Main risks and uncertainties faced by the Autogrill Group

The Autogrill Group is exposed to external risks and uncertainties arising from general economic conditions or those specific to the industry in which it works, from the financial markets and from frequent changes in legislation, as well as to risks generated by strategic decisions and operating procedures.

The Group Risk Management department ensures the uniform handling of risks across the different organizational units by way of a model based on the systematic identification, analysis and assessment of the risk areas that may hinder the achievement of strategic goals. It helps evaluate the Company’s overall exposure to risks and orient the necessary mitigation efforts, with a view to reducing the volatility of business objectives.

The updated risk matrix is essentially the same as that produced the previous year.

The main risk areas – divided into business risks and financial risks – are presented below.

Business risks

Exogenous factors: traffic statistics and propensity to consume

The Group’s operations are influenced by traffic trends. Any factor with the potential to reduce traffic flows significantly in the countries and channels served by the Group constitutes a threat to the production of value.

Exogenous (hence uncontrollable) factors that may affect the flow of traffic and travelers’ propensity to consume include the general economic situation and its contributing trends – consumer confidence, inflation, unemployment and interest rates – along with rising oil prices and, in general, the increasing cost of transport. Traffic and average spending may also be sensitive to other uncontrollable events, such as the spread of alternative means of travel, changes to laws and regulations that govern or in any case influence how the Group operates in a given channel (this is especially relevant for airports), strikes and political instability, acts or threats of terrorism; natural disasters, and hostilities or wars.

The impact of this risk is mainly economic, leading to a reduction in sales and thus profitability. The Autogrill Group’s sales are also subject to seasonal fluctuations and are higher in the summer, when passenger traffic goes up. Therefore, should one of the above events occur in the summer, the negative impact could be amplified.

One factor that helps mitigate this risk is the diversification of the Group’s activities in terms of:

  • channels (airports, motorways and railway stations);
  • geographical areas served.

The Group also has the following tools available to counter recessions or soften the impact of any concentration of its businesses in channels or areas hit by a downturn:

  • constant revision of products and customer services, to keep them competitive in terms of quality and price and adapt to consumers’ different spending habits;
  • regularly updated operating models to ensure the most efficient mix of technologies and human resources; 
  • focus on the profitability of sales, by cutting costs without sacrificing menus and catalogues or the quality of service; 
  • modulation of investments in order to limit the impact on cash flow.


The Group’s reputation with customers and with concession grantors and licensors is of great importance and is also a significant factor when grantors decide to award or renew concessions.

With customers, loss of or damage to reputation is caused by the perceived deterioration of service, which can drive dissatisfied customers away, while with grantors and licensors it stems from an inability to satisfy contractual commitments that threatens good business relations and the prospect of extending contracts.

To counter that risk, Autogrill constantly monitors the quality of the service it provides to customers (in terms of perceived satisfaction and product safety) and to the grantor (in light of the quantitative and qualitative standards defined in the concession contract), by way of:

  • the constant monitoring of procedures and processes, both internally and by outside firms, to keep service efficient and customers and workers safe; 
  • portfolio reviews to make sure the company’s brands, concepts and products remain appealing; 
  • the development of customer retention initiatives and customer satisfaction surveys; 
  • training programs to ensure high standards of service.

Loss of reputation can also have indirect causes beyond our control. In Italy, for example, the fact that many travelers use the Group’s name to refer to highway rest stops in general (“let’s stop at the autogrill”) exposes operations in the motorway channel to reputation risk caused by any shortcomings on the part of competitors. Suitable brand protection measures are taken in Italy if unpleasant experiences are wrongly attributed to Autogrill.

Likewise, for operations involving the sale of thirdparty brands under license, any reputation damage suffered by the licensor may expose Autogrill to a potential loss of business, due to factors outside of its control.

Consumption habits

A change in consumption habits can be a risk if the Group is unable to react in time by adapting its service model and products to what the customer desires.

In developing its concepts and offerings, the Group puts a high premium on innovation and flexibility, so that it can quickly interpret and respond to changes in consumers’ purchasing habits and tastes. To that end it periodically conducts specific market research and customer satisfaction surveys.

In addition, an extensive portfolio of brands and commercial formulas helps to mitigate this risk.

Concession fees

Most of the Group’s operations are conducted under long-term contracts awarded through competitive bidding by the owner of the infrastructure management concession (airport/ motorway/station). Concession contracts are therefore a fundamental asset for the Group, and their extension under competitive conditions or the acquisition of new ones is a strategic factor.

The contracts signed by the Group generally have a duration exceeding one year and require the operator to pay minimum guaranteed rent, regardless of the revenue earned. Should the revenue earned through the concession fall short of the amount forecast when the contract was awarded, perhaps due to a reduction in traffic or propensity to consume, the contract could become less profitable or even a liability given the obligation to pay minimum rent.

Over time, there have been changes in the competitive context and in the details of calls for tenders, so that in the case of new and/or extended contracts, the conditions set by the grantors may be less favorable than those valid today. This risk might expose the Group to long-term losses in profitability, especially if it coincides with a wane in traffic or consumer confidence.

Some concession agreements involving Group companies restrict the operator’s sphere of movement, e.g. by limiting the range of products that can be sold or how they are priced. The need to comply with such limits could reduce or eliminate the Group’s ability to adapt its product range and terms of sale to customers’ changing needs and preferences, which, as mentioned above, is one of the key points of its commercial strategy.

In general, the Group mitigates these risks by focusing on the profitability of its contracts and not bidding at all for those considered to offer poor returns, and by following an approach aimed at building and maintaining a long-term partnership arrangement with the concession grantor, based in part on the development of concepts and commercial solutions that maximize the overall gain.


Labour is a significant factor for the Group, whose business has a strong customer service component.

The need to maintain service standards acceptable to customers and to the concession grantor, and the complexity of international labour laws, limit the flexibility of HR management.

Therefore, major increases in the cost per employee or more stringent regulations can have a significant impact on the Group’s profitability.

This risk is mitigated through the constant review of operating procedures in order to make the most efficient use of labour, increase flexibility and reduce occupational hazards.

Regulatory compliance

The business in which the Group works is highly regulated in terms of operating practices and customer and worker safety, which involves personal protections as well as product quality. Any violation of such norms would not only expose the Group to legal consequences but could diminish its reputation with concession grantors and customers, possibly leading to reduced sales, the loss of existing contracts and/or the inability to compete for new ones.

To mitigate this risk, with the help of outside specialists, Autogrill stays constantly abreast of legal developments so it can adapt its processes, procedures and controls to the new requirements and bring personnel up to date. It also relies on constant monitoring and frequent audits of service quality with respect to contractual and legal obligations.

Further risks may arise from new legislation affecting the channels served by the Group, which sometimes introduce more restrictive procedures, regulations or controls that can influence the consumer’s propensity to buy, most typically in the airport channel.

These risks are lessened by constantly monitoring consumer behaviour when new rules come into force and by incorporating suitable measures into the business model.


The Group’s ability to maintain a constant process of innovation for its business model, concepts, products and processes is key to offering a level of service and quality that keeps up with customers’ demands and strategically important to operations.

The potential loss of such an ability would have a direct impact on sales performance and reputation.

Efforts to thwart the risk of reputation loss and regulatory non-compliance (concerning the quality of Food & Beverage preparation and service), and quality controls on raw materials mitigate this threat as well.

Development in emerging markets

The Autogrill Group is active in some emerging markets and hopes to expand into others; such markets typically present greater risks than those found in the areas it prevalently serves.

The exogenous risks of operating in emerging markets may include the disruption of business due to political or social instability, and the establishment/enforcement of trade restrictions.

It is also difficult to pinpoint local tastes and choose an appropriate selection of products and brands.

To mitigate this risk, the Group has a broad portfolio of brands and commercial formulas and constantly monitors customer satisfaction and the attractiveness of the portfolio in terms of brands, concepts and pricing schemes, so it can react promptly to any issues.


Financial risks

Autogrill manages its financial risks by defining Group-wide guidelines that necessarily inform the financial management of its operating units, as part of an overall policy of financial independence.

The Finance department ensures that the financial risk management policies are harmonized, indicating the most suitable financial instruments and monitoring the results achieved.

The Autogrill Group does not allow the use of speculative derivative instruments.

The Group also strives for a certain financial flexibility, maintaining enough cash and committed credit lines to cover its refinancing needs for at least 12 to 18 months.

Regarding the management of financial risks, consisting mostly of interest rate, currency and liquidity risk, see the financial risk management section of the notes.