First quarter 2016 results

Transcription

1 Lincoln Financing Holdings Pte. Limited First quarter 2016 results 27 July 2016 This report provides the unaudited combined accounts for Lincoln Financing Holdings Pte. Limited (the Company ), its finance subsidiary Lincoln Finance Limited (the Issuer ) and its holding subsidiary LP Group B.V. ( LP Group ) for the period ending 31 March The Company is incorporated in Singapore and operates as a holding company for the investment in LeasePlan Corporation N.V. ("LeasePlan") by a consortium of long-term responsible investors including leading Dutch pension fund service provider PGGM, Denmark s largest pension fund ATP, GIC, Luxinva S.A., a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA) and investment funds managed by TDR Capital LLP (the Consortium ). The Issuer is a wholly owned subsidiary of the Company, incorporated in Jersey for the purposes of raising acquisition finance. LP Group is a wholly owned subsidiary of the Company incorporated in the Netherlands for the purposes of directly holding the investment in LeasePlan. The acquisition of LeasePlan by the Consortium was completed on 21 March The Issuer issued 1,250 million 6.875% Senior Secured Notes due 2021 and $400 million 7.375% Senior Secured Notes due 2021 (collectively, the senior secured notes ) on 16 March 2016 to finance a portion of the purchase price for the acquisition of LeasePlan. The Company and the Issuer were each incorporated in March 2015, and LP Group was incorporated in February 2015, but each had no material trading, assets or liabilities prior to the issuance of the senior secured notes and the completion of the acquisition and therefore no prior year comparison figures are included in this report. These accounts provide combined financial information of the Company, the Issuer and LP Group and reflect the completion of the acquisition of LeasePlan. This combined perspective therefore includes the equity invested in the Company, the issuance of senior secured notes by the Issuer and the investment made by LP Group in LeasePlan. The investment in LeasePlan is currently valued on the balance sheet at the level of the purchase price. In accordance with IFRS requirements, a purchase price allocation will be performed for LP Group during the remainder of This purchase price allocation will identify intangibles and any remaining goodwill representing the difference between the 3,531.5 million purchase price and the equity of LeasePlan. With regard to the latter, reference is made to LeasePlan's accounts for the quarter ended 31 March 2016, which

2 show equity of 2,901.4 million after deduction of a dividend of 265.5m relating to the results of the year ended 31 December With respect to the income statement, these combined results show only the accrued interest expense on the senior secured notes and certain expenses incurred in relation to the acquisition. No income in respect of the underlying business of LeasePlan has been included in these combined results because of the short period between completion of the acquisition and the quarter end. Therefore, we believe that the results shown here will not be directly comparable to expected future quarterly results, in which the net result achieved by LeasePlan will be reflected in the combined accounts. These non-consolidated accounts do not provide information on the operational performance of LeasePlan, the single (indirect) investment made by the Company. For information on the operational performance of LeasePlan, please refer to its published results for Q1 2016, which are available at: Post balance sheet events: LeasePlan declared a dividend of 265.5m relating to the results of the year ended 31 December This dividend was paid to LP Group on 4 April 2016 and 195m was subsequently deposited into the Interest Coverage Account held by the Company. The remaining dividend proceeds will be deposited into the Interest Coverage Account after the payment of certain transaction costs. Note: Defined terms used but not defined in this report have the meaning given to them in the offering memorandum for the senior secured notes issued by the Issuer.

3 Supplementary financial statements Company, Issuer and LP Group combined income statement m Fee expenses Acquisition-related fees 1 (44.4) Financial expense Bank charges (0.1) Interest expense 2 (6.6) (6.7) Profit / (loss) for the period (51.0) 1 As of 31 March 2016, the Company and LP Group expect to incur acquisition-related fees of approximately 160 million in aggregate, of which 44 million have been expensed and 116 million have been capitalised. 2 Interest expense represents an accrual for the expense of the senior secured notes, issued 16 March 2016.

4 Company, Issuer and LP Group combined balance sheet Assets Fixed assets Participation in LeasePlan 3 3,531.5 Capitalised expenses Current assets Receivables from affiliates 0.0 Cash at banks Equity and liabilities Shareholders' equity Issued capital 2,329.0 Result of the period (51.0) m 3, , ,277.9 Long-term liabilities 1,250m senior secured notes 1,250.0 $400m senior secured notes Current liabilities, accruals and deferred income Accrued interest 6.6 Accrued capitalised expenses , , LP Group s investment in LeasePlan is subject to an ongoing purchase price allocation process to identify intangible assets and goodwill created by the acquisition of LeasePlan. 4 Cash at banks includes 279m in the Interest Reserve Account.

5 Company, Issuer and LP Group combined statement of cash flows m Operating Activities Dividends received - Fees paid 5 (53.9) Bank costs (0.1) Interest paid - Interest income - Cash flow from operating activities (53.9) Financing Activities Equity proceeds received 6 2,329.0 Senior secured notes proceeds received 1,606.8 Cash flow from financing activities 3,935.7 Investing Activities Acquisition of LeasePlan (3,531.5) Cash flow from investing activities (3,531.5) Net Change in Cash Of the 160 million in acquisition-related fees incurred, 53.9 million were paid in the quarter ended 31 March 2016, all of which were financing-related fees which were capitalised. The Company expects that the remaining fees will be paid in future quarters. 6 Equity proceeds comprise 1,849 million equity proceeds from the Consortium and 480 million proceeds from a mandatorily exchangeable facility (the MEF ).

6 For further information: About LeasePlan LeasePlan is a global fleet management and driver mobility company of Dutch origin. LeasePlan s full service offering consists of financing and operational fleet management services to meet the needs of a diverse client base. Established in 1963, LeasePlan has grown to become the world s leading global fleet management and driver mobility company with more than 85% of its 7,300 strong workforce now operating outside the Netherlands. LeasePlan s global franchise manages over 1.5 million multi-brand vehicles and provides global fleet management and driver mobility services in 32 countries. For more information, please refer to Disclaimer This information is based on internal information used by the management of the Company. We caution that the foregoing information has not been and will not be audited or reviewed by our independent auditors. Financial and other information in this document may contain certain forward-looking statements (all statements other than those made solely with respect to historical facts) based upon beliefs and data currently available to management. These statements are based on a variety of assumptions that may not be realised and are subject to significant business, economic, legal and competitive risks and uncertainties. Our actual operations, financial conditions, cash flows and operating results may differ materially from those expressed or implied by any such forward-looking statements