LeasePlan publishes 2019 Annual Report and crisis steps
LeasePlan Corporation N.V. has published its 2019 Annual Report as it also comments on its actions to prepare for the unprecedented times during the Covid-19 pandemic.
The results, available to view here, show an underlying net result of €557m (£510.5m) – down 3.4% from the figure of €576m (£527.9m) in 2019 – alongside significant strategic investments of approximately €100m (£91.2m) in its operations, particularly in its CarNext.com platform.
Within the Car-as-a-Service side, the serviced fleet grew 2.4% to 1.9 million vehicles with continued growth in European core markets offset by the rest of the world as result of service-only contract losses. The funded fleet grew 3.8% to 1.4 million vehicles, driven by growth in core European markets.
Revenues increased by 6.3% to €10.1bn (£9.2bn), driven by higher volumes and increased B2C retail sales penetration in vehicle sales and end of contract fees as well as solid growth in lease and additional services income.
Underlying net result was up 1.8% to €605m (£554m) driven by solid performance in the core business partially offset by lower PLDV.
LeasePlan also continued working towards its ambition to achieve net zero tailpipe emission from its funded fleet by 2030, with 10% of new orders being for EV powertrains in Q4 of 2019. Within the corporate segment, take-up of its full package EV solution, which is now available in 12 countries, increased as it continued to encourage customers to make the switch to electric vehicles. Among funded vehicles, CO2 emissions stood at 133g/km in 2019.
In the CarNext.com sector, B2C retail volumes were up 50% to approximately 39,600 vehicles. B2B volumes in 2019 were up 4.2% to 214,600 vehicles.
Revenue was up 22.5% to €120m (£110m) driven by higher B2C retail volumes and higher third-party revenues. Gross profit was up 14.1% to €38m (£34.8m) due to higher B2C retail volumes.
Underlying net result in 2019 was down to €-49 million (£-44.9m) driven by increased strategic investments.
Commenting on the figures, CEO Tex Gunning said: “Throughout its 55-year history, LeasePlan has delivered a consistent track record of sustainable growth and profitability. 2019 was no exception: LeasePlan delivered a solid underlying net result of €557m, while making significant strategic investments in our operations, particularly in our fast-growing CarNext.com platform and digital transformation. Our 2019 results are a proofpoint of the strength and resilience of our business and our market, as well as LeasePlan’s strategy to capitalise on the megatrend from car ownership to subscription services.”
He added: “Today, we find ourselves in unprecedented times, with the Covid-19 health crisis causing significant disruption in the global economy. At LeasePlan, we have already taken swift action to ensure the safety of our employees, minimise the impact on our business and our customers, and adjust to the new economic reality. While we are in a strong position as a result of the fundamental strength and resilience of our business – including our high-quality customer base, the contractually recurring nature of our business and income streams, strong balance sheet and diverse funding platform – we have taken the prudent decision to defer non-urgent investments and pay no further dividends on our 2019 net results. In short, we have taken decisive steps to ensure that LeasePlan has maximum room for manoeuvre in the coming months and will emerge strongly from the crisis when it passes.”