Schörghuber is fighting against the red

Nusmeier assumes that all areas of the company will grow above plan this year: He wants to significantly increase the value of the three billion euro real estate portfolio, the brewing group should earn significantly more, even in the hotels shaken by the pandemic he sees a lot of potential – for example, by rededicating them for long-term stays. Salmon farming in Chile is also expected to grow significantly by activating previously unused licenses for sea areas.

Read the full interview here:

Mr. Nusmeier, normally the people of Munich get dirndls or lederhosen out of the closet these days. Now the Oktoberfest is canceled for the second time in a row. What does that mean for a Munich-based company like the Schörghuber Group?
It hurts us. Sure, with Paulaner we earn a lot at the Oktoberfest, so it’s a financial loss. But that’s not the worst, there is another component: Munich is the beer capital of the world, and that is embodied by the Oktoberfest. Although I am Dutch, I am also a trained brewer, so I can justifiably claim that.

So you don’t have the stage to present your beer worldwide?
Yes, because the Oktoberfest is part of the Paulaner heritage. Six or seven million people meet at Oktoberfest, you don’t have that many contacts anywhere else, it’s a tremendous opportunity to show us. That is good for us, it is also good for the city, because many people come from abroad. Just like at the beginning of the month at the IAA, the automobile fair. It was important to once again greet outside guests in Munich.

Are you worried about the Oktoberfest in the long term?
If the two-year break remains, then not.

When you took a seat in the executive chair two years ago in the summer, the world looked very different. In 2019 the Schörghuber Group achieved record results.
That’s right, 2019 was an excellent year. The pandemic has hit us hard since then. Nevertheless, my mission is unchanged. I started the fourth phase in the 75-year history of the group: The company should grow again.

Basically, that goes without saying for a billion-dollar company like Schörghuber. Why do you emphasize that?
After the founding phase under Josef Schörghuber came the phase of internationalization and growth under Stefan Schörghuber. After his untimely death, a phase of consolidation and a strengthening of the balance sheet was announced. Alexandra Schörghuber and her children, the next generation of entrepreneurs, are now driving the company’s development forward.

Would you not have come to Munich without a clear forward strategy?
In my more than 30 years in management, I’ve been a renovator at one point or another. But I like to think ahead and grow more.

What goals did the owner family give you?
They differ depending on the company division. Take Bayerische Hausbau, for example. Although this is not the largest division, it is our core business in terms of earnings. At the moment we come to a property portfolio of a good three billion euros. Its value is expected to increase significantly over the next three or four years – more than the expected increase in value for real estate.

Specifically, what plus do you have to deliver?
We are a family business and we are not publicly traded, so I won’t give you any numbers. Just so much: We will grow primarily in Hamburg, the most important location for Bayerische Hausbau next to Munich. We also expect growth in our breweries. There we achieved earnings before interest and taxes (EBIT) of 60 million euros before Corona. We want to go well beyond that in 2023/24.

Why not in two or three years?
Next year we are likely to see a reluctance to attend major events. In important export markets such as Italy and France, the catering industry could still suffer from Corona in 2022.

The most difficult thing is to grow in the hotels. The hotel industry is suffering from the pandemic like never before, right?
That’s right, but we still see potential here, not least as an operator of hotels. We don’t always have to be the owners of the real estate. We can get more out of the existing properties and also imagine managing additional hotels.

Do you still need more hotels? Most recently stood empty for months, and whether business travelers will return in the future is completely open.
We wouldn’t necessarily be building more city hotels in Munich now. But if there are attractive leisure houses to buy, let’s take a look. We also think about new concepts. For example, we will convert our Four Points at Theresienwiese into a Residence Inn and thus implement a long-stay concept.

Your predecessor wore himself out over the years at your group’s salmon farm in Chile. How’s the business going?
We have worked for a long time to get the costs under control. We succeeded, we are competitive with the other large Chilean providers and were highly profitable.

But?
But the corona pandemic has pushed salmon prices to a historic low because the catering business collapsed. We sold a lot, but didn’t make a lot from it.

Why do you hold onto the division on the other side of the world, even though it has been causing problems for years?
The demand for healthy protein, i.e. salmon, is increasing by six or seven percent every year. We are convinced that we can grow even faster. Because we still have unused licenses to use additional ocean areas. So that contributes to our growth strategy.

The bottom line is that the Schörghuber Group slipped into the red last year with 34 million euros. How great is the need in the company?
Our cash flow is decent and the equity ratio is stable at 47 percent. We made all the major investments. Of course we’re in economy mode, but you don’t have to worry about us.

Where did you invest?
In hundreds of apartments on Nockherberg or the future Rosewood Munich in the Kreuzviertel, for example. In the middle of the pandemic, we decided to expand the Kulmbacher brewery for 30 million euros, because we are growing there primarily with the Mönchshof, the market leader for swing locks. We are also investing at Chiemseer in Rosenheim. And at the Westin in Frankfurt, we brought the extensive renovation work forward.

Their hotels were practically deserted for months. How much support was there from the state?
Nothing at all – apart from the short-time work allowance for our employees.

Why that?
Because business in other areas of the company, especially real estate, continued to be fairly stable. Therefore, as an affiliate company, we have not yet been eligible for the relief measures. We have left our hotels open to the limit of pain, even when the occupancy rate is below ten percent.

Do you fear that you will have to close again soon because the pandemic is spiraling out of control?
I expect the government to create the conditions so that restaurants and hotels can remain open. For me that means: vaccinate, vaccinate, vaccinate!

How has this year gone so far?
2021 will be significantly better than 2020, that much is certain. But it won’t be as good as 2019 for a long time.

The individual areas have again developed very differently, haven’t they?
There is an upward trend in every single division, and the direction is right everywhere. After the first half of the year, we are above plan in terms of sales and earnings – even though we had calculated better figures than in the previous year.

How are the two largest divisions, real estate and beverages?
There was hardly a dent in real estate, so the upswing will be moderate. Business at the Paulaner Group was still weak in the first five months due to the lockdown, but in the summer catering, retail and international business were great. What we are still clearly missing are events, otherwise business is going well.

You are the boss of a holding company that does not run its own business; that takes place in the independent companies below. Is this construction still needed?
Yes, because we support the corporate divisions primarily in three areas: digitization, sustainability and personnel. Let’s take a look at the third point: As a conglomerate, we can really offer our employees something, because not many companies are as broadly positioned as we are. In the combination as a family company, whose owners think very long term, this is really an advantage for us.

But digitization should be the topic of every managing director in your group!
Yes, but we think ahead. For example, we are considering whether to invest in start-ups. Our corporate divisions will then benefit from this. We also take care of future areas such as data mining or consumer platforms, i.e. applications that the divisions actually benefit from.

Sustainability is another general topic that every manager should keep in mind, don’t you think?
In any case. But as a holding company, we will work with our group companies to define specific goals that contribute to an overall strategy. We want to be ready in nine months. We make funds available to the departments, promote exchange among each other, but also speed up.

You are currently building a new corporate headquarters – right next to Theresienwiese, the Oktoberfest site in the heart of Munich. Isn’t that a bit daring given the trend towards home offices?
Even before the Corona, our employees were able to work from home two days a week. Working from home is therefore nothing new to us and is included in our planning. Nevertheless, the new headquarters is important; it will make our employees more creative and encourage collaboration. The view over the roofs of the city to the Alps also contributes to this – from the coolest roof terrace in all of Munich.

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