Grenke AG — Earnings Release 2009

Apr 30, 2009

News Details

Corporate | 30 April 2009 07:46

GRENKELEASING AG:Quarterly financial report as per March 31, 2009

GRENKELEASING AG / Quarter Results

Release of a Corporate News, transmitted by DGAP - a company of EquityStory
AG.
The issuer / publisher is solely responsible for the content of this announcement.

---

• Group net profit after-tax amounts to EUR 7.2 million after integration
  expenses of Hesse Newman Bank (compared with EUR 7.9 million in Q1-2008)
• Liquidity rises to EUR 112.9 million, following EUR 77.0 million as per
  December 31, 2008

Baden-Baden, April 30, 2009: As announced, in Q1-2009 the management of our
business focused on raising liquidity in view of the bond falling due for
payment in April 2009. Accordingly, our holding of cash and cash
equivalents at the end of the quarter increased to EUR 112.9 million which,
together with the existing credit lines, was used to repay the bond at the
due date on 20 April.

The higher settlement of claims resulting from the weak economy overall was
offset by increased net interest income, resulting in net interest income
after settlement of claims and risk provisions matching the previous year's
level of EUR 11.6 million. The favourable net interest figure, in turn, is
attributable to the fact that we made an effort to improve contribution
margin ratio for new business already at the beginning of the current
financial crisis and ultimately succeeded in doing so. As already reported,
in Q1-2009 we have just reached a new all-time high in terms of
contribution margin 2.

The profit of our insurance business and new business again matched the
previous year's levels. Profit from disposal corresponded more or less to
the figure calculated, with profit from disposal for the reporting quarter
amounting to EUR 0.1 million over and above the calculated value. In the
same period a year earlier, the corresponding figure amounted to EUR 0.9
million. We adjust the calculated residual value at the time of contracting
whenever the actual profit from disposal exceeds or falls short of the
calculated values on a regular and sustained basis.

In the first quarter of 2009, operating income as a whole, at EUR 22.8
million, remained only slightly below the previous year's level of EUR 23.4
million. Effective as of February 12, GRENKELEASING AG acquired 100% of the
Hamburg-based private bank Hesse Newman & Co. AG. The first-time
consolidation of the Hesse Newman Bank in the quarter under review had no
substantial impact on the Group's operating income.

In contrast, on the expense side the first-time consolidation contributed
to an increase in personnel expenses from EUR 6.5 million in the previous
year to EUR 7.4 million in the quarter under review. The opening of two new
branches in Paris and Warsaw likewise contributed to the increase in
personnel costs. On the whole, due to slower international expansion,
however, we registered significantly lower increases in expenses than in
the past.

Accordingly, the Group recorded earnings before taxes of EUR 10.2 million
in the quarter under review, compared with EUR 11.2 million in the previous
year. With a tax rate of 29.4%, which remained at the previous year's
level, the net profit for the period amounted to EUR 7.2 million (Q1-2008:
EUR 7.9 million). Taking account of the overall economic situation, the
costs of holding additional liquidity and the integration costs of the
Hesse Newman Bank, we consider earnings for the first quarter to be very
favourable.

The result was generated by 502 employees, compared with 474 in Q1-2008 (on
a full-time basis, excluding the Executive Board).

'The recent developments relating to contribution margins, liquidity,
balance sheet strength and earnings clearly indicate that the Group is well
prepared for the currently problematic general economic phase and is
capable of steering the business well and precisely even in difficult
times. This is evident not least in the fact that the early adjustment of
contribution margins made it possible to offset the cyclical increase in
claims and risk provisions thanks to improved net interest income figures.
Of course, holding additional liquidity is associated with additional
expenses. Also, the strategically very important acquisition of the Hesse
Newman Bank had reduced earnings in the quarter under review. Against this
background, we are very satisfied with the quarterly results achieved. In
spite of this acquisition, we succeeded in maintaining our equity capital
ratio at its previous high level. If the balance sheet total is adjusted
for cash and cash equivalents, the equity capital ratio even increased
slightly compared with the end of fiscal 2008.

The refinancing situation of the Group is solid in the light of the state
of the refinancing markets, and by acquiring the Hesse Newman Bank, we
further extended our funding base.' explained Dr. Uwe Hack, Deputy Chairman
of the Executive Board of GRENKELEASING AG.

He added: 'The high level of economic uncertainties, particularly with
regard to the liquidity supply to corporates and the future trend in asset
utilisation nevertheless represent significant challenges for the coming
quarters. Accordingly, our policy in underwriting new business will
deliberately remain subject to the principle of caution. Although they are
completely typical during economic downturns and as such form part of our
business model, the growing level of settlement of claims in the current
fiscal year constitutes a major uncertainty factor for our development of
results. The business performance in the second quarter should give clearer
indications of this. On the other hand, we are confident that we will
successfully continue to steer the Group through this difficult phase. The
fact that we also play a proactive role in managing our new business in
these times is reflected by our cell division in Poland, where we now have
two locations after opening a branch office in Warsaw, and by the
acquisition of Hesse Newman in February. In doing so, we have taken an
important step in the direction of extending our business activities and
diversifying our refinancing sources even further.'

The GRENKE Group (incl. franchise partners) now operates in twenty European
countries.

The GRENKELEASING AG Group (excluding franchise partners) is represented in
20 German cities. In addition to nine branches in France, three in
Switzerland, three branches in Italy, and two in Poland, the enterprise
operates with subsidiaries in Austria, the Czech Republic, Spain, the
Netherlands, Denmark, Sweden, Ireland, the United Kingdom and Belgium.

In Norway, Hungary, Romania, Spain (Madrid), Portugal, Slovakia and Finland
as well as in Germany, in the filed of car leasing and factoring,
GRENKELEASING has a franchise system in place.

GRENKELEASING offers contracts predominantly in the field of small-ticket
IT leasing for such products as PCs, notebooks, copiers, printers or
software of a relatively low asset value.

GRENKELEASING AG is listed on the Prime Standard of Frankfurt's Securities
Exchange and is part of the SDAX.

The shares of GRENKELEASING AG are listed on the SDAX of the Frankfurt
Securities Exchange under the identification code GLJ, ISIN DE0005865901.

Information about the company and its products is available on the
Internet, at http://www.grenke.de.

The full quarterly report as per March 31, 2009 is available for download
from www.grenke.de Investor Relations - Financial Data.

The Executive Board

Should you have any queries, please contact:

Renate Hauss
Tel.: 07221/5007-204
Fax: 07221/5007-112
E-mail: investor@grenke.de
Internet:http://www.grenke.de

30.04.2009 Financial News transmitted by DGAP

Language: English
Issuer: GRENKELEASING AG
Neuer Markt 2
76532 Baden-Baden
Deutschland
Phone: +49 (0)7221 50 07-204
Fax: +49 (0)7221 50 07-112
E-mail: investor@grenke.de
Internet: www.grenke.de
ISIN: DE0005865901
WKN: 586590
Indices: SDAX
Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
in Berlin, Stuttgart, München, Düsseldorf, Hamburg

End of News DGAP News-Service

---