Revenue up, forecast down for Sixt Leasing
According to its preliminary calculations, Sixt Leasing SE generated record revenue and increased its earnings in 2018. The company expects its contract portfolio, which remained stable last year, to increase slightly in 2019.
Sixt Leasing SE, a business unit within Sixt SE, is the market leader in online direct sales of new vehicles in Germany, and a specialist in the management and full-service leasing of large fleets. The 2018 results for its three contract portfolios were as follows.
Increases and decreases
- Online Retail: volume declined 1.6% to 44,700 contracts. New business was weaker due to WLTP implementation and the related tight delivery situation for some OEMs. Also, the number of expired contracts increased due to strong contract growth over the past years.
- Fleet Management: stronger than expected increase: +6.6% to 42,000 contracts.
- Fleet Leasing: decrease of 10.5% to 43,000 contracts, primarily due to the unexpected loss of a volume customer. Another factor was active risk management, i.e. reducing the portfolio of diesel vehicles in Germany with Euro 5 or lower standard to just 2,800 vehicles at year’s end – a decline of approximately 50% vis-à-vis the preceding year.
While Sixt Leasing’s overall contract portfolio (in Germany and abroad) declined by 2.4% to 129,700 contracts, its consolidated revenue climbed by 8.3% to a record €805.8 million. This was due in particular to the expansion of the Online Retail portfolio in 2017.
Consolidated operating revenue (excl. sales revenue) increased stronger than expected, by 5.7% to €408.5 million. Sales revenue (from leasing returns and marketed customer vehicles in Fleet Management) achieved above-average growth: +12.3% to €325.3 million, again mainly due to higher vehicle volume in Online Retail.
“Fit for future”
In all, consolidated net profit increased by 5.1% to €22 million. “In 2018, we made our portfolio fit for the future,” said Sixt Leasing CEO Michael Ruhl. “In 2019, we intend to get back on our growth path, expand our product portfolio and make it more flexible via digitisation.”
The company still considers itself well positioned to ‘benefit disproportionately’ from expected continuing strong market growth, especially in Online Retail and Fleet Management.
However, the company has made some downward adjustments to its expected growth. By 2021, it expects a contract portfolio of around 200,000 contracts (previously: 220,000). Consolidated operating revenue by then is expected to be around €650 million (previously: €700 million). EBT should be around €40-45 million (previously: €50 million).