EANS-Adhoc: gategroup Reports Solid 2009 Performance

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announcement.
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18.03.2010

- Results demonstrate resilience in face of weak airline industry and severe
global recession

ZURICH, March 18 --

Highlights for the year 2009:

- gategroup reports respectable turnover, profitability and
very strong cash flow despite challenging macro-economic and airline
industry environment

- New contract wins and increased volume among low-fare
carriers mitigate effects of aviation industry downturn

- Revenue of CHF 2,712.3 million, is down 6.7% reported;
essentially flat in constant currencies (down 0.5%)

- EBITDA of CHF 202.2 million, is down 17.4% reported; or 10.1%
in constant currencies

- EBITDA margin holds steady at 7.5% down less than one
percentage point from the previous year

- Operating profit of CHF 98.3 million, is down 20.4% reported,
or 11.3% in constant currencies

- Reported profit for the year is CHF 51.0 million, 12.8% lower
than 2008's result of CHF 58.5 million

- Cash flow from operations is up sharply to CHF 137.1 million
from CHF 36.6 million, an increase of 274.6%

- Shares are listed on SIX Swiss Exchange as of May 2009

gategroup, the leading independent global provider of onboard products
and services, reported a profit of CHF 51.0 million for the full year 2009 in
the face of a severe global economic downturn and the weakest environment in
decades for airlines, its core customer group.

The reported profit for the period came on revenue of CHF 2,712.3 million
compared to CHF 2,907.9 million in 2008. However, when adjusted for foreign
exchange differences, revenue was essentially flat. Basic earnings per share
improved in 2009 to CHF 2.61 versus CHF 2.16 in 2008.

"In the context of the world economic downturn and crisis within the
airline industry, we consider 2009's results to be a solid performance," said
Chief Executive Officer Guy Dubois. "gategroup is structured to withstand the
shocks of the cyclical airline industry and these results demonstrate that
resilience," he said.

Substantial contract wins and retentions
The relatively mild impact on revenue was largely influenced by new
customer business that offset volume reductions among existing accounts. The
new agreements include, among others:

- The 10-year renewal of British Airways' long-haul catering
and handling business at its London Heathrow hub
- A major contract renewal with Delta Air Lines, now the world's
largest carrier, that will exceed CHF 1 billion in revenue over several
years
- Extension of business with Swiss International Air Lines at its
home bases in Switzerland
- A new long-term contract with United Air Lines for business at
its Tokyo hub and an agreement to manage United's onboard retail program
within North America
- A quadrupling of the rail catering and logistics business in Spain as
provider to Cremonini Rail Iberica S.a.a, whose contract with RENFE, the
Spanish national railway company, was expanded to the railroad's entire
network

"In addition to winning new business, the Group's basic contract
structure buffers it against swings in the number of passengers among its
traditional full-service airline customers because it generally includes a
fixed overhead recovery charge, a handling charge and per-meal revenue,"
explained Chief Financial Officer Thomas Bucher. "In addition to this revenue
buffer, the Group has a very flexible cost structure," he said.

Approximately 90% of gategroup's 2009 revenue was derived from contracts
which are valid through 2010; about 80% from contracts valid through 2011;
and 75% through 2012, which management believes implies stable future cash
flow generation.

Further expansion into onboard retailing
Also, gategroup has successfully expanded into the onboard retailing
business, which is an integral part of the business model for the
fast-growing low-fare airline segment and which traditional airlines are
increasingly adopting as a way to generate additional revenue. gategroup is
the industry's leading provider of onboard retailing services, currently
managing programs for 10 airlines involving well over 500 aircraft.

Impressive cash flow generation on the back of resilient business model
Reported EBITDA was CHF 202.2 million, down 17.4% or 10.1% in constant
currencies, and EBITDA margin was 7.5%, which was at the high end of the
Group's earlier stated expectations. The EBITDA margin declined by less than
one percentage point (minus 0.9pp) compared to the previous year.

Operating profit was CHF 98.3 million compared to CHF 123.5 million in
2008, a decline of 20.4%, or 11.3% in constant currencies.

Profitability in 2009 was negatively impacted due to higher restructuring
costs in line with our continuous efforts to rightsize our operations to
market conditions and the costs incurred in relation to the Company's listing
on the SIX Swiss Exchange. In addition, the startup costs for SAS
Scandinavian Airlines as well as integration costs of the new United Airlines
business at Tokyo Narita had an impact on profitability.

Meanwhile, cash flow from operations was up sharply to CHF 137.1 million
from CHF 36.6 million the previous year, an increase of 274.6%. "We put
considerable emphasis on balance sheet management in 2009 and that has paid
off," Bucher said, adding that "we intend to maintain this strong focus on
cash flow management within our operating units."

Reported gross debt was CHF 692.8 million, higher than at the end of the
previous year following the Group's decision to tap a delayed draw credit
facility, at LIBOR +250 bps, that would have expired in May 2009. The intention
was to retain financial flexibility during uncertain economic times by having
more cash on the balance sheet, Dubois said. Reported net debt decreased
compared to the previous year by CHF 68.2 million to CHF 435.2 million.

In addition to a comfortable cash position, the Group's listing on the
SIX Swiss Exchange sets the stage for potentially broader access to capital
markets as an additional funding source should appropriate opportunities
arise, Dubois said. "We intend to be active in the market consolidation
process and to benefit from the trend among airlines and other travel-related
industries to outsource non-core activities."

Cautiously confident outlook
Looking ahead, Dubois said 2010 will continue to be difficult, but that
an upturn is likely. "We believe the U.S. market will turn around in the
first half, but that Europe will lag behind by at least one or two quarters.
On the revenue line, we expect that a positive run rate from 2009 contract
wins will offset the non-retention of the British Airways short-haul catering
contract at London Heathrow.

In summary, we expect a recovery to take hold by the end of the year,
which we believe will translate into a stable top line for 2010, an improved
EBITDA margin of 7.5% to 8.0% and continued strong operating cash flow,"
Dubois said.

Key figures of gategroup

Income Statement information
In CHF m except per share data

Period ended                              Dec. 31, 2009  Dec. 31, 2008
Revenue                                         2,712.3        2,907.9
EBITDA                                            202.2          244.9
EBITDA margin                                       7.5%           8.4%
Operating profit                                   98.3          123.5
Operating profit margin                             3.6%           4.2%
Finance (costs) net                               (26.7)         (79.1)
Profit before tax                                  72.2           45.0
Profit for the year                                51.0           58.5
Basic earnings per share                           2.61           2.16
Fully diluted earnings per share                   2.57           2.13

Balance Sheet information
in CHF m                                  Dec. 31, 2009  Dec. 31, 2008
Current assets                                    665.6          580.6
Non-current assets                                860.9          844.5
Total assets                                    1,526.5        1,425.1
Current liabilities                               519.9          557.2
Non-current liabilities                           892.4          809.3
Total liabilities                               1,412.3        1,366.5
Total equity                                      114.2           58.6
Total liabilities and equity                    1,526.5        1,425.1
Cash and cash equivalents                         257.6          155.2
Short-term debt                                    19.5           85.9
Long-term debt                                    673.3          572.7

Cash Flow information
in CHF m                                  Dec. 31, 2009   Dec. 31, 2008
Profit before tax                                  72.2            45.0
Cash generated from operations                    182.3           100.2
Interest, net                                    (35.9)          (41.0)
Income taxes paid, net                             (9.3)          (22.6)
Net cash flow operating activities                137.1            36.6
Acquisition of subsidiaries                       (19.5)          (34.9)
Capital expenditure                               (58.6)          (79.6)
Other                                               6.2             4.9
Net cash flow investing activities                (71.9)         (109.6)
Net cash flow financing activities                 52.3            76.4
Increase in cash                                   117.5            3.4

For more detailed information, please see gategroup's Annual Report 2009,
which is available in English in the Investor Relations section of our web
site, www.gategroup.com.

About gategroup:
gategroup is the leading independent global provider of onboard services
to companies that serve people on the move. gategroup comprises 11 member
companies, which are deSter, eGate Solutions, Elan, Gate Aviation, Gate
Gourmet, Gate Safe, Harmony, Performa, potmstudios, Pourshins and Supplair.

The Group's world-class capabilities are focused in catering and
hospitality; provisioning and logistics; and onboard solutions.

Our customers include top airlines, railroads and hotels around the world
that rely on our expertise and solutions tailored to their guests, service
offerings and geographic regions.

Shares of Zurich-based gategroup are traded on the SIX Swiss Exchange
under the symbol GATE. Please visit www.gategroup.com.

IMPORTANT NOTICE
This publication may contain specific forward-looking statements, e.g.,
statements including terms like "believe", "assume", "expect" or similar
expressions. Such forward-looking statements are subject to known and unknown
risks, uncertainties and other factors which may result in a substantial
divergence between the actual results, financial situation, development or
performance of the company and those explicitly or implicitly presumed in
these statements. Against the background of these uncertainties readers
should not rely on forward-looking statements. The company assumes no
responsibility to update or revise any of these forward-looking statements or
to adapt them whether to reflect new information, future events, developments
or circumstances or otherwise.

INVITATION TO MEDIA
gategroup CEO Guy Dubois and CFO Thomas Bucher invite media
representatives to participate in a telephone conference call regarding Full
Year 2009 Results.

The call will be held at 9:00 CET on Thursday, March 18, 2010.

To participate, please call the dial-in number approximately 15 minutes
before the start time. Once dialed in, please follow the instructions given
over the phone.

Direct dial-in numbers:
+41 (0) 91 610 56 00 (CH & other countries)
+44 (0) 207 107 06 11 (UK)
+1 866 291 4166 (USA - Toll-Free)
+49 (0) 69 2 22 22 05 93 (Germany)

INVITATION TO ANALYSTS AND INVESTORS
gategroup CEO Guy Dubois and CFO Thomas Bucher invite analysts and
investors to participate in a telephone conference call regarding Full Year
2009 Results.

The presentation of Full Year Results 2009 can be accessed via webcast
and dial-in teleconference at 14:00 CET on Thursday, 18 March 2010.

To listen to the live presentation via teleconference, call the dial-in
number approximately 15 minutes before the start time. Once dialed in, please
follow the instructions given over the phone.

Direct dial-in numbers:
+41 (0)91 610 56 00 (CH & all countries)
+44 (0)207 107 06 11 (UK)
+1 866 291 41 66 (USA - Toll-Free)
+49 (0)69 2 22 22 05 93 (Germany)

Please note that media will not be able to ask questions during the Q&A
session for analysts and investors.

To link to the live webcast of the presentation, please go to the
"Investor Pack" tab under the "Investor Relations" section of the gategroup
website, www.gategroup.com.

ANNUAL REPORT ESSAYS
Annual Report essays by the Chairman, Chief Executive Officer and Chief
Financial Officer are reproduced here for your convenience.

Chairman Andreas Schmid
As Chairman of our Board of Directors, it gives me great pleasure and
pride to present gategroup Holding AG's first Annual Report as a publicly
traded company. Despite a challenging economic environment during 2009, the
Group has performed admirably, particularly considering results within its
largest customer segment -- the airline industry.

The International Air Transport Association estimates its member airlines
will post losses of about $9.4 billion for 2009, following negative results
of $17 billion the previous year. The Group, meanwhile, has held its own with
a 2009 reported profit for the year of CHF 51.0 million, coming from reported
revenue of CHF 2,712.3 million.

These results are testament to the resilient business model of the Group,
management's close attention to cost control and our innovative responses to
customer needs.

gategroup Holding AG listed its shares on the SIX Swiss Exchange on May
12, 2009. At the time, markets worldwide were in the doldrums. The Dow was
under 8,500; the FTSE 100 below 4,500; and the SMI under 5,400. I have been
asked many times why the Company chose to go public during such a period.
Simply stated, the enterprise was ready.

Following a financial and organizational restructuring in the middle of
the decade as part of a private equity firm's portfolio, the Group's
ownership base expanded in 2007 to about 100 investors, primarily financial
institutions, with shares trading in a limited fashion over the counter.

Recognizing the structural changes within its customer base, management
launched a growth-through-acquisitions strategy in 2007. By building upon the
traditional airline catering business and growing through selective
acquisitions, gategroup's 11 brands now address a full range of onboard needs
in the aviation and rail industries. With a successful reorganization
completed and a flexible business model achieved, the time was right to begin
positioning for the future.

By going public, we increased the liquidity of our shares and expanded
our ownership base, which now numbers about 500 registered shareholders, as
investors increasingly recognize the value of gategroup. The Group instituted
a new governance structure, ensuring transparency to all of our constituents,
and we have attracted coverage among a number of financial analysts.

We firmly believe airline industry consolidation will continue and lead
to growth opportunities. Through its listing, the Group has set the stage for
potentially broader access to capital markets as an additional funding
source, which also may be used for merger and acquisition activities.

In the meantime, the Group continues to focus on cash flow to deleverage
the balance sheet and provide internally generated funds for growth and
investment, including any potential M&A activity.

There will continue to be challenges in 2010, although we expect to see a
recovery taking hold by the end of the year. The Group has already
demonstrated its capability to weather economic storms, and my fellow Board
members and I are confident that the Group is uniquely well equipped to
capitalize on an upturn.

On behalf of the Board of Directors, I thank our management team for
their excellent work in the past year navigating through a very difficult
environment. Our thanks also go to the employees around the world for their
efforts and contribution to the Group's performance. And, of course, we are
grateful for our shareholders' ongoing interest and support.

Chief Executive Officer Guy Dubois
2009 will long be remembered as the year that the world's economies
entered the most difficult period in decades. Airlines, our major customer
group, were particularly hard hit as businesses slashed travel to cut costs
and worried consumers canceled vacation plans.

The Group, of course, has not been immune to these global forces. 2009
reported revenue of CHF 2,712.3 million was down by 0.5% on a constant
currency basis compared to 2008. The reason for the mild revenue impact was
due to new business wins that offset volume reductions among existing
accounts. Our reported EBITDA margin was 7.5%. On a reported basis, we
delivered to the high end of our expectations on the EBITDA margin, while
generating substantial operating cash flow of CHF 137.1 million. In the
context of the world economic downturn and crisis within the airline
industry, we consider this a solid performance.

Our resiliency is a direct result of our corporate strategy to create a
"one-stop shop" for clients seeking end-to-end solutions for their customer
service needs. This year has seen a further integration and alignment of our
11 brands to work more coherently, and especially to leverage our ability to
cross-sell to clients and solve problems holistically. As a result, customers
increasingly regard gategroup as a strategic partner rather than simply a
supplier.

We started the year strongly with the 10-year renewal of British Airways'
long-haul business at its key London Heathrow hub. We also completed major
contract renewals with Delta Air Lines and Northwest Airlines -- now the
world's largest airline -- as part of their post- merger integration of
supply contracts. This is a significant deal that will encompass in excess of
CHF 1 billion in revenue over several years.

Service to SAS Scandinavian Airlines began at its three Nordic hubs, and
we extended our business with Swiss International Air Lines for three
additional years at its home bases in Switzerland. LAN Airlines extended and
expanded business with gategroup brands in its key Latin American markets. We
increased our presence in the important European rail market through the
Group's increased business in Spain with Cremonini, which provides catering
for the national railway.

There were other "wins," and it's clear we have forward momentum. I am
pleased to say that nearly 90% of the past year's revenue is already secured
under contract for 2010 and the figure for 2011 is at about 80%.

Innovation continued to blossom in 2009 and gategroup today is more than
ever the leader in serving people on the move. As airlines seek to save fuel
costs by lowering weight and to respond to environmental concerns about
carbon output, we have brought new products to market. The deSter brand
developed its unique Lean-on-Me Tray(TM) concept to save trolley space, and
our Harmony brand is offering amenity bags made from recycled plastic, to
name a few examples.

One of the fastest growing segments of catering and hospitality in the
airline industry is onboard retailing and gategroup has clearly become the
industry's leading provider. We have developed a robust offering that ranges
from a turn-key model, such as with easyJet, to managing a customer's retail
program as under a new agreement with United Airlines for its domestic
network. eGate Solutions' acquisition of Abanco's software and wireless
point-of-sale technology significantly enhances our retail solution, which
airlines are increasingly adopting as a way to generate additional revenue.

The Abanco acquisition is just one example of our continued commitment to
invest in our future. Others include the acquisition of United Airlines'
flight kitchen at Narita in the important Tokyo hub, new Gate Gourmet units
in Newark and Copenhagen, and the addition of new highloaders into the
network. We have invested CHF 58.6 million in fixed assets in 2009.

We continued to refine our "asset-light" model by aligning the management
of our Pourshins and Supplair brands into one leadership team to take
advantage of customer, supply chain and market synergies. Working together
the two brands offer unique and flexible off-airport food and beverage
solutions that can free up space in existing flight kitchens and allow the
Group to operate in markets where it has no physical presence.

We believe that consolidation within the industry will continue and that
merger and acquisition opportunities, particularly in the Asia-Pacific and
Middle East Regions, will develop as airlines there follow the pattern set
elsewhere and outsource non-core activities such as catering and
provisioning. Under the right conditions, the Group fully intends to
participate in this consolidation. We have cash available, and since our
listing on the Swiss stock exchange, we can tap capital markets for merger
and acquisition funds should an attractive opportunity arise.

Internally, we have new leaders for deSter, Pourshins/Supplair, Performa,
for the Asia-Pacific Region and the human resources function. These moves
have further strengthened our management team across regions and brands.
Additionally, our efforts to identify and enhance our people talent through
leadership development programs are in full swing. In the technology area,
the continued rollout of SAP and strengthening of IT systems and processes
are resulting in more standardization and cost efficiencies.

I thank our tireless management team and our hard-working employees
around the world for what they have achieved against a backdrop of enormous
challenges. We anticipate that 2010 will be difficult. An upturn, however, is
inevitable, and we expect it in late 2010 with a full impact in the following
year.

Through the efforts of our employees and the continued support of our
Board of Directors and shareholders, we at gategroup are well positioned to
take advantage of a recovery.

Chief Financial Officer Thomas Bucher
The global economic climate in general was challenging in 2009 and the
recessionary environment for airlines -- gategroup's primary end-user
industry -- was particularly difficult. Yet even in the face of these adverse
circumstances, the Group generated respectable turnover and profitability and
very strong cash flow.

Furthermore, when normalized for foreign exchange variations and one-time
charges related to restructuring and the costs related to the listing process
at the Six Swiss Exchange, the results paint a picture that underscores the
Group's resilience.

Taken at face value, the reported performance for the Group, at both the
top and bottom lines, shows a decline for 2009 when compared to the previous
year. Context, however, is the key to understanding these results.

Reported revenue for the year totaled CHF 2,712.3 million for 2009, a
decrease of 6.7% but essentially flat (down only 0.5%) when compared to 2008
at constant currencies. The impact on revenue due to volume reductions among
existing customers was mitigated by new contract wins, including our growing
business in the low-cost carrier segment.

Furthermore, the Group in principle is less exposed to swings in the
number of airline passengers because our basic contract structure generally
includes a fixed overhead recovery charge, a handling charge and per-meal
revenue. In addition to this revenue buffer, we have a very flexible cost
structure that generally lessens the impact on profitability in a down
market.

EBITDA was CHF 202.2 million, a decline of 10.1% at constant currencies
compared to 2008. The results of 2008 were positively impacted overall by the
release of substantial legal provisions no longer needed. Our profitability
in 2009 was negatively affected by the costs incurred in relation to the
listing on the SIX Swiss Exchange as well as the startup costs for SAS
Scandinavian Airlines in Scandinavia and integration costs of the new United
Airlines business at Tokyo Narita. Likewise, the full run rate profitability
of new business won was not yet fully achieved, and the overall lower volume
led to sub-optimal capacity utilization in some of our production units.

Operating profit of CHF 98.3 million was down compared to CHF 123.5
million in 2008, a decline of 20.4%, or 11.3% in constant currencies, and was
impacted by higher restructuring costs in our continuous efforts to rightsize
operations to market conditions. Reported profit for the period was CHF 51.0
million, a decline of CHF 7.5 million, which was positively impacted by a net
foreign exchange gain of CHF 24.3 million.

Cash flow from operating activities, meanwhile, was up in 2009 to CHF
137.1 million versus CHF 36.6 million in the previous year. We put
considerable emphasis on balance sheet management in 2009 and that has paid
off. We have been able to manage our net working capital position more
effectively through better controls and tighter processes, for example over
receivables, payables and inventories, and that has helped improve cash flow
significantly compared to the previous year. Going forward, we intend to
maintain this strong focus on cash flow management within our operating
units.

Reported gross debt of CHF 692.8 million is higher than at the end of the
previous year at LIBOR +250 bps because we decided to tap the delayed draw
facility that would have expired in May 2009. Our intention was to retain the
financial flexibility of the Group in uncertain economic circumstances by
having more cash on the balance sheet. In addition to a comfortable cash
position, our listing on the stock exchange has created a platform for future
financial flexibility through potentially wider and deeper access to capital
markets. Reported net debt was CHF 435.2 million, a decrease of CHF 68.2
million compared to 2008.

In summary, we are pleased with our solid business performance in
economically challenging times. The results validate the Group's claim to a
resilient business model and our focused approach to cash management has
shown results and generated value for shareholders. We believe the Group is
in a good position to benefit as the global economy and our end-user
industries recover.

SOURCE gategroup

Further inquiry note:
Media, John Bronson, Corporate Communications, +41-43-812-2048,
[email protected]; Investors/analysts, Dagmara Wawrzonowska, Investor
Relations, +41-43-812-5496, [email protected], both of gategroup
end of announcement euro adhoc
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issuer:   gategroup Holding AG
          Balz-Zimmermannstrasse 7
          CH-8302 Kloten
phone:    +41 43 812 54 96
FAX:      +41 43 812 91 19
mail:     [email protected]
WWW:      http://www.gategroupmember.com/
sector:   Consumer Goods
ISIN:     CH0100185955
indexes:

stockmarkets: Hauptsegment: SIX Swiss Exchange
language: English

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