< Previous10 NEW PRODUCTSHI THERE, WE’RE NEW!NEW FRoSTA PRODUCTS IN 2017The 12 new products that we launched in 2017 are of course also subject to the strict FRoSTA Purity Command. Our products have been consistently free from all addi-tives and flavourings since 2003. Since 2016, we have also included the country of origin of all ingredients on our packaging. Traditional vegetablesThis year at FRoSTA, as well as ‘Butter bei die Fische’ as we say here in the North, we’re suggesting you try it with your vegetables, too. The two new additions to our range of traditional vegetables are good examples of how well these go together. Our mixed beans are flavoured with a herb butter and the cauliflower-beans-carrots mix comes with a delicious pumpkin seed butter. Veggie PacksOur new vegan dishes bring plenty of variety to your menu. Chili con Quinoa is our new take on a true classic. But if you’re after something a little more exotic, why not give our new sweet potato stir fry with pineapple or the couscous with chickpeas & cranberries a try? NEW PRODUCTS 11Vegetable stir-friesOur new veggie stir-fries with superfoods are super new and super yummy. The vegetable stir-fry with chickpeas & cranberries and the vegetable stir-fry with courgette & quinoa are the new kids on the block since October 2017. But two old favourites have also been given a makeover. As well as an updated recipe, the product name is now also more transparent. The ingredients in the name tell you at a glance what’s in the recipe for our pepper vegetable stir-fry and vegetable stir-fry with curry and coconut. No more guessing what’s hidden behind Balkan vegetables and Caribbean vegetables Fish fillet portionsWith these three delicious new varieties of fillet portions you’re really spoilt for choice. What’s it to be: crispy spinach, Mediterrano or cheesy leek? We recommend you simply try all three! FROM BREMERHAVEN TO THE REST OF THE WORLDOUR EFFORTS IN 2017In December 2017, FRoSTA was selected by the German Sustainability Award Foundation from among all the winners of the past 10 years to receive its Anniversary Prize. The jury commended FRoSTA for its outstanding pioneering work campaigning transparency and sustainability in the food industry. To us, this prize represents a commitment for the future: we intend to continue to champion environmental protection, sustainable production of our ingredients and involvement in social projects.JANUARYFEBRUARYFor many years we have sourced our broccoli from Ecuador’s Cotopaxi prov-ince, where it grows under ideal climatic conditions at an altitude of over 2,000 metres. We feel we have a special responsibility to make a contribution towards improving the living conditions for people in this region. Together with the children’s aid organi-sation we have therefore initiated a two-year educa-tion programme through which we assist around 200 young people aged between 14 and 19 with implementing their own business ideas. The young men and women receive additional support in the form of micro credits for their business start-ups, which it is hoped will contribute to the positive development of the local economy to the benefit of all members of the five project communities.Start of our education project in Ecuador together with Plan International Cooking beyond your plateSince 2016, FRoSTA has supported the initia-tive and is co-founder and main sponsor of the Bremer-haven ‘satellite’. With this, we hope to help refugees in Bremerhaven with their integration. At “Über den Tellerrand”, refugees and citizens of Bremerhaven come together on an equal footing, cook together in the FRoSTA Culinary School in the “Klimahaus” and like this get to know something about the respective other cuisine and culinary tradi-tions. In 2017, over 700 people from all over the world met at 16 cooking events in Bremer-haven.12 OUR EFFORTS IN 2017FEBRUARYMARCHNot even an instant stock cube is allowed: at the children learn how to turn simple ingredients into a delicious meal – completely without ready-made products. Even if it comes hard to us – at the FRoSTA Culinary School, you therefore won’t find a FRoSTA bag anywhere in sight. Instead, there’s no end of seasonal fresh ingredients that wher-ever possible have been locally sourced. The aim of our Culinary School is to ensure that at our largest location in Bremerhaven, every child gets the chance to learn to cook. In March, the Bertelsmann Founda-tion honoured this with its “Mein Gutes Beispiel” (‘My Good Example’) award. Children in the kitchen!Knowing where it’s fromIn 2015, we the country of origin of all of our ingredients directly on the product packaging. Since February 2017, we have also been able to imple-ment this for all of our fish products, too. This makes us the first and only food brand to specify the country of origin of all ingredients on the packaging. Only people who can cook will appreciate good food all their lives.”Felix Ahlers, head chef at FRoSTAOUR EFFORTS IN 2017 131. Everything that food contains must be written on the label.2. Consumer-friendly labelling of artificially flavoured foods.3. Clear declaration of so-called functional additives.Honesty is the best policyFRoSTA supports the online petition – initiative for honest lists of ingredients” initiated by the German Food Additives Museum. The petition calls on policy-makers to meet three concrete demands for more transparency in food labelling: “We support this petition because current food laws prevent consumers from distin-guishing between products of very different quality. A look at what goes on behind the scenes and hence vital information is currently only available to the producers or additive suppliers themselves,” Felix Ahlers, Chairman of FRoSTA AG’s Exec-utive Board, explains. Let’s be honest!Our FRoSTA Purity Command is at the focus of our latest TV campaign. This is all about transparency, unnec-essary additives and real ingredients. Because if you want an authentic taste, you have to use real ingre-dients. In 2003, we decided to completely stop using any additives or flavourings in our products – irrespec-tive of weather they belong to the “E-numbers” and are subject to declaration or not. At FRoSTA, the great taste is the result of great ingre-dients – no more, no less: real butter, real cheese, real cream, homemade noodles, fresh-picked vegetables and shock-frozen freshly caught AUGUSTSEPTEMBEROur environmental and climate targetsBack in 2008, we began to determine the carbon footprint of our products and assess the impact our company’s operations have on the environ-ment. We set ourselves targets and report on the results. You can find our targets for the next few years Total CO₂ (in t CO₂e/t finished product; 2017/2013)-1.9%With fewer “Es” this would be a “Schlmmr filt Bordlais”.14 OUR EFFORTS IN 2017CO2e: carbon dioxide equivalentSocial standards are not negotiable!In October 2017, we were holding our first Supplier Day with over 100 guests from 18 different countries in Bremerhaven. The day focused on “Social stand-ards” in the supply chain and on the high standards set by our FRoSTA Purity Command. We want to get all our suppliers on board in engaging with these issues. By 2020, our suppliers from BSCI risk countries must be and certified in accordance with an inter-nationally recognised social standard (SMETA, BSCI, SA8000). To this end, we will carry out unan-nounced social audits at all non-certified suppliers from these countries. FRoSTA wins German Sustainability Award Foundation’s Anniversary PrizeOn 8 December 2017, was awarded in Düsseldorf and to our great delight FRoSTA was selected as the winner from among the 63 previous Sustainability Award winners. Hinnerk Ehlers: “This prize is really very special, because it honours all our efforts of the past several years in the area of sustainability. We can and should all be proud of this prestigious prize. At the same time, it is an incentive and a motivation for us all to maintain our position as pioneer in the industry and beyond!”OCTOBERDECEMBER-1.6%Electricity consumption (in kWh/t finished product; 2017/2013)-6.8%Employee business travel (in passenger km/t finished product; 2017/2013)Fuel emissions (in t CO₂e/t finished product; 2017/2013)-7.5%OUR EFFORTS IN 2017 1516 CONSOLIDATED MANAGEMENT REPORT PRODUCTION AND QUALITY STANDARDS SEPARATE FINANCIAL STATEMENTS OF FROSTA AG CONSOLIDATED MANAGEMENT REPORTCONSOLIDATED MANAGEMENT REPORT 17Since we introduced our Purity Command back in 2003, only real ingredients have found their way into our packs, into your frying pan – and onto your plate. The FRoSTA Purity Command means: free from E-numbers, flavourings and any other additives. 18 CONSOLIDATED MANAGEMENT REPORTEMPLOYEESEmployees20162017FRoSTA head office210224Administration127131Sales 8393FRoSTA production facilities1,4551,485Bremerhaven549583Bydgoszcz 603581Lommatzsch 162179Bobenheim-Roxheim 141142Group total1,6651,709We again increased the number of our employees in 2017, adding 44 new members of staff to the payroll. An additional 14 employees support the integration of the new Italian brand business. In our production facilities as well, demand led to more new recruitments.Total personnel expenses in 2017 increased by 6.8% to a level of EUR 73.0m. This is accounted for with 3.8 percentage points by the increase in the number of employees. Raising the proportion of women in management positions is an issue we take very seriously, although we unfortunately recorded no progress here compared to the previous year. In 2017, the proportion of women in first-level management was 25% (2016: 27%) and in second-level management 35% (2016: 34%), with a total share of women employed at FRoSTA amounting to 37% (2016: 40%).One of the top priorities at FRoSTA in coming years will be to develop modern working hours models that make it easier to reconcile family and a career. Therefore, in those operating segments where it is possible, we are moving towards more flexible working time arrangements, including defining rules for home office activities. BUSINESS ENVIRONMENT AND GENERAL CONDITIONSBUSINESS STRUCTURECONSOLIDATED MANAGEMENT REPORT FOR THE COMPANY AND THE GROUP OF FRoSTA AKTIENGESELLSCHAFT, BREMERHAVENAT FRoSTA, OUR SUCCESSFUL BUSINESS STRUCTURE WAS RETAINED IN 2017.3 OPERATING SEGMENTS1. FRoSTA – OUR BRAND2. NON-RETAIL BUSINESS INCLUDING THE FOODSERVICE AND HOME DELIVERY3. COPACK – OUR PRIVATE LABEL BUSINESS9 SALES OFFICESHAMBURGBREMERHAVENBYDGOSZCZPARISROMEPRAGUEBUCHARESTBUDAPESTMOSCOWVEGETABLES AND HERBS FROM OUR OWN CULTIVATION IN LOMMATZSCH AND BOBEN-HEIM-ROXHEIMFISH, READY MEALS AND VEGETABLES IN BREMERHAVEN AND BYDGOSZCZ/POLAND4 PRODUCTION PLANTSCONSOLIDATED MANAGEMENT REPORT 19Through our education and trainee programme we train our own future employees, with the aim of filling future vacancies with junior staff from within our own ranks. We have made this one of our top priorities at FRoSTA. We offer vocational training opportunities at all three locations in Germany with a total of 8 different apprenticeships. In the financial year 2017, we increased the number of apprentices by 4 to 34 and have a takeover of more than 80%. We place great emphasis on continuous learning. Which is why we invest on an ongoing basis in the training and ongoing education of our employees in all areas. We are proud that we were again able to maintain the high level of training programmes on offer for our employees in 2017.Communication with one another is our key to success. Nowhere is this truer than for internal communication between our international locations. For many activities, we therefore expect our staff to have a good command of English. As part of our vocational training programme, we support our employees in their daily work routines by offering a wide range of language courses at all levels.One important aspect of our training measures in 2017 again focused on our corporate culture and our shared values and ground rules. We want to ensure that our employees are familiar with and have internalised our “shared DNA”. Our goal is to create an atmosphere in which we encourage and expect all employees across all hierarchies to adhere to our values.A practised, 360° feedback culture is an important instrument in developing a productive corporate culture. To promote their development, every employee has a right to know where he stands. That’s why we regularly conduct structured appraisal interviews on all levels. In 2017, we also asked our employees to appraise their superiors. The results help our managers to improve their own performance.We offer our employees the opportunity to share in the ownership of FRoSTA AG and in this way allow them to participate in the company’s success. In 2017, they again had the option to purchase employee shares at preferential conditions. A total of 432 buyers (2016: 405) took part in the campaign in 2017 and acquired shares with a value of kEUR 1,141.8 (2016: kEUR 855.7). We are delighted at our employees’ involvement in this scheme and the trust demonstrated and hope that even more employees will become FRoSTA shareholders in future. We would like to warmly thank all of our employees and the Works Council for their high level of commitment and enthusiastic dedication during the past year.PROCUREMENTGlobal procurement markets were highly volatile in the 2017 financial year. In the first half-year in particular, first exchange rate fluctuations between the EUR and the USD, along with the strained situation in the milk-producing industry, led to a marked deterioration of purchasing prices. However, the situation improved significantly in the second half of the year.PRODUCTION AND QUALITY STANDARDSDue to extremely strong demand in European markets, we were able to increase production volumes by more than 1% compared to 2016. As a result, capacity utilisation was extremely good at all production facilities in the reporting period. A fire at the Bremerhaven production facility in May 2017 led to an unplanned 4-week stoppage on the production lines for ready meals. However, by transferring production to other lines and plants it was possible to reduce the production losses. All damage caused was quickly assessed by the relevant insurance experts and immediately repaired.In order to demonstrate our consistently high commitment to quality and production reliability, we are certified in accordance with the IFS 6 and BRC 7 standards and in this context underwent unannounced audits at all plants. Additionally, we regularly subject our business processes to auditing in accordance with the ISO 9001 quality management system. We strive to continuously optimise the use of energy across the FRoSTA Group by adhering to ISO 50001 (energy management). In the first half of 2017, we succeeded in lowering energy consumption per tonne of finished products by 1% (measured in CO2 equivalents). However, due to the commissioning of new production lines, a series of tests and the usual start-up times without corresponding production of ready meals in the second half-year, our performance for the year as a whole deteriorated temporarily by 4%. Next >