|
1. Summary
• Consolidated EBT rises to EUR 7.0 million
• Operating revenue up by 14.4%
• Sixt experiences increasing demand in rental business
• Forecasts for full-year 2005 confirmed
The Sixt Group's positive business development in 2004 continued gaining momentum in Q1 2005. Revenue and earnings for the
first three months clearly exceeded expectations. The European mobility services provider more than tripled consolidated EBT
to EUR 7.0 million in Q1, seasonally the weakest quarter (Q1 2004: EUR 2.1 million). Operating revenue from rental and leasing
business rose by 14.4%. The Company is confirming the full-year forecasts made at the end of March in full.
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 |
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2. Report on the Position of the Sixt Group
2.1 General developments in the Group
Consolidated revenue in Q1 2005 totalled EUR 568.9 million, following EUR 525.0 million in Q1 2004. This represents an increase
of 8.4%. EUR 98.0 million of consolidated revenue was generated abroad, up 11.8% on the prior-year period (EUR 87.7 million).
Operating revenue from rental and leasing activities - which best reflects the performance of the Sixt Group - amounted to
EUR 239.5 million in the first three months. This represents an increase of 14.4% over the comparable period of the previous
year (EUR 209.4 million), and clearly exceeded expectations. The sharp increase in revenue is due in particular to vehicle rental
growth in Germany, where business and corporate customers, a key market segment for Sixt, picked up for the first time in a long time.
However, the Group also achieved further revenue growth abroad.
Revenue from the vehicle rental business rose by 21.2% to EUR 169.4 million in the period from January to March 2005 (prior-year
period: EUR 139.9 million). Leasing revenue increased slightly by 0.7% from EUR 69.5 million to EUR 70.1 million. The Vehicle Rental
Business Unit accounted for 71% of consolidated operating revenue in the period under review (prior-year period: 67%), and 29% was
generated by the Leasing Business Unit (prior-year period: 33%).
Revenue from sales of used rental and lease vehicles - almost all of which are secured by way of buy-back agreements with dealers
or manufacturers - amounted to EUR 328.6 million in the first three months. This represents an increase of 4.4% over the comparable
period of the previous year (EUR 314.7 million).
The Sixt Group achieved significant earnings growth in what is traditionally a seasonally weaker first quarter. Consolidated
earnings before taxes (EBT), the key earnings parameter in the Group's reporting, amounted to EUR 7.0 million, more than triple
the prior-year figure (EUR 2.1 million). Both operating Business Units, Vehicle Rental and Leasing, recorded an increase in earnings.
Along with domestic growth, foreign EBT also improved (EUR 1.0 million as against EUR -0.6 million in the prior-year period). Despite
improved market-driven growth opportunities, particularly in the Vehicle Rental Business Unit, Sixt adhered to its successful principle
of previous years of avoiding business with inadequate margins. The "Other" segment recorded EBT of EUR 1.8 million (prior-year period:
EUR 0.1 million), in particular from e-commerce business and financial income.
2.2 Vehicle Rental Business Unit
Despite a renewed deterioration in overall economic conditions in the first three months of 2005 in Germany in particular,
Sixt recorded an upturn in demand in the vehicle rental market. This increase applied particularly to the business and corporate
customers segment, which accounted for almost 60% of Sixt's revenue from the Vehicle Rental Business Unit in full-year 2004. At the
same time, Sixt profited from the staffing and organisational measures introduced in the second half of 2004 to strengthen its sales
activities.
As part of the Group's internationalisation strategy, the global franchise network was expanded to include the Ukraine in
January, meaning that Sixt is now present in almost every country in Eastern Europe. The franchise cooperation launched in December
in Brazil developed satisfactorily.
Rental products such as SIXTI and Sixt Holiday Cars were developed further in Q1. For example, the low-cost brand SIXTI introduced a
new product and price concept in January, comprising a larger range of vehicles and increased flexibility for customers. The online
booking tool for Sixt Holiday Cars was upgraded and made substantially easier for customers to use.
Rental revenue in the Vehicle Rental Business Unit totalled EUR 169.4 million in the first three months of 2005, compared with EUR
139.9 million in the same period of the previous year (+21.2%). Domestic operations recorded significant growth of 24.8% to EUR 135.7
million (prior-year period: EUR 108.8 million). Foreign revenue increased by 8.3% to EUR 33.7 million (prior-year period: EUR 31.1 million).
Revenue from used vehicle sales in the period under review amounted to EUR 261.1 million, 3.8% higher than in the prior-year period
(EUR 251.5 million). The Vehicle Rental Business Unit recorded quarterly revenue of EUR 430.5 million overall, after EUR 391.4 million
in the prior-year period (+10.0%).
The Vehicle Rental Business Unit reported EBT of EUR 3.1 million after only breaking even in the same period of the previous year.
The average number of rental vehicles in the first three months was approximately 45,400, up 8.4% from 41,900 in the same
period of the previous year. The number of rental offices worldwide (own offices and franchisees) rose further in the course
of Sixt's international expansion, from 1,332 as at 31 March 2004 to 1,403 as at 31 March 2005.
2.3 Leasing Business Unit
The growth trend in the German market for equipment leasing continued, following the recovery in 2004. According to
information from the Bundesverband Deutscher Leasing-Unternehmen (BDL - German Association of Leasing Companies) the year-on-year
growth in Q1 2005 amounted to 4.3%, measured in terms of the number of contracts, or 5.5% in terms of the acquisition value of the
items concerned. The industry is profiting from the ongoing low interest rates and the growing realisation, particularly among
middle-market companies, that vehicle leasing offers an alternative financing method to purchasing that helps take the pressure
off their balance sheets.
Sixt Leasing is one of the leading vendor-neutral and non-bank providers of full service leasing in Germany, providing a variety
of services in addition to the traditional finance function that enable private and corporate customers to lower their fleet costs.
The product offering was further optimised in Q1. For example, Sixt Leasing is the first vendor-neutral leasing company on the
Internet to offer a vehicle configurator comprising a fully integrated selection of packages for major customers. Among other things,
this user-friendly solution automatically refers customers to price advantages available for certain fittings.
The Leasing Business Unit generated leasing revenue of EUR 70.1 million in the first three months of 2005, a year-on-year increase
of 0.7% (prior-year period: EUR 69.5 million). Revenue from the sale of leasing vehicles for the period January to March grew 6.8%
to EUR 67.5 million (Q1 2004: EUR 63.2 million). Overall, revenue from the Leasing Business Unit for the first three months totalled
EUR 137.6 million, compared with EUR 132.7 million in the prior-year period (+3.7 %).
EBT in the Leasing Business Unit amounted to EUR 2.1 million, up 6.8% on the prior-year period (EUR 2.0 million).
2.4 Outlook
In the first few months of 2005, the prospects of an economic upturn in Germany receded further. The major economic research
institutes reduced their spring forecasts for GDP growth, published at the end of April, to 0.7% after predicting 1.5% in autumn 2004.
For the euro zone, the European Central Bank forecasts GDP growth of 1.6%.
The Sixt Group outperformed expectations in the first three months of 2005. The Managing Board is also optimistic for the year as a whole.
Based on a renewed overall upturn in demand for mobility services and a noticeable increase in sales activities in both business units,
it expects the positive trend to continue and confirms the guidance issued in March 2005:
Sixt is conservatively estimating around 5% growth in consolidated operating revenue and at least 20% growth in consolidated EBT for the
year as a whole. The forecasts presuppose that the macroeconomic environment does not deteriorate significantly, that rental prices remain
stable and that no unforeseen events occur.
|
| 3. Consolidated Balance Sheet and Statement of Changes in Equity |
|
| Assets |
Interim report |
Annual financial
statements |
| EUR thou. |
31 Mar. 2005 |
31 Dec. 2004 |
|
| Current assets |
| Cash and cash equivalents |
33,881 |
36,879 |
| Trade accounts receivable |
125,408 |
103,631 |
| Accounts receivable due from related parties |
13,006 |
12,738 |
| Inventories |
24,553 |
31,161 |
| Prepaid expenses and other current assets |
41,401 |
49,533 |
| Rental assets |
532,032 |
363,713 |
| Total current assets |
770,281 |
597,655 |
|
| Non-current assets |
| Property, plant and equipment |
27,278 |
29,640 |
| Intangible assets |
2,674 |
2,526 |
| Goodwill |
16,393 |
16,803 |
| Financial assets |
5,784 |
5,784 |
| Leasing assets |
460,937 |
476,181 |
| Total non-current assets |
513,066 |
530,934 |
|
| Total assets |
1,283,347 |
1,128,589 |
|
| Liabilities and shareholders' equity |
Interim report |
Annual financial
statements |
| EUR thou. |
31 Mar. 2005 |
31 Dec. 2004 |
|
| Current liabilities |
| Short-term debt and current portion of long-term debt |
306,224 |
275,032 |
| Trade accounts payable |
286,938 |
187,747 |
| Accounts payable due to related parties |
6,649 |
4,673 |
| Advance payments received |
8,890 |
8,957 |
| Provisions |
130,172 |
108,122 |
| Other current liabilities |
32,110 |
30,450 |
| Others |
4,938 |
4,930 |
| Total current liabilities |
775,921 |
619,911 |
|
| Non-current liabilities |
| Long-term debt, less current portion |
175,784 |
175,844 |
| Capital lease obligations, less current portion |
33 |
3,191 |
| Others |
995 |
937 |
| Total non-current liabilities |
176,812 |
179,972 |
|
| Minority interest |
2,173 |
2,189 |
|
| Shareholders' equity |
| Subscribed capital |
57,611 |
57,611 |
| Capital reserves |
119,145 |
119,145 |
| Revenue Reserves (including unappropriated profit) |
51,685 |
49,761 |
| Profit participation capital |
100,000 |
100,000 |
| Total shareholders' equity |
330,614 |
328,706 |
|
| Total liabilities and shareholders' equity |
1,283,347 |
1,128,589 |
|
|
| Consolidated Statement of Changes in Equity |
|
| EUR thou. |
Subscribed
capital |
Capital
reserves |
Revenue
reserves1) |
Profit
participation
capital |
Minority
interest |
Total |
| 1 January 2004 |
57,299 |
116,902 |
40,658 |
0 |
1,785 |
216,644 |
| Consolidated net income Q1 2004 |
|
|
-1,306 |
|
-42 |
-1,348 |
| Dividends 2003 |
|
|
0 |
|
|
0 |
| Other Changes |
|
|
-704 |
|
|
-704 |
| 31 March 2004 |
57,299 |
116,902 |
38,648 |
0 |
1,743 |
214,592 |
|
|
| EUR thou. |
Subscribed
capital |
Capital
reserves |
Revenue
reserves1) |
Profit
participation
capital |
Minority
interest |
Total |
| 1 January 2005 |
57,611 |
119,145 |
49,761 |
100,000 |
2,189 |
328,706 |
| Consolidated net income Q1 2005 |
|
|
1,947 |
|
-52 |
1,895 |
| Dividends 2004 |
|
|
0 |
|
|
0 |
| Other Changes |
|
|
-23 |
|
36 |
13 |
| 31 March 2005 |
57,611 |
119,145 |
51,685 |
100,000 |
2,173 |
330,614 |
1) Including unappropriated profit
|
|
|
The Group's total assets rose by 13.7% to EUR 1.28 billion as at 31 March 2005, as against EUR 1.13
million at 31 December 2004. This increase was primarily due to the considerable increase in rental
assets as at the reporting date, which climbed 46.3% as against the 2004 year-end figure to EUR 532.0
million. This sharp rise reflects the expansion of the rental fleet due to increased demand; in addition,
a large proportion of the vehicles were financed through purchase.
Lease assets as at 31 March 2005 reached EUR 460.9 million, and was thus 3.2% below the figure as at 31 December 2004.
With regard to the equity and liabilities side of the balance sheet, current liabilities increased
quarter-on-quarter by 25.2% to EUR 775.9 million. This was primarily due to the increase in trade payables
by EUR 99.2 million resulting from the expansion of the vehicle fleet. Furthermore, reporting date effects
have to be taken into account. At EUR 176.8 million, non-current liabilities were slightly (1.8%) down on
the 2004 year-end figure (EUR 180.0 million).
Group equity amounted to EUR 330.6 million as of 31 March 2005 (31 December 2004: EUR 328.7 million). This corresponds
to an equity ratio of 25.8%, significantly above the industry average. However, this figure was down on that for
the 2004 year-end (29.1%) due to the growth in total assets. Equity includes the EUR 100 million in profit
participation certificates issued in autumn 2004. Without the profit participation certificates, the equity
ratio was 18.0%.
|
|
| 4. Earnings performance |
|
Group Profit and Loss Account
Nature of expense method - EUR thou. |
Q1
2005 |
Q1
2004 |
|
| Revenue |
568,950 |
524,980 |
| Other operating income |
2,279 |
2,085 |
| Fleet expenses and cost of lease assets |
423,446 |
405,796 |
| Personnel expenses |
22,709 |
21,613 |
| Depreciation and amortisation 1) |
43,033 |
27,476 |
| Amortisation of goodwill |
410 |
410 |
| Other operating expenses |
64,262 |
60,698 |
|
| Operating income |
17,369 |
11,072 |
| Financial result (interest income and expenses)2) |
-10,407 |
-8,987 |
| Result before taxes and minority interest |
6,962 |
2,085 |
| Income tax + other taxes |
5,067 |
3,433 |
| Extraordinary income / expenses |
|
|
| Result before minority interest |
1,895 |
-1,348 |
| Minority interest |
-52 |
-42 |
| Result after minority interest |
1,947 |
-1,306 |
|
| Net income per share (basic) |
0.08 |
-0.06 |
| Net income per share (diluted) |
|
|
| Weighted average shares outstanding (basic) |
22,504,300 |
22,382,500 |
| Weighted average shares outstanding (diluted) |
|
|
|
1) Item includes depreciation and amortisation of rental assets:
Q1 2005: EUR 38,947 thousand (prior-year period: EUR 25,137 thousand)
2) Including expenses for profit participation capital
Q1 2005: EUR 2,262 thousand (prior-year period: EUR 0 thousand) |
|
|
|
The cost of purchased materials, which corresponds to fleet expenses and the cost of lease assets,
includes expenses relating to the sale of lease and rental vehicles (disposal of residual values
and other expenses). In the first three months of 2005, this item was 4.3% up on the prior-year period
(EUR 405.8 million) at EUR 423.4 million. The rise was primarily due to increased sales of used vehicles.
At EUR 22.7 million, personnel expenses were 5.1% above the prior-year figure, reflecting the higher net
number of employees in the Sixt Group.
Depreciation and amortisation increased overall by 55.8% as against Q1 2004, from EUR 27.9 million to EUR
43.4 million. This was primarily a result of depreciation of rental assets, which increased in volume and
were increasingly financed through purchase (EUR 38.9 million, following EUR 25.1 million in Q1 2004).
Other operating expenses rose by 5.9% from EUR 60.7 million to EUR 64.3 million due to the expansion of the
business. Net interest expense amounted to EUR -10.4 million in the three-month reporting period, following
EUR -9.0 million in Q1 2004. It should be noted in this context that this item contains the proportionate
expenses for profit participation capital of EUR 2.3 million.
EBT for the Sixt Group totalled EUR 7.0 million in the first three months of 2005, a significant increase as
against the prior-year period (EUR 2.1 million). This increase is primarily due to the growth in the Vehicle
Rental Business Unit.
After adjustment for the tax expense of EUR 5.1 million (prior-year period: EUR 3.4 million), and minority
interest, the Group reported net income for the quarter of EUR 1.9 million (prior-year period: net loss of EUR
1.3 million). Net income per share for the first three months, for a slightly increased number of shares,
amounted to EUR 0.08, following EUR -0.06 in Q1 2004.
|
|
| 5. Consolidated Cash Flow Statement |
|
Cash flow statement
EUR thou. |
Q1
2005 |
Q1
2004 |
|
| Cash flows from operating activities: |
| Net profit / loss |
1,895 |
-1,348 |
| Adjustments for: |
|
|
| Minority interest |
|
|
| Depreciation and amortisation |
69,413 |
57,365 |
| Increase / decrease in provisions and accruals |
22,050 |
1,767 |
| Losses / gains on the disposal of fixed assets |
|
|
| Foreign exchange gains / losses |
|
|
| Change in net rental assets |
-207,266 |
-292,226 |
| Change in net working capital |
126,606 |
161,531 |
| Net cash provided by / used in operating activities |
12,698 |
-72,911 |
|
| Cash flows from investing activities: |
| Acquisition of subsidiaries, net of cash acquired |
|
|
| Proceeds from disposal of subsidiaries, net of cash transferred |
|
|
| Purchase of property, plant and equipment, net |
-87,624 |
-71,867 |
| Proceeds from sale of equipment, net |
75,028 |
157,830 |
| Net cash used in / provided by investing activities |
-12,596 |
85,963 |
|
| Cash flows from financing activities: |
| Other changes in equity |
13 |
-703 |
| Proceeds from short- or long-term borrowings |
|
|
| Cash repayments of amounts borrowed |
-13 |
-45 |
| Payment of capital lease liabilities |
-3,158 |
-2,828 |
| Other |
58 |
12 |
| Net cash used in financing activities |
-3,100 |
-3,564 |
| Net effect of currency translation in cash and cash equivalents |
|
|
| Net change in cash and cash equivalents |
-2,998 |
9,488 |
| Cash and cash equivalents at beginning of period |
36,879 |
14,162 |
| Cash and cash equivalents at end of period |
33,881 |
23,650 |
|
|
|
The Sixt Group's net cash provided by operating activities amounted to EUR 12.7 million in Q1 2005,
following net cash used in operating activities of EUR 72.9 million in Q1 of the previous year. Net cash used
in investing activities amounted to EUR 12.6 million (Q1 2004: net cash from investing activities of EUR 86.0
million). Financing activities generated a negative cash flow of EUR 3.1 million (Q1 2004: EUR -3.6 million).
Total consolidated cash funds at 31 March 2005 amounted to EUR 33.9 million, EUR 3.0 million below the 2004
year-end figure.
|
|
| 6. Other Information about the Group |
|
6.1 Accounting
The interim financial statements for the period ended 31 March 2005 contained in this report were prepared
in accordance with the provisions of the Handelsgesetzbuch (HGB - German Commercial Code), as were the
comparative statements for the period ended 31 March 2004.
6.2 Accounting policies
No changes were made to the accounting policies applied in the annual financial statements for the year ended 31 December 2004.
|
|
| 6.3 Sixt Group revenue development |
|
| in EUR million |
Q1 2005 |
Q1 2004 |
Change
in % |
|
| Operating revenue |
239.5 |
209.4 |
+ 14.4 |
| thereof Vehicle Rental |
169.4 |
139.9 |
+ 21.2 |
| thereof Leasing |
70.1 |
69.5 |
+ 0.7 |
|
| Revenue from vehicle sales |
328.6 |
314.7 |
+ 4.4 |
| thereof Vehicle Rental |
261.1 |
251.5 |
+ 3.8 |
| thereof Leasing |
67.5 |
63.2 |
+ 6.8 |
|
| Other revenue |
0.8 |
0.9 |
- 6.2 |
| Consolidated revenue |
568.9 |
525.0 |
+ 8.4 |
|
|
| 6.4 Segment reporting |
|
|
The Sixt Group's segment reporting since the end of the financial year 2003
comprises the segments Vehicle Rental, Leasing and Other.
|
|
Q1 2005
EUR thou. |
Vehicle
Rental |
Leasing |
Other |
Consolidation/
Reclassification |
Sixt
Group |
| Revenue |
430,561 |
137,621 |
768 |
0 |
568,950 |
| Intersegment sales |
1,247 |
4,607 |
499 |
-6,353 |
0 |
| Total revenues |
431,808 |
142,228 |
1,267 |
-6,353 |
568,950 |
| Depreciation / amortisation |
43,310 |
25,9955) |
108 |
-25,970 |
43,443 |
| Financial result 1) |
-7,925 |
-5,443 |
2,974 |
-13 |
-10,407 |
| Segment result 2) |
3,046 |
2,136 |
1,780 |
0 |
6,962 |
| Investments 3) |
1,696 |
85,923 |
5 |
0 |
87,624 |
| Segment assets |
864,262 |
518,058 |
751,829 |
-850,802 |
1,283,347 |
| Segment liabilities |
781,812 |
495,868 |
319,881 |
-644,828 |
952,733 |
| Employees 4) |
1,607 |
202 |
18 |
0 |
1,827 |
|
|
Q1 2004
EUR thou. |
Vehicle
Rental |
Leasing |
Other |
Consolidation/
Reclassification |
Sixt
Group |
| Revenues |
391,400 |
132,762 |
818 |
0 |
524,980 |
| Intersegment sales |
2,456 |
33,576 |
493 |
-36,525 |
0 |
| Total revenues |
393,856 |
166,338 |
1,311 |
-36,525 |
524,980 |
| Depreciation / amortisation |
27,172 |
29,5215) |
672 |
-29,479 |
27,886 |
| Financial result 1) |
-6,145 |
-4,589 |
1,378 |
369 |
-8,987 |
| Segment result 2) |
17 |
1,965 |
103 |
0 |
2,085 |
| Investments 3) |
2,312 |
69,551 |
4 |
0 |
71,867 |
| Segment assets |
954,686 |
423,450 |
596,102 |
-797,429 |
1,176,809 |
| Segment liabilities |
923,659 |
403,837 |
338,753 |
-704,032 |
962,217 |
| Employees 4) |
1,545 |
196 |
14 |
0 |
1,755 |
1) Corresponds to net interest result (including expenses for profit participation capital)
2) Corresponds to earnings before taxes (EBT)
3) Corresponds to investments in fixed assets, not including rental assets
4) Annual average number of employees
5) Reported under fleet expenses and cost of lease assets
Q1 2005: EUR 25,970 thousand (prior-year period: EUR 29,479 thousand)
|
|
|
|
6.5 Employees
As a result of its healthy business performance, the Sixt Group increased the number of employees. An average
of 1,827 people were employed in Q1. This corresponds to around 70 more employees than, or a 4.1% increase on,
the prior-year period. The expansion primarily took place in Germany. An average of 497 people were employed abroad
in Q1 2005, compared with 532 in Q1 2004. The 6.6% decline is entirely result of the systematic reduction of
business in the UK and its transfer to franchisees in the course of the previous year. This was combined with the streamlining
of administrative functions at the UK subsidiary.
6.6 Investments
In the first three months of 2005, approximately 27,400 vehicles worth almost EUR 620 million were added to the
rental and leasing fleet. During the same period of 2004, the relevant figures were 22,300 vehicles worth just under
EUR 470 million. The sharp rise in investments reflects the growth in business volume and the positive expectations
for further business development in 2005.
|
»
Download the Interim Report in PDF format (ZIP file, 216KB) |
Pullach, 31 May 2005
Sixt Aktiengesellschaft
The Managing Board
|
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