DGAP-News: GRENKELEASING AG: Consolidated Group net profit

DGAP-News: GRENKELEASING AG / Key word(s): Quarter Results GRENKELEASING AG: Consolidated Group net profit rises 40% in the first half of 2014 and is at the upper end of our full-year expectations 25.07.2014 / 07:21 --------------------------------------------------------------------- Consolidated Group net profit rises 40% in the first half of 2014 and is at the upper end of our full-year expectations - Operating result increased 34.7% to EUR 42.0 million in the first half of 2014 (previous year: EUR 31.2 million) - Consolidated Group net profit in the first half of 2014 grew 39.5% to EUR 31.2 million compared to EUR 22.4 million in the previous year - Expenses for the settlement of claims and risk provision in the first half 2014 amounted to EUR 24.8 million and were at the previous year's level - Net profit forecast for 2014 refined: Consolidated Group net profit expected at around EUR 56 million (previous forecast: EUR 52-56 million) Baden-Baden, July 25, 2014: The profitability of the GRENKE Consolidated Group continued to improve in the first half of 2014. Interest expenses from refinancing and from the deposit business continued to decline as a result of the sustained favourable interest rate environment and amounted to EUR 27.6 million in the first half of 2014 after reaching EUR 29.1 million in the first half of 2013. Net interest income climbed 18.0% to EUR 74.6 million (1.HY 2013: EUR 63.3 million). At EUR 24.8 million, expenses for the settlement of claims and risk provision were at the previous year's level (1.HY 2013: EUR 24.7 million). The second quarter's loss rate was near the level of the first quarter of 2014 and thus continued to be below the previous year's level. Net interest income after the settlement of claims and risk provision improved accordingly by 29.3% to EUR 49.8 million after EUR 38.5 million in the prior year. This development, however, cannot be assumed for the full year due to the volatility of losses - especially on a quarterly basis. Given the continuing difficult economic situation in some of the European countries, the related risks will persist in the future, in spite of the positive trend seen in the second quarter. Profit from insurance business grew 17.3% to EUR 19.5 million (1.HY 2013: EUR 16.6 million). Profit from new business increased 8.3% to EUR 23.2 million after reporting EUR 21.4 million in the first half of 2013. Profit from disposals totalled EUR 0.7 million after EUR 1.3 million in the first half of 2013. This item is very volatile on a quarterly basis and, due to its magnitude, is of less significance to the GRENKE Consolidated Group. Overall, income from operating business rose 19.7% to EUR 93.3 million after amounting to EUR 78.0 million in the comparable period of the previous year. Following the upfront investments for our expansion, the resulting economies of scale have become noticeable on the cost side. There was only a moderate rise in both our staff costs and in our selling and administrative expenses. Staff costs amounted to EUR 26.5 million in the first half of 2014 after reaching EUR 24.9 million in the comparable period of the previous year. Selling and administrative expenses grew by 17.2% to EUR 21.7 million after amounting to EUR 18.6 million in the first half of 2013. The operating result climbed by 34.7% to EUR 42.0 million after EUR 31.2 million in the first half of 2013. Consolidated Group net profit gained 39.5% to a total of EUR 31.2 million in the first half of 2014 (previous year: EUR 22.4 million) and was at the top end of our expectations. We are refining our previous forecast for 2014, which projected a net profit in the range of EUR 52-56 million for the GRENKE Consolidated Group, and now expect a figure of around EUR 56 million for the year 2014. The likelihood that we will exceed this level has increased. At 16.5%, the equity ratio was just slightly below the level as per December 31, 2013 of 16.7% - in spite of the dividend payment in May - and still above our long-term target of at least 16%. These results were generated by a total of 859 employees compared to 792 employees in the first half of 2013 (based on full-time employees, excluding the Board of Directors). "In view of our positive business performance, income and earnings are clearly headed for the upper end of our forecast range. Our operating result climbed a gratifying 35%. This was not only the result of the income generated from our thriving new business in recent quarters, but also owed to the cost side, where economies of scale are becoming more noticeable after completing the upfront investments for our expansion. In the meantime, we have a portfolio of more than 400,000 current leasing contracts. This allows us to refine our previous 2014 net profit forecast of between EUR 52 million and 56 million for the GRENKE Consolidated Group. We now expect to reach a level of around EUR 56 million, whereby the likelihood that we may even exceed this level has increased", said Wolfgang Grenke, Chairman of the Board of Directors of GRENKELEASING AG with regard to the results. "GRENKE Bank provides us with the opportunity to work together with development banks of German federal states. After successfully starting our cooperation with NRW.BANK in North Rhine Westphalia in 2010, we have just entered into our fourth cooperation. The goal is to provide small and medium-sized enterprises and members of self-employed professions access to development funds when they finance new investments through leasing. The vouchers provided by NRW.BANK have proven themselves through the years and are a key component of our product range for supporting small and medium-sized enterprises. More than 7,500 supported leasing contracts have been concluded since the beginning of this successful cooperation. Similar collaborations are in place with LfA Förderbank Bayern, Thüringer Aufbaubank, and Investitionsbank Berlin," explained Jörg Eicker, Chief Financial Officer (CFO) of GRENKELEASING AG. The full Financial Report for the 2nd Quarter and the First Half-Year 2014 may be accessed at www.grenke.de/en INVESTOR RELATIONS - financial reports - financial reports 2014. Should you have any queries, please contact: Renate Hauss Tel.: +49 7221 5007-204 Fax: +49 7221 5007-4218 E-mail: investor@grenke.de Internet: http://www.grenke.de, http://www.grenkeleasing.de, http://www.grenkebank.de, http://www.grenkefactoring.de The GRENKE Group The GRENKE Group is a broadly diversified provider of efficient services in Small-Ticket-IT-Leasing, Factoring and Banking for small and medium-sized companies. In addition, the GRENKE Bank offers its classic online services also to private customers. The GRENKE Group is independent of vendors and banks and holds a leading market position in Europe in the field of small-ticket IT leasing for products such as PCs, notebooks, copiers, printers, or software of relatively low asset value. The GRENKE Group operates in 27 countries and employs more than 900 staff. GRENKELEASING AG is listed in the Prime Standard of the Frankfurt Stock Exchange and is included in the SDAX. GRENKELEASING AG shares are listed in the SDAX on the Frankfurt Stock Exchange with the code GLJ, ISIN DE0005865901. Information on the GRENKE Group and its products is available at http://www.grenke.de End of Corporate News --------------------------------------------------------------------- 25.07.2014 Dissemination of a Corporate News, transmitted by DGAP - a company of EQS Group AG. The issuer is solely responsible for the content of this announcement. DGAP's Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------- Language: English Company: GRENKELEASING AG Neuer Markt 2 76532 Baden-Baden Germany Phone: +49 (0)7221 50 07-204 Fax: +49 (0)7221 50 07-4218 E-mail: investor@grenke.de Internet: www.grenke.de ISIN: DE0005865901 WKN: 586590 Indices: SDAX Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Düsseldorf, Hamburg, München, Stuttgart End of News DGAP News-Service --------------------------------------------------------------------- 279332 25.07.2014