DGAP-News: GRENKE AG / Keyword(s): Miscellaneous
GRENKE accelerates its growth: Further strong increase in new leasing business
05.07.2022 / 07:00
The issuer is solely responsible for the content of this announcement.

GRENKE accelerates its growth: Further strong increase in new leasing business

Baden-Baden, July 5, 2022: GRENKE AG, a global financial partner for small and medium-sized enterprises, generated new leasing business of EUR 587.4 million in the second quarter of 2022, outperforming the level of the same period of the previous year (Q2 2021: 398.6 million euros). GRENKE thus accelerated its quarterly year-on-year growth in new leasing business for the third consecutive time. In the fourth quarter of 2021, growth was 22.1% and in the first quarter of this year, 36.5%.

“This result confirms our expectation of a return to a stable and sustainable growth trajectory”, commented Michael Bücker, Chairman of the Board of GRENKE AG. Dr. Sebastian Hirsch, CFO of GRENKE AG, adds: “Our business remains very profitable. First, this is a result of our strong increase in new business, leading to a significant increase in contribution margin. Second, we will pass on a higher interest rate level – as we have always done in past phases of rising interest rates – with a manageable lag in the market.”

Regional development of new rental activities

In the DACH region, GRENKE generated in Q2 2022 new leasing business of 139.9 million euros, 26.0% more than the level of the same quarter of the previous year (Q2 2021: 111.1 millions of euros). In Western Europe without DACH, growth of 36.5% was recorded for the same period. The Southern Europe region saw the largest increase in new business, up 73.0% year-on-year. In Northern and Eastern Europe, GRENKE recorded growth in new rental business of 63.0%. The other regions recorded an increase of 56.8% compared to the same quarter of the previous year.

Preparation of lease applications

During the quarter under review, GRENKE received a total of 138,261 lease applications, which represents a significant increase compared to the same period of the previous year (Q2 2021: 117,387). The demand for leasing products has thus continued to increase, even in the face of the current uncertain economic environment. GRENKE concluded a total of 72,192 new leases during the reporting period, which corresponds to a conversion rate of 52%. In the second quarter of 2021, 56,078 leases had been concluded at a conversion rate of 48%.

Factoring activity and new credit activity at GRENKE Bank

Receivables activity within the factoring business, which represents 1.3% of total assets (as of the closing date of March 31, 2022), generated new business volume of purchased receivables during of the reference quarter of 191.5 million euros, corresponding to -annual growth of 9.3% (Q2 2021: 175.2 million EUR). The average maturity of these receivables is six weeks. While factoring new business in Germany decreased by 25.0% to EUR 42.3 million (Q2 2021: EUR 56.4 million) due to extraordinary Covid-related effects and the reorganization of sales activities, they increased by 25.6% to 149.2 million euros internationally. markets after 118.8 million euros in the same quarter of the previous year. GRENKE Bank’s new credit business increased by 123.0% to EUR 13.6 million in Q2 2022 (Q2 2021: EUR 6.1 million).

Development of contribution margin in new leasing business

The strength of new leasing business resulted in a significant increase in contribution margins compared to the level of the previous year. Contribution margin 2 (CM2) in Q2 2022 increased by 29.2% compared to the same quarter of the previous year (72.1 million euros) and amounted to 93.2 million euros . At 61.4 million euros, the contribution margin 1 (CM1) in the second quarter of 2022 was 30.1% higher than the level recorded in the same quarter of the previous year (47.2 million euros).

The CM2 margin reached 15.9% in Q2 2022. The new business on which the CM2 margin is based could already offset two-thirds of the rise in interest rates in the second quarter, resulting in a CM2 margin that is n is more than one point below the target figure of 17.0%. In the coming months, we will continue to systematically apply this adjustment process to new business. The CM2 margin is only temporarily below this target, as passing through interest rate increases to individual markets is a process that typically takes a quarter to complete. The same goes for the CM1 margin which, at 10.4% in Q2 2022, was lower than the same period of the previous year (Q2 2021: 11.8%).

In the same quarter of the previous year, the CM2 margin was exceptionally high at 18.1%, new business being driven by Covid and specifically limited to the highest margin customer segments for precautionary reasons. In 2019, the year before the Corona crisis, the CM2 margin was 17.0%. The existing activity is refinanced at equivalent maturities and therefore on the basis of an earlier and lower interest rate level.

Overview of new business development (in millions of euros)

*Regions: DACH: Germany, Austria, Switzerland

Western Europe without DACH: Belgium, France, Luxembourg, Netherlands

Southern Europe: Croatia, Italy, Malta, Portugal, Slovenia, Spain

North | Eastern Europe: Denmark, Finland, Ireland, Latvia, Norway, Sweden, United Kingdom | Czechia, Hungary, Poland, Romania, Slovakia

Other regions: Australia, Brazil, Canada, Chile, Singapore, Turkey, United Arab Emirates, United States

The half-year financial report will be published on August 11, 2022.

For more information, please contact:

About GRENKE

The GRENKE Group (GRENKE) is a global financial partner for small and medium-sized enterprises. As a one-stop-shop for customers, GRENKE’s products range from low-cost flexible leasing and demand-driven banking products to convenient factoring. Simple and fast processing and personal contact with customers and partners are at the heart of GRENKE’s activities.

Founded in 1978 in Baden-Baden, the Group is present in 33 countries and employs more than 1,800 people (measured in full-time equivalents) worldwide. GRENKE shares are listed on the Frankfurt Stock Exchange (ISIN DE000A161N30).

05.07.2022 Broadcast of a Corporate News, transmitted by the DGAP – a service of EQS Group AG.
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