Almere, Netherlands, 7 February 2013 – LeasePlan Corporation N.V., the world’s leading fleet and vehicle management company, today published its annual results for 2012. LeasePlan again delivered strong results despite the economic challenges occurring in a number of regions across the globe, reporting a net profit of EUR 241.3 million for the year. This represents an increase of EUR 16.6 million (+7.4%) compared to the 2011 net result.
KEY HIGHLIGHTS:
.Net profit increased by 7.4% to EUR 241 million, compared to EUR 225 million in 2011
.Total number of vehicles remained stable at 1.3 million
.Diversified funding strategy made further gains with a completed U.S. institutional debt offering
.Strong solvency position with core tier 1 ratio of 15.7%
.Large positive turnaround on results of vehicles sold
Vahid Daemi, CEO of LeasePlan, expresses his thoughts on the year: “As we celebrate our 50th anniversary we are proud to be able to report such strong results. Against a backdrop of challenging economic and market conditions, LeasePlan management and employees maintained their focus on our clients while continuing to deliver strong performance both financially and in terms of our strategic priorities. As a result, we achieved a near-record net profit which is a strong testament to the stability and global reach of our business.”
OUR GLOBAL REACH REMAINS KEY
LeasePlan’s operations on five continents ensure that different regions will experience varying challenges, with results being largely dependent on the overriding economic climate in that area. As such, where certain countries were subject to rather subdued business activity in 2012 yet still remained profitable, others demonstrated very positive market growth and LeasePlan was able to increase its market share accordingly. This global breadth provides LeasePlan with the necessary stability to navigate an uncertain worldwide economy.
Furthermore, the positive aspects of diversification apply equally to LeasePlan’s funding strategy. The diversified funding levers that we set up in previous years also delivered successfully in 2012. At the beginning of the year, LeasePlan added the important U.S. funding route with the establishment of an institutional (Rule 144A) debt issuance program and a corresponding debut transaction in October.
Through the variety of funding methods mentioned, total new funding for the year amounted to EUR 4.8 billion. Significantly, as an important indication of the health of the company’s funding profile, LeasePlan prepaid a large share of bonds issued under the Netherlands government guarantee plan, maturing in 2014.
The success of another element of the diversified funding strategy, LeasePlan Bank, continued in 2012 with year-end deposits totalling EUR 4 billion. This represents an increase of EUR 1.2 billion from the previous year’s close.
Overall the liquidity buffer remains very healthy, with continued access to a revolving credit facility via thirteen major banks and an additional credit facility through Volkswagen. These are in addition to a cash balance of EUR 1.8 billion. LeasePlan also maintained a strong solvency position with a core tier 1 ratio of 15.7%, up from 14.9% in 2011.
A STRONG CORE
LeasePlan’s profit numbers were positively influenced by a turnaround in results of vehicles sold.
In absolute terms, however, the strongest contributors to profit continue to be generated by LeasePlan’s core business model components of management fees, damage risk retention, and lease services. Providing excellent customer service – as evidenced by LeasePlan’s very high customer and driver satisfaction survey scores – and leveraging the size and scope of operations to the mutual benefit of its customers and its own organisation remain at the very core of LeasePlan’s continued strong financial performance.
CREDIT RATINGS
LeasePlan's long term unsecured debt ratings are listed by Standard & Poor's (BBB+), Moody's (Baa2) and Fitch (A-). The ratings remain largely unchanged from the previous year, with the lower rating by Moody’s as part of a large-scale European banking downgrade being the sole difference.
OUTLOOK FOR 2013
LeasePlan anticipates a similarly mixed year ahead in terms of the global economy and market conditions. We foresee continued challenges in certain regions, with potentially more encouraging market conditions in other areas as well as expansion into new markets.
As we celebrate our 50th year in existence we remain optimistic about the strength of our organisation. In terms of performance, our primary sources of strength continue to lie in the global reach and scale of our business, our diversified funding approach, our client focus and the expertise and commitment that exists in our entities globally.
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