Germany-based Sixt announced its full-year financial earnings on March 14. In 2012, Sixt generated consolidated earnings before taxes (EBT) of EUR 118.6 million, which was 14.6% down on the record figure of EUR 138.9 million generated in 2011.
For its rental segment, Sixt reported an increase in revenue, particularly for its operations outside Germany.
Sixt said these are preliminary figures and will release more details on its 2012 financial year on April 16.
Group Revenue and Earnings Performance in 2012
Sixt reported that its rental revenues rose in 2012 by 6.5% to EUR 953.7 million (2011: EUR 895.7 million). The company said the driving force was its foreign business operations, which expanded by 20.1% to EUR 349.0 million.
“The fact that we managed to generate such a good result in 2012, despite the recessionary climate in Europe, the general cost increases and in spite of the start-up costs for such future projects as setting up our U.S. business, proves the inner strength of the Sixt Group,” said Erich Sixt, chairman of the managing board of Sixt AG. “The dynamic growth in Europe outside Germany is particularly gratifying. Although our plans for 2013 are cautious because of the difficult market environment, we will continue all growth initiatives unabated.”
Sixt gained market shares in key European rental markets, such as France and Spain. In Germany, the company said demand ebbed off during the course of the year because of the drop in business activity, bringing rental revenue of EUR 604.7 million, which was roughly in line with 2011’s level (-0.1%).
In view of the growing economic uncertainties, Sixt said it started to call vehicle orders more cautiously and flexibly in the second half of 2012. Over the entire financial year, the Sixt Group added around 153,600 vehicles to the rental and leasing fleet (2011: 158,900 vehicles) with a total value of EUR 3.69 billion (2011: EUR 3.75 billion). This equals a decrease of 3.3% in the number of vehicles and 1.6% in the value of vehicles.
Other 2012 Sixt financial highlights include:
- Consolidated earnings before interest and taxes (EBIT) came to EUR 167.7 million, which was 11.7% less than the year before at EUR 189.8 million.
- After taxes, the Sixt Group reported a profit of EUR 79.2 million compared to EUR 97.5 million the year before (-18.7%).
Outlook for 2013
Sixt expects demand in Germany to drop for vehicle rental, while the growth path in the other European countries and the U.S. is set to continue. All in all, the managing board expects consolidated rental revenues to contract slightly in 2013.
As well, Sixt will once again adhere to the principle of giving preference to adequate margins over volume growth ("Earnings before growth"). Nonetheless, strategic growth initiatives, such as the expansion in the U.S., will continue without restrictions.
Developments in Rental
At the end of 2012, Sixt had 1,970 rental offices worldwide, 494 of them in Germany. In Western Europe and the U.S., Sixt operates its own subsidiaries, while in the other European countries and the other regions of the world, the company is represented by a close-knit network of franchisees.
The activities that started in 2011 to gradually develop the U.S. market continue to outperform expectations. Currently, Sixt maintains 12 stations of its own, with the focus on Florida. Parallel to these, 2012 saw the set-up of a franchise network, and Sixt is also sounding out the Canadian market.
The premium car sharing service DriveNow remains also on expansion course. In 2012 it won over 60,000 new registered users, bringing the total to more than 85,000 to date. In addition, the vehicle portfolio was extended to further BMW and MINI models.
Financial earnings reports from other public car rental companies operating in the U.S. can be found here.