Grenke AG (0R97.IL) Earnings Call Transcript & Summary

Ladies and gentlemen, welcome to our new business update for the first quarter 2024. My name is Anke Linnartz. I'm Head of IR, and I'm here together with our designated CFO, Dr. Martin Paal. Welcome, Martin.

Thank you, Anke. Also, a very warm welcome from my side.

Martin, we got off to a good start with plus 10% in new leasing business, and we were wondering what were the growth drivers behind that?

Yes. We are really satisfied with the 3 sides, but let me just elaborate on that from a little bit more broader perspective. The first quarter normally is the quarter where new leasing volume comes in a bit softer compared to the other ones. Q2 and Q4 are the quarters with the highest volume and Q3 a little bit lower, but always above the first quarter. And really a double-digit growth of 10% compared to the first quarter of 2023 is a very good result. And if you consider our growth dynamics we have in a typical financial year at GRENKE, you might have seen that we are really well on track to achieve our ambitious 2024 targets given these dynamics.

And dynamics brings me on to profitability. So can you elaborate on the CM2 margin now in the first quarter?

Yes, for sure. Our CM2 margin, which is one of our most important KPIs, reached a level of 16.8% in the first quarter of 2024, and this is 10 basis points higher compared to the last year's first quarter. And this is important as we are really able to enhance our performance against the backdrop of a really challenging macroeconomic environment, especially at the beginning of the year. And this really profitable 16.8% contribution margin too helps us to achieve our profit target for 2024 for this year, but also for the following years.

So Martin, just so you mentioned it, what is your view on the overall economy?

Yes, that's a good point, especially January was characterized by some reluctance to invest given the overall economic environment, especially in Germany. However, from February, March onwards, there was a clear recovery what we have seen, and this is backed by the number of lease requests, which grew by about 10% compared to the last quarter of 2023. And the good news is we are well equipped to serve this demand.

Thank you very much for your comments. Ladies and gentlemen, this concludes our new business update for the first quarter. Thank you for joining. We look forward to you tuning in again next time. Until then, we wish you all the best and say goodbye from Baden-Baden.

Bye-bye.