Sixt AG, Germany’s largest car rental company and one of Europe’s leading mobility service providers, witnessed business perform in line with internal expectations during the first six months of 2012. Despite a cooling economy, higher operative expenses and start-up costs for new activities, the results of operations remained on a high level with consolidated earnings before taxes (EBT) at EUR 63.4 million. Second quarter EBT was just short of the record figure recorded for the same quarter the previous year. Driven above all by the dynamic growth in the foreign operations, rental revenues in the Vehicle Rental Business Unit rose by a gratifying 8.0% over the first six months. The Group’s total revenue increased by 2.8%.
Given that economic risks are mounting worldwide and are threatening to spill-over into Germany, Sixt expects conditions in the second half to become more difficult, while the Company maintains its projections to see good results of operations for the year 2012 as a whole.
Erich Sixt, Chairman of the Managing Board of Sixt AG: “The results for the first half year demonstrate that Sixt can operate highly successful even in a worsening market environment. The business performance so far reconfirms our expectation that we will close 2012 with yet again a satisfying result. We will stay our course of giving precedence to margins and earnings before volume growth, and invest pro-active into the expansion of our foreign operations.”
Group performance in the first half of 2012
With demand generally positive so far, rental revenue continued to perform gratifying, growing 8.0% to
EUR 452.7 million (H1 2011: EUR 419.3 million). Growth driver was above all the business outside Germany, where rental revenue climbed 20.2% period-on-period.
Leasing revenue came to EUR 188.3 million, which was 4.4% down on the figure recorded for the first half of 2011 (EUR 197.0 million).
Revenue from the sale of used vehicles, in which fluctuations are normal, was EUR 86.7 million, down
7.2% from the prior-year equivalent (H1 2011: EUR 93.4 million).
The Group’s total revenue climbed from EUR 755.8 million 2.8% to EUR 777.1 million.
Consolidated earnings before net finance costs and taxes (EBIT) reached EUR 88.5 million, which was merely 4.2% less than the figure for the same period last year that came to EUR 92.3 million after adjustment for
non-recurring income of EUR 4.4 million (reported at EUR 96.7 million for the first six months of 2011).
The consolidated profit before taxes (EBT), the Group’s key earnings indicator, was EUR 63.4 million, a drop of 5.4% on the previous year figure of EUR 67.0 million after adjustment for non-recurring income
(reported EBT: EUR 71.4 million). As announced, higher operating expenses as well as the start-up costs for growth initiatives, such as the establishment of Sixt’s rental business in the USA and the premium carsharing offer
DriveNow, had a dampening effect on the consolidated earnings.
After taxes Sixt reports a half-year profit of EUR 43.8 million (H1 2011: EUR 50.2 million).
Group development in the second quarter of 2012
At EUR 237.0 million, rental revenue grew 5.9% compared to last year’s equivalent quarter (EUR 223.7 million).
Leasing revenues totalled EUR 95.0 million as against EUR 100.5 million in Q2 2011 (-5.5%).
The Group’s total revenue went up slightly 1.3% to EUR 396.3 million (Q2 2011: EUR 391.4 million).
For the second quarter of 2012 the Group reports EBT of EUR 37.4 million (Q2 2011 EUR 39.2 million; -4.9%).
Measured expansion of fleet
From January to June 2012, Sixt added 85,800 vehicles with a total value of EUR 2.04 billion to the rental and leasing fleets in Germany and abroad. In the same period of 2011 the Company had added 77,600 vehicles at a value of EUR 1.85 billion. This equals an increase of 10% in the number of vehicles and to the value of vehicles.
Outlook for full-year 2012
In view of mounting economic risks, that are threatening to spill-over into Germany, Sixt is readying itself for more difficult conditions both in the rental and leasing business for the second half of 2012. Looking ahead to the full financial year, the Managing Board expects the Group’s total revenue to grow, based on an increase in rental revenues and a slight decline in leasing revenues. Results of operations for 2012 are still expected to be good and on a high level. However, the consolidated EBT will not reach the record figure of the previous year.
Developments in the operating business units
Sixt’s subsidiaries cover more than 70% of the European rental market. The Company is furthermore active in the USA with company-own rental stations. The Sixt brand is represented by a close-knit network of franchisees in further European countries and in other global regions.
The Vehicle Rental Business Unit generated rental revenue of EUR 452.7 million in the first half of 2012 (+8.0%). In Germany, where Sixt is clear market leader well ahead of its competitors, rental revenue climbed 2.5% to
EUR 297.7 million. Outside of Germany Sixt continues its dynamic growth, above all in the USA, France and Spain, and recorded a plus of 20.2% to EUR 155.0 million.
The EBT for the Vehicle Rental Business Unit’s amounted to EUR 53.9 million for the first half of 2012, a drop of 7.6% compared to the previous year’s period (EUR 58.3 million). In view of the higher operating expenses as well as the start-up costs for the establishment of Sixt’s activities in the USA and the premium carsharing offer DriveNow, the Managing Board considers this result to be satisfactory.
In Germany Sixt is one of the largest vendor-neutral, non-bank full-service leasing companies, offering corporate and private customers pure finance leasing plus a wide range of ancillary services for managing fleets and individual vehicles.
The Leasing Business Unit’s total number of leases in and outside Germany (excluding franchisees) was 60,200 at 30 June 2012, almost 7% above the figure recorded at the end of 2011 (56,300) and a good 4% above the figure at the end of the first quarter of 2012.
At EUR 188.3 million, leasing revenue for the first six months was 4.4% down on the corresponding prior year figure of EUR 197.0 million. Among other things, this was due to the focus being on fleet management product. Total revenue at the Leasing Business Unit (including revenue from the sale of used vehicles) came to EUR 275.0 million for January through June, down 5.3% (H1 2011: EUR 290.4 million).
The Business Unit reported EBT of EUR 9.6 million for the first half of 2012. This equals a decline of 22.0% from the adjusted figure of the previous year period (EUR 12.3 million, reported at EUR 16.7 million).