EUROPCAR GROUP FULL YEAR 2015 RESULTS. The leading European car rental company at the heart of new mobility solutions.

Transcription

1 EUROPCAR GROUP The leading European car rental company at the heart of new mobility solutions FULL YEAR 2015 RESULTS February 25, 2016

2 Agenda Our Success and Our Commitments Operating Performance & Financing Overview Conclusion Appendix IMPORTANT NOTICE: based on Financial statements prepared under IFRS Investors have to read the important disclaimer at the end of this presentation 2

3 OUR SUCCESS AND OUR COMMITMENTS 1 We achieved our upgraded 2015 guidance 2 We will continue to deliver organic profitable growth as we committed at the IPO thanks to our self-help transformation program Fast Lane 3 We will accelerate value creation through acquisitions and new mobility solution deployment thanks to cash generation and financing headroom 3

4 OUR SUCCESS AND OUR COMMITMENTS 1 We achieved our upgraded 2015 guidance 4

5 1 STRONG FY 2015 RESULTS IN LINE WITH OUR UPGRADED GUIDANCE Revenues Organic growth* in the high end of the 3%-5% bracket 4.9% Adjusted Corporate EBITDA Slightly above 250m 251m Net Income Pro Forma ** Close to 130m 128m Corporate Leverage Below 1.0x at the end of x * At constant exchange rate and excluding EuropHall, one of our French franchisee, acquired in Q As a result, this company has been fully consolidated only for two months in On a standalone basis, EuropHall revenue amounted to c. 23 million for the full year 2014 ** Net income excluding exceptional items (operational and financial), before associates, and adjusting financial expenses pro-forma for the full year effect of the repayment of the 324m bond, refinancing of the 400m bond through the issuance of the 475m senior notes due 2022 at an issue price of % and a coupon of 5.75%, and refinancing of the RCF and SARF facility at improved terms. 5

6 1 CONTINUOUS INCREASE IN ADJUSTED CORPORATE EBITDA WITH TRACTION FROM GROWTH LEVERS Sustained revenue growth LTM Adj. Corporate EBITDA progression In million +4.9% organic* In million +15.6% at constant currency % 11.7% % 10.1% 10.8% 10.9% 11.2% % 0 Q1 Q2 Q3 Q4 Q1-14 Q2-14 Q3-14 Q4-14 Q1-15 Q2-15 Q3-15 Q4-15 Adj. Corp. EBITDA LTM ( m) Adj. Corp. EBITDA LTM margin * At constant currency and excluding perimeter effect (EuropHall) 6

7 KEY COMMERCIAL INITIATIVES GSA 7

8 OUR SUCCESS AND OUR COMMITMENTS 2 We will continue to deliver organic profitable growth as we committed at the IPO thanks to our self-help transformation program Fast Lane 8

9 2 FAST LANE WILL CONTINUE TO DELIVER PROFITABLE GROWTH From well engaged key pillars continuing to deliver 1 Commercial Strategy FOSTER SEGMENTS AND BRANDS FOOTPRINT 2 Shared Service Center Logic EFFICIENCY BENEFITS ON TRACK 3 Network Optimization IMPROVING COVERAGE AND EFFICIENCY GAINS To new programs to sustain and enhance long term growth 4 Customer Journey/Experience ROADMAP LAUNCHED IN EARLY IT / Digitalization INCREASED SUPPORT TO FAST LANE INITIATIVES AS PLANNED 9

10 2 FAST LANE COMMERCIAL STRATEGY Strengthen Europcar s leadership serving all customer needs with dedicated and simplified tools INCREASE DIFFERENTIATION Corporate On line strategy with Business Mobile Services and Self Serve Wide range of new mobility solutions (Ubeeqo, E-Car Club) Dedicated / simplified administrative processes Leisure Direct to Brand investments Cross Border dynamics InterRent international footprint acceleration Increase GSA network Revenue and Capacity Management Enhanced Tools Real Time Rate Engine : roll out by station Price and utilization optimization : Current enhancement of our forward looking tool. 10

11 2 FAST LANE OPERATIONAL CONTINUOUS IMPROVMENT Capillarity of our Network and centralized approach of back office functions => a key asset and a strong differentiator in the deployment of our commercial strategy Our Local Network TO A FLEXIBLE AND PERFORMANCE DRIVEN NETWORK FITTING NEW MOBILITY NEEDS Optimized coverage, incl. through virtual stations Amplification of commercial dynamics Productivity gains Launched in Germany in 2015 Shared Service Center in Portugal GLOBAL PROCESSES EFFICIENCY Group reengineering Extension with new functions, incl. data, billing etc. Leaner organization in both countries and SSC ~ 300 people two years after implementation Further savings to come from non fleet procurement program On going roll out 11

12 2 FAST LANE - CUSTOMER JOURNEY A comprehensive program addressing all customer touch points Get the basics fixed A new CRM vision supported by investments of + 10M over , starting in March 2016, targeting first quick wins in 3 main areas Digital journey enhancement Full mobile journey within 2 years Marketing & IT investments in scaling up new products ALL EMPLOYEES FOCUSED ON NET PROMOTER SCORE 12

13 OUR SUCCESS AND OUR COMMITMENTS 3 We will accelerate value creation through acquisitions and new mobility solution deployment thanks to cash generation and financing headroom 13

14 3 UPDATE ON ACQUISITION PROCESS AND NEW MOBILITY SOLUTION DEPLOYMENT Bolt-on / franchisee opportunities Increasing pipeline Focus on Customer base acquisition and geographical synergies Franchisee acquisitions expected to be accretive and have short term pay-back Strict financial criteria Europcar Lab Priority roadmap roll out E-Car Club acquisition - UK s first entirely electric pay per use car club to hire cars and vans for periods of one hour. Ubeeqo development - Launch of a unique mobility platform in London and Paris. Scale up in other European cities - BtoB car sharing now available in France, Belgium, Germany and UK. Further countries on the agenda - Increasing synergies through crossselling with Europcar customer base 14

15 2016 GUIDANCE FULLY IN LINE WITH OUR IPO COMMITMENTS OUR MOTTO = PROFITABLE GROWTH THANKS TO OUR SELF-HELP FASTLANE PROGRAM WHILE ACCELERATING INVESTMENTS FOR FUTURE GROWTH Revenue organic growth between 3% to 5%* Leveraging our network capillarity and our well balanced geographical coverage Main actions: Van & Trucks, SME, Direct to Brand, Customer Journey Adjusted Corporate EBITDA above 275m Including investment in IT, Customer Journey, and new mobility solutions From 2016, Dividend pay out ratio at least 30% of Net Income To be paid from 2017, based on prior year net income We are strongly engaged in the roll out of our ambitious acquisition plan to increase value creation for our shareholders * Considering current petrol price 15

16 Agenda Our Success and Our Commitments Operating Performance & Financing Overview Conclusion Appendix IMPORTANT NOTICE: Financial statements unaudited and prepared under IFRS Investors have to read the important disclaimer at the end of this presentation 16

17 FY 2015 KEY METRICS MEET OUR EXPECTATIONS All data in m, except if noted FY 2015 FY 2014 Change Change at constant currency* Revenues 2,142 1, % 5.8% Rental Day Volume (million) % RPD ( ) % -1.2% Average duration (day) % Average Fleet (thousand)** % Per unit fleet costs ( ) % -0.7% Financial utilization rate 76.1% 76.4% -0.3 pt Adjusted Corporate EBITDA % 15.6% Adjusted Corporate EBITDA Margin 11.7% 10.8% +0.9 pt Estimated Net Income Pro Forma*** 128 na Operating Income IFRS **** % Net Income IFRS % Corporate Net Debt Average Total Fleet Net Debt (incl. operating leases) 3,127 2,807 * UK pound and Australian dollar ** Fleet 181.8k as of December 31, 2015 vs k at as of December 31, 2014 *** See definition on slide 32 **** Includes non-recurring expenses for 62m in 2015 vs. 116m in

18 STRONG TOP LINE ORGANIC GROWTH AT 4.9% All data in m FY 2015 FY 2014 Change Change at constant currency Rental revenues 1, , % 6.8% Other revenue associated with car rental % -8.2% Franchising business % -2.0% Revenues 2, , % 5.8% Key considerations All countries enjoying strong volume increase Increased demand on the leisure segment supported by Europcar brand notably on direct distribution channels and by the accelerated deployment of the InterRent brand +8.1% FY Rental Revenue at cc +60.1% Increased volumes for the business segment, in particular for SME and vehicle replacement, in line with our commercial strategy RPD slightly declining due to mix and geography effects : +6.8% (0.6%) +2.1% +6.6% Europcar excl. vans flat thanks to balanced growth, favorable effect of full deployment of ancillary and impact of increase in duration -1.2% Average RPD Rental day volume Average RPD Rental day volume Europcar InterRent Realignment of van strategy with focus on lower categories and longer duration Other revenue impacted by Petrol income decrease, with limited impact on margins 18

19 ALL TIME HIGH ADJUSTED CORPORATE EBITDA AT 251M All data in m FY 2015 FY 2014 Change Adjusted Corporate EBITDA margin at 11.7% increasing by 0.9 pt Change at constant currency Revenues 2, , % 5.8% Fleet holding costs excluding estimated interest included in operating leases Fleet operating, rental, revenues and insurance-related costs % 8.3% % 3.5% Margin after variable costs % 6.4% Margin Rate after variable costs 43.1% 42.9% +0.2pt Personnel, network, IT and other HQ costs % 5.8% Fleet financing costs % -6.3% Adjusted Corporate EBITDA % 15.6% Adjusted Corporate EBITDA Margin 11.7% 10.8% +0.9pt Key considerations Solid improvement of margin after variable cost at 43.1% mainly reflecting: Strong management of the utilization rate in a context of significant increase of the fleet, revenues and upsell dynamic Fleet costs per unit (holding and operating) continue to decline Other operating costs benefiting from strong initiatives notably on insurance Operational leverage delivering: Efficiency gains on the network, control of our semi fixed costs based Investments in Sales & Marketing to sustain the profitable growth Decrease in fleet financing costs following the refinancing initiatives between July 2014 and June

20 2015 WAS A TRANSITION YEAR All data in m FY 2015 FY 2014 Change Adj. Corporate EBITDA % Non-fleet D&A % Other non-recurring operating expenses % Non-fleet financial expenses % Profit Before Tax % Net tax expense Associates Net income % Estimated Pro forma Net Income at 128m (before associates and exceptional items and pro forma the refinancing initiatives)* IFRS 2015 Net Loss Included Net negative impact of some proceedings for approx. 25 m (mainly Q items) Costs associated with the IPO for 11m Reorganization charges linked to Fast lane for 24 million Cost linked to the reshape of the capital structure: Redemption premium of 56m Write off of amortization costs for 27m (non cash) Increase of tax expense mainly related to the operations and to tax audit provision Deployment costs of Car2Go Europe (associates) * See definition and reconciliation on slide 32 20

21 OPERATIONAL CASH FLOW IMPACTED BY ONE OFF ITEMS Management Cash Flow part 1 All data in m FY 2015 FY 2014 Adjusted Corporate EBITDA Non-recurring expenses Non-fleet capital expenditure (net of proceeds from disposals) Changes in non-fleet working capital Change in provisions and employee benefits 1 11 Income tax paid Corporate operating free cash flow Cash interest paid on corporate High Yield bonds Cash flow before change in fleet asset base, financing and other investing activities Key considerations Adjusted Corporate EBITDA up 38 m Non recurring expenses cash out of 73m linked to a 12.5m litigation settlement, continuing Fast Lane reorganization plans and bonus payment following the success of Fast Lane first tranche 2015 change in non fleet working capital reflecting the growth in activity and impacted by tax payment related to previous years that should be paid back in 2016 Increase in income tax cash out linked to better performance 2015 cash interest reflecting the benefit of the refinancing occurred at the time of the IPO end of June

22 CASH FLOW IMPACTED BY IPO AND CAPITAL STRUCTURE RESHAPING Management Cash Flow part 2 All data in m FY 2015 FY 2014 Cash flow before change in fleet asset base, financing and other investing activities Other investing activities Change in fleet asset base, net of drawings on fleet financing and working capital facilities Capital increase Key considerations Other Investing activities including Car2Go capital increase to support new openings Ubeeqo capital increase leading to 75.7% ownership E-car club acquisition in July 2015 Change in fleet asset base and working capital facilities of 87 m driven by higher level of fleet and by lower drawings on RCF following IPO Change in High Yield Transaction cost cash out and swap impact Net change in cash before FX effect Capital increase: gross proceeds at 475m less fees paid as of Dec 31, 2015 Change is Corporate High Yield notes negative at 308m : repayment of the two former Corporate bonds (i.e. 324m and 400m) issuance of the new Corporate bond for 472m ( 475m at issue price of %) 56m of redemption price 22

23 CORPORATE NET DEBT BRIDGE OVER M (223) (448) 235 Net Corporate Debt 2014 Cash Adjusted Corporate EBITDA Non fleet Capex Income tax paid Non recurring expenses Profit and loss interest on Corporate debt Other investing activities Increase in capital Transaction, premium, discount costs writte offs Redemption price Amortisation of transaction, premium, discount costs Other Net Corporate Debt 2015 Corporate operating free cash flow (before change in rental fleet) 86M 23

24 SECURED AND OPTIMIZED FINANCING STRUCTURE IN Balance Sheet million Pricing Maturity Dec. 31, 2015 High Yield Senior Notes 5.75% Senior Revolving Facility ( 350m) E+250bps FCT Junior Notes, accrued interest not yet due, capitalized financing costs and other Gross Corporate debt Short-term Investments and Cash in operating and holding entities CORPORATE NET DEBT (A) 235 Corporate Net Debt at 235m Only one Corporate bond for 475 (June 2022) with 27m annual interest Cash available post IPO and new notes currently used for RCF repayment Very low leverage at 0.9x IN Balance Sheet million Pricing Maturity Dec. 31, 2015 High Yield EC Finance Notes 5.125% Senior asset revolving facility ( 1.1bn SARF) E+170bps FCT Junior Notes, accrued interest, financing capitalized costs and other UK, Australia and other fleet financing facilities 142 various 509 Gross financial fleet debt 1,659 Cash held in fleet financing entities and Short-term fleet investments -161 Fleet net debt at 2.821m Both IN and OFF Balance Sheet fully asset backed with vehicles Successful refinancing from July 2014 to June 2015 with improved terms on all IN BS key debt lines SARF single A rated OFF BS Fleet net debt in Balance sheet Debt equivalent of fleet operating leases - OFF BS TOTAL FLEET NET DEBT (incl. op leases) 1,498 1,323 (B) 2,821 Secured interest costs thanks to swap up to 1.6 bn maturing up to 2019 Still room for improvement for OFF BS lines as a result of better performances and upgraded rating in July 2015 TOTAL NET DEBT (A)+(B) 3,057 24

25 Agenda Our Success and Our Commitments Operating Performance & Financing Overview Conclusion Appendix IMPORTANT NOTICE: Financial statements unaudited and prepared under IFRS Investors have to read the important disclaimer at the end of this presentation 25

26 EUROPCAR, A LOW RISK BUSINESS MODEL WITH SIGNIFICANT VALUE CREATION POTENTIAL Organic development for the medium term Unrivalled leader in an attractive and growing market Successful Fast Lane transformation Huge Financial Headroom thanks to IPO and Cash Generation Acceleration potential Enhance international footprint Develop new mobility solutions Efficient buy-back model Seize bolt-on/ franchisee opportunities 2016 Guidance Revenues organic growth 3% to 5%* Adjusted Corporate EBITDA above 275M 2017 Objectives Confirmed Revenues organic growth 3% to 5% Adjusted Corporate EBITDA margin above 13% Financial investment capacity Natural organic deleveraging: organic leverage ratio below 1x at the end of 2017 Dedicated envelop of ~ 80 m for financial investments in strategic initiatives over the period, incl. up to 25m for the Lab * Considering current petrol price 26

27 OUR SUCCESS AND OUR COMMITMENTS 1 We achieved our upgraded 2015 guidance 2 We will continue to deliver organic profitable growth as we committed at the IPO thanks to our self-help transformation program Fast Lane 3 We will accelerate value creation through acquisitions and new mobility solution deployment thanks to cash generation and financing headroom 27

28 Agenda Our Success and Our Commitments Operating Performance & Financing Overview Conclusion Appendix IMPORTANT NOTICE: Financial statements unaudited and prepared under IFRS Investors have to read the important disclaimer at the end of this presentation 28

29 Management P&L Q4 and FY 2015 Q Q All data in m FY 2015 FY Total revenue 2, , Fleet holding costs, excluding estimated interest included in operating leases Fleet operating, rental and revenue related costs Personnel costs Network and head office overhead Other income and expense Personnel costs, network and head office overhead, IT and other Net fleet financing expense Estimated interest included in operating leases Fleet financing expenses, including estimated interest included in operating leases Adjusted Corporate EBITDA % 7.1% Margin 11.7% 10.8% Depreciation excluding vehicle fleet Other operating income and expenses Other financing income and expense not related to the fleet Profit/loss before tax Income tax Share of profit/(loss) of associates Net profit/(loss)

30 IFRS P&L Q4 and FY 2015 Q Q All data in m FY 2015 FY Total revenue 2, , Fleet holding costs Fleet operating, rental and revenue related costs Personnel costs Network and head office overhead Other income and expense Depreciation excluding vehicle fleet Recurring operating income Other non-recurring income and expenses Operating income Net financing costs Profit/(loss) before tax Income tax Share of profit/(loss) of associates Net profit/(loss) Net profit/(loss) attributable to Europcar owners Q4 IFRS P&L presented for convenience purposes, not prepared on a standalone basis but obtained by difference between FY 2015 P&L and Q3 YTD P&L 30

31 Reconciliation Q4 and FY 2015 Q Q All data in m FY 2015 FY Adjusted Consolidated EBITDA Fleet depreciation IFRS Fleet depreciation included in operating lease rents Total Fleet depreciation Interest expense related to fleet operating leases (estimated) Net fleet financing expenses Total Fleet financing Adjusted Corporate EBITDA Amortization, depreciation and impairment expense Reversal of Net fleet financing expenses Reversal of Interest expense related to fleet operating leases (estimated) Adjusted recurring operating income Interest expense related to fleet operating leases (estimated) Recurring operating income

32 2015 Pro Forma Net Income Estimated Pro Forma Net Income corresponds to IFRS Net income excluding exceptional items (operational and financial) before associates, and adjusting financial expenses pro-forma for the full year effect of the repayment of the 324m bond, refinancing of the 400m bond through the issuance of the 475m senior for a coupon of 5.75%, and refinancing of the RCF and SARF facility at improved terms All data in m FY 2015 IFRS Net Loss -56 Pro Forma on Interest on Corporate High Yield bonds 26 Pro forma Transaction cost amortization 7 Reversal of Corporate High Yield Bonds redemption premium 56 Reversal of the write off associated with Corporate High Yield Bonds reimbursment 27 Reversal of exceptional income / expenses 56 Reversal of Share of profit/(loss) of associates 12 Estimated Pro Forma Net Income 128 Reversal of exceptional income / expenses mainly corresponds to: Net negative impact of some proceedings Costs associated with the IPO Provision accrued in connection with tax audit 32

33 Balance Sheet In thousands of As at Dec. 31, 2015 As at Dec. 31, 2014 ASSETS Goodwill ,389 Intangible assets ,732 Property, plant and equipment ,204 Equity-accounted investments ,323 Other non-current financial assets ,934 Deferred tax assets ,395 Total non-current assets ,362,977 Inventories ,141 Rental fleet recorded on the balance sheet ,402,660 Rental fleet and related receivables ,098 Trade and other receivables ,912 Current financial assets ,477 Current tax assets ,347 Restricted cash ,795 Cash and cash equivalents ,037 Total current assets ,583,467 Total assets ,946,444 Equity Share capital ,383 Share premium ,978 Reserves (74 341) (77,926) Retained earnings (losses) ( ) (664,250) Total equity attributable to the owners of ECG ,185 Non-controlling interests Total equity ,135 LIABILITIES Financial liabilities ,043,069 Non-current financial instruments ,928 Employee benefit liabilities ,759 Non-current provisions ,114 Deferred tax liabilities ,005 Other non-current liabilities Total non-current liabilities ,351,240 Current portion of financial liabilities ,127,545 Employee benefits ,744 Current tax liabilities ,560 Rental fleet related payables ,957 Trade payables and other liabilities ,866 Current provisions ,397 Total current liabilities ,437,069 Total liabilities ,788,309 Total equity and liabilities ,946,444 33

34 In thousands of As at Dec. 31, 2015 As at Dec. 31, 2014 Profit/(loss) before tax (6,047) (94,520) Reversal of the following items Depreciation and impairment charge on property, plant and equipment 15,277 12,834 Amortization and impairment charge on intangible assets 17,893 36,183 Impairment charge on goodwill Changes in provisions and employee benefits ,865 Recognition of share-based payments 2,624 IPO costs 8,692 Profit/(loss) on disposal of assets (394) (1,311) Total net interest costs 127, ,011 Redemption premium 56,010 17,063 Amortization of transaction costs 42,340 29,237 Amortization of bond issue premiums 1,415 Other non-cash items (1) 1,465 16,258 Financing costs 227, ,984 Operating income before changes in working capital 266, ,035 Acquisition of the rental fleet recorded on the balance sheet (6) (232,851) (91,466) Changes in fleet working capital 34,869 (74,025) Changes in non-fleet working capital (57,243) 50,018 Cash generated from operations 10, ,562 Income taxes received/paid (39,669) (31,447) Net interest paid (137,334) (166,798) Net cash generated from (used by) operations (166,066) (89,683) Acquisition of intangible assets and property, plant and equipment (29,172) (23,578) Proceeds from disposal of intangible assets and property, plant and equipment 5,384 3,491 Other investments and loans (1,158) Proceeds from disposal of financial assets (7,563) (9,614) Acquisition of subsidiaries, net of cash acquired (2) (23,872) (45,778) Net cash used by investing activities (55,223) (76,637) Capital increase (net of related expenses) (3) 448,203 - Issuance of bonds (5) 471, ,000 Redemption of bonds (4) (780,010) (367,063) Change in other borrowings 123, ,699 Payment of transaction costs (19,820) (17,336) Swap cash payment - (2,000) IFRS Cash Flow (1) Of which, 1.5 million ( 14 million in 2014) of swap fair value adjustments reclassified from other comprehensive income to profit and loss (2) Of which, in 2014, the acquisition price net of cash acquired of Ubeeqo ( 17.3 million) and Europhall ( 22.5 million) and the subscription to the capital increase of Car2Go ( 5.7 million), and, in 2015, the subscription to the capital increase of Car2Go ( 12.5 million), the payment of the balance of the acquisition price of Europhall ( 5.4 million), the subscription to the capital increase of Ubeeqo ( 5 million) and the payment of the acquisition of E-Car Club. (3) Capital increase done May 15, and June 26, 2015 for a total amount of million net of related expenses ( 8.7 million) recorded in non-recurring expenses and 19,6 million out of 23.6 million deducted on share premium. (4) Repayment of HY 324 million and HY 400 million and payment of their relating redemption price ( 56 million). (5) Issuance of HY 475 million (99,289%) (6) Because of its short holding period in average, rental fleet is classified in current assets and as such its change from one period to another is part of operational activities. Net cash generated from (used by) financing activities 243, ,300 Cash and cash equivalent at beginning of period 206, ,038 Net increase/(decrease) in cash and cash equivalents after effect of foreign exchange differences 22,018 (63,020) Effect of foreign exchange differences 1,033 2,299 Cash and cash equivalents at end of period 229, ,317 34

35 Group Financing Structure IN Balance Sheet IN Balance Sheet million Pricing Maturity Dec. 31, 2015 Dec. 31, 2014 High Yield Senior Notes refinanced in High Yield Senior Notes (a) 5.75% Senior Revolving Facility ( 350m) E+250bps (b) FCT Junior Notes, accrued interest not yet due, capitalized financing costs and other Gross Corporate debt Short-term Investments and Cash in operating and holding entities CORPORATE NET DEBT million Pricing Maturity (A) Dec. 31, 2015 Dec. 31, 2014 High Yield EC Finance Notes (a) 5.125% Senior asset revolving facility ( 1.1bn SARF) (c) E+170bps FCT Junior Notes, accrued interest, financing capitalized costs and other UK, Australia and other fleet financing facilities (d) Gross financial fleet debt Cash held in fleet financing entities and Short-term fleet investments Fleet net debt in Balance sheet Key Considerations Corporate debt refinancing transactions Early repayment of the 324m bond with IPO primary proceeds Refinancing of the 400m bond via the issuance of the 475m senior notes due 2022 at an issue price of % and a coupon of 5.75% RCF facility extended to 2020 for amount of 350m at improved terms (May 2015) Commitment fee: 35% of margin Leverage Margin grid: corp. leverage 2.0x: 2.75% // corp. leverage < 2.0x: 2.50% Fleet debt refinancing transactions 1,100m SARF facility extended to 2019 at improved terms (May 2015) Margin of 170 bps Non utilization rate: 0.75% if utilization 50%; 0.50% if utilization > 50% Extension and increase of the related swap programs In H2 2014, refinancing of the 350 bond and the UK facility Credit ratings Upgrade S&P upgrade one notch to B+ on July 8 Moody s upgrade 2 notchs to B1 on July 7 OFF BS Debt equivalent of fleet operating leases - OFF Balance Sheet (e) TOTAL FLEET NET DEBT (incl. op leases) TOTAL NET DEBT (B) (A)+(B) (a) These bonds are listed on the Luxembourg Stock Exchange. The corresponding prospectus is available on Luxembourg Stock Exchange website ( (b) Depending on the leverage ratio (c) Swap instruments covering the SARF structure have been extended to 2019 (d) UK fleet financing maturing in 2017 with a two-year extension option (e) Corresponds to the net book value of applicable vehicles, which is calculated on the basis of the purchase price and depreciation rates of corresponding vehicles (based on contracts with manufacturers). average LTV Average Fleet net debt for FY 2015 In balance sheet 1,589 Off Balance Sheet 1,538 Total Fleet net debt 3,127 Indebtedness at the testing date 1,019 Total value of the net assets 1,084 Loan to value ratio 94.0% 35

36 BRIDGE TOTAL NET DEBT OVER 2015 Off Balance Sheet Debt On Balance Sheet Debt 3,148 Investments in fleet to support activity growth and summer season 3,057 1,284 (86) (35) (448) * 1,323 1,864 1,733 Net debt incl operating lease fleet at reported exchange rates Corporate free cash flow (before change in rental fleet) Profit and loss interest on Corporate debt Change in rental fleet (on balance sheet) Fleet working capital decrease / (increase) Change in operating leases fleet (off balance sheet) Other investing activities Increase in capital Transaction, premium, discount costs writte offs Amortisation of transaction, premium, discount costs Redemption price Other Net debt incl operating lease fleet at closing * Including effect of exchange rates for 26M 36

37 Glossary (1/2) Business customers: include corporations, small and medium-sized businesses, government agencies and other organizations which rent cars as well as entities renting cars to provide vehicle replacement services Corporate countries: countries where Europcar owns and operates its own network, where corporate-operated stations are located (Germany, UK, France, Italy, Spain, Portugal, Belgium and Australia/New Zealand) Adjusted Corporate EBITDA: EBITDA less fleet depreciation, fleet operating lease rents and fleet financing costs Fleet: all vehicles operated by the car rental company available or not for rent which includes cars and vans Fleet Cost per Unit per month: defined as total monthly fleet costs (including fleet holding and fleet operating costs but excluding financial interests) divided by the average fleet over the period. Fleet holding costs: include (A) Costs related to rental fleet agreements, which consist of (i) depreciation expense relating both to vehicles purchased with manufacturer or dealer buy-back commitments and to at risk vehicles (based, with respect to vehicles purchased with a buy-back commitment, on monthly depreciation rates negotiated under the buy-back agreements, net of volume rebates, and with respect to at risk vehicles, to the difference between the acquisition cost of the vehicles and the estimated residual value, the value of at risk vehicles being adjusted monthly on the basis of the vehicles market values) and (ii) charges under operating leases; (B) Acquisition and sale-related costs, which include principally (i) the cost of vehicle accessories; (ii) costs relating to the conditioning of new vehicles; and (iii) costs relating to disposal of used vehicles and of vehicles purchased in connection with buy-back programs; and (C) Taxes on vehicles. Fleet operating, rental and revenue related costs: include (A) Fleet operating costs, which include repairs and maintenance costs and costs incurred for damaged and stolen cars, as well as the costs of reconditioning vehicles for repurchase by the car manufacturer or dealer; (B) insurance (the costs of car insurance covering civil liability and damage to vehicles, as well as self-insurance costs); (C) Revenue-related commissions and fees, which include commissions paid to agents, such as personnel costs and station overhead (excluding vehicle fleet), as well as commissions paid to travel agents, brokers and other commercial partners and fees and taxes paid for airport and train station concessions; and (D) Rental related costs, which include the cost of transferring vehicles from one site to another, vehicle washing costs and fuel costs. Fleet financial utilization rate: number of actual rental days as a percentage of the theoretical total potential number of days of the fleet. The theoretical total potential number of days of the fleet is equal to the number of vehicles held over the period, multiplied by the total number of days in the period Franchising: arrangement where the franchiser grants the franchisee the right to use its trademark or trade-name as well as certain business systems and processes, to produce and market a good or services according to certain specifications. In exchange, the franchisee usually pays the franchiser an entry fee plus a percentage of sales revenues as royalty 37

38 Glossary (2/2) GDS (Global Distribution System): computerized reservations systems operated by third parties and used by intermediaries such as travel agents and travel operators to make reservations with the Europcar Network GSA (General Sales Agent): general sales representative that promotes and sells the services offered by Europcar in a specific country or region in consideration of a commission GreenWay system: software application, owned by Europcar, offering a comprehensive business solution mainly in the areas of fleet management, e-commerce, reservations and global distribution systems and rental operations Leisure customers: include not only individual travelers booking vacation car rentals but also people renting to meet other personal needs. Loan to value: corresponds to the indebtedness of Securitifleet Holding, the Securitifleet Companies and EC Finance Plc divided by the total value of the net assets on the balance sheets of these companies. Margin after variable costs: corresponds to the total revenues less Fleet holding costs and Fleet operating, rental and revenue related costs Net rates: brokers selling at any price, ie brokers revenue is the gap between Europcar s selling price and their selling price (usually offered to TOs for package, brokers with Keddy and destinations where brokers are more present than Europcar) Operating lease vehicle: agreement by which a vehicle is leased to a car rental company, which pays periodically on a relatively short-term basis; at the end of the operating lease, title does not pass to the car rental company Rental Day Volume: number of vehicles rented over a period of time RCM: Revenue Capacity Management Retail rates: Europcar setting the price and paying a commission to brokers preventing them from selling at a lower price than Europcar s RPD (Revenue Per Day): rental revenue divided by the Rental Day Volume Vehicle replacement: business involving principally the rental of cars to individuals whose rental charges are wholly or partially paid or reimbursed, by insurance companies, vehicle leasing companies and vehicle dealers and other entities offering vehicle replacement services, with whom Europcar has a direct contractual relationship 38

39 Important Legal Disclaimer / Contacts DISCLAIMER The document has been prepared by Europcar (the Company ). Recipients should conduct and will be solely responsible for their own investigations and analysis of the Company. The Company has no obligation to update the document or to correct any inaccuracies herein. None of the Company nor its respective employees or officers, makes any representation or warranty, express or implied, as to the accuracy, relevance and/or completeness of the document or the information, forwardlooking, statement contained herein and the Company shall not incur any liability for the information contained in, or any omissions from, the document. In particular, but without prejudice to the foregoing, no representation or warranty is given as to the achievement or reasonableness of any projections, targets, estimates or forecasts, and nothing in the document is or should be considered as a representation as to the future. Forward-looking statements are based on management's current expectations or beliefs on or about the date of the document and involve risks and uncertainties that could result, but not limited to, in different results from those described in the forward-looking statements and risk described in the documents the Company filed with the Autorité des Marchés Financiers (French securities regulators). The Company does not undertake, nor have any obligation to provide any updates or to revise any forward-looking statements in order to reflect any events or circumstances that may occur or arise after the date of the Presentation. INVESTOR RELATIONS Aurélia Cheval aurelia.cheval@europcar.com Investor Relations investor.relations@europcar.com For all financial or business information, please refer to our IR website at: finance.europcar-group.com 39