Landmark year for ALD after record 2022 financial results

ALD has registered record financial results in 2022, driven by the strong increase in margins and exceptionally high used car sales results, which more than offset the LeasePlan acquisition-related costs of €128 million incurred in 2022.

A successful €1.2 billion rights issue was completed at the end of 2022, securing the financing of the acquisition of LeasePlan.

ALD’s record net income (group share) reached €1,203.2 million in 2022, up 37.8% vs. 2021. The contribution from Q4 2022 was €285.0 million, up 8.4% compared to Q4 2021.

Full-service lease contracts reached 1,413 thousand units at the end of December 2022, while the order book remained at a high level, reflecting strong commercial dynamics in a context of continuing supply constraints. Funded fleet grew by a strong +3.1% vs. end 2021 on a like-for-like basis, in line with the guidance range (+2% to +4%).

The total number of fleet management contracts increased by 43,000 in 2022 or +14.6% vs. 2021, to reach 336,000 vehicles, with growth primarily driven by a new banking partnership.

Total contracts stood at 1,806 thousand at the end of 2022, up by 5.2% compared to end 2021, reflecting ALD’s good commercial performance.

The contribution from used car sales result reached an exceptionally high level of €747.6 million in 2022, up from €437.7 million in 2021, reflecting the very favourable supply/demand situation.

As a result of this exceptionally high used car markets, ALD’s gross operating income reached €2,631.8 million in 2022, up 44.6% vs. 2021. The impact of the reduction in depreciation costs, net of its impact on UCS results was + €239.4 million over the full year.

Taken together, leasing contract and services margins (total margins) reached €1,884.2 million in 2022, up 36.3% over the previous year, and up 31.7% when adjusted for non-operating items.

Leasing contract margin reached €1,181.1 million in 2022, up 61.2% compared to the prior year and up 54.1% when adjusted for non-operating items. Services margin was €703.2 million, up 8.2% vs. 2021, underpinned by the increasing number of fleet management contracts. Besides, Q4 2022 was boosted by the integration in the consolidation perimeter of Fleetpool’s margins over the full year.

Commenting on the full-year 2022 Group Results, Tim Albertsen (pictured above), ALD CEO, stated: “In spite of a deteriorating geopolitical and macroeconomic environment, with continued disruptions of supply chains, ALD recorded a landmark year. We generated a net result well above one billion euros for the first time in our history, confirming the solidity of our business model through the cycle and our agility in challenging situations. This record financial performance reflects the commitment of our employees to achieve the highest standards of service quality and to fuel business growth in new market segments with innovative products, while maintaining a strong focus on operational excellence.”

Outlook for 2023

In a fast-changing environment where monetary policies were focused on fighting inflation, economies proved resilient in 2022. In the current geopolitical context and taking into account China’s reopening, ALD anticipates that supply chains will only gradually return back to normal, leading new car supply to normalise later than previously anticipated, towards the end of 2023. Against this backdrop, the favourable supply/demand situation in the used car markets is expected to remain in place in 2023.

ALD is currently finalising its integration plan for LeasePlan to be ready to start executing it as soon as the acquisition closes. ALD expects to provide operational guidance for the combined entity for 2023 after the closing of the acquisition.