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DGAP-News: GRENKE AG / Key word(s): Change in Forecast/Miscellaneous
GRENKE AG: New leasing business in the third quarter adversely affected by supply bottlenecks; increased momentum expected in the fourth quarter; guidance for 2021 adjusted
- New leasing business in Q3 2021 declines year-on-year to EUR 372.2 million (Q3 2020: EUR 517.6 million)
- CM2 margin in Q3 2021 at 17.1% (Q3 2020: 18.4%)
- Guidance for new leasing business in 2021 adjusted to EUR 1.5 billion to EUR 1.7 billion (previously EUR 1.7 billion to EUR 2.0 billion); forecast for net profit in 2021 remains at EUR 60 million to EUR 80 million
- Successful increase in bond of EUR 125 million placed
- GRENKE BANK AG accredited as selected partner for the German Federal Government's Microcredit Fund for the third consecutive time
- Previously announced change in the Board of Directors of GRENKE BANK AG completed with appointment of Dr Oliver Recklies as of October 1, 2021
Baden-Baden, October 4, 2021: GRENKE AG, a global financing partner for small and medium-sized enterprises, achieved new leasing business of EUR 372.2 million in the third quarter of 2021 (Q3 2020: EUR 517.6 million). Global supply bottlenecks, specifically at manufacturers of computer and office equipment, were the cause of the weaker year-on-year new leasing business. The contribution margin 2 declined slightly in the third quarter due to refinancing costs and amounted to 17.1% (Q3 2020: 18.4%). New business volume is the total acquisition cost of all newly purchased leased assets.
As a result of the current developments, the Company has adjusted its guidance for new leasing business in the current financial year to EUR 1.5 billion to EUR 1.7 billion (previously EUR 1.7 billion to EUR 2.0 billion). The forecast for net profit in the current financial year remains unchanged at EUR 60 million to EUR 80 million.
GRENKE's chair of the Board of Directors, Michael Bücker: " Following my first few weeks at GRENKE AG, I am convinced of its potential as a backbone for financing SMEs." In addition, GRENKE BANK AG has been accredited as a partner bank of the German Federal Government's Microcredit Fund for the third consecutive time. In his comments, Michael Bücker stated: "Building on this strong starting position, we intend to accelerate our business in the fourth quarter of 2021 and, therefore, have launched a sales campaign." Dr Sebastian Hirsch, Chief Financial Officer of GRENKE AG, added: "With the successful increase in our latest issued bond, we have proven our refinancing ability on the capital market, laying the foundation for additional new business in the upcoming year."
Development of the percentage contribution margin
Contribution margin 1 recorded a decrease of 38.7% to EUR 40.4 million (Q3 2020: EUR 65.9 million), with the CM1 margin falling from 12.7% in Q3 2020 to 10.9% in Q3 2021.
The GRENKE Group received a total of 100,416 lease applications in the third quarter of 2021. Of the total, 22,339 applications originated in the DACH region and 78,077 applications in international markets. At the Consolidated Group level, 48,724 new lease contracts were concluded from these applications, corresponding to a conversion rate of 49%.
With a purchased receivables volume of EUR 178.5 million, GRENKE Group Factoring's new business recorded a favourable increase of 15.6% compared to the same period in the previous year (Q3 2020: EUR 154.4 million).
GRENKE BANK's new SME lending business amounted to a mere EUR 0.9 million in the third quarter of 2021 due to the discontinuation of the lending business (Q3 2020: EUR 32.1 million). With a deposit volume of EUR 1,521.3 million as of September 30, 2021 (September 30, 2020: EUR 1,300.0 million), GRENKE BANK's deposit business continues to be an important pillar of the Consolidated Group's refinancing.
Successful bond increase of EUR 125 million
On September 9, 2021, the GRENKE Group increased an existing bond (ISIN: XS2155486942) by a further EUR 125 million, further strengthening its liquidity base for the continued development of new business. The high order book demand of over EUR 230 million confirmed the capital market's confidence in GRENKE. The issue yield is approximately 2.5%. The bonds totalling EUR 125 million will trade under the code ISIN XS2386650191 until October 25, 2021. Subsequently, they will merge into the existing quotation under ISIN XS2155486942.
German Federal Government again awards GRENKE contract for Microcredit Fund Germany
New member of the Board of Directors of GRENKE BANK
Overview of new business development (in EUR millions)
* Regions: DACH: Germany, Austria, Switzerland
The quarterly statement for the third quarter and the first nine months of 2021 will be published on November 10, 2022.
For further information, please contact:
The GRENKE Group (GRENKE) is a global financing partner for small and medium-sized companies. As a one-stop shop for customers, GRENKE's products range from flexible small-ticket leasing and demand-driven bank products to convenient factoring. Fast and easy processing and personal contact with customers and partners are at the centre of GRENKE's activities.
Founded in 1978 in Baden-Baden, the GRENKE Group operates in 33 countries and employs more than 1,800 staff worldwide. GRENKE shares are listed in the SDAX on the Frankfurt Stock Exchange (ISIN DE000A161N30).
04.10.2021 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
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