Editor's choice
2 Aug 19

ALD presents strong fleet growth and excellent used-car sales results

Buoyed by strong fleet growth and huge used-car profits, ALD’s better than expected half-year results pushed up the company’s stock on the Paris Bourse.

Here are some of the most striking elements of ALD’s H1 results.

1.7 million vehicles

  • At the end of June, ALD managed a worldwide fleet of 1.7 million vehicles, up 7.2% vs. the same time last year. The forecast was for 5-7% growth. 
  • Thanks to its extensive partnership network, ALD’s private lease fleet grew by 36% to 133,000 contracts in mid-2019. The 150K target for year’s end looks eminently achievable. 
  • Just 47% of ALD vehicles registered in H1 2019 were diesel, versus 61% in H1 2018. Virtually all ALD diesel cars are Euro 6, the remaining 29,000 Euro 5 diesel cars will be phased out this year.

Strong demand

  • Thanks to strong demand, sales results for used cars rose significantly, from €258 per car in the first quarter of 2019 to €346 in the second quarter. On average, the net car sales result for H1 was €301 – just above the guidance range (€100-€300), which ALD reconfirms for the full year. More than 60% were sold via online platforms.
  • ALD’s net income for the half-year was €280.7 million, up slightly from €280 million in mid-2018. The annualised return on equity in H1 2019 stood at 15.3%. 

Key initiatives

Among ALD’s key initiatives the past half-year is ‘Motors’, a private leasing platform launched in Spain in collaboration with Amazon. Contracts are available for 36 or 48 months and include a range of services. After completing the process, entirely online, the car is delivered to the customer’s doorstep. 

Also significant were ALD’s two acquisitions, of BBVA Automercantil’s rental portfolio in Portugal, and of SternLease in the Netherlands. As an example of the company’s policy to pursue targeted bolt-on acquisitions, the BBVA deal is expected to strengthen the company’s full-service leasing presence in Portugal. The SternLease deal will bolster ALD’s SME and Private Lease offering in the Netherlands.

“Important milestone”
Finally, the company also struck a distribution deal with Spanish supermarket chain Eroski, which will offer ALD’s full-service leasing contracts to its employees, providers and customers via its online platform and via dedicated pop-up stores. 

“ALD’s private lease business passed an important milestone, via our collaboration with Amazon in Spain. This illustrates the efficiency of our digital tools,” said Mike Masterson, CEO of ALD (pictured). “Our shift away from diesel has accelerated, outperforming our own objectives.” 

The release of ALD’s half-year results on Thursday pushed up the price of the company’s stock by 7.85%, making it one of the best-performing shares on the Paris Stock Exchange yesterday. 

Authored by: Steven Schoefs