DGAP-News: Sixt Leasing SE achieves record revenue and increases earnings in 2018 financial year

Sixt Leasing SE achieves record revenue and increases earnings in 2018 financial year

• Group contract portfolio with around 130,000 contracts roughly at previous year's level
• Consolidated operating revenue increases by almost six per cent to more than EUR 450 million
• Consolidated earnings before taxes (EBT) rise by almost three per cent to more than EUR 30 million
• Managing Board makes proposal to Supervisory Board of stable dividend of EUR 0.48 per share
• Outlook for 2019: Slight increase in Group contract portfolio as well as stable consolidated operating revenue and EBT expected
• CEO Michael Ruhl: "In 2019, we are strengthening our focus on the topic of digitisation in order to further optimise our product range and to make our internal and customer related processes more efficient."

Pullach, 13 March 2019 - Sixt Leasing SE, market leader in online direct sales of new vehicles in Germany as well as specialist in the management and full-service leasing of large fleets, generated record revenue and increased its earnings in the 2018 financial year, according to preliminary calculations (IFRS). The Group's contract portfolio remained almost stable compared to the previous year, but is expected to increase again slightly in 2019. In the mid-term, the Managing Board expects significant growth, also for revenue and earnings.

Business performance
The contract portfolio in the Online Retail business field decreased by 1.6 per cent to 44,700 contracts in 2018, remaining roughly on a par at the level of the previous year. This development was influenced by two factors in particular. Firstly, new business was weaker than in the previous year primarily due to the slow implementation of the new WLTP test procedure and the related tight delivery situation for certain manufacturers. And secondly, the number of expired contracts increased sharply in the 2018 financial year due to strong contract growth over the past years.

The contract portfolio in the Fleet Management business unit increased stronger than expected by 6.6 per cent to 42,000 contracts.

The contract portfolio in the Fleet Leasing business field saw a decrease of 10.5 per cent to 43,000 contracts. This was primarily due to the unexpected loss of a volume customer and the active risk management announced at the beginning of the year. Within this initiative, the potential residual value risk posed by diesel vehicles across the total new leasing business was lowered successfully. The portfolio of diesel vehicles in Germany with the Euro 5 standard or lower without buyback agreement was thereby reduced to just approximately 2,800 vehicles as at 31 December 2018. This equates to a decline of approximately 50 per cent in comparison to the corresponding previous year's figure (31 December 2017: around 5,600 vehicles).

Overall, the Group's contract portfolio in Germany and abroad (excluding franchise and cooperation partners) decreased by 2.4 per cent to 129,700 contracts, remaining roughly at the level of the previous year.

Consolidated revenue climbed by 8.3 per cent year-on-year to a record EUR 805.8 million, in particular due to the expansion of the contract portfolio in the Online Retail business field in the 2017 financial year. Consolidated operating revenue (excluding sales revenue) increased slightly stronger than expected by 5.7 per cent to EUR 480.5 million. Sales revenue from leasing returns and marketed customer vehicles in Fleet Management achieved above-average growth of 12.3 per cent to EUR 325.3 million. This was mainly due to a higher number of vehicle returns in the Online Retail business field.

Consolidated earnings before interest, taxes, depreciation and amortisation (EBITDA) increased slightly in the 2018 financial year by 2.8 per cent to EUR 240.8 million. The financial result increased significantly year-on-year by EUR 3.0 million to EUR -13.2 million. Interest expenses were reduced significantly especially as a result of the repayment of the last two instalments of the Core Loan to Sixt SE in the amount of EUR 300 million in June 2017 and EUR 190 million in June 2018.

Consolidated earnings before taxes (EBT) rose by 2.8 per cent to EUR 30.5 million in the 2018 financial year, thereby roughly matching the previous year's figure as forecasted. Operating return on revenue remained relatively stable at 6.4 per cent (2017: 6.5 per cent). Consolidated net profit rose by 5.1 per cent to EUR 22.0 million.

Subject to the approval of the Supervisory Board, the Managing Board plans to propose a dividend of EUR 0.48 per share for the 2018 financial year to the Annual General Meeting on 3 June 2019. This proposal represents a pay-out ratio of around 45 per cent of consolidated net profit and a dividend yield of 4.2 per cent based on the closing price at year-end 2018. The ratio is therefore in the middle of the communicated target range of 30 to 60 per cent of the consolidated net profit.

Michael Ruhl, CEO of Sixt Leasing SE: "In 2018, we have made our portfolio fit for the future and thereby improved our risk-return profile significantly. In 2019, we intend to get back on our growth path and to expand the product portfolio and make it more flexible via various digitisation initiatives. At the same time, we plan to leverage cost potentials and realise efficiency enhancements through process optimisations."

Due to the recent noticeable change of the market environment and the customer preferences especially in Online Retail, Sixt Leasing is now increasingly focussing on supplementing its offerings through products and services which can be used to target further customer groups. On the basis of evolved strengths and long-time experience in the early development of customer-oriented solutions, the company is very well positioned to benefit disproportionally from the expected continuing strong market growth.

Outlook
For the current 2019 financial year, the Managing Board is forecasting a slight increase of the Group's contract portfolio as well as consolidated operating revenue and EBT both at around the previous year's level. For the first half of 2019, business development is expected to be significantly weaker than in the same period of the previous year as well as the expected business development in the second half of 2019.

On the basis of the present market and business development, the Managing Board has adjusted the medium-term growth targets. Thus, it is expecting an increase of the Group's contract portfolio to around 200,000 contracts until the end of the 2021 financial year (previously: more than 220,000 contracts). The company hence still expects very strong growth in the Online Retail and Fleet Management business fields in the medium term. Regarding consolidated operating revenue, the company expects a significant increase to around EUR 650 million by the financial year 2021 (previously: around EUR 700 million). EBT is also expected to increase significantly to a figure in the range of EUR 40 to 45 million by 2021 (previously: EUR 50 million).

About Sixt Leasing:
Sixt Leasing SE based in Pullach near Munich is market leader in online direct sales of new vehicles in Germany as well as specialist in management and full-service leasing of large fleets. With tailor-made solutions, the company enables the longer-term mobility of its private and corporate customers.

Private and commercial customers use the online platforms sixt-neuwagen.de and autohaus24.de to lease new vehicles affordably. Corporate customers benefit from the cost-saving leasing of their vehicle fleet and from efficient fleet management.

Sixt Leasing SE (WKN: A0DPRE / ISIN: DE000A0DPRE6) has been listed in the Regulated Market of the Frankfurt Stock Exchange (Prime Standard) since 7 May 2015. In fiscal year 2018, the Group generated consolidated revenue of EUR 806 million.

www.sixt-leasing.com

Contact:
Sixt Leasing SE
Investor Relations
Stefan Kraus
+49 89 74444 4518
ir@sixt-leasing.com

Note:
All fiscal year 2018 figures in this release are preliminary and subject to possible change. The final and audited 2018 consolidated annual financial statements for Sixt Leasing Group will be published on 16 April 2019.

The Sixt Leasing Group in 2018 at a glance¹

¹ Preliminary figures according to IFRS; rounding differences possible
² Ratio of EBT to operating revenue