ALD
ALD: Trading update on Q1 2019 Results
ALD
PRESS RELEASE trading update
Paris, 3 May 2019
ALD TRADING UPDATE ON Q1 2019 RESULTS
FIRST QUARTER 2019 RESULTS HIGHLIGHTS Total Fleet: 1.68 million vehicles managed worldwide at end March 2019, up 1.1% vs. end December 2018 and up 9.3% vs. end March 2018 Leasing Contract and Services Margins together up 4.7% Car Sales Result at EUR 19.0 million Gross Operating Income: EUR 332.3 million, up 1.1% vs. Q1 18 Cost-Income ratio excluding Car Sales Result[1] improved to 49.6% from 51.1% a year earlier Net Income (Group share): EUR 133.8 million in Q1 19, down 2.1% vs. Q1 18
KEY STRATEGIC AND COMMERCIAL INITIATIVES Stern Lease acquisition and partnership agreement in the Netherlands International framework agreement with Chargepoint Partnership with Belgian retail chain Hubo and Nissan
On 3 May 2019, Mike Masterson, ALD CEO, commenting on the Group Results, stated: “In the first quarter of 2019 ALD has continued to develop its commercial activity and made a significant bolt-on acquisition, reinforcing our leadership position. Our private lease offering is encountering success in a number of important markets thanks to our state–of–the–art digital solutions, which we continue to optimize and deploy more widely to boost growth in this segment. At the same time, in the context of a general transformation impacting the car industry, we remain focused on promoting electric and hybrid vehicles and reducing the share of diesel in our fleet. Our financial performance in Q1 is in line with our guidance for 2019, which we are confident of achieving thanks to the rigourous management of our costs and risks. ALD is determined to pursue its strategy of delivering sustainable growth, building on its constant customer focus and backed by the service excellence of its teams.“
BUSINESS DEVELOPMENT ON TRACK TO REACH GROWTH TARGET
ALD maintained good fleet growth during the first quarter of 2019. Total fleet rose to 1.68 million vehicles at the end of March, increasing by 1.1% vs. the end of December 2018 and 9.3% vs. the end of March 2018. Private lease development was dynamic, confirming the 150K vehicles target set for the end of 2019. All of this quarter’s fleet growth was organic and all regions contributed.
Q1 19 ended with a strong order bank, reflecting longer delivery periods for certain types of vehicles (in particular EV and hybrid vehicles) and ALD is confident of reaching its total fleet organic growth guidance of 5-7% for 2019.
GOOD FINANCIAL PERFORMANCE
Leasing Contract and Services Margins taken together rose by 4.7% in the first quarter of 2019 vs. the same quarter last year. This performance was achieved in the context of an ongoing focus on the promotion of electric and hybrid vehicles and the repricing of Diesel residual value, putting pressure on Services margin growth.
Demand for used cars was good this quarter, supporting prices. As a result, Car Sales Result per unit[2] in Q1 19 maintained itself at a robust level at EUR 258. Although down from EUR 417 in Q1 18, this represented an increase from EUR 235 in the previous quarter, and was well inside the guidance range of EUR 100 to EUR 300 per vehicle provided at the start of the year.
The number of used cars sold2 in Q1 19 reached c. 74 thousand, rising from c. 72 thousand in the preceding quarter and c. 71 thousand in Q1 18. In line with previous quarters, more than 60% of used cars were sold via electronic platforms. Average stock turnover[3] remained stable over the quarter.
Car Sales Result in Q1 19 was EUR 19.0 million, rebounding from EUR 17.1 million in the previous quarter, though down markedly from EUR 29.6 million in Q1 18.
Gross Operating Income for the first quarter of 2019 came in at EUR 332.3 million, up 1.1% from EUR 328.7 million a year earlier.
Operating Expenses amounted to EUR 157.5 million in Q1 19, showing a moderate rise of 3.5% vs. Q1 18. As a result, the Cost-Income ratio excluding Car Sales Result[4] improved to 49.6%, from 51.1% recorded a year earlier, continuing its downward trend driven by scale benefits and automation of processes throughout the organisation.
Impairment charges on receivables were up from a low EUR 6.4 million in Q1 18, but remained well under control at EUR 10.4 million in Q1 19 and down from the two previous quarters.
ALD’s effective tax rate stood at a low 17.6%, reflecting the continued strong, favourable impact of the Italian Stability Law.
ALD’s solid operating performance resulted in Net Income (Group share) for Q1 19 of EUR 133.8 million, down 2.1% from Q1 18.
The Group’s consolidated results as at 31 March were examined by the Board of Directors, chaired by Didier Hauguel, on 2 May 2019.
KEY STRATEGIC AND COMMERCIAL INITIATIVES
Stern Lease acquisition and partnership agreement in the Netherlands On 1 March 2019, ALD signed an agreement to acquire SternLease B.V., the leasing arm of Stern Group, the Dutch listed market leader in automotive retail. SternLease B.V. holds a fleet of c. 13,000 vehicles rented to SMEs and private individuals in the Netherlands and provides leasing services through direct distribution and Dealergroup Stern’s network of 85 local dealerships. On top of the acquisition, a dedicated distribution agreement has been signed to provide access to this local dealership network for the exclusive distribution of ALD leasing services for SMEs and private individuals.
International framework agreement with Chargepoint In order to facilitate and accelerate the transition to e-mobility for its clients, ALD has signed an international framework agreement with ChargePoint, the world’s leading electric vehicle (EV) charging network. A joint end-to-end electric vehicle solution will be rolled out across Europe over the next few months. This agreement will reinforce ALD’s EV coverage by improving and complementing existing e-mobility partnerships, with energy suppliers in particular.
Partnership with Belgian retail chain Hubo and Nissan ALD recently entered into a partnership with Belgian retail chain Hubo to sell private lease via 40 of their shops, offering Nissan vehicles. This 100% online offer will rely on ALD’s end to end digital platform and is the opportunity to promote digital solutions to other potential partners.
2019 GUIDANCE
For 2019, the Group expects 5-7% organic growth in Total Fleet. Bolt-on acquisitions might add to this growth, as opportunities arise.
Car Sales Result per unit is expected to average between EUR 100 and EUR 300.
In addition, the Group aims to improve its Cost/Income (excluding Car Sales Result) ratio further and expects it to reach c. 49% in 2019 (vs. 50% in 2018).
Given the strong capital generation from its activities, the Group targets a pay-out ratio of 40-50% for 2019, a level which allows it to maintain a high rate of growth without significantly impacting its total equity to total assets ratio.
To summarise ALD’s guidance for 2019:
CONFERENCE CALL FOR INVESTORS AND ANALYSTS
Date: 3 May 2019, at 10.00 am Paris time – 9.00 am London time Speakers: Mike Masterson, CEO, and Gilles Momper, CFO
FINANCIAL CALENDAR
22 May 2019 General assembly of shareholders 29 May 2019 Detachment of the dividend 31 May 2019 Payment of the dividend 1 August 2019 Q2 and H1 2019 results 6 November 2019 Q3 2019 trading update
Press contact: Stephanie Jonville +33 (0)1 42 14 38 99 stephanie.jonville@aldautomotive.com
ALD
ALD is a global leader in mobility solutions providing full service leasing and fleet management services across 43 countries to a client base of large corporates, SMEs, professionals and private individuals. A leader in its industry, ALD places sustainable mobility at the heart of its strategy, delivering innovative mobility solutions and technology-enabled services to its clients, helping them focus on their everyday business.
With over 6,500 employees worldwide, ALD manages 1.68 million vehicles (at end March 2019).
ALD is listed on Euronext Paris, compartment A (ISIN: FR0013258662; Ticker: ALD) and its share is included in the SBF120 index. ALD’s controlling shareholder is Societe Generale.
For more information, you can follow us on Twitter @ALDAutomotive or visit www.aldautomotive.com.
This document contains forward-looking statements relating to the targets and strategies of ALD SA (the “Company”) and its subsidiaries (together with the Company, the “Group”). These forward-looking statements are based on a series of assumptions, both general and specific, in particular the application of accounting principles and methods in accordance with IFRS (International Financial Reporting Standards) as adopted in the European Union. These forward-looking statements have also been developed from scenarios based on a number of economic assumptions in the context of a given competitive and regulatory environment. The Group may be unable to: – anticipate all the risks, uncertainties or other factors likely to affect its business and to appraise their potential consequences; – evaluate the extent to which the occurrence of a risk or a combination of risks could cause actual results to differ materially from those provided in this document and the related presentation. Therefore, although the Company believes that these statements are based on reasonable assumptions, these forward-looking statements are subject to numerous risks and uncertainties, including matters not yet known to it or its management or not currently considered material, and there can be no assurance that anticipated events will occur or that the objectives set out will actually be achieved. Important factors that could cause actual results to differ materially from the results anticipated in the forward-looking statements include, among others, overall trends in general economic activity and in the Group’s markets in particular, regulatory changes, and the success of the Company’s strategic, operating and financial initiatives. More detailed information on the potential risks that could affect the Company’s financial results can be found in the Registration Document and in the Last Financial Report filed with the French Autorité des Marchés Financiers. Investors are advised to take into account factors of uncertainty and risk likely to impact the operations of the Group when considering the information contained in such forward-looking statements. Other than as required by applicable law, the Company does not undertake any obligation to update or revise any forward-looking information or statements. Unless otherwise specified, the sources for the business rankings and market positions are internal. The financial information presented for the year ending 31 December 2018 was reviewed by the Board of Directors on 6 February 2019 and has been prepared in accordance with IFRS as adopted in the European Union and applicable at this date.
Appendix
Notes: (1) On and off balance sheet (2) Defined as: (Total Operating Expenses) / (Leasing Contract Margin + Services Margin)
[1] Calculated as a 4-quarter rolling average [2] Management information [3] Measured as the ratio between average stock for the month (start and end) and the number of cars sold during the month, multiplied by the number of days in the month [4] Calculated as a 4-quarter rolling average Regulatory filing PDF file Document title: ALD Trading update on Q1 2019 Results Document: http://n.eqs.com/c/fncls.ssp?u=YVAAIHBMXK |
Language: | English |
Company: | ALD |
1 Rue Eugène et Armand Peugeot | |
92500 Rueil-Malmaison | |
France | |
Internet: | https://www.aldautomotive.com/ |
ISIN: | FR0013258662 |
Euronext Ticker: | ALD |
AMF Category: | Additional regulated information to be pubicly disclosed under the legislation of a Member State / First quarter financial report |
EQS News ID: | 806615 |
End of Announcement | EQS News Service |