grenke achieves strong new business in Q3 2024

• Leasing new business rises year-on-year by 24.9% in the third quarter,
  reaching EUR 738.5 million (Q3 2023: EUR 591.1 million)
• Contribution margin 2 (CM2) grows by 29.1% to EUR 125.8 million
  (Q3 2023: EUR 97.4 million)
• CM2 margin increases to 17.0% (Q3 2023: 16.5%)

Baden-Baden, October 2, 2024: grenke AG, a global financing partner for small and medium-sized enterprises, increased its leasing new business in the third quarter of 2024 by 24.9% compared to the same quarter of the previous year, reaching EUR 738.5 million (Q3 2023: EUR 591.1 million). Contribution margin 2 (CM2), a key indicator of the profitability of new business, grew by 29.1% year-on-year, totalling EUR 125.8 million (Q3 2023: EUR 97.4 million). The CM2 margin of 17.0% (Q3 2023: 16.5%) in the third quarter met the medium-term guidance level.

Dr Sebastian Hirsch, CEO of grenke AG: “We have strongly underscored our ambition to generate record new business of more than three billion euros this year. The very robust third quarter was another milestone following a strong first half-year. Recent interest rate cuts by central banks are likely to stimulate new investment, including among small and medium-sized enterprises. The first indication of this is the increasing number of lease applications we are currently receiving for small-ticket financing.”

Dr Martin Paal, CFO of grenke AG: “The successful placement of our third bond at the end of September, with a volume of EUR 500 million, made a significant contribution to ensuring our ambitious growth. This clearly proves that we have established ourselves in the benchmark class. The favourable coupon of 5.125% will further enhance our refinancing conditions.”

Green economy objects continue to gain traction – ongoing expansion of reseller network
In Q3 2024, lease objects from the green economy category continued to make a significant contribution to leasing new business, as they have in previous quarters. More than one in five lease contracts (21.0%) fell into this object category (Q3 2023: 22.7%). The main drivers were eBikes, water treatment systems, and solar systems. The international sales network was expanded further and now comprises over 38,000 resellers (Q3 2023: 35.3k). The direct customer business as a share of the total leasing new business increased slightly to 17.7% (Q3 2023: 17.5%).

DACH is the strongest region ahead of Western Europe
The DACH region saw the strongest growth, increasing by 19.5% year-on-year to EUR 189.3 million (Q3 2023: EUR 158.4 million) and accounting for 25.6% of leasing new business. The largest share in this region came from Germany, which contributed 20.9% of the total leasing new business. Western Europe (without DACH) was second, increasing 17.8% compared to the same prior-year quarter, contributing leasing new business of EUR 175.7 million (Q3 2023: EUR 149.2 million). France was the strongest country in this region, contributing 18.1% of the total leasing new business. Southern Europe ranked third in terms of volume, with growth of 32.7% to EUR 166.5 million (Q3 2023: EUR 125.5 million). Within Southern Europe, Italy recorded the largest share, contributing more than half of leasing new business in this region and achieving growth of 42.9%.

The Northern/Eastern Europe region recorded growth of 33.3%, generating a volume of EUR 158.6 million (Q3 2023: EUR 119.0 million). Denmark and Romania performed particularly well, with grenke achieving increases in new business in the third quarter of 2024 of 107.4% and 40.0%, respectively. The other regions achieved growth of 24.2%, reaching EUR 48.4 million (Q3 2023: EUR 39.0 million). This category includes the future markets USA, Canada and Australia.

Growing demand for leasing
Demand for leasing solutions to finance investments and optimise liquidity remains strong internationally. In the third quarter of 2024, grenke’s lease applications grew to around 146,000 (Q3 2023: around 130,000). Approximately 76,000 new lease contracts were signed, compared to around 68,000 in the same prior-year quarter. The conversion rate was largely stable at 52.2% and close to last year’s level (Q3 2023: 52.9%). At EUR 9,702, the average ticket size remained under EUR 10,000 (Q3 2023: EUR 8,667).

Placement of third benchmark bond; growth in factoring business
In September, grenke successfully issued its third benchmark bond with a volume of EUR 500 million. The bond carries an interest rate of 5.125% and matures in January 2029. As of the September 30, 2024 reporting date, the deposit business amounted to EUR 1,877 million, representing an increase of 16.1% since the start of the year (December 31, 2023: EUR 1,617 million).

The factoring business held for sale recorded an increase of 11.2% in the third quarter of 2024, equivalent to new business volume of EUR 234.2 million (Q3 2023: EUR 210.7 million). grenke Bank’s lending new business, which largely consists of the microcredit business, reached EUR 9.6 million during the reporting period (Q3 2023: EUR 9.6 million). 

In a short interview, CFO Dr Martin Paal explains the new business figures for the third quarter of 2024.

These and other updates are also available on the grenke AG Investor Relations channel on LinkedIn.

The quarterly statement for Q3 and Q1-Q3 2024 will be published on November 14, 2024.

Overview of new business (in EUR millions)

Leasing regions: DACH: Austria, Germany, Switzerland

                            Western Europe without DACH: Belgium, France, Luxembourg, Netherlands

                            Southern Europe: Croatia, Italy, Malta, Portugal, Slovenia, Spain

                            Northern | Eastern Europe: Denmark, Finland, Ireland, Latvia, Norway, Sweden, UK | Czechia,                                          Hungary, Poland, Romania, Slovakia

                            Other regions: Australia, Brazil, Canada, Chile, Singapore*, Turkey*, UAE, USA

                            *Leasing new business was discontinued in 2023.

Factoring regions: DACH: Germany, Switzerland

                              Northern | Eastern Europe: Hungary, Ireland, Poland, UK

                              Southern Europe: Italy, Portugal

grenke announced its intention to sell the factoring companies on January 31, 2024.