- Nine-month net profit increases by 24% to EUR 97.9 million (9M-2017: EUR 79.3 million)
- Full-year 2018 Consolidated Group net profit target narrowed to an increase of EUR 126 to 132 million compared to the previous target of EUR 123 to 131 million
- Strong equity base: equity ratio at 19.2% after the first nine months of 2018
Baden-Baden, October 30, 2018. The growth momentum of the GRENKE Consolidated Group continued in the third quarter of the current fiscal year. "With an increase in net profit of 24 percent from EUR 79.3 million to EUR 97.9 million in the first nine months of 2018, we are clearly on course. As a result, we narrow our full-year 2018 forecast and now expect Consolidated Group net profit to be in the range of EUR 126 million to EUR 132 million," said Antje Leminsky, Chair of the Board of Directors of GRENKE AG. As already reported on October 2, 2018, new business at the GRENKE Group grew by a total of 22% in the first nine months of 2018 compared to the same period of the previous year. With an increase of 23%, new business volume at GRENKE Group Leasing was at the upper end of the published fullyear forecast.
In the reporting quarter and the nine-month period, the profitable new business in the recent past was the main driver of net interest income and, thus, of the profitability of the Consolidated Group. Overall, interest and similar income from financing business increased by 14% in the first nine months versus a rise in expenses from interest on refinancing of only 8%. As a result, net interest income increased by 15% from EUR 182.2 million in the first nine months of the previous year to EUR 209.0 million. Net interest income after the settlement of claims and risk provision – which as per the beginning of 2018 under IFRS 9 includes not only losses that have already occurred but also expected losses – increased 13% to EUR 142.2 million after EUR 126.2 million in the same period of the previous year. The Consolidated Group’s loss rate, based on the overall risk provisioning in accordance with IFRS 9, amounted to 1.3% after 1.4% in the prior year period. The results from service business and new business in the first nine months increased by 21% and 24%, respectively. Overall, the Consolidated Group's income from operating business increased by 19% from EUR 220.0 million in the first nine months of the previous year to EUR 262.1 million.
Including the most recent cell divisions and acquisitions, the average number of employees at the GRENKE Consolidated Group increased by 19% to 1,429 employees compared to the same period in the prior year. Staff costs rose to the same extent and were 20% higher than in the prior-year period. The Consolidated Group’s second major expense item, selling and administrative expenses, increased by 22% as a result of the Consolidated Group’s growth and intensified sales and marketing activities.
The operating result exceeded the previous year’s figure of EUR 104.9 million by 12% and reached EUR 117.1 million. As mentioned above, net profit increased by 24% to EUR 97.9 million in the nine-month period compared to EUR 79.3 million in the first nine months of the previous year. This resulted in earnings per share of EUR 2.06 compared to EUR 1.74 in the nine-month period of the prior year.
The Consolidated Group’s balance sheet structure was very solid as per the September 30, 2018 reporting date. The equity ratio came to 19.2% as per September 30, 2018, which was above our long-term benchmark of 16%. "With our solid equity base, we are keeping a keen eye on one of our most important strategic goals – high financial strength – which remains the key to the GRENKE Group's further expansion, the continuation of our successful internationalisation strategy, the targeted expansion of our market share and the systematic development of our range of products and services", explained Sebastian Hirsch, Member of the Board of Directors of GRENKE AG.