Sixt Records 2014 as Most Successful Business Year in Corporate History – Dividend Payout to Increase by Around 20%
- Consolidated earnings before taxes (EBT) climb 14.1% to record figure of EUR 157.0 million
- Consolidated operating revenue gains 9.3% with growth across the board
- Foreign business grows once again very dynamically with an 18.0% increase in rental revenues
- Managing Board to propose a dividend of EUR 1.20 per ordinary share and EUR 1.22 per preference share to the Annual General Meeting for fiscal year 2014
March 18, 2015 // Franchising.com // Pullach – The Sixt Group records 2014 as the most successful fiscal year in its corporate history. Revenues and earnings exceeded the original expectations of the Managing Board and reached best-ever figures. The international mobility service provider's consolidated earnings before taxes (EBT) rose 14.1% to EUR 157.0 million. The Group's operating revenue climbed 9.3% to EUR 1.65 billion. This development rests on a broad base of increasing demand registered in both business units, Vehicle Rental and Leasing. The growth driver was once again the dynamic development of the Vehicle Rental Unit's foreign operations. Total consolidated revenue increased 8.6% to EUR 1.80 billion. Against the background of such an encouraging business performance the Managing Board plans to increase the dividend payout for fiscal year 2014 by around 20 %.
Sixt communicated the preliminary key figures for fiscal year 2014 during the Company's Annual Press Conference in Munich today.
Erich Sixt, Chairman of the Managing Board of Sixt SE: "The strong result in 2014 exceeded our expectations. It is all the more encouraging if one considers the restrained economic environment in Europe. The basis for this success were once more the ongoing international expansion and our clear premium strategy. With a 9.5% pre-tax return on operating revenue, Sixt once again underlined its position as one of the world's most profitable mobility service providers. Our Company's internal strength makes us generally optimistic for 2015."
Sixt Group's revenue and earnings development in 2014
- Consolidated operating revenue (excluding revenue from the sale of used leasing vehicles) climbed 9.3% to EUR 1.65 billion (2013: EUR 1.51 billion). The share of consolidated operating revenue generated abroad increased slightly to 35% (2013: 34%).
- The Group's total revenue climbed 8.6% to EUR 1.80 billion (2013: EUR 1.65 billion).
- Rental revenues registered a rise of 10.2% to EUR 1.12 billion (2013: EUR 1.02 billion). Foreign business showed above-average growth of 18.0% to EUR 489.1 million. This development was carried through in particular by the subsidiaries in the USA, France, Great Britain and Spain. Thanks to its successful sales activities Sixt was also able to increase the already high level of domestic rental revenues by another 4.8% to EUR 630.5 million. 44% of total rental revenues in 2014 were generated outside Germany (2013: 41%).
- In 2014 leasing revenue increased 6.2% to EUR 417.3 million, as against EUR 392.8 million the year before. The total number of contracts grew by 28%, above all in the fleet management and private customer leasing sectors.
- Due to the higher revenues and consistent cost management, earnings before taxes (EBT)reached another record figure of EUR 157.0 million, an increase of 14.1% on the same figure the year before (EUR 137.6 million). As in the years before the EBT includes start-up losses for strategic growth initiatives, such as the expansion in the USA.
- The Group's earnings after taxes climbed 16.5% to EUR 110.0 million, as against EUR 94.4 million the year before.
Proposed dividend payout to increase by around 20%
In keeping with Sixt's shareholder-friendly dividend policy, the Managing Board plans to raise the dividend for fiscal year 2014. Subject to the approval of the Supervisory Board, the Managing Board will propose to the Annual General Meeting on 24 June 2015 a dividend of EUR 0.80 (previous year: EUR 0.65) per ordinary share and EUR 0.82 (previous year: EUR 0.67) per preference share as well as a bonus of EUR 0.40 (previous year: EUR 0.35) for both share categories. This would result in a total payout of EUR 1.20 for ordinary shares and EUR 1.22 for preference shares. The proposed payout total amounts to EUR 58.0 million, some 20% higher than the previous year's figure of EUR 48.4 million. In relation to consolidated profit the distribution ratio would come to 53% (previous year: 51%).
Continued strong equity basis
As at 31 December 2014 the Group had balance sheet equity of EUR 746 million (2013 reporting date:
EUR 675 million) and was therefore equipped with an ongoing strong equity basis, giving it the leeway for further expansion measures. The equity ratio came to 26.4% (2013: 28.5%), which was still significantly higher than the average for the rental and leasing industry in general.
Over the whole of 2014 a total of 172,600 vehicles, or 11.8% more than the year before, was added to the rental and leasing fleet in Germany and abroad (2013: 154,400 vehicles). This increase reflects the stronger demand from both business units. The value of the added vehicles increased 11.5%, to EUR 4.32 billion and thus for the first time exceeded the EUR 4 billion mark (2013: EUR 3.87 billion). Sixt continues to pursue a clear premium policy in its fleet composition, with a broad range of highly equipped cars from renowned brands. The share in value of the vehicle fleet taken up by BMW, Mercedes-Benz and Audi was 51% in 2014 (in Germany and abroad).
Outlook for fiscal year 2015
Given that the economic business environment in Europe is slightly better than last year, Sixt is generally optimistic for the current fiscal year. All the strategic growth initiatives, such as the expansion in the USA and Europe outside Germany will be continued and also strengthened in some cases. In the Vehicle Rental Business Unit, Sixt is expecting to see slight growth in demand from business and private travellers, but also an increase in fleet costs and operating expenses. In the Leasing Business Unit, the Company also expects marginally higher demand.
On the basis of a continued cautious and demand-driven fleet policy as well as further efficiency gains, the Managing Board expects a slight rise in consolidated operating revenues as well as stable to marginally higher Group EBT in 2015.
Developments in the operating business units
In the core markets of Western Europe and the USA Sixt operates its own subsidiaries (Sixt corporate countries). In the other European countries and the other regions of the world, the Company is represented by an extensive network of franchise partners. The worldwide number of Sixt rental stations (corporate and franchise) grew to 2,177 in 2014 (as at 31 December), which was 110 more than at the end of the previous year's reporting date (2,067). This growth is primarily the result of new stations being opened outside Germany, above all in the USA, France and Great Britain. The presence of stations in the USA, the world's biggest rental market, increased in 2014 (as at 31 December) to
50 stations (previous year's reporting date: 26).
In 2014 the premium carsharing service DriveNow strengthened its position as the leading German carsharing company. The number of customers has more or less doubled. At present DriveNow already has around 400,000 registered users. With the launch of services in Vienna and London, the joint venture co-managed with BMW is driving forward its expansion outside Germany. Over the next few years, the presence in Europe and the USA is to be significantly extended.
Rental revenue for the Vehicle Rental Unit increased 10.2% in 2014 to EUR 1.12 billion (2013: EUR 1.02 billion). Growth outside Germany amounted to +18.0% to EUR 489.1 million (2013: EUR 414.5 million). As in the year before, all foreign subsidiaries, with the exception of the USA, made a positive contribution to earnings. The Business Unit's total revenue climbed 10.4% to EUR 1.23 billion after it had amounted to EUR 1.11 billion the year before. The average fleet size of the Vehicle Rental Business Unit in the Sixt corporate countries climbed 8.4% to 84,600 vehicles, compared to 78,000 vehicles the year before.
The Business Unit's EBT rose 11.9% to EUR 136.8 million (2013: EUR 122.3 million). This equals a return on revenue of 11.1% (2013: 11.0%), which continues to be above the long-term target level of at least 10%.
The Leasing Business Unit and its holding company, Sixt Leasing AG, are one of Germany’s leading vendor-neutral, non-bank full-service leasing providers. Their range of services covers a broad selection of products and services for efficient fleet management. This way Sixt can enable its customers to bring their mobility costs down over the long term and also increase transparency over their fleet. Private customers and smaller commercial enterprises can benefit from attractive leasing and vario-financing offers for new vehicles that are made available via the online portal "Sixt Neuwagen".
In 2014 the Business Unit performed successfully and managed to increase its portfolio of contracts substantially. The number of leasing contracts in Sixt corporate countries increased 27.8% by 31 December 2014 to a total of 97,400 contracts (2013 reporting date: 76,200 contracts). As in the year before, the growth drivers were above all the fleet management and private customer leasing segments.
In 2014 leasing revenue was up 6.2% to EUR 417.3 million, compared to EUR 392.8 million the year before. Including the usually fluctuating revenue from the sale of used leasing vehicles, the unit's total revenue amounted to EUR 563.2 million, which was a gain of 5.1% (2013: EUR 535.7 million). The Business Unit's EBT climbed 22.2% to EUR 25.6 million (2013: EUR 21.0 million), which equals a return on revenue of 6.1% (2013: 5.3%).
Note: As announced, Sixt Group's final Annual Financial Statement 2014 will be published on 21 April 2015.
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