Please note that this website shows an excerpt from the grenke AG Annual Report 2024. The annual report, which is also available in the “Reports & Presentations” section of the grenke AG website, prevails.

The global macroeconomic and geopolitical environments in 2024 were fraught with persistent and emerging challenges. A weak economy and rising insolvency rates in key regions added to the uncertainty. The ongoing conflicts between Russia and Ukraine, as well as in the Middle East, had direct and indirect widespread impacts on economic activities. Political upheavals, including the U.S. elections, significantly influenced both national and international economic policies. Close to the same time, government crises in Germany, France, and, most recently, Canada further contributed to instability.

In contrast, monetary easing by central banks worldwide, triggered by declining inflation rates, had a stimulative effect on economic activity. Inflation in the euro area at the beginning of 2024 stood at 2.8 percent, remaining above the 2 percent target. As a result, the European Central Bank (ECB) initially maintained its key interest rate at 4 percent. As inflationary pressures eased during the year, the ECB gradually lowered its benchmark rate. The first cut occurred in June 2024, followed by further reductions in September, October, and December, bringing the rate down to 3 percent by the end of the reporting year. Inflation temporarily fell below the 2 percent target, reaching 1.7 percent in September 2024. However, in the months that followed, it slightly exceeded the ECB’s target, with preliminary estimates indicating a rise to 2.4 percent in December 2024. The ECB refrained from providing specific guidance on future rate changes, instead emphasising its intention to make data-dependent decisions in upcoming meetings. During its meeting on December 12, 2024, the ECB continued to classify its monetary policy as restrictive, though credit conditions for businesses and households had already improved over the course of 2024.

According to the ECB’s Bank Lending Survey, banks surveyed in the euro area reported that they had tightened corporate lending standards in the fourth quarter of 2024 more than at any time since the third quarter of 2023. This was due to increased risks related to the economic outlook, industry- and company-specific conditions, and a lower risk tolerance on their part. Germany and France were particularly affected while lending standards in Italy eased. For the first quarter of 2025, the surveyed banks expected a further tightening of corporate lending standards.

The United States began its monetary easing slightly later than the euro area. At the beginning of 2024, the U.S. federal funds rate ranged from 5.25 percent to 5.5 percent. The U.S. Federal Reserve (Fed) introduced its first rate cut in September 2024, followed by two additional cuts in November and December. By the end of the year, the federal funds rate ranged from 4.25 percent to 4.5 percent. The U.S. inflation rate, measured by the personal consumption expenditures (PCE) price index, which is relevant for the Fed’s inflation target, followed a similar trajectory to that of the euro area. The U.S. inflation rate initially fell during the year (from 2.6 percent in January and 2.8 percent in March to 2.1 percent in September) before rising again toward the year’s end, reaching 2.6 percent in December 2024.

In its World Economic Outlook published in January 2025, the International Monetary Fund (IMF) assessed global economic growth in 2024 as generally stable at an estimated 3.3 percent, although growth varied significantly between countries. At 2.8 percent, the United States grew at a similar pace compared to the prior year, supported by strong consumption. The euro area economy, in contrast, showed only a weak recovery, with year-on-year growth of 0.8 percent. The absence of a stronger recovery in the euro area was due to exceptionally high gas prices in Europe and continued weakness in exports and manufacturing. Consumption, on the other hand, had a positive impact due to higher real incomes. Spain benefitted from tourism, recording strong growth at an above-average rate of 3.1 percent. France and Italy generated growth in the middle of the range, reporting 1.1 percent and 0.6 percent, respectively. The German economy, however, shrank 0.2 percent due to high real interest rates, which drove construction costs higher. The United Kingdom, with growth of 0.9 percent, was at a level similar to that of the euro area.

The IMF also observed progressing disinflation in the months leading up to the publication of its outlook. Median global core inflation was slightly above 2 percent during this period, with moderate nominal wage growth a contributing factor. Despite this, the IMF noted persistently high inflation rates in the services sector, particularly in the United States and the euro area, which could complicate the normalisation of inflation rates.

Corporate insolvencies in the eurozone continued to rise, according to an estimate by Eurostat. The corresponding index was estimated at 174.1 points in Q4 2024, representing a 6.5 percent increase compared to the same quarter of the previous year (Q4 2023: 163.5 points). In a country comparison, France recorded a significantly higher figure at 257.8 points (Q4 2023: 233.9 points), well above the aggregated eurozone value. Germany stood slightly below the average at 161.7 points (Q4 2023: 133.8 points), while Spain and Italy performed somewhat better than the eurozone overall, with 131.2 points (Q4 2023: 137.4 points) and 109.5 points (Q4 2023: 91.3 points), respectively. For full-year 2024, Allianz Trade estimates global insolvency growth at 11 percent compared to the previous year (2023: 7 percent). It forecasts a 25 percent increase in insolvencies for Germany (2023: 22 percent), 22 percent for Italy (2023: 13 percent), 18 percent for France (2023: 35 percent), and 7 percent for Spain (2023: –27 percent). For the entire eurozone, Allianz Trade expects insolvencies to rise by 19 percent (2023: 14 percent).

The Purchasing Managers’ Index (PMI) for the manufacturing and services sectors in the euro area was 49.6 points in December 2024, remaining slightly below the 50-point threshold (December 2023: 47.6 points). The index is derived from a monthly survey of purchasing managers in the manufacturing and services sectors, assessing new orders, production, employment, deliveries received, and inventory levels. The PMI serves as a leading indicator, with values above 50 points indicating an increase in production and values below 50 points signalling a decline in production across the sectors surveyed. Starting from a level of 47.6 points in December 2023, the PMI rose steadily until May 2024 but declined again as the year progressed.

The German companies surveyed by the ifo Institute were more pessimistic at the end of 2024 than in the same month of the prior year. The ifo Business Climate Index, which summarises companies’ assessments of their current business situation and their expectations for the subsequent six-month period, stood at 84.7 points in December 2024 (December 2023: 86.7 points). This marked the index’s lowest level since May 2020. In 2024, the index improved until May but then declined steadily until the end of the year. Growing pessimism was found in all sectors surveyed by the ifo Institute, likely influenced by the potential for U.S. tariffs and political uncertainty in both France and Germany.

Despite the challenging environment, we successfully continued our growth trajectory in leasing new business throughout 2024. We also significantly increased the profitability of our new business compared to the previous year. An unexpected rise in insolvencies in several core markets starting mid-year resulted in a higher loss rate for the portfolio of 1.5 percent in the second half of 2024, compared to 1.1 percent in the first half. For full-year 2024, the loss rate was 1.3 percent (prior year: 1.0 percent).

The ifo Business Climate Index for Germany’s leasing sector stood at 1.8 points in December 2024, marking a net decline over the year (December 2023: 10.8 points). The indicator revealed a volatile trend throughout 2024. In December 2024, leasing companies assessed their current business situation positively, at 18.4 points. This compared to an expected business outlook reading of –13.5 points for the subsequent six-month period. The Federal Association of German Leasing Companies (BDL) positively highlighted the fact that businesses are adopting a long-term perspective on investments in digital and sustainable transformation, with the leasing sector continuing to serve as a reliable financing partner for these initiatives.

Statistics from Leaseurope for the first half of 2024 (full-year figures were not yet available at the time of this report’s publication) show that leasing new business for equipment investments (including vehicles) in the European market grew 6 percent year-on-year. This compares to full-year 2023, which had still recorded growth of 11 percent. As the largest leasing market, the United Kingdom grew 4.1 percent year-on-year, Germany recorded an increase of 7.8 percent and France of 5.7 percent.

After starting the year 2024 at a benchmark rate of 4 percent, interest rate developments in the euro zone continued to influence our business. The interest environment eased over the course of the year after the ECB’s interest rate cuts and the anticipation in the financial markets of further cuts on the horizon. Lower financing costs typically stimulate investment demand; however, recessionary concerns and geopolitical uncertainty tend to have a dampening effect on corporate investments. Since lease instalments are set at the time the investment is made and the contract is concluded, leasing provides our target customers with a reliable basis for financial planning in times of volatile markets and difficult-to-forecast interest rates. At the same time, leasing represents a financing option that preserves liquidity.

Total leasing new business continued to grow in the reporting year, as detailed in Chapter 2.5. This growth was likely due to companies choosing to use lease financing for their investments in replacements and expansion – particularly digitalisation initiatives and green economy objects. Unlike loans, where liquidity is provided upfront and may not necessarily be used for investments, lease contracts are typically linked to operationally essential objects, demonstrating a tangible medium- to long-term investment requirement.

Our refinancing costs were lower in the reporting year due to the decline in interest rates throughout the year. Consequently, the CM2 margin, which serves as an indicator of the projected profitability of our new business, continued to improve over the course of 2024 and, at 17.0 percent, exceeded our target.

As a delayed consequence of the COVID-19 crisis, we observed a sharp increase in insolvencies, particularly in our core markets of France, Spain, and Germany. This in turn led to higher expenses for settlement of claims and risk provision. As a result, the loss rate increased compared to the previous year. For further details, please refer to Chapter 2.6.
The ongoing sanctions against Russia have no direct impact on our business. We are also not directly affected by the wars in Ukraine or the Middle East, as we do not have any operations or engagements in these regions.

Other macroeconomic influences, including the impact of changes in capital market and central bank interest rates on refinancing costs, are discussed in detail in Chapter 5.3.2.2 of the risk report.

On January 31, 2024, we announced our decision to focus on the leasing business going forward and, consequently, to initiate the divestment of the factoring business. The synergies with our core and primary leasing operations that were expected when entering the factoring business had not materialised. Additionally, an in-depth analysis concluded that the existing factoring business could only be operated profitably in the long term with significant additional investments and a multi-fold increase in business volume (assets from the factoring business represented less than 2 percent of the consolidated statement of financial position in 2024). By the end of the reporting year, the divestment process was not yet complete.

On February 6, 2024, we announced that, with the consent of the Supervisory Board, the Board of Directors of grenke AG had decided to launch a share buyback programme. The initiative had already received approval from the German Federal Financial Supervisory Authority (BaFin) (see ad hoc announcement dated November 21, 2023). The programme encompassed a maximum of 2,317,695 shares and a value of up to EUR 70 million (excluding ancillary costs), equivalent to 5 percent of the Company’s share capital as of the authorisation resolution passed at the Annual General Meeting on August 6, 2020. The share buyback programme commenced on February 12, 2024 and was successfully concluded on September 30, 2024.

On March 5, 2024, we announced that the Supervisory Board of grenke AG had appointed Dr Martin Paal as Chief Financial Officer, effective July 1, 2024. Having joined grenke as Vice President of Controlling in June 2022, he was promoted to General Representative in March 2023. As the designated Chief Financial Officer, he oversaw the Accounting & Tax, Controlling and M&A, Treasury, and Reporting departments.

On March 15, 2024, we announced that Dr Konstantin Mettenheimer, member of the Supervisory Board of grenke AG since July 2021 and its Deputy Chair since May 2023, would not stand for re-election to the Supervisory Board at the Annual General Meeting on April 30, 2024.

On April 30, 2024, we held our Annual General Meeting. This meeting resolved a dividend distribution of EUR 0.47 per share (previous year: EUR 0.45), corresponding to a total distribution of EUR 21.6 million at our historical payout ratio of 25 percent of Group earnings. The distribution was based on the dividend-entitled share capital at the time of the Annual General Meeting, taking into account the previous buyback of own shares. Due to the Annual General Meeting, the share buyback programme was paused from April 22, 2024, to May 3, 2024, and resumed on May 6, 2024. The shareholders’ meeting also approved all other agenda items with a large majority. Dr Ljiljana Mitic was re-elected to the Supervisory Board for a five-year term, and Manfred Piontke was elected to the Supervisory Board for a term of three years. In a subsequent meeting, the Supervisory Board elected Moritz Grenke as Deputy Chair of the Supervisory Board.

On May 31, 2024, grenke AG issued its second benchmark bond with a volume of EUR 500 million. The bond is not solely limited to financing green economy objects. The bond has a term of slightly over five years and carries an interest rate of 5.75 percent.

On September 6, 2024, we announced the departure of Isabel Rösler from the Board of Directors of grenke AG at her own request, effective December 31, 2024. She joined the Board on January 1, 2021 as Chief Risk Officer (CRO), overseeing key internal control functions such as risk control, compliance, anti-money laundering, information security, and data protection. In addition, she was responsible for the Credit Center and the Administration department. Until a successor is appointed, CEO Dr Sebastian Hirsch has provisionally taken over all of Ms Rösler’s areas of responsibility, except for Internal Audit, which has been transferred to Gilles Christ.

On September 27, 2024, we announced the opening of our second location in the United States in Chicago, Illinois. This office will serve the entire Central, North, and Southeast regions. Since 2019, we have been covering the western part of the United States, the world’s largest leasing market, from our location in Phoenix, Arizona.

On September 27, 2024, grenke AG issued a new benchmark bond with a volume of EUR 500 million and maturity in January 2029. This “social bond” is dedicated exclusively to financing SME microcredits of up to EUR 50,000 in countries with unemployment rates above the EU27 average. The bond carries an interest rate of 5.125 percent.

On September 30, 2024, we successfully completed our share buyback programme launched in February 2024 and announced this on October 1, 2024. During the preceding 33 weeks, we had repurchased a total of 2,317,695 shares at an average price of EUR 23.92 per share (excluding ancillary costs), representing 4.98 percent of the outstanding capital.

In its ad hoc announcement on October 29, 2024, the Board of Directors announced an adjustment to the Group earnings guidance for the 2024 financial year. According to this revised forecast, the Company expected Group earnings in the range of EUR 68 million to EUR 76 million (previously: EUR 95 million to EUR 115 million). This revision was attributed to higher expenses for settlement of claims and risk provision, driven by a continued rise in insolvencies, particularly in the core markets of France, Spain, and Germany. The guidance for new business in 2024 of EUR 3.0 billion to EUR 3.2 billion remained unchanged.

On March 7, 2024, with the release of the Annual Report 2023, we refined our guidance for leasing new business and Group earnings for the 2024 financial year. The Board of Directors gave a forecast for leasing new business of between EUR 3.0 billion and EUR 3.2 billion, alongside Group earnings of EUR 95 million to EUR 115 million for 2024. With respect to the CM2 margin, the Board anticipated a slight year-on-year increase (2023: 16.5 percent) and identified a mid-term target of approximately 17 percent. The guidance for Group earnings in 2024 assumed that the loss rate would remain below 1.5 percent, consistent with the previous year. Despite planned investments in the digitalisation programme, the Board of Directors aimed for a cost-income ratio (CIR) of under 58 percent in 2024. As in prior years, the Board of Directors forecast an equity ratio on the balance sheet of over 16 percent.

On October 29, 2024, the Board of Directors announced an adjustment to the Group earnings guidance for the 2024 financial year to the range of EUR 68 million to EUR 76 million. The reason for this adjustment was higher expenses for the settlement of claims and risk provision, resulting from the continuously rising number of insolvencies, particularly in the core markets of France, Spain, and Germany, as well as the resulting full impairment of the goodwill of the Spanish subsidiary.

In the 2024 financial year, grenke generated EUR 3.1 billion in leasing new business, meeting the forecasted range of EUR 3.0 billion to EUR 3.2 billion. This represented a year-on-year increase of 18.4 percent. The CM2 margin reached 17.0 percent, in line with the mid-term target of 17.0 percent, as expected, following 16.5 percent in the prior year.
The loss rate stood at 1.5 percent in the second half of 2024 and 1.3 percent for the full 2024 financial year, remaining below the long-term average of 1.5 percent. At 59.2 percent, the cost-income ratio was above the target of under 58 percent.

For the full 2024 financial year, grenke achieved Group earnings after taxes of EUR 70.2 million, in line with the adjusted guidance range of EUR 68 million to EUR 76 million announced in October. The equity ratio equalled 16.1 percent at the year’s end, as expected, and was at the long-term benchmark of 16 percent.
 

Leasing new business – defined as the total acquisition cost of newly acquired leased assets – reached a volume of EUR 3,057.0 million in full-year 2024 (previous year: EUR 2,581.3 million). This volume was 18.4 percent higher than in the previous year. We were able to generate a year-on-year increase new business in each quarter of the reporting year. This demonstrates not only how we are consistently following our growth trajectory but, in our estimation, have also grown faster than the market.

A key driver of this performance was our extensive dealer network, which we continued to expand. We currently collaborate with over 39,000 specialist resellers in the more than 30 countries where we operate.

We are particularly pleased that we achieved this growth while increasing our profitability at the same time. The contribution margin 1 (CM1) of our leasing new business rose by 35.1 percent in the 2024 financial year to EUR 343.2 million (previous year: EUR 254.1 million). The CM1 margin for the reporting year equalled 11.2 percent, significantly exceeding the previous year’s level of 9.8 percent. Despite slightly declining market interest rates, contract prices remained almost unchanged compared to 2023, fuelling the rise in the CM1 margin. This also led to a significant rise in the contribution margin 2 (CM2) of leasing new business in the 2024 financial year by 21.6 percent to EUR 518.5 million (previous year: EUR 426.3 million). The CM2 margin increased from 16.5 percent in the previous year to 17.0 percent, slightly exceeding the annual target. With this increase, we have established a solid foundation for sustainable and profitable growth in 2025.

Following the change in segment reporting, the Other segment includes the lending business of grenke Bank AG as well as the factoring business held for sale.

In the 2024 financial year, the factoring business recorded new business with a purchased receivables volume of EUR 910.4 million. Of this amount, 19.0 percent is related to receivables management (without a financing function). Compared to the previous year, this represented an increase of 8.6 percent. At the same time, this receivables volume, with an average term from purchase to maturity of approximately 45 days, means that these receivables are theoretically turned over 8.1 times per year (365 days/45 days). Consequently, the factoring business, based on a balance sheet receivables volume of EUR 84.3 million, continued to account for an insignificant share of the Group balance sheet.

The gross margin of the factoring business is calculated as the income relative to net acquisition values. Due to the revolving purchase of receivables and the resulting lower volume, the refinancing requirement is lower than for refinancing leasing new business. The gross margin decreased slightly in the reporting year to 1.5 percent (previous year: 1.6 percent).
grenke Bank’s new lending business primarily consisted of loans granted under the “Mikrokreditfonds Deutschland” (Microcredit Fund Germany) programme. Through this programme, grenke Bank offers government-sponsored microfinancing of between EUR 1,000 and EUR 25,000. The total lending business of grenke Bank decreased in the reporting year by 16.1 percent to EUR 37.8 million (previous year: EUR 45.0 million).

The loss rate (expenses for the settlement of claims and risk provision in relation to the volume of leased assets on the respective reporting date) increased to 1.3 percent in the 2024 financial year (previous year: 1.0 percent). The loss rate was thus below its average value since 2019 of 1.5 percent. The volume of leased assets (sum of the net acquisition values of all current leasing contracts) increased by 7.5 percent as of December 31, 2024 due to higher new business volume and reached EUR 10,122 million (December 31, 2023: EUR 9,415 million).

Before revising the income statement (see Note 2.3 of the notes to the consolidated financial statements), goodwill impairment was included in the line item depreciation, amortisation and impairment. Total goodwill impairment in the reporting year amounted to EUR 4.4 million (previous year: EUR 0.6 million) and, as in the previous year, related to the cash-generating unit in the leasing business in Spain. Goodwill impairment in the 2024 financial year resulted from deteriorating return prospects, which are partly due to a worsening of the development of losses.

Other operating result remained nearly unchanged at EUR –9.6 million (previous year: EUR –9.5 million). Other operating income and other operating expenses both declined.

Other operating expenses decreased by 4.8 percent in the 2024 financial year to EUR 17.5 million (previous year: EUR 18.4 million). This decline resulted primarily from lower foreign currency translation differences from the translation of the Turkish lira (TRY), amounting to EUR 2.8 million, which, among other factors, resulted from the effects of hyperinflation accounting under IAS 29. In addition, the translation of the Chilean peso (CLP) resulted in foreign currency translation differences of EUR 1.1 million; the Polish zloty (PLN) of EUR 1.2 million; the Hungarian forint (HUF) of EUR 0.9 million; and the Australian dollar (AUD) of EUR 0.9 million. These differences mainly arose from derivative hedging transactions, which balance out economically over the full period. This was partially offset by currency translation recognised directly in equity through other comprehensive income. As this mainly relates to the translation of lease receivables in foreign currency countries, this effect is shown in a different line item than the aforementioned translation effects from derivatives. In addition, lease receivables are translated at the exchange rate on the reporting date, whereas derivatives are measured at fair value based on the forward exchange rates applicable on the reporting date. This difference and the resulting valuation effect balance each other out over the term of the hedging relationships.

Other operating income decreased in the 2024 financial year to EUR 7.9 million (previous year: EUR 8.8 million), primarily due to a lower level of reversal of other provisions, lower capital gains from the sale of non-current assets, and lower miscellaneous income from lessees. Offsetting this and contributing to an increase in other operating income was higher revenue from late payment fees.

The operating result declined by 20.3 percent in the 2024 financial year to EUR 90.0 million (previous year: EUR 112.9 million).

The balance of other interest income and interest expenses improved to EUR 2.9 million (previous year: EUR 1.8 million), primarily owing to the general recovery in interest rates and higher central bank balances.
Our earnings before taxes declined 19.0 percent in 2024 to EUR 89.4 million (previous year: EUR 110.4 million). The tax rate remained unchanged from the previous year at 21.5 percent.

Our Group earnings decreased accordingly by 19.1 percent to EUR 70.2 million (previous year: EUR 86.7 million).
As a result, earnings per share declined to EUR 1.44 in the reporting year (previous year: EUR 1.79).

The loss rate (expenses for the settlement of claims and risk provision in relation to the volume of leased assets on the respective reporting date) increased to 1.3 percent in the 2024 financial year (previous year: 1.0 percent). The loss rate was thus below its average value since 2019 of 1.5 percent. The volume of leased assets (sum of the net acquisition values of all current leasing contracts) increased by 7.5 percent as of December 31, 2024 due to higher new business volume and reached EUR 10,122 million (December 31, 2023: EUR 9,415 million).

Before revising the income statement (see Note 2.3 of the notes to the consolidated financial statements), goodwill impairment was included in the line item depreciation, amortisation and impairment. Total goodwill impairment in the reporting year amounted to EUR 4.4 million (previous year: EUR 0.6 million) and, as in the previous year, related to the cash-generating unit in the leasing business in Spain. Goodwill impairment in the 2024 financial year resulted from deteriorating return prospects, which are partly due to a worsening of the development of losses.

Other operating result remained nearly unchanged at EUR –9.6 million (previous year: EUR –9.5 million). Other operating income and other operating expenses both declined.

Other operating expenses decreased by 4.8 percent in the 2024 financial year to EUR 17.5 million (previous year: EUR 18.4 million). This decline resulted primarily from lower foreign currency translation differences from the translation of the Turkish lira (TRY), amounting to EUR 2.8 million, which, among other factors, resulted from the effects of hyperinflation accounting under IAS 29. In addition, the translation of the Chilean peso (CLP) resulted in foreign currency translation differences of EUR 1.1 million; the Polish zloty (PLN) of EUR 1.2 million; the Hungarian forint (HUF) of EUR 0.9 million; and the Australian dollar (AUD) of EUR 0.9 million. These differences mainly arose from derivative hedging transactions, which balance out economically over the full period. This was partially offset by currency translation recognised directly in equity through other comprehensive income. As this mainly relates to the translation of lease receivables in foreign currency countries, this effect is shown in a different line item than the aforementioned translation effects from derivatives. In addition, lease receivables are translated at the exchange rate on the reporting date, whereas derivatives are measured at fair value based on the forward exchange rates applicable on the reporting date. This difference and the resulting valuation effect balance each other out over the term of the hedging relationships.

Other operating income decreased in the 2024 financial year to EUR 7.9 million (previous year: EUR 8.8 million), primarily due to a lower level of reversal of other provisions, lower capital gains from the sale of non-current assets, and lower miscellaneous income from lessees. Offsetting this and contributing to an increase in other operating income was higher revenue from late payment fees.

The operating result declined by 20.3 percent in the 2024 financial year to EUR 90.0 million (previous year: EUR 112.9 million).

The balance of other interest income and interest expenses improved to EUR 2.9 million (previous year: EUR 1.8 million), primarily owing to the general recovery in interest rates and higher central bank balances.
Our earnings before taxes declined 19.0 percent in 2024 to EUR 89.4 million (previous year: EUR 110.4 million). The tax rate remained unchanged from the previous year at 21.5 percent.

Our Group earnings decreased accordingly by 19.1 percent to EUR 70.2 million (previous year: EUR 86.7 million).
As a result, earnings per share declined to EUR 1.44 in the reporting year (previous year: EUR 1.79).

At the grenke Group, we place a particular focus on maintaining an adequate level of liquidity to give us the flexibility to respond to market conditions. Regulatory requirements also require the Consolidated Group to maintain a liquidity buffer.
On the liabilities side of the balance sheet, the rise in total assets was largely attributable to the increase of EUR 1,090.7 million in financial liabilities to a total of EUR 6.5 billion (December 31, 2023: EUR 5.4 billion). Current and non-current liabilities from refinancing continued to account for the largest share of our financial liabilities, increasing to EUR 4.3 billion compared to the end of 2023 (December 31, 2023: EUR 3.8 billion). Current and non-current liabilities from grenke Bank’s deposit business also increased by EUR 611.4 million to EUR 2.2 billion (December 31, 2023: EUR 1.6 billion).

Current and non-current derivative financial instruments with a negative market value increased to EUR 26.1 million in the 2024 financial year (December 31, 2023: EUR 22.3 million).

As of December 31, 2024, equity recorded a moderate decline to EUR 1.3 billion (December 31, 2023: EUR 1.4 billion), primarily due to the completed share buyback in the amount of EUR 55,551k according to the statement of changes in equity. The Group earnings generated in the reporting period amounted to EUR 70.2 million and were offset mainly by the dividend payment (EUR 21.6 million), interest payments on hybrid capital (EUR 15.0 million), transactions with non-controlling interests (EUR 3.8 million) related to subsequent purchase price payments for the acquisition of franchise shares, and effects from the market valuation of hedging instruments (EUR 5.9 million). Due to the increase in total assets relative to the decline in equity, the equity ratio decreased to a level of 16.1 percent as of December 31, 2024 (December 31, 2023: 19.1 percent) but remained above the Consolidated Group’s self-set target of a minimum of 16 percent.

Cash flow from operating activities increased in the 2024 financial year to EUR 394.0 million (previous year: EUR 329.3 million). This increase was primarily driven by two factors: the unchanged stable payment behaviour and proceeds from lessees amounting to EUR 2,583.2 million in the 2024 financial year (previous year: EUR 2,409.7 million) and the expansion of refinancing and related proceeds, particularly from the issue of two new benchmark bonds and the growth of deposit business at grenke Bank. The selected disclosures from the consolidated statement of cash flows and their development are explained below.

In the presentation below, cash flow from new business includes investments in new lease receivables. These include the net acquisition values of lease objects and the costs directly associated with the conclusion of the contract. Due to the higher new business volume, investments in new lease receivables increased in the 2024 financial year to EUR 3,148.1 million (previous year: EUR 2,656.3 million). These were offset by proceeds from increased refinancing totalling EUR 3,505.2 million compared to EUR 2,319.4 million in the prior year. Additionally, grenke Bank AG’s deposit business grew to EUR 611.4 million, up from EUR 466.4 million in the prior year. In total, cash flow from investments in new business increased to EUR 968.5 million (previous year: EUR 129.5 million).

In the 2024 financial year, a total of EUR 3,214.3 million (previous year: EUR 2,272.3 million) was repaid to refinancers. Cash flow from existing business declined to EUR –631.1 million (previous year: EUR 137.4 million) due to higher repayments to refinancers.

Cash flow from investing activities totalled EUR –12.1 million in the 2024 financial year (previous year: EUR –33.3 million). This includes subsequent purchase price payments of EUR 3.6 million for the two former leasing franchise companies in Australia (previous year: EUR 24.1 million for the acquisition of the former leasing franchise companies in Australia and Singapore as well as the factoring franchise companies in Ireland, the United Kingdom, Poland, and Hungary). Payments for the acquisition of property, plant, and equipment and intangible assets totalled EUR 8.6 million (previous year: EUR 7.0 million). Additionally, this item included proceeds of EUR 0.1 million from the sale of property, plant, and equipment and intangible assets (previous year: EUR 0.9 million).

Cash flow from financing activities amounted to EUR –105.5 million in the 2024 financial year (previous year: EUR –47.3 million). The change was primarily due to a payment of EUR 55.6 million for the purchase of treasury shares (previous year: EUR 0 million). The dividend payment for the 2023 financial year amounted to EUR 21.6 million, compared to EUR 20.9 million in the previous year.

Interest payments on hybrid capital amounted to EUR 15.0 million (previous year: EUR 12.9 million). Additionally, the repayment of lease liabilities resulted in a cash outflow of EUR 13.3 million (previous year: EUR 13.4 million).

As a result, total cash flows in the 2024 financial year amounted to EUR 276.4 million (previous year: EUR 248.6 million). Cash and cash equivalents increased accordingly to EUR 973.4 million as of December 31, 2024, compared to EUR 696.9 million at the end of the 2023 financial year.

Thanks to our diversified refinancing structure, we met our payment obligations at all times during the past financial year.

We have a wide range of refinancing instruments at our disposal that we utilise depending on the market conditions as part of our overall strategy. Our debt financing is essentially based on three pillars: senior unsecured instruments, such as bonds, debentures and commercial paper, which are primarily based on our ratings; the deposit business, including grenke Bank AG development loans; and receivables-based financing, consisting primarily of asset-backed commercial paper (ABCP) programmes. We avoid maturity transformation at portfolio level and thus minimise interest rate and follow-up financing risks. Thanks to our broad refinancing mix, we can utilise the individual pillars in a targeted manner and expand or reduce the share depending on requirements and the market situation. At the same time, we want to be active in all three pillars for strategic reasons.

The refinancing mix as of the reporting date based on the grenke Group’s refinancing pillars was distributed as follows:
 

Compared to the end of the 2023 financial year, our total assets increased by EUR 1.1 billion to EUR 8.2 billion as of December 31, 2024 (December 31, 2023: EUR 7.1 billion).

The increase in our total assets as of December 31, 2024 was mainly attributable to the increase in current and non-current lease receivables. Our largest balance sheet item, lease receivables, rose by EUR 816.4 million to EUR 6.5 billion compared to the end of the 2023 financial year (December 31, 2023: EUR 5.7 billion) due to the continued positive development of new business. For further details on the development of lease receivables in the 2024 financial year, please refer to Note 5.2 Lease receivables in the notes to the consolidated financial statements.

Cash and cash equivalents increased by EUR 277.3 million to EUR 974.6 million (December 31, 2023:
EUR 697.2 million). As of December 31, 2024, EUR 790.7 million (December 31, 2023: EUR 484.7 million) of the cash and cash equivalents were held in Deutsche Bundesbank accounts.

The decline in other current and non-current financial assets to EUR 181.8 million (December 31, 2023: EUR 215.2 million) is attributable to a reduction in receivables from the lending business, which amounted to EUR 118.7 million (December 31, 2023: EUR 134.6 million). Additionally, factoring receivables of EUR 24.6 million were classified as held for sale under IFRS 5 at the end of the 2024 financial year as the plan is to divest the factoring business in the short term. These receivables are presented under other financial assets.

Within non-current assets, property, plant, and equipment increased by EUR 9.6 million to EUR 98.4 million (December 31, 2023: EUR 88.8 million). This was primarily due to an increase in leased assets under operating leases, which rose by EUR 9.7 million to EUR 63.8 million in the reporting year (December 31, 2023: EUR 54.1 million). The decline in other intangible assets by 19.2 percent to EUR 9.8 million (December 31, 2023: EUR 12.2 million) was the result of low investments in the reporting year (EUR 2.8 million), which were offset by amortisation of EUR 5.1 million. Goodwill decreased to EUR 30.1 million (December 31, 2023: EUR 34.4 million) due to an impairment loss of EUR 4.4 million related to the cash-generating unit in Spain. For further details, see Note 5.7 Goodwill in the notes to the consolidated financial statements.