with the airport’s neighboring communities, and we do this
in part by providing them with timely, comprehensive information on our plans and by involving them in life at the airport. Community relations work in 2006 involved a variety of
initiatives, including the hosting of art exhibitions. Besides providing local artists with a platform on which to show their work, the exhibitions generate considerable interest among the
local population and passengers.
We also had booths at several regional shows
where local people, especially those living in the
airport’s neighboring towns and villages, could
obtain first-hand information on the airport and
its expansion plans. To meet the demand for information, FMG published a flyer on its plans for
a third runway, which it handed out at shows and
mailed to all households in the airport’s local
area. The company also posted details of its expansion program on the Munich Airport web site.
The new airport visitors’ center, opened in 2006,
and FMG’s redesigned newsletter for neighbors,
M Dialog, offered detailed information on the airport’s expansion, too. Published every two
months, with a print run of 96,000, and sent out
to all households in the Freising and Erding administrative districts, the newsletter provides an
excellent means of delivering in-depth information to local communities.
41
The regional relations office: Networking with
neighbors
For many years now, Flughafen München GmbH
has worked hard to promote an open dialogue
with stakeholders in its immediate locale and
wider outlying region. Our aim is to break down
barriers and identify overlapping interests to create mutually beneficial relationships. Our efforts
in this area have proved a success. We understand the importance of getting to know one another – to understand others’ positions and concerns, and, crucially, to build mutual trust. To
achieve this, Flughafen München GmbH needs to
network closely with local organizations, and our
regional relations officer and his bureau help to
make this happen.
The Communities Council: Dialogue with the
region
The Communities Council, formed in the summer of 2005 and independently chaired by Edda
Huther, was set up to provide a forum for dialogue and an exchange of ideas with the region
on Flughafen München GmbH’s expansion plans
to build a third runway.
During the first six months of 2006, the Communities Council convened on numerous occasions
to review and discuss plans and experts’ reports
in depth as they became available. At a meeting
in July 2006, the Council met with three minis-
42
ters from the Bavarian government to clarify the
need for the planned runway and to discuss the
region’s road and rail networks.
Since the autumn of 2006, the Council’s committee has been examining the issues surrounding a
voluntary impact fund that Flughafen München
GmbH plans to set up to provide compensation
for hardships sustained as a result of the runway
project. The committee is also reviewing a number of current questions of infrastructure.
The regional marketing association
The regional marketing initiative, operated and
funded by FMG in association with the Erding
and Freising administrative districts, is an excellent example of active collaboration between the
airport and its host region. A joint taskforce, set
up in 2005, works to actively develop the region
and promote and publicize its advantages further
afield. The primary focus is on promoting business investment and tourism.
In 2006, we laid the strategic foundations for the
regional marketing initiative’s future programs.
With the finalization of a marketing roadmap and
the creation of a corporate design in the first
quarter of 2007, the groundwork has largely been
completed.
At the same time, the initiative has engaged in a
number of inward activities focused on the region and its population. These included a campaign titled “Faces of the Region” in which individuals who had helped shape the region significantly through their efforts and dedication
were chosen to be honored with special awards.
The measures also included the first regional reception for the five partners, attended by 300
people from various segments of society, to
strengthen ties and make new contacts.
Outward-directed measures included attending
the largest German industry show for industrial
location and regional development in Leipzig,
where the region for the first time mounted a
promotional presence for an audience of outside
experts.
Sponsorships for the region’s youth
In 2006, FMG set out to create a new foundation
for sponsorships and to introduce a new system
of sports sponsorships in the region. Working
closely with local sports clubs, the company decided that it would focus its support on young
people and that funding provided by Flughafen
München GmbH would be determined by the
number of young people in clubs. Under this
scheme, FMG sponsors around 18,000 young
people up to the age of 18.
FMG also continued to support cultural highlights in the region, including the Erding Jazz
Festival, Erding Symphony Orchestra concerts,
and the Freising Cultural Festival.
Competency center for municipal road
construction
Improving the airport and region’s transport infrastructure has always been a major concern for
Flughafen München GmbH, and the company recently set up a competency center to help advance municipal road construction in the region.
The competency center offers local municipalities support with non-delegable construction duties related to planning and implementing municipal road building projects. The technical
support offered by the center has been well received by neighboring communities and has
helped a number of projects to progress.
43
Aviation and climate protection
Continuous monitoring of aviation noise
In spite of a 3.1 percent rise in the number of aircraft movements year on year, none of our aviation noise monitoring system’s 16 fixed measuring stations showed a continuous sound pressure level of more than 60 dB(A) during 2006. By
contrast, due to carriers operating more longhaul jets, the incidence of noise events with levels in excess of 75 dB(A) was 8 percent higher
than in the prior year. Levels of more than 85
dB(A) were recorded three times a day on average.
44
Fewer night flights
In 2006, there were 19,837 nighttime aircraft
movements. These used up 42 percent of our allotted maximum noise quota (Neq) for night
flights, down from 45 percent a year earlier. The
drop was due to the declining number of air mail
services as well as fewer delayed flights. The
continuous sound pressure level along the
perimeter of the combined daytime and nighttime noise protection zone never reached its permitted maximum of 50 dB(A) during the course
of the year.
Airborne pollutants remain at non-critical levels
Limits for dust particulate levels in the airport’s
area were exceeded during 2006, but not as a result of flight operations. The dust was caused by
gravel mining operations and transportation at a
pit located to the east of the airport. The mining
has since stopped.
Continuous monitoring of airborne pollutants
showed that the nitrogen dioxide level had increased further, to 34 µg/m3 from 31 µg/m3 in
2005, but was still below the statutory limit of 48
µg/m3. Overall, airborne pollutants again remained below critical levels in 2006.
Bioindicator tests with curly kale
Munich Airport has continuously measured levels of airborne pollutants since 1991 using analysis equipment. In the autumn of 2006, we also
reintroduced a biomonitoring program of the
kind already operated between 1991 and 1993 to
supplement ongoing monitoring. Standardized
curly kale plants were set up at 14 points around
the airport campus and in neighboring areas.
Pollutants in the air are absorbed by the kale and
accumulate in the plants’ cells. After a few
weeks, the plants are sent to labs for analysis.
The program allows us to measure levels of
polycyclic aromatic hydrocarbons (PAHs) produced in combustion processes – by industrial
plants, automobiles, aviation, and house heating
systems, for example.
Parallel to the biomonitoring program, we also
track the deposition and accumulation in ecosystems of other substances using simple precipitation collectors. This enables us to record levels of
heavy metals and nitrogen and sulfur compounds.
With these voluntary environmental analysis programs, Flughafen München GmbH aims to track
and monitor current pollutant levels at the airport and in its immediate surrounding area to
provide local communities with a clear picture of
the environmental situation in the area. We plan
to introduce additional monitoring programs using grass cultures during the summer of 2007.
Ramp vehicles running on rapeseed fuel
Flughafen München GmbH is committed to continuing and extending trials and production use
of renewable energy sources at Munich Airport in
an effort to protect the climate. As part of this
commitment, we are converting a large number
of our ramp vehicles to run on rapeseed fuel
rather than on conventional diesel.
Award-winning environmental statement
Flughafen München GmbH’s environmental
statement, produced as part of our environmental management program, was picked by the
Berlin Chamber of Auditors as the winner of the
German Environmental Reporting Award (DURA)
competition. The award citation praised the report’s innovative approach, clarity of presentation, and comprehensive scope.
Protecting the climate
Aware of its responsibility to help protect and
preserve the environment and the world’s climate, Munich Airport is keen to encourage airlines to operate more environment-friendly aircraft. We are therefore currently reviewing the
option of introducing emission-based landing
fees in addition to current noise-based charges
as an incentive.
45
Safety and security
Averting threats
Safety and security are two key concerns for aviation
and airports. Measures to ensure safety center on possible dangers to and from flight operations, whereas
security measures focus on guarding against external
threats targeting, rather than issuing from, aviation.
FMG goes to great lengths to ensure security and safety at Munich Airport.
46
Passenger and airline safety
Operators of commercial airports are obligated
to ensure the safety of flight operations, taxiing,
and aircraft handling. The unit responsible for
this at Munich Airport is Traffic Management. Besides carrying out inspections of the airport, it is
in charge of safety, damage, accident, and construction operations, as well as snow and ice
clearing services and bird control. Its work ensures passengers and airlines enjoy a high level
of safety at all times.
The Safety Management System
To maintain high safety standards, Flughafen
München GmbH has deployed a Safety Management System (SMS) in accordance with ICAO requirements. The system has promoted a culture
of safety, supported and sustained by Munich
Airport employees and all of the companies and
organizations involved in any way with safety at
the airport. The purpose of the SMS is to enable
us to identify and assess possible dangers to
flight operations and to work with specialist units
to introduce countermeasures.
Germany’s Federal Ministry of Transport, Building
and Urban Affairs on airport safety management
systems and inspections by government agencies.
Security without inconveniencing passengers
In 2006, a year with a number of high-profile, international events, Munich successfully cemented its reputation for robust security while inconveniencing passengers as little as possible.
This we owe to the professionalism and dedication of our employees and to the positive outcomes and successes of our M-Power restructuring program. From January 1, 2005, M-Power
assigned operational security to the Security
service division and security management to the
Legal Affairs and Security division. As a result,
Security employed roughly 140 people in 2006,
plus around 450 indirectly through FMG subsidiary CAP Flughafen München Sicherheits
GmbH, operating in the capacity of a contractor,
while the security management unit had just seven employees.
Munich Airport has helped spearhead the introduction of safety management systems at airports: In a joint research project conducted with
Berlin’s Technical University, we have helped to
define baseline national requirements for the deployment of safety management systems at airports in Germany. The results of the research,
which attracted considerable international interest, have informed recommendations issued by
47
Smooth implementation of screening
Following careful groundwork by security management teams and airport security, physical
checks on employees, vehicles and objects were
introduced efficiently from January 1, 2006, at
the interfaces between the publicly accessible
area and the security-sensitive parts of the restricted area. Implementing these checks costs
FMG more than €11 million a year, a sum that
has only been passed on to passengers in part in
the form of security charges.
Likewise in January 2006, we incorporated a key
extension to the airport’s cargo facilities into the
security regime, meeting urgent requirements issued by DHL, UPS and FedEx as well as specifications defined FMG’s security management. We
also implemented multi-stage automated baggage checks in Terminal 1’s baggage transportation system, bringing it up to a standard similar
to that in Terminal 2. The final system components were successfully deployed at the beginning of March 2007.
Security at major events
Flughafen München GmbH prepared and coordinated security programs with the aviation security authorities and the federal and Bavarian police
as well as a number of FMG Group units to put
appropriate security in place for several largescale events, including the 2006 World Cup, and
visits by Pope Benedict XVI and President Putin.
48
Other security management tasks included continuous revision of the aviation security plan and
technical security reviews concerning a future
terminal satellite.
Routing in Terminal 2
Security management teams were also responsible for planning the implementation of EU aviation security requirements regarding the separation of passenger streams. Under these requirements, passengers arriving from non-EU countries must be kept separate from departing air
travelers who have already undergone security
checks. They and their baggage must also be
screened before they can be permitted to transfer to an onward flight.
In Terminal 1, the construction work to comply
with these requirements has already been completed at a cost of more than €4 million; in Terminal 2, the changes have been accomplished for
transfer passengers with onward flights to EU
destinations. In the summer of 2007 we will begin making the necessary changes for transfer
passengers bound for non-EU destinations.
Specifically, this involves creating a passenger
routing hallway on building level 06 in Terminal 2
to take transfer passengers to the transfer checkpoints. The capital expenditure is expected to run
to more than €60 million and the work is slated
for completion in 2008.
Screening passengers and carry-on luggage
One crucial event for the whole of Europe’s civil
aviation was the timely discovery on August 910, 2006, in the United Kingdom of plans for suicide bombers to use liquid explosive to bring
down a total of nine aircraft on flights to the U.S.
What was remarkable about this incident was,
first, that home-made liquid explosives were to
be used and, second, that the plot was not foiled
by airport security checks but by security forces
observing suspected terrorists.
The European Commission’s response as defined
in Regulation 1546/2006 aimed once again to
tighten the last line of defense, passenger and
hand-luggage screening. Munich Airport’s security management expressly endorsed and supported the intense lobbying by national and international airport associations. At the end of the day,
the efforts resulted not in a complete ban on liquids as originally envisaged, but in a ruling that
allowed passengers to purchase liquids once inside the sterile area at EU airports and to carry
with them, in sealed bags, toiletries and spirits
purchased in duty-free stores, if flying on to another EU airport on the same day.
The fact that passengers are allowed to take
small quantities of liquids as carry-on luggage
from the public area through security checks,
provided these liquids are contained in resealable clear plastic bags with a volume of one liter
at most and the volume of any one liquid does
not exceed 100 millimeters, is, in light of the
original plans to ban liquids completely, a testament to the success of the lobbying efforts.
When the time came to enforce the regulations
from October 6, 2006, Munich Airport had done
an exceptional job of preparing passengers for
the changes. A high-profile information campaign with posters, news releases, and, initially,
the distribution of resealable one-liter bags to
passengers meant that Munich did not experience the same delays and passengers complaints as other airports when the new security
regulations came into force.
Leading customer service and satisfaction
The Security support division and the Legal Affairs and Security central division’s security management unit will continue to maintain high security standards in 2007, but not at the expense
of passengers’ and employees’ convenience.
One success has been the postponement for 12
months of plans by Brussels to limit the size of
hand luggage from May 6, 2007 – plans that
would have presented passengers and airport
operators with enormous and unnecessary problems.
Munich Airport will continue to fulfill statutory
safety and security requirements to exceptional
standards while maintaining its strong reputation for customer focus and satisfaction.
49
The FMG Group’s
business performance
50
The FMG Group in 2006
Operating costs
Compared to other commercial airports in Germany, Munich Airport saw exceptional traffic
growth in 2006. Recording around 30.8 million
passenger movements, Munich ranked seventh
in the league table of the busiest airports in Europe. To secure sufficient capacity to accommodate predicted intermediate-term growth, FMG
began preparations for the construction of a third
runway during 2006. The company applied for a
regional planning process for the runway on July
31, 2006, and received approval from the regional government of Upper Bavaria in early March
2007.
Operating costs in fiscal 2006 totaled €853 million, an increase of €43 million or 5.3 percent
year on year. Although the headcount was 6 percent higher than in 2005, personnel expense
grew less rapidly at 3 percent.
Group sales
Net income
Having made a return to positive earnings in
2005 with a profit €3.6 million, the FMG Group
reported net income of €61.5 million in fiscal
2006. This was due not just to operating earnings
but also to stronger financial earnings, which improved as a result of better interest management
and higher income from investments.
In fiscal 2006, FMG Group sales totaled €920 million, up €76 million, or 9 percent on 2005. More
than half of Group sales – €486 million – were
generated by the servicing of air traffic, an increase of almost 9 percent year on year, in line
with the positive growth in traffic. Non-aviation
sales, consisting for the most part of leases, concessions, hospitality and retail revenues, likewise
grew 9 percent in comparison with the prior
year, to €434 million.
51
Consolidated financial
statements 2006
52
Supervisory board’s report
The supervisory board was informed regularly
and in detail by executive management through
written reports and at meetings about the company’s situation, its development, and important
business events. On the basis of the reports and
the information received, the supervisory board
monitored the management of the company’s
business and made such decisions as it was
called upon to make in accordance with its statutory responsibilities.
The yearend accounts as at December 31, 2006,
and the report on the economic development
and position of Flughafen München GmbH and
its group of companies presented by executive
management have been audited and approved
by Deloitte & Touche GmbH, the appointed auditors. Having conducted its own review, the supervisory board accepts the auditors’ findings
and raises no objections. In accordance with Section 42a, Paragraphs 2 and 4 of the Limited Liability Companies Act (GmbHG) and Section 171,
Paragraph 2 of the Stock Corporations Act (AktG),
the board approves the yearend accounts of
Flughafen München GmbH and the FMG Group.
The supervisory board proposes that the shareholders endorse the yearend accounts of
Flughafen München GmbH and the FMG Group.
There were no changes to the membership of the
supervisory board in fiscal 2006.
The supervisory board wishes to express its gratitude and respect for the work carried out and
the successes achieved by the company’s executive management and employees in fiscal 2006.
Munich, July 26, 2007
Flughafen München GmbH
The supervisory board
Prof. Kurt Faltlhauser
Chairman
53
Consolidated management report for 2006
The purpose of the Flughafen München Group is
to operate Munich Airport and to engage in ancillary lines of business. The FMG Group comprises
Flughafen München GmbH and 12 subsidiary
companies.
General economic environment and situation in
the industry
The global economy again continued to expand
in 2006 in spite of new historic highs in the price
of oil. Alongside the fast-growing national economies of east Asian countries and the United
States, Europe’s economy, too, rapidly picked up
speed.
In 2006, the German economy showed strong
growth for the first time since the boom year
2000, not least on account of burgeoning domestic demand and robust and expanding exports.
Against the background of a hale global economy
and recovery in Europe, conditions were right for
world aviation to continue growing as it had a
year earlier. The German Airports Association
(ADV) and its member airports reported a solid
5.3 percent increase in the number of passenger
movements, to 174.2 million, in 2006.
Business trends
The passenger volume at Munich Airport rose
sharply again in fiscal 2006 to 30.8 million, exceeding 30 million for the first time in the airport’s history. This marked a 7.5 percent increase
or 2 million passengers more than in the year before. Within the circle of Europe’s ten busiest passenger airports, this result ranked Munich as one
of the strongest growth engines, with only
Madrid and Barcelona airports reporting even
higher rates of growth.
Based on passenger movements, Munich succeeded in moving up a place among Europe’s top
ten airports to seventh in the rankings.
54
The number of takeoffs and landings in the commercial and non-commercial sectors rose 3.1 percent year on year to 411,335 aircraft movements.
With intercontinental traffic up 12.5 percent at
Munich Airport, the volume of cargo also expanded. Cargo traffic in the flown cargo segment rose
10.6 percent to 224,409 tons. Given that around
70 percent of the cargo transported by air to and
from Munich is carried as bellyhold freight on
passenger services, the renewed rise in the flown
cargo tonnage was the result of a drive to develop long-haul services.
Group net sales totaled €920.1 million in fiscal
2006, up 9.0 percent on the prior year. The servicing of air traffic contributed €475.2 million, with
concessions, rents, leases and other sources providing a further €246.5 million, retail and hospitality €182.2 million, cargo handling €10.6 million, security services €3.0 million, medical
services €1.9 million, and insurance €0.7 million.
Aviation earnings rose in tandem with the growth
in traffic, and revenue from landing and parking
fees rose sharply. Although a second authorized
ramp services operator succeeded in winning a
greater share of the ground handling market,
FMG succeeded in generating higher revenues
from ramp services than a year earlier. Overall,
aviation revenues grew €39.1 million, an increase
of 9.0 percent.
Non-aviation revenues were also higher year on
year, up 9.0% or €36.7 million, contributing
€444.9 million, or 48.3 percent, to total net sales.
For the most part, these revenues comprised
rents, leases and concessions (€246.5 million)
and retail and hospitality revenues (€182.2 million).
Materials expense rose by €23.2 million or 10.8
percent on 2005, to €238.6 million. This was
mainly due to additional spending on guarding
and security services and higher material requirements in line with stronger sales growth among
FMG’s retail subsidiaries. However, efforts to lower procurement costs were successful in reducing
expenditure on third-party services.
Although sales were substantially higher in comparison with 2005, personnel costs rose just €8.5
million, or 3.0 percent, to €294.3 million.
Other operating expense and interest, a major
factor in the company’s costs, accounted for
€247.5 million or 26.9 percent of total costs. Depreciation across the Group totaled €139.5 million, down marginally on 2005.
provided in the form of shareholder loans to enable the construction of the new airport had to be
paid back at the end of 2006.
A project team was formed to find the most favorable and reliable way to refinance the shareholder loans through banks or the money market.
In 2006, the team thoroughly researched the capital procurement options. In association with the
shareholders and under the guidance of Westdeutsche Landesbank and Bayerische Landesbank, the most favorable solution identified was a
syndicated loan involving 21 German and other
European banks. The Group’s net interest for fiscal 2007 will be encumbered with a further €29
million by the syndicated loan.
Investments1
After two years of losses and then a return to
positive territory in fiscal 2005 with Group profits
of €3.6 million, FMG reported a net profit before
tax of €61.5 million in 2006. However, this figure
includes an extraordinary gain from the reversal
of a €26.7 million provision formed in previous
years to cover aviation invoicing risks.
The primary cause for this development was a
€75.8 million increase in external revenues and
an exceptional increase in operating expense, including interest. At the same time, FMG for the
first time accrued €800 thousand for deferred
taxes to account for higher interim results within
the Group.
Financial situation
Of shareholder loans totaling €1.276 billion granted to the Group’s parent company, €784.3 million
were repaid on December 15, 2006.
The repayment became due when Flughafen
München GmbH’s shareholders (the state of
Bavaria, the Federal Republic of Germany, and
the city of Munich) decided in December 2005
that around 62 percent of the financial support
Having successfully expanded its business activities, eurotrade Flughafen München Handels-GmbH,
Munich, increased its sales by €17.5 million, from
€103.4 million to €120.9 million, a rise of 16.8 percent. Due to the higher sales and a reduction in materials costs, the company was able to report an
earnings rise from €5.5 million to €8.4 million.
With the approval of its corporate parent, eurotrade
retained €1.0 million in earnings. The increase in
other retained earnings is related to substantial
capital investment in Terminal 2 security upgrades.
The residual profit of €7.4 million was transferred
to Flughafen München GmbH under a profit-andloss transfer agreement.
In the review year, Cargogate Flughafen München
Gesellschaft für Luftverkehrsabfertigungen mbH,
Munich, posted sales totaling €10.6 million (2005:
€10.1 million). More business and the continued increase in cargo tonnage enabled the company was
able to post a profit of €0.9 million (2005: €0.6 million). The profit was transferred to Flughafen München GmbH under a profit-and-loss transfer agreement.
1
Sales figures are external sales unless otherwise stated.
55
Allresto Flughafen München Hotel und Gaststätten GmbH, Munich, succeeded in boosting sales
by €7.1 million or 12.7 percent year on year. In
fiscal 2006, the company increased profits by
€1.7 million to €2.4 million. The profits were
transferred to Flughafen München GmbH under a
profit-and-loss transfer agreement.
aerogate München Gesellschaft für Luftverkehrsabfertigungen mbH, Munich, provides passenger
and aircraft handling services. In fiscal 2006, the
company reported sales of €7.1 million (2005:
€8.8 million). Due to a decline in the number of
handling services delivered and the attendant
drop in revenue, the company reported a net loss
for 2006 of €175 thousand (2005: negative €79
thousand).
CAP Flughafen München Sicherheits-GmbH, Freising, an FMG unit, provides guard and security
services at Munich Airport, in particular special
security measures as required under aviation law.
In fiscal 2006, the company reported a €1.7 million drop in external revenues. CAP’s total sales,
however, grew from €14.6 million to €17.6 million, with the company reporting a net profit of
€121 thousand (2005: €62 thousand) for the year.
In fiscal 2006, FMV - Flughafen München Versicherungsvermittlungsgesellschaft mbH, Freising,
reported sales of €999 thousand, including external revenues of €714 thousand (2005: €600 thousand). The company posted profits of €458 thousand, up from €424 thousand a year earlier. The
profits were transferred to Flughafen München
GmbH under a profit-and-loss transfer agreement.
56
IMMO FM Terminal 2 Immobilien-Verwaltungsgesellschaft mbH & Co oHG, Freising, reported sales
of €77.3 million (2005: €76.9 million), generated
entirely within the Group. The company posted its
first ever profit in 2006, with net earnings of €1.5
million (2005: negative €0.5 million). Profits were
transferred to FMG in proportion to its shareholding through Flughafen München Holding GmbH
(formerly, T2 Holding GmbH) and Lufthansa Commercial Holding GmbH.
AeroGround Flughafen München Aviation Support
GmbH, Munich, supports handling operations by
recruiting temporary workers and hiring them out
to ground services. In fiscal 2006, the company reported sales of €910 thousand (2005: €946 thousand), generated entirely within the Group. The
company posted a profit of €54 thousand (2005:
€55 thousand). The profit was transferred to Flughafen München GmbH under a profit-and-loss
transfer agreement.
MediCare Flughafen München Medizinisches Zentrum GmbH, Oberding, reported sales of €4.2 million (2005: €3.3 million), of which €2.3 million
(2005: €2.3 million) were generated internally
within the Group. In the review year, the company
posted a profit of €128 thousand (2005: €8 thousand).
In fiscal 2006, Terminal 2 Betriebsgesellschaft
mbH & Co oHG, Oberding, grew its sales by
€19.5 million, from €167.4 million to €186.9 million, a rise of 11.6 percent. The company reported
its first ever annual net profit – €8.7 million
(2005: negative €8.0 million) – before dividend
payouts to its shareholders, FMG and Passage
Services Holding GmbH. The profits were shared
in proportion to the shareholders’ respective holdings.
Flughafen München Holding GmbH (formerly, Terminal 2 Holding GmbH), Freising, holds shares in
IMMO FM Terminal 2 Immobilien-Verwaltungsgesellschaft mbH & Co oHG, Freising, and, as of fiscal 2006, in AeroGround Flughafen München Aviation Support GmbH, Munich, and in MUCGround
Services Flughafen München GmbH, Freising.
Under the terms of the company agreement,
Flughafen München Holding GmbH has a proportionate share in IMMO’s profits and therefore
posted a profit of €852 thousand in 2006 (2005:
negative €319 thousand). This profit was transferred to Flughafen München GmbH under a profit-and-loss transfer agreement.
In its first full fiscal year, MUCGround Services
Flughafen München GmbH, Freising, reported
sales of €19.0 million, compared to €4.9 million
in its short fiscal year from March 23 to December
31, 2005. These sales were generated in their entirety within the Group. The company earned a
profit of €3.5 million in 2006, compared to a loss
of €91 thousand in the previous, short fiscal. The
profit was transferred to Flughafen München under a profit-and-loss transfer agreement.
In fiscal 2005/2006, EFM – Gesellschaft für Enteisen und Flugzeugschleppen am Flughafen
München mbH, Freising, reported sales of €27.4
million (prior year: €23.4 million). The net profit
for the year totaled €4.0 million (prior year: €2.0
million). As FMG has a 49 percent holding, the
company is included as an associated company
in the consolidated accounts. EFM paid out €980
thousand to FMG in the review year.
FMG holds 50 percent of AFBG Augsburger Flughafen Betriebs-GmbH, Augsburg. Due to the immateriality of this holding, it is omitted from the
yearend accounts in accordance with the provisions of Section 311, Paragraph 2 of the German
Commercial Code.
In fiscal 2006, Bayern Facility Management
GmbH, Munich, reported sales of €19.7 million
(2005: €16.1 million). The net profit for the year
totaled €450 thousand (2005: €372 thousand).
FMG has a 49 percent stake in the company. The
company is therefore included as an associated
company in the consolidated accounts. The prior
year’s profit was retained in its entirety as a revenue reserve.
57
Asset and capital structure
December 31, 2006
€ million
%
December 31, 2005
€ million
%
Assets
Unpaid contributions to capital stock
0.1
0.0
0.1
0.0
Startup expenses
0.0
0.0
0.1
0.0
Intangible assets
Tangible assets
Financial assets
Fixed assets
2.2
0.1
2.3
0.1
2,863.8
95.7
2,952.9
91.6
3.9
0.1
2.9
0.1
2,869.9
95.9
2,958.1
91.8
Inventories
55.1
1.8
50.9
1.6
Receivables
52.4
1.8
96.2
3.0
Liquid assets
11.1
0.4
115.8
3.6
118.6
4.0
262.9
8.2
3.1
0.1
0.6
0.0
2,991.7
100.0
3,221.8
100.0
390.0
13.1
328.7
10.2
1.2
0.0
0.8
0.0
491.9
16.4
491.9
15.3
Long-term debt
1,515.7
50.7
1,068.2
33.2
Short-term debt
592.9
19.8
1,332.2
41.3
2,991.7
100.0
3,221.8
100.0
Current assets
Prepaid expenses and deferred charges
Total assets
Capital
Capital stock
Special reserve items
Shareholder loans
Total assets
Total assets at December 31, 2006, were 7.1 percent lower at €2.991 billion, compared to a year
earlier. The €230.1 million drop was largely
caused by the €154.6 million reduction in fixedterm deposits with banking organizations, needed in part to pay back the shareholder loans due
on December 15, 2006.
Other reductions totaling €88.1 million in comparison with a year earlier were triggered by a reduction in long-term assets. Depreciation totaled
€139.5 million, compared to asset additions of
€70.2 million. Compared to a year earlier, financial assets increased by €1.077 million, to €3.939
million, as a result of investment valuations.
Current assets and liquid assets were down
€144.3 million, mainly because of low levels of
cash and cash equivalents.
The €61.4 million change in equity is the result of
profits to the same amount. In 2005, the shareholders decided that €784.3 million in sharehold-
58
er loans were to be repaid by the end of 2006. The
loans were originally granted to Flughafen München GmbH to finance the new airport. Booked
under liabilities to shareholders in 2005, the
€784.3 million were repaid in December 2006.
This was partly covered by the company’s own financial resources and partly by outside financing,
with liabilities to banks increasing by €501.4 million in 2006.
Compared to a year earlier, accruals were reduced by €23.0 million to €154.7 million, primarily through the elimination of aviation invoicing
risks.
Liabilities were €268.0 million lower, at €1.948
billion, in comparison with the prior fiscal. The
change is largely the result of liabilities to shareholders being transferred to liabilities to banks,
as well as to the consumption of cash and cash
equivalents.
Capital investments
Additions to tangible assets totaled €66.2 million,
compared to retirements totaling €28.3 million.
Environmental stewardship and HR issues
As an airport operator, Flughafen München GmbH
has special responsibilities toward the environment and local communities, and to meet these responsibilities we have deployed a sustainable environmental management system that has been
certified to DIN ISO 14001 and to EMAS 761/2001.
creasingly tough competition and, thus, to safeguard jobs. In addition, the company has not just
widened its employee health management initiatives, it has also conducted an employee survey to
create a solid foundation for workplace and social
improvements, and has stepped up internal communications programs on health.
In 2006, the FMG Group’s average headcount increased by 411 in comparison with a year earlier.
The figure includes 190 vocational trainees
(2005: 160).
Risks and opportunities
This advanced environmental management system takes an end-to-end approach to company environmental stewardship. Continuous documentation of resource consumption and environmental
outputs enables us to monitor our impacts, to define specific environmental performance targets,
to track implementation and goal attainment, and
to develop new initiatives to ease environmental
burdens.
Going forward, the company will continue to place
great emphasis on preserving natural resources
and limiting environmental impacts arising
through the operation and expansion of Munich
Airport. Our planning and preparations for the
construction of a third runway at the airport are informed by fundamental principles of environmental compatibility.
With regard to human resources, there is the following to report: Executive management has
worked with the works council and the labor
unions to develop a restructuring strategy designed to achieve stronger earnings in the ground
handling sector. This strategy includes extensive
programs to increase the flexibility of working
hours and to lower HR expense. The aim is to put
us in a position to meet the future challenges of in
The FMG Group’s system of risk management is
designed to identify and gauge potential risk facing the enterprise and covers all of its operational
business processes. Risks are assessed based on
the likelihood of occurrence and on quantification
of the scale of impact in the event of an occurrence. The primary goal of risk management is to
take a controlled approach to risk and to define
preventive measures to avoid it.
All risk information is processed internally on a
quarterly basis to enable executive management
and division heads to respond swiftly and effectively to shifts in risk scenarios. When the need
arises, management responds immediately to
new or changing risk situations. The latest risk reports are also made available to the members of
the supervisory board.
To minimize possible financial damage, the FMG
Group has insurance for appropriate amounts
covering key areas of potential loss and liability.
External risks identified in 2006 as having a low
likelihood but potentially severe economic impact
included flooding as a result of record high-water
levels in the river Isar and acts of terror.
59
Other risks, such as the effects of the pending
corporate tax reform, the price of oil, the economic cycle, changes to aviation law, and loss of
market share to rival ground services operators
are also addressed in our system of risk management.
A concluding review of the risks has shown that
there is no threat to the company’s continuity. In
the review period, no risks were identified as posing a threat to the current situation, either before
or subsequent to the making of risk provisions.
Financial instruments – receivables, liabilities and
derivatives – are assessed at regular intervals
with regard to price, default and liquidity risks.
Derivative financial instruments are employed
with the approval of executive management to
hedge and optimize interest rates. The relevant
hedge amount is set at FMG Group shareholder
meetings.
To safeguard rapid ongoing growth in air traffic
and continued development in line with future
demand, Flughafen München GmbH began planning the construction of a third runway in 2005
and prepared and initiated the requisite regional
planning process in 2006. Following the review of
a number of possible locations to assess their potential to provide the required additional capacity,
those capable of sustaining 120 aircraft movements an hour were examined in detail based on
a comprehensive set of criteria, including noise
levels, land requirements, and the impact on the
natural ecological balance. As a result, candidate
runway location 5b was chosen. It is at a distance
60
of 1,180 meters from the airport’s north runway
(center to center), offset by 2,100 meters to the
west, and 4,000 meters long. To build support for
the project, the Communities Council, formed in
2005, is currently reviewing possible compensatory measures, including an impact fund, improvements to the region’s infrastructure, and
other protective measures that are to be negotiated bilaterally.
At the beginning of March 2007, Upper Bavaria’s
regional government completed the regional
planning process for the third runway and approved plans for the addition to the airport infrastructure in the form submitted (with runway location 5b). As was highlighted in a government
news release, Flughafen München GmbH had
clearly demonstrated “that current runway capacity would be stretched to its limits in the next few
years and that the growth in air traffic anticipated
in the intermediate and longer term necessitates
an additional runway.”
For Flughafen München GmbH, regional planning
approval for the third runway is an important step
along the road toward creating the much-needed
additional capacity that will enable us to achieve
our goal of safeguarding traffic and business
growth and remaining the region’s economic and
employment powerhouse.
FMG is submitting its application for zoning approval to the regional government of Upper
Bavaria in 2007.
Outlook
We continue to rigorously pursue plans to develop and expand Munich Airport as a leading European aviation hub. The company is submitting an
application for zoning approval for the third runway in 2007.
The planned capacity increase through the construction of a third runway will strengthen Munich Airport’s economic development in the long
term, sustain the expansion of hub traffic in the
years ahead, and bring our long-haul offering into line with that of other major European hub airports. Before we proceed to expand our landside
capacity – through extensions to our terminal
buildings, for example – we will take steps to
make better use of our available resources. In
2007, for example, we are concentrating on filling
capacity in Terminal 1.
To meet the needs issuing from the exceptionally
rapid growth in aviation, we began expanding
our freight handling facilities at the beginning of
2007. In the initial phase, we are adding 15,000
square meters of cargo capacity, due to open at
the end of 2007.
We also need additional hotel capacity at the airport and are planning to build a three-star facility
with around 250 rooms. The new hotel is to be
run by a well-known international operator and
funded by an outside real-estate investor.
In 2006 we successfully completed M-Power, the
strategy development and earnings growth project we launched back in 2003. Its goal was to reorganize the FMG Group and to realign it strategically to achieve sustained, profitable growth and
create greater company value. Key objectives included a significant and sustained improvement
in the Group’s earning power through a comprehensive restructuring of services and costs.
One major change introduced by M-Power was
the reorganization of the Group into five business
divisions, five central divisions, and four service
divisions. Our core business is conducted by the
five business divisions, Aviation, Ground Handling, Corporate Real Estate Management and
Development, Retail and Services, and Terminal 2.
The structural reorganization has proved to be a
sound decision and has worked out well. The
new, more flexible organizational structure and
the clear strategic direction have put us on the
right footing to respond more rapidly to economic change and to compete effectively in a liberalized marketplace.
The project also set the target of raising earnings
by €50 million a year from 2008 and of achieving
a €100 million increase in earnings by the end of
2007. We look set to over-fulfill both these targets:
The annual earnings improvement will amount
to around €90 million a year, and the cumulative
earnings increase between 2005 and 2007 will total almost €200 million.
The offering of long-haul flights at Munich Airport will expand in 2007, with Deutsche Lufthansa
operating daily services to Denver and three
flights a week to Busan, via Seoul. From July
2007, South African Airways will offer a nonstop
service to Johannesburg. In addition, a number
of airlines will be expanding their networks and
adding further frequencies on routes in Europe.
The rates of growth predicted for the traffic sector and the favorable outlook for Germany’s
economy mean that we have a solid foundation
on which to continue to build and grow our business successfully in the years ahead. Due to the
one-time cumulative effect of the reversal of provisions in 2006 and the additional burden of refinancing shareholder loans, we expect to report a
substantially improved operating result for 2007
but a lower net profit than in 2006.
Munich, April 27, 2007
Dr. Michael Kerkloh
Walter Vill
Peter Trautmann
61
Consolidated balance sheet as at December 31, 2006
Assets
€
A. Outstanding contributions to subscribed capital
B. Startup expenses
Dec. 31, 2006
2005
€
€ thousand
110,249.25
110
0.00
58
C. Fixed assets
I. Intangible assets
1. Franchises, intellectual property, and similar rights and assets
2,195,372.67
2,085
2. Goodwill
0.00
94
3. Advances on intangible assets
0.00
105
2,195,372.67
2,284
II. Tangible assets
1. Land, rights similar to land, and buildings,
including buildings on land not owned
2. Technical equipment and machinery
2,357,214,971.83
2,420,075
419,324,168.31
461,448
3. Other equipment, plant and office equipment
43,523,754.69
50,178
4. Construction in progress and advances on fixed assets
43,732,635.07
21,232
2,863,795,529.90
2,952,933
III. Financial assets
1. Investments in associated companies
2. Other loans
3,344,455.81
2,150
594,547.78
712
3,939,003.59
2,862
2,869,929,906.16
2,958,079
D. Current assets
I. Inventories
1. Substitute plots of land
2. Raw materials and supplies
3. Finished goods and goods for resale
29,986,309.04
28,952
4,751,224.47
4,342
20,387,178.70
17,540
55,124,712.21
50,834
II. Receivables and other current assets
1. Trade accounts receivable
2. Receivables from associated companies
3. Other current assets
35,378,369.23
31,363
95,747.05
506
16,922,654.61
64,358
of which €4,392,239.88 with a residual term
of more than one year (2005: €1.712 million)
III. Liquid assets
E. Prepaid expenses
Total assets
62
52,396,770.89
96,227
11,045,100.71
115,822
118,566,583.81
262,883
3,108,421.84
647
2,991,715,161.06
3,221,777
Liabilities
€
Dec. 31, 2006
2005
€
€ thousand
A. Equity
I.
Subscribed capital
II. Capital reserves
306,776,000.00
306,776
102,258,376.24
102,258
7,743,830.36
6,697
- 38,181,615.97
- 98,406
III. Earnings reserves
Other reserves
IV. Consolidated net loss
V. Minority interests
11,461,125.59
B. Conditionally repayable shareholder loans
C. Special item for subsidies toward assets
11,379
390,057,716.22
328,704
491,912,735.89
491,913
1,186,500.00
741
D. Accrued liabilities
1. Pension accruals
12,239,081.00
12,392
2. Tax accruals
34,963,295.37
29,600
3. Other accruals
107,485,724.06
135,720
154,688,100.43
177,712
E. Liabilities
1. Liabilities to banks
2. Trade accounts payable
3. Liabilities to shareholders
4. Liabilities to associated companies
5. Other liabilities
F. Deferred income
Total liabilities
1,815,172,896.29
1,313,800
57,033,375.65
40,268
0.00
784,314
3,810,094.96
2,617
72,242,808.44
75,246
1,948,259,175.34
2,216,245
5,610,933.18
6,462
2,991,715,161.06
3,221,777
63
Consolidated income statement
for the fiscal year
from January 1 to December 31, 2006
€
1. Net sales
2. Other capitalized labor, overheads and material
3. Other operating income
2006
2005
€
€ thousand
920,081,082.79
844,316
4,015,013.89
2,616
61,037,907.45
34,722
985,134,004.13
881,654
4. Material expense
a. Supplies, raw materials
and merchandise
b. Purchased services
- 118,692,530.97
- 108,750
- 119,936,089.64
- 106,617
- 238,628,620.61
- 215,367
5. Personnel costs
a. Wages and salaries
- 234,027,689.89
- 227,751
b. Social security, pension costs,
and support
- 60,284,704.69
- 58,088
- 294,312,394.58
- 285,839
- 139,453,510.70
- 140,394
6. Depreciation, amortization and write-downs on intangible
assets and property, plant and equipment, and on
capitalized startup and business expansion
expenses
7. Depreciation of goodwill
- 94,193.30
- 94
8. Other operating expense
- 178,338,201.51
- 170,351
- 850,826,920.70
- 812,045
134,307,083.43
69,609
9. Income from investments in associated companies
10. Other interest and similar income
11. Interest and similar expense
2,173,969.04
1,187
6,220,666.55
6,020
- 69,120,554.61
- 74,831
- 60,725,919.02
- 67,624
12. Income from ordinary activities
73,581,164.41
1,985
13. Taxes on earnings
- 5,827,170.17
390
14. Other taxes
- 2,207,410.82
- 2,127
0.00
3,396
15. Income from loss transfer
16. Losses absorbed under profit-and-loss transfer agreements
- 4,063,202.78
0
17. Consolidated net income
61,483,380.64
3,644
- 211,626.52
- 134
18. Minority interest in consolidated net income
19. Transfers to retained earnings
- 1,047,163.01
- 56
20. Consolidated loss carried forward
- 98,406,207.08
- 101,860
21. Consolidated net loss
- 38,181,615.97
- 98,406
64
Consolidated cash flow statement
Financial resources
Liquid assets
Short-term deposit investments included in miscellaneous assets
Consolidated net income
Depreciation, amortization and write-downs on fixed assets and on capitalized startup expenses
Increase in medium- and long-term accruals
2006
2005
€ million
€ million
11.1
115.8
0.0
50.0
11.1
165.8
61.5
3.6
139.6
140.5
5.5
2.6
Significant noncash credits
- 26.7
0.0
Cash earnings according to DVFA/SG
179.9
146.7
- 1.8
- 61.7
0.1
- 0.4
- 12.9
12.0
Reduction in short-term accruals
Losses (prior year: profits) from the retirement of assets (on balance)
Increase (prior year: decrease) in inventories,
trade receivables and other assets not
booked under investment or financing activities
Increase in inventories, trade payables and other liabilities not booked under
investment or financing activities
Cash flow from operating activities
Proceeds from the sale of noncurrent assets and from subsidies
14.5
0.3
179.8
96.9
18.8
129.7
Capital expenditure
- 70.2
- 69.6
Cash flow from investment activities
- 51.4
60.1
- 0.2
- 0.1
Payments to minority shareholders
Repayment of shareholder loans
Proceeds from financing loans
Repayment of financing loans
- 784.3
0.0
581.0
254.0
- 79.6
- 264.0
Cash flow from financing activities
- 283.1
- 10.1
Change in cash and cash equivalents
- 154.7
146.9
Cash and cash equivalents at start of period
165.8
18.9
Cash and cash equivalents at end of period
11.1
165.8
65
Changes in consolidated equity
Parent company
Subscribed
capital
At Jan. 1, 2005
Capital
reserve
Minority
shareholders
Consolidated
retained
earnings
Equity
Minority
capital
€
€
€
€
306,776,000.00
102,258,376.24
- 95,258,926.39
313,775,449.85
€
Consolidated
equity
€
11,366,741.87
325,142,191.72
Other changes
0.00
0.00
39,345.74
39,345.74
3,323.39
42,669.13
Dividends
0.00
0.00
0.00
0.00
- 124,600.00
- 124,600.00
Consolidated net income
0.00
0.00
3,510,040.94
3,510,040.94
133,772.62
3,643,813.56
At Dec. 31, 2005
306,776,000.00
102,258,376.24
- 91,709,539.71
317,324,836.53
11,379,237.88
328,704,074.41
At Jan. 1, 2006
306,776,000.00
102,258,376.24
- 91,709,539.71
317,324,836.53
11,379,237.88
328,704,074.41
Other changes
0.00
0.00
- 0.02
- 0.02
113.21
113.19
Dividends
0.00
0.00
0.00
0.00
- 129,852.02
- 129,852.02
Consolidated net income
At Dec. 31, 2006
66
0.00
0.00
61,271,754.12
61,271,754.12
211,626.52
61,483,380.64
306,776,000.00
102,258,376.24
- 30,437,785.61
378,596,590.63
11,461,125.59
390,057,716.22
Annex to the consolidated financial statements 2006
I. General notes on the consolidated financial
statements
Flughafen München GmbH, Munich, (FMG) manages and coordinates all of the businesses in the
FMG Group. In accordance with Section 290,
Paragraph 1 of the German Commercial Code
(HGB), FMG, as the parent company, therefore
presents consolidated financial statements and a
consolidated management report for the FMG
Group for fiscal 2006.
1. Scope of consolidation
Besides FMG as the parent company, the consolidated financial statements also incorporate the
following subsidiaries:
– aerogate München Gesellschaft für Luftverkehrsabfertigungen mbH, Munich (aerogate)
– AeroGround Flughafen München Aviation
Support GmbH, Munich (AeroGround)
– Allresto Flughafen München Hotel und Gaststätten GmbH, Munich (Allresto)
– CAP Flughafen München Sicherheits-GmbH,
Freising (CAP)
– Cargogate Flughafen München Gesellschaft
für Luftverkehrsabfertigungen mbH, Munich
(Cargogate)
– eurotrade Flughafen München Handels-GmbH,
Munich (eurotrade)
– FM Terminal 2 Immobilienverwaltungsgesellschaft mbH & Co oHG, Oberding (IMMO)
– FMV-Flughafen München Versicherungsvermittlungsgesellschaft mbH, Freising (FMV)
– MediCare Flughafen München Medizinisches
Zentrum GmbH, Oberding (MediCare)
– Terminal 2 Betriebsgesellschaft mbH & Co oHG,
Oberding (T2BG)
– Flughafen München Holding GmbH, Freising
(formerly Terminal 2 Holding GmbH),
(FM Holding)
– MUCGround Services Flughafen München
GmbH, Freising (MUCGround)
2. Principles of consolidation
In fiscal 2006, capital consolidation was conducted
using the fair-value method in accordance with
Section 301, Paragraph 1, Item 2 of the German
Commercial Code (HGB).
As in fiscal 2005, assets and liabilities were valuated in accordance with German Accounting Standards (DRS), Section 4, “Company acquisitions in
consolidated accounts.”
The difference resulting from first-time consolidation was stated as a goodwill asset in accordance
with Section 301, Paragraph 3 of the German Commercial Code. The goodwill is written down proportionally over the estimated useful life of five
years. The final write-down was in 2006, leaving a
book value of €0 at December 31, 2006.
EFM – Gesellschaft für Enteisen und Flugzeugschleppen am Flughafen München mbH, Freising,
Augsburger Flughafen Betriebs-GmbH, Augsburg,
and Bayern Facility Management GmbH, Munich,
are reported as associated companies at the value
of the proportionate interest in their respective net
worth. The three companies were initially consolidated as follows at the value of the proportionate
interest in their respective net worth as per Section
312, Paragraph 1, Item 2 of the German Commercial Code: EFM at December 31, 1992; Augsburger
Flughafen Betriebs-GmbH at December 31, 2001
(due to an increase in the proportionate interest at
December 31, 2000); and Bayern Facility Management GmbH at December 31, 2004. EFM's fiscal
year is from October 1 to September 30.
The yearend accounts for all the fully consolidated companies are dated December 31, 2006, and
have received the full and unqualified approval of
the auditors.
67
The yearend accounts of AFBG – Augsburger
Flughafen Betriebs-GmbH, Augsburg, are not included in the consolidated financial statements
on account of their insignificance as per Section
311, Paragraph 2 of the German Commercial
Code.
Expenses totaling €233 thousand for the startup
and expansion of operations of a private clinic,
Airport Klinik München, for MediCare Flughafen
München Medizinisches Zentrum GmbH, Oberding, capitalized in 2002, are written down according to schedule over four years. The final writedown of €58 thousand was made in fiscal 2006.
Sales, expenses and earnings, as well as receivables and liabilities within the group of consolidated companies are set off against one another.
Interim profits of €18.1 million from fiscal 2003
through 2006 for FMG and IMMO and interim
profits of €1.4 million from fiscal 2005 and 2006
for FMG and T2 BG were deducted from additions
to land and buildings and depreciated over a remaining useful life of two years. The depreciation
of €4.9 million was deducted from depreciation
on property, plant and equipment.
II. Accounting and valuation principles
1. Tangible and intangible assets
Changes in Group assets are presented separately.
Tangible and intangible assets are valuated at
their original cost or at their mandatory capitalized cost of production in accordance with statutory fiscal requirements. Assets with a limited
useful life are written down over their anticipated
overall service life as per the write-down tables
for airport operating companies. Movable items
of plant and office equipment, which until December 31, 2003, were generally written down according to the declining balance method, are now
written down as per the straight-line method, effective January 1, 2004.
The difference between the additional depreciation recorded by Flughafen München GmbH and
by FM Terminal 2 Immobilien-Verwaltungsgesellschaft mbH & Co oHG between the accounts prepared for tax purposes and the accounts prepared for financial reporting purposes in fiscal
2006 totaled €24.9 million. This concerns buildings as per Section 7, Paragraph 4, Item 1 of the
German Income Tax Code that are operating business assets and are non-residential in character,
essentially buildings belonging to the passenger
handling facilities.
Minor-value assets are written off in full in the
year in which they are added.
68
2. Financial assets
4. Accruals
In fiscal 2006, EFM’s carrying value grew from
€1.779 million at January 1, 2006, to €2.752 million at December 31, 2006, with a proportionate
net profit for the year of €1.953 million and a payout of €980 thousand.
Accruals for pensions are valuated as per Section
6a of the German Income Tax Code (EStG) according to their actuarial value at a 6% rate of interest
and according to 2005 tables produced by Prof.
Klaus Heubeck.
AFBG’s carrying value was set at €0 at December
31, 2006.
Trade taxation accruals are valuated based on an
assumed tax rate of 15 percent.
Bayern Facility Management GmbH’s carrying
value in fiscal 2006 rose from €367 thousand at
January 1, 2006, to €587 thousand at December
31, 2006, with a proportionate net profit of €220
thousand. The entire prior-year profit of €372
thousand was assigned to retained earnings.
Other provisions take into account all uncertain liabilities and potential losses. They are of a size
deemed appropriate to meeting obligations,
based on a reasonable commercial assessment.
5. Liabilities
Other financial assets are stated at cost.
Low-interest employee loans are stated at their
nominal value at the balance-sheet date.
Liabilities are valuated at the respective amounts
repayable. Liabilities for annuity payments are
stated at their cash values.
3. Current assets
6. Currency conversion
Inventories are mostly stated at their weighted
average cost for the past three months and are
written down at the lower of cost or fair value to
cover risks arising from slow-moving items and
drops in price.
Foreign-currency receivables and liabilities are
booked at the respective buying or selling rate
and converted at the less favorable rate applicable on the balance-sheet date.
Substitute plots of land reported as inventories
are capitalized at the lower of cost or fair value.
Receivables, other current assets, and liquid assets are stated at the lower of nominal or fair value. Identifiable risks are accounted for in valuation adjustments. Appropriate provisions are
made to cover general credit risk.
69
III. Notes on individual balance-sheet items
1. Changes in Group fixed assets
Acquisition and production costs
Jan. 1, 2006
Additions
Retirements
Reclassifications
Dec. 31, 2006
€
€
€
€
€
233,000.00
0.00
0.00
0.00
233,000.00
233,000.00
0.00
0.00
0.00
233,000.00
Startup and business
expansion expenses
Fixed assets
I. Intangible assets
1. Franchises, intellectual property,
22,134,013.87
1,198,439.93
- 65,366.13
121,522.00
23,388,609.67
2. Goodwill
and similar rights and assets
470,966.50
0.00
0.00
0.00
470,966.50
3. Advances on intangible assets
104,842.36
0.00
0.00
- 104,842.36
0.00
22,709,822.73
1,198,439.93
- 65,366.13
16,679.64
23,859,576.17
3,329,651,043.64
16,507,766.30
- 16,540,908.78
- 867,824.74
3,328,750,076.42
1,334,480,454.24
14,716,107.04
- 3,303,861.31
4,087,153.78
1,349,979,853.75
246,072,667.85
8,996,901.97
- 8,165,682.23
- 75,763.57
246,828,124.02
II. Tangible assets
1. Land, rights similar to land,
and buildings, including
buildings on land not owned
2. Technical equipment and machinery
3. Other equipment,
plant and office equipment
4. Construction in progress and
advances on fixed assets
21,231,995.21
25,990,644.17
- 329,759.20
- 3,160,245.11
43,732,635.07
4,931,436,160.94
66,211,419.48
- 28,340,211.52
- 16,679.64
4,969,290,689.26
1. Investments
2,176,731.21
2,173,969.04
- 980,000.00
0.00
3,370,700.25
2. Other loans
711,632.79
594,547.78
- 711,632.79
0.00
594,547.78
2,888,364.00
2,768,516.82
- 1,691,632.79
0.00
3,965,248.03
4,957,034,347.67
70,178,376.23
- 30,097,210.44
0.00
4,997,115,513.46
III. Financial assets
70
Accumulated depreciations
Book values
Jan. 1, 2006
Additions
Retirements
Reclassifications
Dec. 31, 2006
Dec. 31, 2006
Dec. 31, 2005
€
€
€
€
€
€
€
174,750.00
58,250.00
0.00
0.00
233,000.00
0.00
58,250.00
174,750.00
58,250.00
0.00
0.00
233,000.00
0.00
58,250.00
20,048,858.47
1,209,744.66
- 65,366.13
0.00
21,193,237.00
2,195,372.67
2,085,155.40
376,773.20
94,193.30
0.00
0.00
470,966.50
0.00
94,193.30
0.00
0.00
0.00
0.00
0.00
0.00
104,842.36
20,425,631.67
1,303,937.96
- 65,366.13
0.00
21,664,203.50
2,195,372.67
2,284,191.06
909,576,517.95
62,147,154.37
- 99,434.80
- 89,132.93
971,535,104.59
2,357,214,971.83
2,420,074,525.69
873,032,190.19
60,390,924.07
- 3,030,173.73
262,744.91
930,655,685.44
419,324,168.31
461,448,264.05
195,894,687.96
15,647,437.60
- 8,064,144.25
- 173,611.98
203,304,369.33
43,523,754.69
50,177,979.89
0.00
0.00
0.00
0.00
0.00
43,732,635.07
21,231,995.21
1,978,503,396.10
138,185,516.04
- 11,193,752.78
0.00
2,105,495,159.36
2,863,795,529.90
2,952,932,764.84
2,150,486.77
26,244.44
0.00
0.00
0.00
26,244.44
3,344,455.81
0.00
0.00
0.00
0.00
0.00
594,547.78
711,632.79
26,244.44
0.00
0.00
0.00
26,244.44
3,939,003.59
2,862,119.56
1,998,955,272.21
139,489,454.00
- 11,259,118.91
0.00
2,127,185,607.30
2,869,929,906.16
2,958,079,075.46
71
2. Details of ownership
– Companies included in the consolidated
financial statements
Share of
Name
Seat
aerogate München Gesellschaft für Luftverkehrsabfertigungen mbH
Munich
capital %
100.0
Munich
100.0 1
Flughafen München Hotel und Gaststätten GmbH
Munich
100.0 1
CAP Flughafen München Sicherheits-GmbH
Freising
76.1
Munich
100.0 1
Flughafen München Handels-GmbH
Munich
74.0 1
FM Terminal 2 Immobilien-Verwaltungsgesellschaft mbH & Co oHG
Oberding
60.0 1
FMV – Flughafen München Versicherungsvermittlungsgesellschaft mbH
Freising
AeroGround
Flughafen München Aviation Support GmbH
Allresto
Cargogate Flughafen München
Gesellschaft für Luftverkehrsabfertigungen mbH
eurotrade
100.0 1
MediCare
Flughafen München Medizinisches Zentrum GmbH
Oberding
MUCGround Services Flughafen München GmbH
Freising
Terminal 2 Betriebsgesellschaft mbH & Co oHG
Oberding
Flughafen München Holding GmbH (vormals: Terminal 2 Holding GmbH)
Freising
51.0
100.0 1
60.0 1
100.0 1
– Associated companies
Share of
Name
Seat
Augsburger Flughafen Betriebs GmbH
Augsburg
capital %
50.0
Bayern Facility Management GmbH
Munich
49.0
Freising
49.0
EFM – Gesellschaft für Enteisen und Flugzeugschleppen
am Flughafen München mbH
1
Exemption provisions with regard to the yearend accounts as per Section 264, Paragraph 3 and Section 264b of the German
Commercial Code apply.
72
3. Equity
4. Accruals
The FMG Group’s retained earnings comprise
other retained earnings from Allresto, CAP, eurotrade, and FMG, earnings from consolidation entries, and subsidiaries’ net income.
Accruals for deferred taxes in the FMG consolidated financial statements increased to €31.9 million in fiscal 2006 through the addition of €3.5
million for trade income tax. In addition, in line
with higher interim figures within the Group, accruals totaling €800 thousand were made for deferred trade income tax (assuming a taxation rate
of 15 percent) and for income tax.
The Group’s net loss is calculated as follows:
Dec. 31, 2006
€ thousand
Consolidated net income
Minority interest in net income
Amounts transferred to retained earnings
61,483
- 212
- 1,047
Loss carried forward
- 98,406
Consolidated net loss
- 38,182
Minority interests comprise eurotrade (+ €127
thousand), CAP (+ €78 thousand), IMMO
(+ €10.00 million), MediCare (+ €46 thousand)
and T2 BG (+ €1.21 million).
The change in consolidated equity is presented
separately in the equity table.
In the review year, the FMG Group had other accruals totaling €107.5 million. This sum largely
comprises €11.4 million for HR expenses, €22.6
million for settlement backlogs, future obligations, and compensation for phased retirement
programs, €12.8 million as a contingency for
losses, and €18.1 million for maintenance obligations and outstanding invoices.
Other accruals include €4.6 million to cover risks
issuing from water damage that occurred in 2002,
€4.5 million for public offices’ entitlements from
rental agreements, and €1.8 for litigation risks.
73
5. Liabilities
Liabilities table
December 31, 2006
December 31, 2005
Residual term
Residual term
Residual term
Total
up to 1 year
1 to 5 years
over 5 years
Total
Residual term
up to 1 year
€
€
€
€
€
€
0.00
0.00
0.00
0.00
784,313,725.48
784,313,725.48
1,815,172,896.29
432,930,670.05
334,622,350.18
1,047,619,876.06
1,313,800,239.89
363,300,021.15
57,033,375.65
54,356,357.26
2,677,018.39
0.00
40,267,855.55
35,162,531.38
Liabilities to
shareholders
Liabilities to
banks
Trade accounts
payable
Liabilities to
associated companies
Other liabilities
3,810,094.96
3,810,094.96
0.00
0.00
2,617,086.90
2,617,086.90
72,242,808.44
20,467,959.89
2,660,829.57
49,114,018.98
75,246,338.54
38,100,069.18
43,688,860.40
120,860.40
0.00
43,568,000.00
43,757,040.40
14,313,040.40
8,869,302.88
8,869,302.88
0.00
0.00
11,658,334.50
11,658,334.50
228,859.81
228,859.81
0.00
0.00
6,690,917.47
6,690,917.47
1,948,259,175.34
511,565,082.16
339,960,198.14
1,096,733,895.04
2,216,245,246.36
1,223,493,434.09
of which to
insurance companies
of which in taxes
of which in social welfare
74
IV. Notes on the income statement
The consolidated income statement was
prepared according to the total cost method.
1. Proceeds on sales
Following is a breakdown of year-on-year sales
growth by business segments across the FMG
Group:
2006
2005
€ million
%
€ million
%
Servicing of aviation
475.2
51.6
436.1
51.6
Franchises, rents, leases
246.5
26.8
233.7
27.7
Retail and hospitality
182.2
19.8
157.6
18.7
10.6
1.2
10.1
1.2
3.0
0.3
4.7
0.6
Cargo handling
Security services
Medical services
1.9
0.2
1.1
0.1
Insurance
0.7
0.1
1.0
0.1
920.1
100.0
844.3
100.0
2. Own work capitalized/Other operating income
3. Other financial obligations
Since 2005, planning work conducted by Flughafen München GmbH for goods for which capitalization is mandatory has been booked as own
work capitalized. For fiscal 2006, this item includes €1.2 million in planning work for the airport’s future third runway.
Existing real-estate lease contracts are expected
to incur costs of around €51.4 million in 2007. The
burden through to the end of the basic lease term
in 2020 will amount to €355.7 million.
Other operating income includes €33.3 million
from the reversal of provisions (including €26.7
million to cover aviation billing risk). Additional
operating income items include €6.2 million in
transferred charges for vacant capacity in Terminal 1, €4.4 million from advertising, €3.7 million
for the provision of the utility infrastructure for
Terminal 2, and €1.1 million from long-term
building rights.
Existing construction, supply and service contracts and agreements with planners, architects
and engineers pertain essentially to ongoing
business operations and are of a scope consistent with such operations. There are also additional obligations for environmental protection
measures and the honoring of public-law requirements.
Obligations issuing from service agreements and
purchasing commitments are within the usual
business scope.
75
4. Derivative financial instruments
The FMG Group had the following derivative financial instruments at the balance-sheet date:
– 29 payer swaps with a volume of €979.4 million
and terms through to 2016. Of these, 14 swaps
with a nominal volume of €375 million had a
market value of €7.7 million at December 31,
2006, and 15 with a nominal value of €604.4
million had a market value of negative €43.1
million.
– 2 receiver swaps with a term through to 2015
and a volume of €190 million (market value:
negative €3.7 million)
– 3 caps with a volume of €80 million and terms
through to 2010 (market value: negative €0.6
million)
– 4 constant maturity swaps with a volume of
€178 million and terms through to 2015 (market
value: negative €6.3 million)
The market values of all of the derivative financial instruments were stated by the relevant
banks and were computed by these banks using
the discounted cash flow method and current interest structure curves.
Due to the negative market values of the four
constant maturity swaps, a reserve of €6.3 million was formed as a hedge against losses (2005:
€2.8 million).
All other swaps and caps were combined with
underlying transactions for valuation purposes
and are not stated separately in the balance
sheet.
Moreover, two loans in existence at the balancesheet date that were originally taken out in
Japanese yen were transferred into euros by
means of cross-currency swaps (total volume:
€43.6 million).
In addition to this remuneration, executive board
members received emoluments in kind and contractually agreed fringe benefits totaling €37.0
thousand. Reserves totaling €1.926 million were
also formed at December 31, 2006, to cover future pension obligations.
Former members of executive management and
surviving dependents of former members received emoluments of €561.9 thousand in fiscal
2006. Reserves of €4.559 million were formed to
cover future pension payments and accrued pension rights of surviving dependents.
Emoluments paid to supervisory board members
totaled €16.4 thousand.
6. Employees
Since the introduction of a new collective labor
agreement, we no longer differentiate between
wage, salaried and temporary employees in our
reporting as of fiscal 2006.
As per Section 267, Paragraph 5 of the German
Commercial Code, the FMG Group had, on average, 6,996 employees on unlimited, fixed-term
and trainee contracts in fiscal 2006 (2005: 6,615).
In addition, 190 apprentices were undergoing vocational training (2005: 160).
Munich, April 27, 2007
Dr. Michael Kerkloh
Walter Vill
Peter Trautmann
5. Parent company executive board remuneration
and loans
Remuneration of executive board members consists of a fixed salary and a variable, performance-based amount:
Executive board
remuneration
Fixed
Variable
Total
€ thousand € thousand € thousand
Dr. Michael Kerkloh
225.0
87.6
312.6
Walter Vill
181.5
72.2
253.7
Peter Trautmann
179.5
72.1
251.6
Total
586.0
231.9
817.9
76
Independent auditor’s report
We have audited the consolidated financial statements prepared by Flughafen München GmbH, Munich, comprising the balance sheet, income statement, cash flow statement, equity statement, and
the notes to the consolidated financial statements,
together with the consolidated management report
for the fiscal year from January 1 to December 31,
2006. The preparation of the consolidated financial
statements and the consolidated management report in accordance with German commercial law requirements is the responsibility of the company’s
management. Our responsibility is to express an
opinion, based on our audit, on the consolidated financial statements and on the consolidated management report.
We conducted our audit of the consolidated financial statements in accordance with Section 317 of
the German Commercial Code (HGB) and with generally accepted standards for the audit of financial
statements in Germany as issued by the Institute of
Public Auditors in Germany. These standards require that we plan and perform the audit such that
misstatements materially affecting the presentation
of the net assets, financial position and results of
operations in the consolidated financial statements
in accordance with the principles of proper accounting and in the consolidated management report are
detected with reasonable assurance. Knowledge of
the business activities and the economic and legal
environment of the company and expectations as to
possible misstatements are taken into account in
the determination of audit procedures. The effectiveness of the accounting-related internal control system and the evidence supporting the disclosures in
the consolidated financial statements and the consolidated management report are examined primarily on a test basis within the framework of the au-
dit. The audit includes assessing the annual financial
statements of those entities included in consolidation, the determination of entities to be included in
consolidation, the accounting and consolidation
principles used and significant estimates made by
management, as well as evaluating the overall presentation of the consolidated financial statements
and the consolidated management report. We believe that our audit provides a reasonable basis for
our opinion.
Our audit has not led to any reservations.
In our opinion, based on the findings of our audit,
the consolidated financial statements of Flughafen
München GmbH, Munich, comply with the statutory
requirements and give a true and fair view of the
net assets, financial position and results of operations of the company in accordance with these requirements. The consolidated management report
is consistent with the consolidated financial statements and as a whole provides a suitable view of
the company’s position and suitably presents the
opportunities and risks of future development.
Munich, June 6, 2007
Deloitte & Touche GmbH
Appointed auditors
Dorn
Auditor
pp Häussermann
Auditor
77
Additional information
1. Executive board
Federal Republic of Germany
Members of the executive board:
Dr. Dieter Knoll
Ministerial councilor,
Federal Ministry of Finance, Bonn
Dr. Michael Kerkloh
President and Chief Executive Officer
Walter Vill
Vice President and Chief Financial Officer
Peter Trautmann
Chief Operating Officer
Robert Scholl
Director-General,
Federal Ministry of Transport
Building and Housing
2. Supervisory board
City of Munich
Members of the supervisory board:
Christian Ude
Chief Mayor, City of Munich
Prof. Kurt Faltlhauser
Minister of State,
Bavarian State Ministry of Finance, Munich
Chairman
Dr. Reinhard Wieczorek
Councilor, City of Munich
Thomas Bihler
Clerical employee
Employee representative and vice chairman
Employee representatives
Free State of Bavaria
Hans-Joachim Bues
Head of Corporate Communications
Executive employees’ representative
Josef Poxleitner
Director-General,
Board of Building and Public Works in the
Bavarian State Ministry of Home Affairs
Hans Spitzner
Undersecretary,
Bavarian State Ministry for Economic Affairs,
Transport and Technology
Klaus Weigert
Director-General,
Bavarian State Ministry of Finance, Munich
Heinrich Birner
Director of the ver.di labor union, Munich region
Willy Graßl
Certified aircraft handler
Works council chairman (from May 1, 2006)
Full-time works councilor
Ralf Krüger
Works council chairman (until April 30, 2006)
Full-time works councilor
Orhan Kurtulan
Certified aircraft handler
Full-time works councilor
Anna Müller
Clerical employee
Full-time works councilor
Otto Siegl
Clerical employee
78
Publisher:
Flughafen München GmbH
Finance and Controlling
Tel.: +49 89 975-00
Fax: +49 89 975-3 50 06
Editor:
Corporate Communications
Internal Communications and Publications
Dr. Reingard Schöttl
Flughafen München GmbH
Postfach 23 17 55
85326 Munich
Germany
www.munich-airport.de
Photographs:
Corbis
Marco Einfeldt
Alex Tino Friedel
Getty Images
Dr. Werner Hennies
Jupiterimages
Miguel Perez
Jan Wolter
Design:
Pantos Werbeagentur GmbH, Munich
Printing:
Lang Offsetdruck GmbH & Co. KG, Unterschleißheim
Paper:
Inside pages printed on Recy-Satin recycled paper with
at least 80 percent secondary fiber content.
79