GRENKELEASING AG Group. Financial Report for the 1st Quarter 2015

Transcription

1 GRENKELEASING AG Group Financial Report for the 1st Quarter 2015

2 GRENKELEASING AG Consolidated Group 1 Contents Key Figures 2 Letter to Shareholders from the Board of Directors 4 The GRENKELEASING AG Share 5 Interim Management Report 6 Targets and Strategy 6 Macroeconomic and Sector-Specific Environment 7 New Business 7 Report on the Results of Operations 10 Report on Financial Position and Net Assets 12 Report on Risks, Opportunities, and Forecasts 14 Condensed Interim Consolidated Financial Statements 16 Consolidated Income Statement 16 Consolidated Statement of Comprehensive Income 17 Consolidated Statement of Financial Position 18 Consolidated Statement of Cash Flows 20 Consolidated Statement of Changes in Equity 22 Notes to the Condensed Interim Consolidated Financial Statements 23 Auditor s Review Report 38 Calendar of Events and Contact Information 39

3 GRENKELEASING AG Consolidated Group 2 Key Figures GRENKE Group Jan. 1, 2015 to Mar. 31, 2015 Change (%) Jan. 1, 2014 to Mar. 31, 2014 Unit New business GRENKE Group Leasing 304, ,423 EURk of which international 224, ,606 EURk of which franchise international 7, ,930 EURk of which Germany 73, ,887 EURk Western Europe (without Germany)* 108, ,212 EURk Southern Europe* 72, ,133 EURk Northern / Eastern Europe* 45, ,893 EURk Other regions* 5, ,298 EURk New business GRENKE Group Factoring 65, ,488 EURk of which Germany 24, ,844 EURk of which international 32, ,081 EURk of which franchise international 8, ,563 EURk GRENKE Bank Deposits 288, ,747 EURk New business start-up financing 3, ,881 EURk Contribution margin 2 (CM2) on new business GRENKE Group Leasing 58, ,394 EURk of which international 46, ,148 EURk of which franchise international 1, EURk of which Germany 10, ,332 EURk Western Europe (without Germany)* 21, ,622 EURk Southern Europe* 16, ,722 EURk Northern / Eastern Europe* 8, ,208 EURk Other regions* EURk Further information leasing business Number of new contracts 37, ,229 units Share of IT products in lease portfolio percent Share of corporate customers in lease portfolio percent Mean acquisition value EURk Mean term of contract months Volume of leased assets 3, ,133 EURm Number of current contracts 442, ,469 units *Regions: Western Europe (without Germany): Austria, Belgium, France, Luxembourg, the Netherlands, Switzerland Southern Europe: Croatia, Italy, Malta, Portugal, Slovenia, Spain Northern / Eastern Europe: Denmark, Finland, Ireland, Norway, Sweden, UK / Czech Republic, Hungary, Poland, Romania, Slovakia Other regions: Brazil, Canada, Chile, Dubai, Turkey GRENKE Group = GRENKE Consolidated Group including franchise partners GRENKE Consolidated Group = GRENKELEASING AG and all consolidated subsidiaries and structured entities according to IFRS

4 GRENKELEASING AG Consolidated Group 3 Key Figures GRENKE Consolidated Group Jan. 1, 2015 to Mar. 31, 2015 Change (%) Jan. 1, 2014 to Mar. 31, 2014 Unit Key figures income statement Net interest income 44, ,226 EURk Settlement of claims and risk provision 14, ,843 EURk Profit from insurance business 11, ,416 EURk Profit from new business 11, ,101 EURk Gains from disposals (income exceeding the calculated residual value) EURk Other operating income 1, EURk Cost of new contracts 8, ,487 EURk Cost of current contracts 2, ,271 EURk Project costs and basic distribution costs 9, ,279 EURk Management costs 6, ,571 EURk Other costs 2, ,992 EURk Operating result 25, ,436 EURk Other interest income (expense) EURk Income / expenses from fair value measurement EURk EBT (earnings before taxes) 24, ,284 EURk Net profit 18, ,505 EURk Earnings per share (according to IFRS) EUR Further Information Dividends EUR Embedded value, leasing contract portfolio (incl. equity before taxes) EURm Embedded value, leasing contract portfolio (incl. equity after taxes) EURm Economic result (after taxes)* EURm Cost / income ratio percent Return on equity (ROE) after taxes percent Average number of employees employees Staff costs 15, ,084 EURk of which total remuneration 12, ,731 EURk of which fixed remuneration 9, ,200 EURk of which variable remuneration 3, ,531 EURk * Indicator that combines the net profit of one period with the change in the embedded value after tax (the present value of all outstanding lease instalments after costs and risk provisions). To determine the economic result, the method of calculation has been adjusted. The retained earnings are included in both the net profit for the period as well as in the embedded value at the end of the period. Therefore, they are eliminated once in the calculation of the economic result. GRENKE Group = GRENKE Consolidated Group including franchise partners GRENKE Consolidated Group = GRENKELEASING AG and all consolidated subsidiaries and structured entities according to IFRS

5 GRENKELEASING AG Consolidated Group 4 Letter to Shareholders from the Board of Directors Dear Shareholders, Ladies and Gentlemen, In the first quarter of 2015, we continued with the success we had achieved in the past fiscal year. The new business volume generated by GRENKE Group Leasing exceeded the previous year s level by a pleasing 15 percent and our Factoring segment grew its new business by even 51 percent. Our home market of Germany and our international markets are both contributing positively to our growth. Even though we are already the market leader in Germany for small-ticket IT leasing, and the competition in this market is very intense, we were still able to expand our new business in the Leasing segment by nine percent in the first quarter. Internationally, we are currently experiencing particular success in Western Europe. Our new business in this region grew 16 percent. In France, which has become our second home market, our business has developed especially well as has our business in both Italy and Switzerland. In Northern/Eastern Europe, new business was seven percent higher. With twice the new business volume of the previous year, the international markets were also the key drivers of growth in our Factoring segment. We are continuing to manage our margins actively and in a risk-oriented manner. At 19.3 percent in the first quarter, our contribution 2 margin in the Leasing segment considerably exceeded the previous year s level of 18.7 percent. The high contribution margins from the new business generated in the past quarters are accruing to us as those contracts progress. Simultaneously, we see a positive development in our expenses for the settlement of claims and risk provision. This contributed to an 18 percent rise in the income from operating business of the GRENKE Consolidated Group compared to the prior year. We are still profiting from the favourable environment on the capital markets, which offers a large number of refinancing instruments and low interest rates. In addition, due to the first quarter s lower-than-average rise in costs for expansion, our operating result was able to climb by 30 percent and net profit increased 27 percent. This places us fully on track to meet our 2015 annual forecast. Our growth should continue in the future. During the reporting quarter, we acquired our existing franchise partner in Slovenia and opened new locations in Bielefeld and Malmö, Sweden. In 2015, cell divisions are planned in Germany, France, the United Kingdom and Sweden. We have also planned to enter the market in Singapore with our leasing offers and enter the market in Ireland with our factoring offers. Furthermore, we continue to diversify our broad product range and, in the first quarter, we were successful in attaining the concession from the Federal Ministry of Labour and Social Affairs for the continuation of our microcredit programme "Mikrokreditfonds Deutschland". This programme is aimed at small and young companies with a low credit standing. In the period 2010 to 2014, a total of 18,600 microcredit loans with a total volume of EUR 112 million were issued using budgetary resources and funds from the European Social Fund. GRENKE Bank will start to implement this contract throughout Germany in May 2015, which will underline the Group s mission to support small and medium-sized enterprises. Baden-Baden, April 2015 Wolfgang Grenke Chairman of the Board of Directors

6 GRENKELEASING AG Consolidated Group 5 The GRENKELEASING AG Share The year 2015 also began well for the international financial markets. Markets were positively influenced by the decision of the European Central Bank to maintain its expansive monetary policy and were also favourably affected by the delay in a turnaround in interest rates in the US. The conflicts and crises that had recently plagued the markets, which included a possible payment default by Greece or even the country s exit from the eurozone as well as armed conflicts in the Middle East and the Ukraine, did little to slow the rising trend of the global financial markets. Consequently, the German stock market also performed well. The German benchmark index, the DAX, achieved one new record after the other in the first three months of 2015 and reached an all-time high of 12,167 points. On balance, the index rose over 20 percent in the first three months and marked its second best quarter since The SDAX price index had a similar development (+16 percent) as did the DAXsector Financial Services sector index (+21 percent), which includes the shares of GRENKELEASING AG. During the 2015 trading year, GRENKELEASING AG s share has seen a marked continuation of its upward trend. After starting the year at a level slightly below EUR 90, the share price had an almost uninterrupted climb in the weeks to follow. Immediately after the publication of the 2014 fiscal year results, the share price shot past the EUR 100 level to reach an alltime high of EUR in mid-march. Overall, the share rose a pleasing 18 percent in the first three months of the year.

7 GRENKELEASING AG Consolidated Group 6 Interim Management Report Targets and Strategy The GRENKE Consolidated Group and its subsidiaries and branches operate worldwide. A franchise model has been established for the development of new regional markets and for expansion through new financing products. GRENKELEASING AG does not hold interests in the legally independent companies of its franchisees. Therefore, this interim management report distinguishes between the GRENKE Consolidated Group, which refers to GRENKELEASING AG and all of its consolidated subsidiaries and structured entities in accordance with IFRS, and the GRENKE Group, which refers to the GRENKE Consolidated Group including its legally independent franchise partners. We have a straight-forward, valid and value-oriented business model. As one of the leading European companies in our industry, we offer financial services to small and medium-sized enterprises (SMEs). The GRENKE Group began its operations by offering lease financing for smaller IT products (small-ticket IT leasing). As part of our global expansion strategy, we are entering new countries in various continents on a step-by-step basis. We continuously increase our market presence in these countries by opening new locations which gives us the opportunity to generate a high level of growth for a period of several years regardless of the prevailing economic trends. For example, in our home market of Germany, we are seeing increasing success in smaller cities and are uncovering new potential. In the first quarter of 2015, we opened new locations in the cities of Bielefeld, Germany, and Malmö, Sweden. We also acquired the company of our franchise partner in Slovenia in the reporting quarter. The focus of our growth is in countries where we have a favourable competitive environment and thus an attractive risk-reward profile. We do not seek to avoid risk entirely but to correctly assess risk so that we can achieve adequate margins. This is how we sufficiently protect ourselves from existing and potential risks. Prior to the conclusion of each contract, we rely heavily on our long-proven and continuously refined IT-based model for forecasting losses. This model is also a key driver of our growth; a fact that was evident during the recent financial market and sovereign debt crises. During that time, many providers were forced to scale back their business in small-ticket IT leasing or, in some cases, withdraw from the market altogether because the risk situation became unmanageable. This development presented us with some attractive opportunities to further strengthen and expand our position as a leading provider of efficient services. In addition to growth through regional expansion, we are also growing through the continuous diversification in our product range and offers for financial solutions. Examples of this diversification include our participation in the "lease guarantee" programme sponsored by German guarantee banks, as well as the various financing, investment, and payment products provided by GRENKE BANK AG (hereinafter also referred to as "GRENKE Bank"). With the concession granted by the Federal Ministry of Labour and Social Affairs for the continuation of the "Mikrokreditfonds Deutschland" throughout Germany and our cooperation with the "WeltSparen" portal as per April 2015, we were able to continue diversifying our product range during the reporting quarter. Whereas the microcredit offer is aimed at providing loans to small and young companies with a low credit standing, the offer in cooperation with the "WeltSparen" portal consists of various fixed-term deposits at attractive conditions. After a simple one-time registration, WeltSparen customers can conveniently take advantage of and manage savings products provided by a variety of banks. In collaboration with a growing number of development banks of individual German states and the federal government, GRENKE Bank also finances business start-ups and provides development funds for business investments that are financed through leasing. Until now, over 13,909 leasing contracts have been concluded as part of these collaborations. The cooperation with Thüringer Aufbaubank was extended successfully and, in the context of a third global loan, a further EUR 5 million was made available to small and medium-sized enterprises and members of selfemployed professions located in Thuringia at favourable conditions. Since entering into this successful collaboration more than three years ago, a total of over 1,300 sponsored lease contracts has been concluded.

8 GRENKELEASING AG Consolidated Group 7 In addition, we offer the purchase of lower-volume receivables (factoring) in various European countries as a permanent component of our extensive product range. Our regional, product, and sector diversification strategically limit our risk. The broad diversification of our portfolios across customers and industries and the low average volumes of our contracts characterise our business. We avoid cluster risks with our sales partners, and we are not dependent on any single manufacturers for our IT products. We structure our factoring business and our banking services in a similar manner. We also rely on the continued expansion of our already broad range of refinancing instruments so that we are always able to take advantage of a variety of options when financing our growth. Macroeconomic and Sector-Specific Environment Macroeconomic cycles have relatively little impact on the development of GRENKE Group s new business. This factor allows us to grow profitably in both economically favourable and unfavourable periods. We minimise the impact of the overall development of corporate insolvencies on our loss rate by using our sophisticated method for forecasting losses. Sector trends such as the business policies of banks and financial service providers in the leasing, factoring, and deposit business and the sector s increasing regulatory requirements are of greater importance to our growth. The potential changes in capital market and central bank interest rates are always reflected in our contract terms. Nevertheless, the time gap between the changes in interest rates and the changes in our conditions can have a temporary positive or negative effect on the profitability of our new business. Our broad range of refinancing instruments and bank deposits at GRENKE Bank give us a high degree of flexibility so that we can react to various changes in the markets and expected developments in interest rates. New Business We had a good start to the 2015 fiscal year in all of our markets. GRENKE Group Leasing experienced a seamless continuation of the previous year s success and recorded growth in new business volume, i.e., the total of the acquisition costs of newly purchased lease assets, of 15 percent for a total of EUR million. After achieving a record level of 70 percent in the first three months of the prior year, the international share of GRENKE Group s new business reached 73 percent in the reporting quarter. This positive development underscores our commitment to having a growing portion of our new business originating from our international markets. We were also very pleased with the development of our home market of Germany. Despite fierce competition in Germany s leasing sector, we achieved nine percent higher new business volume in the first quarter of the reporting year than in the comparable period of the previous year. We continued to generate strong new business growth in Western Europe (without Germany). In this region, we reached a volume of EUR million, or 20 percent growth compared to EUR 90.2 million reported in the first quarter of Our second core market of France contributed to this pleasing performance with a twelve percent rise in new business of our leasing activities. New business in Southern Europe and Northern/Eastern Europe was still satisfactory but somewhat more subdued. At 16 percent, double-digit growth was still achieved in Southern Europe, growth in Northern/Eastern Europe amounted to eight percent. Other regions generated much stronger growth. After carefully observing the markets of the countries that are still relatively new to us, we have focused our management efforts once again towards growth and

9 GRENKELEASING AG Consolidated Group 8 saw new business volume more than double (+128 percent) in the first quarter compared to the comparable period of the previous year. Nevertheless, we continue to maintain our strong focus on risk. In the first three months of the current fiscal year, we received a total of 89,787 lease applications that went on to generate 37,321 new lease contracts. These numbers represent a conversion rate (applications into contracts) of 42 percent. The international share of applications was 73,117, of which 29,505 led to new contracts. Accordingly, the international conversion rate of 40 percent was below the 47 percent rate in the German market. At EUR 8,167, the mean term per lease contract was only slightly higher than the level of EUR 7,958 recorded in the comparable period of the previous year. The earnings strength of our new business improved further in the first quarter of the current fiscal year. The contribution margin 2 (CM2) of our new business in the Leasing segment defined as the present value of the operating income of a lease contract less the cost of risk and individual contract costs grew 19 percent to EUR 58.9 million after EUR 49.4 million in the first three months of the previous year and exceeded our new business growth. The CM2 margin of GRENKE Group Leasing had a corresponding rise to 19.3 percent after 18.7 percent. We continue to profit from our consistent application of our business model, our ongoing market penetration, and from the continual favourable interest rate environment. Our factoring offers continued to grow strongly. New business volume in this area climbed significantly in the reporting quarter and increased by 51 percent from EUR 43.5 million to EUR 65.6 million. With new business growth of 115 percent, the international markets were the key drivers of this gratifying performance. Growth was stable in Germany and rose eight percent. The income margin on the new business in our international markets was 1.6 percent after 2.0 percent in the comparable period of the previous year. In Germany, the income margin amounted to 2.2 percent after 2.4 percent in the previous year. These margins are based on the average period for a factoring transaction of roughly 28 days internationally (first quarter of 2014: 39 days) and 31 days in Germany (first quarter of 2014: 35 days). Through GRENKE Bank s collaboration with development banks, our banking business generated 37 percent growth in business start-up financing compared to the first quarter of the previous year. Volumes in the first quarter totalled EUR 4.0 million after EUR 2.9 million in the comparable period of the previous year. As per March 31, 2015, GRENKE Bank s deposit volumes rose by 14 percent in comparison to March 31, 2014 and amounted to EUR million. This performance highlights the position GRENKE Bank holds in our refinancing mix. As per the reporting date, GRENKE Bank accounted for a share of 16 percent.

10 GRENKELEASING AG Consolidated Group 9 Shares in new business of GRENKE Group Leasing + Factoring + Business start-up financing including franchise partners as per March 31, 2015 Other regions 1.4% Germany 27.2% Southern Europe 19.2% Western Europe (without Germany) 37.7% Northern / Eastern Europe 14.5% New business Q1 2015: GRENKE Group Leasing EUR million (previous year: EUR million) GRENKE Group Factoring EUR 65.6 million (previous year: EUR 43.5 million) Previous year: Germany 29.8%; Western Europe (without Germany) 33.9%; Southern Europe 20.0%; Northern / Eastern Europe 15.6%; Other regions 0.7% Growth rates in new business of GRENKE Group Leasing as per March 31, 2015 (as against the comparable period of 2014) 30% % % % Germany Western Europe (without Germany) Southern Europe Northern / Eastern Europe Other regions Regions: Western Europe (without Germany): Austria, Belgium, France, Luxembourg, the Netherlands, Switzerland Southern Europe: Croatia, Italy, Malta, Portugal, Slovenia, Spain Northern / Eastern Europe: Denmark, Finland, Ireland, Norway, Sweden, UK / the Czech Republic, Hungary, Poland, Romania, Slovakia Other regions: Brazil, Canada, Chile, Dubai, Turkey Previous year: Germany 3.7%; Western Europe (without Germany) +13.1%; Southern Europe +22.4%; Northern / Eastern Europe +25.4%; Other regions 55.4%

11 GRENKELEASING AG Consolidated Group 10 Report on the Results of Operations Selected information from the consolidated income statement EURk Jan. 1, 2015 to Mar. 31, 2015 Jan. 1, 2014 to Mar. 31, 2014 Net interest income 44,480 36,226 Settlement of claims and risk provision 14,939 11,843 Net interest income after settlement of claims and risk provision 29,541 24,383 Profit from insurance business 11,261 9,416 Profit from new business 11,812 11,101 Gains from disposals Income from operating business 53,347 45,251 Staff costs 15,033 13,084 Of which total remuneration 12,311 10,731 Of which fixed remuneration 9,181 8,200 Of which variable remuneration 3,130 2,531 Selling and administrative expenses (excluding staff costs) 11,017 10,901 Of which IT project costs Earnings before taxes 24,994 19,284 Net profit 18,403 14,505 Earnings per share (basic/diluted, in EUR) The strong, profitable growth of the previous quarters continued successfully into the first three months of the 2015 fiscal year. The key drivers of this performance were the profitable new business of previous quarters and the resulting income accruing successively as the contracts progress and the continued favourable interest rate environment. The impact of favourable interest rates is reflected to a large extent in the interest income of the GRENKE Consolidated Group: higher interest income from the financing business and lower interest expenses for refinancing led to an increase of 23 percent compared to the comparable period of the previous year. In the reporting quarter, the expenses for the settlement of claims and risk provision grew slightly more than interest income, but were still within the usual fluctuation range for the quarter. The settlement of claims and risk provision, which is usually volatile on a quarterly basis, rose 26 percent compared to the first quarter of The Consolidated Group s loss rate amounted to 1.65 percent after 1.5 percent in the comparable period of the previous year. Net interest income after settlement of claims and risk provision developed positively with an increase of 21 percent. We also had a pleasing increase in our profit from insurance business based on new business growth which exceeded the previous year s level by a solid 20 percent. We had comparatively weaker development in our profit from new business. This item increased six percent. Taking into account the volatile gains from disposals (+109 percent), the GRENKE Consolidated Group was able to significantly increase its income from operating business by 18 percent compared to the previous year s figure. Overall expenses had a lower rise: whereas staff costs rose 15 percent as a result of the Company s growth and higher variable compensation linked to economic success in the year 2014, selling and administrative expenses remained essentially at the level of the first quarter of 2014 with an increase of just one percent. Other operating income and

12 GRENKELEASING AG Consolidated Group 11 expenses continue to be immaterial overall for earnings development both in their absolute amounts and their rates of change. The operating result reached EUR 25.2 million after recording EUR 19.4 million in the first three months of the previous year. Earnings before taxes developed similarly to the operating result and increased by a pleasing 30 percent. The tax rate increased slightly to 26 percent after 25 percent in the previous year s period, which is within the range of the usual quarterly fluctuations. Accordingly, net profit climbed 27 percent in the reporting quarter to EUR 18.4 million. Earnings per share were EUR 1.25 after EUR 0.99 in the first quarter of Segment Development Business segments Segment reporting is based on the predominant organisational structure of the GRENKE Consolidated Group. Therefore, operating segments are divided in accordance with the management of the business areas in the Leasing, Banking, and Factoring segments. A regional split of the business activities is provided on a yearly basis as part of GRENKE Consolidated Group s financial statements for each fiscal year. Separate financial information is available for the three operating segments. More detailed information on the business segments can be found in the Consolidated Group s segment reporting. Business Development The Leasing segment continues to represent the most important earnings pillar for the GRENKE Consolidated Group and, therefore, the discussion on the results of operations essentially also applies to this section. Accordingly, the operating segment income of the Leasing segment climbed a pleasing 19 percent from EUR 41.2 million to EUR 49.2 million. The segment result increased from EUR 16.7 million in the comparable period of the previous year to EUR 22.6 million as a result of a below-average rise in expenses. In the Factoring segment, operating segment income in the first three months rose from EUR 0.5 million in the previous year to EUR 0.8 million. The segment result of EUR 0.1 million remained at the level of the first quarter of 2014 due to the still higher staff costs incurred in preparation for future growth. The Banking segment reported results slightly below the previous year s level. The operating segment income declined from EUR 3.5 million in the previous year s period to EUR 3.3 million and the segment result was EUR 2.5 million after EUR 2.6 million in the comparable period of the previous year.

13 GRENKELEASING AG Consolidated Group 12 Report on Financial Position and Net Assets Selected information from the consolidated statement of financial position and the consolidated statement of cash flows EURk Mar. 31, 2015 Mar. 31, 2014 Current assets 1,235,931 1,179,250 thereof cash and cash equivalents 115,905 88,395 thereof lease receivables 916, ,781 Non-current assets 1,809,349 1,745,700 thereof lease receivables 1,641,826 1,579,317 Total assets 3,045,280 2,924,950 Current liabilities 913, ,974 thereof financial liabilities 761, ,319 Non-current liabilities 1,614,326 1,581,990 thereof financial liabilities 1,563,816 1,531,880 Equity 517, ,986 Equity ratio in percent Total liabilities and equity 3,045,280 2,924,950 Jan. 1, 2015 to Mar. 31, 2015 Jan. 1, 2014 to Mar. 31, 2014 Cash flow from operating activities 49,207 52,847 Net cash flow from operating activities 46,525 57,219 Cash flow from investing activities 8,826 2,635 Cash flow from financing activities Total cash flow 38,280 60,316 The GRENKE Consolidated Group s net asset position as per the March 31, 2015 reporting date remained solid. In the course of our steady growth, total assets increased four percent in comparison to the end of the 2014 fiscal year. Equity rose five percent and the Consolidated Group s equity ratio improved slightly from 16.9 percent to 17.0 percent and was above our long-term target of 16 percent. Current and non-current lease receivables remained the largest single position on the asset side of the balance sheet. As per the reporting date, this item had grown four percent in the first three months of the current fiscal year and comprised a share of total assets of 84 percent (December 31, 2014: 84 percent). The Consolidated Group s cash and cash equivalents as per the reporting date were 31 percent above the level reported at the end of the previous fiscal year and remained at a comfortable level. A bond with a volume of EUR 75.0 million was redeemed as scheduled at the end of the reporing quarter. This bond was replaced by two new bonds in the amount of EUR 24.0 million and EUR 30.0 million. With respect to promissory note loans, we issued a total of three new promissory notes totalling EUR 10.0 million and CHF 18.4 million. Promissory notes amounting to EUR 19.3 million and CHF 0.4 million were repaid. We issued only small volumes of our various other instruments in the course of fine-tuning our funding structure, keeping in line with our goal to avoid excess liquidity when possible. These instruments included a total of five commercial papers that were issued in February and March 2015 for a total volume of EUR 60.0 million. At 70 percent, the level of utilisation of our asset-backed commercial paper programmes at the end of the quarter was equal to the level at the beginning of the quarter. Deposits held by

14 GRENKELEASING AG Consolidated Group 13 GRENKE Bank, which are also one of the main pillars of our refinancing mix, were slightly reduced in comparison to their level at the end of the 2014 fiscal year. At EUR 49.2 million, our cash flow from operating activities in the first three months was significantly above the previous year s level of EUR 52.8 million. Based on earnings before taxes of EUR 25.0 million, there were cash outflows originating primarily from changes in lease receivables (EUR million) and refinancing by means of the deposit business of GRENKE Bank (EUR 11.5 million). Cash inflows resulted from a change in refinancing liabilities and deferred lease payments amounting to a total of EUR 98.0 million. An additional cash inflow of EUR 36.7 million originated from the area of other assets/liabilities. After taxes and interest paid and received, net cash flow from operating activities amounted to EUR 46.5 million after EUR 57.2 million in the first quarter of the previous year. Cash flow from investing activities included payments for the purchase of operating and office equipment and intangible assets in the amount of EUR 1.2 million, as well as cash outflows for the acquisition of the franchise company in Slovenia totalling EUR 7.7 million. Total cash flows as per the end of the first quarter amounted to EUR 38.3 million and also included cash flow from financing activities, which contained the assumption of bank liabilities in the amount of EUR 0.6 million.

15 GRENKELEASING AG Consolidated Group 14 Report on Risks, Opportunities, and Forecasts Opportunities and Risks The following opportunities and risks report relates to the GRENKE Consolidated Group and the individual segments. The opportunities and risks that were presented in the 2014 annual financial report continue to be relevant. No new risks or risks of significant importance occurred during the reporting period. For the 2015 fiscal year, we continue to believe as we did in the previous year that the opportunities for our further development outweigh the risks that are typically associated with our business model. Measured by the number of incoming applications described in the chapter on new business, the demand for lease financing remains high. This allows us to squarely place our focus on growing our new business and systematically increasing it while at the same time achieving risk-appropriate margins. We will consistently drive ahead our future organic growth by adding new locations, branches, and franchise partners and by penetrating new regional sales markets and by expanding our range of financial services. We are not subject to substantial individual risks due to the broad diversification of our business. One of the main factors influencing our earnings development is the rise in losses during recessionary periods. Most of the countries where we operate are currently experiencing positive economic development. However, since the number of countries where we operate has grown considerably, some of these countries are experiencing the opposite economic trend. Losses tend to be volatile during the course of the year, and there is roughly a two-year lag based on the underlying business transaction. Assuming and managing these types of risks are a central element of our business model. The management of the GRENKE Consolidated Group is focused on estimating risks as precisely as possible at the time of concluding a contract so that an appropriate margin can be included in the conditions offered. To accomplish this, a comprehensive system of risk identification, quantification, control and management has been implemented. This sophisticated system is continuously developed and is both appropriate and suitable for detecting significant risks at an early stage and to control them. We pay attention not only to individual risks, but especially to potential risk clusters and cross interdependencies. The risk of rising interest rates remains of key importance. However, there is limited interest rate risk associated with the refinancing of our portfolio of existing lease receivables. Refinancing liabilities are hedged using derivatives to the extent that they carry variable interest rates. However, risks associated with new business can occur from changes in interest rates and spreads. Therefore, the potential time lag it takes to pass on a change in interest rates to customers may have a temporary influence on the profitability of the new business. The European Central Bank, however, has recently reaffirmed its current low interest rate policy. In the US, the Federal Reserve Bank is turning from an extremely expansive monetary policy to a more restrictive policy. US markets are expecting an increase in the key interest rates to occur sometime in the next several quarters. This move could lead to a continuation of the current weakness in the euro. These factors would not have a noticeable impact on the business of the GRENKE Consolidated Group. Currently, we do not see any significant risks in terms of refinancing. The capital markets continue to be a good source of available liquidity, and with the recent decision by the European Central Bank to purchase government bonds amounting to EUR 60 billion per month, this liquidity has improved even further. Nevertheless, significant political and geostrategic risks exist, especially with respect to the Greek financial budget and the military conflicts in Ukraine and the Middle East. This can lead to substantial short-term pressure on the capital markets. However, history has shown that even in difficult times

16 GRENKELEASING AG Consolidated Group 15 the market provides sufficient funds on commercially reasonable terms to issuers with a good reputation. Accordingly, we have always been able to successfully place emissions, including promissory note loans, commercial paper and assetbacked securities in a variety of market situations, tailored to our requirements. In addition, our access to bank deposits via GRENKE Bank offers us an attractive source of refinancing that we use with a high level of flexibility. Forecasts The first quarter of the new fiscal year got off to a positive start. Our Leasing segment recorded new business growth of 15 percent and was at the upper end of our forecast range for the full year of 11 to 15 percent. Our Factoring segment significantly exceeded our expectations with a rise of 51 percent versus our projected rise of 20 to 24 percent. The rate of expansion was also far above our long-term growth target for the GRENKE Group of ten percent per year. Furthermore, with net profit growth of 27 percent for the GRENKE Consolidated Group, we are fully on track to achieve our earnings forecast for the year of a net profit in the range of EUR 71 million to EUR 75 million. After increasing our net profit by 38 percent in the previous year and exceeding our raised forecast, we expect net profit in the 2015 fiscal year to grow in a range of 9 to 15 percent. In the future, we will continue to follow our proven and successful management strategy. We focus on those markets where we can achieve the margins appropriate for the risk assumed and thus secure the profitability of the GRENKE Consolidated Group. This strategy allows us to take specific advantage of the different developments of the various markets in which we operate. We are also undertaking a targeted expansion of our market presence. During the 2015 fiscal year, we plan to carry out further cell division and establish ourselves in new countries.

17 GRENKELEASING AG Consolidated Group 16 Condensed Interim Consolidated Financial Statements Consolidated Income Statement EURk Jan. 1, 2015 to Mar. 31, 2015 Jan. 1, 2014 to Mar. 31, 2014 Interest and similar income from financing business 57,252 50,292 Expenses from interest on refinancing and deposit business 12,772 14,066 Net interest income 44,480 36,226 Settlement of claims and risk provision 14,939 11,843 Net interest income after settlement of claims and risk provision 29,541 24,383 Profit from insurance business 11,261 9,416 Profit from new business 11,812 11,101 Gains from disposals Income from operating business 53,347 45,251 Staff costs 15,033 13,084 Depreciation and impairment 1,491 1,495 Selling and administrative expenses (not including staff costs) 11,017 10,901 Other operating expenses 1,597 1,120 Other operating income 1, Operating result 25,220 19,436 Expenses / income from fair value measurement Other interest income Other interest expenses Earnings before taxes 24,994 19,284 Income taxes 6,591 4,779 Net profit 18,403 14,505 Of which, attributable to: non-controlling interests 0 0 shareholders of GRENKELEASING AG 18,403 14,505 Earnings per share (basic) in EUR Earnings per share (diluted) in EUR Average number of shares outstanding (basic) 14,754,199 14,700,000 Average number of shares outstanding (diluted) 14,754,199 14,700,000

18 GRENKELEASING AG Consolidated Group 17 Consolidated Statement of Comprehensive Income EURk Jan. 1, 2015 to Mar. 31, 2015 Jan. 1, 2014 to Mar. 31, 2014 Net profit 18,403 14,505 Items that may be reclassified to profit and loss in future periods Appropriation to / reduction of hedging reserve (before taxes) Income taxes 4 2 Appropriation to / reduction of hedging reserve (after taxes) Change in currency translation differences (before taxes) 5, Income taxes 0 0 Change in currency translation differences (after taxes) 5, , Items that will not be reclassified to profit and loss in future periods Appropriation to / reduction of reserve for actuarial gains and losses (before taxes) 0 0 Income taxes 0 0 Appropriation to / reduction of reserve for actuarial gains and losses (after taxes) Other comprehensive income 5, Total comprehensive income 24,031 14,713 Of which, attributable to: non-controlling interests 0 0 shareholders of GRENKELEASING AG 24,031 14,713

19 GRENKELEASING AG Consolidated Group 18 Consolidated Statement of Financial Position EURk Mar. 31, 2015 Dec. 31, 2014 Assets Current assets Cash and cash equivalents 115,905 88,395 Financial instruments that are assets Lease receivables 916, ,781 Other current financial assets 64,905 59,816 Trade receivables 4,285 4,793 Lease assets for sale 8,597 8,756 Tax assets 11,129 10,940 Other current assets 114, ,001 Total current assets 1,235,931 1,179,250 Non-current assets Lease receivables 1,641,826 1,579,317 Financial instruments that are assets Other non-current financial assets 23,825 30,714 Property, plant, and equipment 41,039 40,411 Goodwill 63,454 57,351 Other intangible assets 17,713 14,264 Deferred tax assets 20,585 21,869 Other non-current assets 907 1,433 Total non-current assets 1,809,349 1,745,700 Total assets 3,045,280 2,924,950

20 GRENKELEASING AG Consolidated Group 19 Consolidated Statement of Financial Position EURk Mar. 31, 2015 Dec. 31, 2014 Liabilities and equity Liabilities Current liabilities Financial liabilities 761, ,319 Liability financial instruments 7,536 3,506 Trade payables 16,664 9,821 Tax liabilities 11,876 7,043 Deferred liabilities 10,283 10,312 Current provisions 1,736 1,887 Other current liabilities 14,456 11,214 Deferred lease payments 89,513 26,872 Total current liabilities 913, ,974 Non-current liabilities Financial liabilities 1,563,816 1,531,880 Liability financial instruments 2,409 1,077 Deferred tax liabilities 44,508 45,692 Pensions 3,564 3,281 Non-current provisions Total non-current liabilities 1,614,326 1,581,990 Equity Share capital 18,859 18,859 Capital reserves 116, ,491 Retained earnings 373, ,389 Other components of equity 7,875 2,247 Total equity attributable to shareholders of GRENKELEASING AG 517, ,986 Non-controlling interests 0 0 Total equity 517, ,986 Total liabilities and equity 3,045,280 2,924,950

21 GRENKELEASING AG Consolidated Group 20 Consolidated Statement of Cash Flows EURk Jan. 1, 2015 to Mar. 31, 2015 Jan. 1, 2014 to Mar. 31, 2014 Earnings before taxes 24,994 19,284 Non-cash items contained in earnings and reconciliation to cash flow from operating activities + Depreciation and impairment 1,491 1,495 / + Profit / loss from the disposal of property, plant, and equipment and intangible assets 6 19 / + Net income from non-current financial assets / + Other non-cash effective income / expenses 5, / Increase / decrease in deferred liabilities, provisions, and pensions Additions to lease receivables 313, ,155 + Payments by lessees 249, ,732 + Disposals / reclassifications of lease receivables at residual carrying amounts 48,345 41,086 Interest and similar income from leasing business 56,118 50,292 + / Decrease / increase in other receivables from lessees 5,438 3,593 + / Currency translation differences 24, = Change in lease receivables 101,746 72,058 + Addition to liabilities from refinancing 276, ,753 Payment of annuities to refinancers 261,198 87,407 Disposal of liabilities from refinancing 7, ,277 + Expenses from interest on refinancing and on deposit business 12,772 14,066 + / Currency translation differences 14, = Change in refinancing liabilities 35,369 22,511 + / Increase / decrease in liabilities from deposit business 11,500 2,908 / + Increase / decrease in loans to franchisees 4, Changes in other assets / liabilities / + Increase / decrease in other assets 21,391 12,282 + / Increase / decrease in deferred lease payments 62,641 7,355 + / Increase / decrease in other liabilities 15,273 7,255 = Cash flow from operating activities 49,207 52,847 continued on next page

22 GRENKELEASING AG Consolidated Group 21 Consolidated Statement of Cash Flows EURk Jan. 1, 2015 to Mar. 31, 2015 Jan. 1, 2014 to Mar. 31, 2014 / + Income taxes paid / received 2,446 4,185 Interest paid Interest received = Net cash flow from operating activities 46,525 57,219 Payments for the acquisition of property, plant, and equipment and intangible assets 1,164 1,275 / + Payments / proceeds from acquisition of subsidiaries 7,709 1,446 + Proceeds from the sale of property, plant, and equipment and intangible assets = Cash flow from investing activities 8,826 2,635 + / Borrowing / repayment of bank liabilities Proceeds from cash capital increase 0 0 Dividend payments 0 0 = Cash flow from financing activities Cash funds at beginning of period Cash in hand and bank balances 88, ,770 Bank liabilities from overdrafts 10, = Cash and cash equivalents at beginning of period 77, ,338 + / Change due to currency translation = Cash funds after currency translation 76, ,336 Cash funds at end of period Cash in hand and bank balances 115,905 53,639 Bank liabilities from overdrafts 939 4,619 = Cash and cash equivalents at end of period 114,966 49,020 Change in cash and cash equivalents during the period (= total cash flow) 38,280 60,316 Net cash flow from operating activities 46,525 57,219 + Cash flow from investing activities 8,826 2,635 + Cash flow from financing activities = Total cash flow 38,280 60,316

23 GRENKELEASING AG Consolidated Group 22 Consolidated Statement of Changes in Equity Retained EURk Share capital Capital reserves earnings / Consolidated net profit Hedging reserve Reserve for actuarial gains / losses Currency translation Equity as per Total equity attributable to shareholders of GRENKE- LEASING AG Noncontrolling Total interests equity Jan. 1, , , , , , ,986 Total comprehensive income , ,663 24, ,031 Dividend payment in 2015 for Equity as per Mar. 31, , , , , , ,017 Equity as per Jan. 1, 2014 before adjustment 18, , , , , ,462 Effects from retroactive adjustment pursuant to IFRS Equity as per Jan. 1, 2014 adjusted 18, , , , , ,420 Total comprehensive income , , ,713 Dividend payment in 2014 for Changes in the scope of consolidation Equity as per Mar. 31, , , , , , ,091

24 GRENKELEASING AG Consolidated Group 23 Notes to the Condensed Interim Consolidated Financial Statements Accounting Policies The subject of these condensed interim consolidated financial statements (interim consolidated financial statements) as per March 31, 2015 is the GRENKELEASING AG and its subsidiaries (the Consolidated Group). These interim consolidated financial statements have been prepared in accordance with the applicable IFRS provisions for interim reporting as published by the IASB and adopted by the EU. These interim consolidated financial statements should be read in conjunction with the IFRS consolidated financial statements as per December 31, The accounting policies used are the same as those used in the previous year with the exception of the new standards that have become mandatory, which are presented briefly in the paragraph below. The condensed interim consolidated financial statements and the interim group management report as per March 31, 2015 have not been audited by the auditor. Mandatory New Accounting Standards In December 2013, various standards were amended ("Annual Improvements to IFRS; Cycle"), in the context of the Annual Improvements Project to IFRS (AIP). This relates to IFRS 1 "First-time Adoption of International Financial Reporting Standards", IFRS 3 "Business Combinations", IFRS 13 "Fair Value Measurement" and IAS 40 "Investment Property". The amended standards clarify existing issues. The amended standards have no relevance for the accounting and measurement used for the condensed interim consolidated financial statements of GRENKELEASING AG since the issues either do not apply to the GRENKE Consolidated Group or have already been interpreted accordingly. IFRIC 21 "Levies" provides guidelines on when to recognise a liability for a levy imposed by governments based on statutory regulations. IFRIC 21 identifies the obligating event for the recognition of a liability as the activity that triggers the payment in accordance with the relevant legislation. Recognition of a liability only occurs when the obligating event occurs. The obligating event can occur progressively over a period of time so that the liability is recognised on a pro rata basis. The issue of IFRIC 21 has no material impact on the interim consolidated financial statements. Use of Assumptions and Estimates The main estimating uncertainties and the associated disclosure requirements are in the following areas: Determination of impairments for non-performing lease receivables from terminated lease contracts or contracts in arrears on the basis of the recoverability rate Use of estimated residual values at the end of the lease term to determine the present value of lease receivables Recognition of lease assets for sale at estimated residual values Consolidation of structured entities Assessment of the ongoing value of intangible assets and other non-financial assets Probability of future tax benefits.