SIXT closes 2020 with a slight profit in Europe despite Corona – total consolidated earnings within context of expectations given restrictions from pandemic and investments in growth market USA
- Despite the significant drop in demand in the wake of the pandemic, SIXT achieves a small pre-tax profit (EBT) of EUR 7.3 million for the Mobility segment in Europe
- Consolidated earnings before taxes (EBT) in line with expectations at EUR -81.5 million, substantially affected by the effects of the pandemic and the high investments in the USA; Earnings after taxes, including the discontinued Leasing Business Unit, slightly positive at EUR 2.0 million
- Corporate EBITDA, as consolidated operating result including interest result and depreciation and amortisation on rental vehicles, sees SIXT clearly in the positive range at EUR 75.6 million for the Mobility segment and demonstrates the strong crisis management and high adaptability of SIXT’s business model
- Thanks to the diversified business model with its stable capacity utilisation of city offices as well as the area of long-term rentals and car subscriptions, SIXT managed to keep the drop in Group revenue at -38.8% to EUR 1.53 billion and thus well below the average drop in international air traffic of -76%
- SIXT uses crisis year 2020 for internationalisation, to expand its product and market portfolio, for strategic partnerships and to strengthen its management
- Consistent cost management successfully implemented: total cost basis massively reduced in 2020 by almost EUR 600 million compared with the previous year
- Solid financing basis currently has significantly more than EUR 2 billion in financial funds available following the successful issue of a bond over EUR 300 million and a syndicated loan of EUR 750 million, which replaces the hitherto unused credit line that had been granted with the participation of the state-owned Kreditanstalt für Wiederaufbau (KfW); equity ratio climbs 6.0 percentage points as at the end of 2020 to a record level of 31.5%
- Erich Sixt will resign from the Management Board and join the Supervisory Board of Sixt SE in June 2021; Supervisory Board appoints Alexander and Konstantin Sixt to succeed him as joint Chairmen of the Board and Co-CEOs on the Group Management Board
- Erich Sixt, CEO of Sixt SE: “SIXT acted and used the crisis as an opportunity, instead of simply waiting for better times.”
Pullach, 2 March 2021 – Following evaluation preliminary figures, SIXT closed 2020 with a marginally positive EBT of EUR 7.3 million despite the massive collapse in travel activities in Europe and at home. Given the significant restrictions and decreases in demand in the wake of the COVID-19 pandemic, as well as the high investments made in the biggest growth market USA, the Group’s consolidated EBT came to EUR -81.5 million and stayed within the communicated corridor between EUR -70 million to EUR -95 million. After taxes and including the result from the discontinued Leasing Business Unit, the Group actually recognised a small profit of EUR 2.0 million.
Corporate EBITDA, which refers to the consolidated operating result including interest result and depreciation and amortisation on rental vehicles, even reported a clear profit of EUR 75.6 million for the Mobility segment for 2020. The diversified business model with its ongoing stable capacity utilisation in the city offices as well as the area of long-term rentals and car subscriptions, allowed the mobility service provider to keep the drop in Group revenue at -38.8% to EUR 1.53 billion and thus well below the average drop in international air traffic, which collapsed by 76% from the previous year.
The 2020 figures demonstrate the strong adaptability of SIXT’s business model and good crisis management. The Group used 2020 as an opportunity and executed strategically important acquisitions, substantially strengthened its personnel, concluded new strategic partnerships, among others with Lyft and Google, and expanded its market position internationally. This means the mobility service provider is excellently equipped to switch back fully into growth mode once the current restrictions to international travel and tourism are gradually lifted again.
Erich Sixt, CEO of Sixt SE: “SIXT acted, stayed true to its course and used the crisis above all as an opportunity, instead of simply waiting for better times. The fact that we even managed to bring in a small profit in Europe, proves the success of our crisis management and the adaptability of our business model even in this exceptional situation. Still more important though, are our investments in the future. The acquisition of the highly attractive airport stations in the USA lets us drive forward with our internationalisation strategy, expand our product portfolio with the successful launch of the car subscription offer SIXT+ and reinforce our top management with top-notch candidates. Even if the current situation in our industry continues to be characterised by high uncertainties, I am still cautiously optimistic that after the end of the contact prohibitions and travel restrictions we will return to a growth mode and link up again with our success story before Corona.”
Expansion in the USA proceeds
With the acquisition of ten strategically significant airport stations, SIXT extended its position in 2020 as the fourth strongest vehicle rental provider in the USA. This step enables the company to rent out vehicles directly from the terminals of such important airports as Boston, all three New York airports, Maui, Denver, Houston, Orlando or Las Vegas. Taken together, the ten new airport stations clock up a market volume of around USD 3.4 billion. SIXT is now present at 25 of the 30 key airports in the world’s biggest vehicle rental market that holds a revenue volume of over USD 32 billion and thereby has laid the groundwork for continued substantial growth after the end of the Corona crisis.
In 2020 SIXT increased the number of stations in the USA from 65 to 100, primarily by expanding the network of downtown sites. The continued consolidation on the US market also offers significant further growth potential. It should develop into the biggest single market for SIXT.
Car subscription service SIXT+ sees gratifying demand
The desire for flexible and independent mobility is picking up more and more speed. In addition, many people currently prefer their own vehicle over public transportation systems as a safe and reliable means of transport. With the car subscription service ‘SIXT+’, which was integrated as the fourth product category into our ONE mobility platform to supplement ‘SIXT rent’ (vehicle rental), ‘SIXT share’ (carsharing) and ‘SIXT ride’ (transfer services) and that can be booked via the SIXT app, SIXT is providing a tailor-made product to serve this need. Current studies show that the flexible use of a car and offers such as carsharing and most of all car subscriptions will gain more and more in importance in the future and are seen as viable alternatives to the acquisition of a car, for SIXT subscription models offer the advantage of long-term and thus easily budgetable revenue flows. Following its successful start in June 2020, ‘SIXT+’ quickly expanded abroad and is already available in Germany, France, Great Britain, the Netherlands, Austria, Spain, the USA, and most recently also in Switzerland. So far, well over 10,000 subscribers have already signed up, and according to the Trendreport of the market research institute Puls published in November 2020, SIXT is already by far the best-know brand for car subscription today. Almost every other person in Germany (46 percent) is familiar with SIXT as a car subscription provider.
Van & Truck (V&T) as long-term growth market
Since 1 January 2021 the Van & Truck segment has been represented on Sixt SE’s Managing Board by its own department. It is headed by the trade and logistics expert Daniel Marasch, who was previously the member of Lidl’s Managing Board responsible for the International Division and thus for expanding into strategically important foreign markets. SIXT views the Van & Truck business as an attractive long-term growth market, not least in view of the rise of online retailing and service providers. This growth market has seen growth in 2020, and SIXT has been continuously expanding its market position in recent years. The strategic objective envisages attaining a market-leading position in Europe as well as a relevant market share in the USA. The plan foresees extending the national and international product range with utility vehicles and trucks with a weight of up to 7.5 tons. The digitisation of the fleet and its integrating into the mobility platform ONE should continually improve the customer experience.
Superbly equipped for the future in terms of personnel
SIXT also used the crisis year 2020 to broaden and refresh its management basis significantly and thereby set the course for key strategic growth impulses. By appointing Managing Board member Daniel Marasch (43) to the new Van & Truck division, SIXT is demonstrating its conviction that logistic services are set to gain in importance in the long term and also after the end of the pandemic. In addition, Nico Gabriel (43), a long-standing SIXT manager, was appointed to the Managing Board as Chief Operations Officer (COO). He is responsible for the logical and consistent amalgamation of the branch office business with the company’s digital mobility products into one integrated global mobility offer. In his 16 year career Mr. Gabriel has already made a material contribution to the digital transformation of SIXT. His joining the Managing Board coincides with the departure of Detlev Pätsch (69), who had been an instrumental force in the expansion of the SIXT Group since 1986, and the Managing Board member with responsibility for Fleet & Operations since 1993. Mr. Pätsch will retire from work effective as of 31 March this year.
To oversee the booming digital business, SIXT managed to gain James Adams (37), the former COO of ‘booking.com’. As Chief Commercial Officer (CCO), he will be responsible for the newly created business unit “E-Commerce & Revenue Management”. The next stage in the expansion in North America will be overseen by Thomas C. Kennedy as new President and Chief Financial Officer (CFO) and Michael Meißner, acting as new President and Chief Operating Officer (COO) for SIXT USA. As an expert for operations and a long-standing SIXT manager, Michael Meißner, has impressively proven his competence in scaling international markets as he did in his role as Managing Director for Italy. Working together with the seasoned travel and mobility manager Thomas Kennedy, they will be responsible for the US-American market. In his last position, Kennedy was CFO for Hertz Global Holdings and the global hotel chain Hilton.
Change at the Management Board will take place in the middle of the year: The longstanding CEO of SIXT SE, Erich Sixt, will resign from the Management Board after the company’s Annual General Meeting on June 16, 2021, at the age of 76, and, subject to the approval of the Annual General Meeting, will join the Supervisory Board of Sixt SE, where he will assume the position of Chairman, provided the Supervisory Board gives its consent. Alexander and Konstantin Sixt, who have already been members of the Management Board since 2015, will succeed Erich Sixt on the Management Board and have been appointed joint Chairmen of the Board and Co-CEOs with effect from June 17, 2021. The company thus focuses on strategic continuity, international growth and digitalization. Friedrich Joussen, current Chairman of the Supervisory Board, will step down from the Supervisory Board after the Annual General Meeting in 2021.
Effective and resolute crisis management
With the onset of the COVID-19 crisis last spring, SIXT immediately resolved on a set of measures to adjust its cost structure to drastically altered market conditions:
- Fleet size reduction: By reducing the average number of vehicles in the Group’s fleet by 25% compared with 2019, SIXT was able to decrease the cost basis substantially and thereby release significant volume of liquidity. Herein it was aided by existing buy-back agreements concluded with the contract partners for the majority of the fleet as well as from the short holding period of the vehicles in Sixt’s fleet that averages six months.
- Total cost basis: All in all, the cost basis saw a massive reduction of almost EUR 600 million compared with the previous year. This impressively demonstrates the variability of the cost basis and thereby the adaptability of the business model.
- Material and personnel costs: The centrally managed and rigorously implemented cost programme meant that the self-defined target of an initial EUR 100 million was clearly exceeded by over EUR 300 million.
Alexander Sixt, Board member responsible for Strategy and Organisation (CAO) of Sixt SE: “We used 2020 to react resolutely to the crisis, especially to ready the SIXT Group for the next growth phase. Thanks to our enormously flexible business model and our stringently applied measures, we were able to implement massive cost savings of almost EUR 600 million and thus successfully counter the crisis. This required the full commitment and loyalty of our workforce, to whom I wish to extend my very special gratitude. Despite the second lockdown in the fourth quarter of 2020 we worked our way back into profit zone by the end of the year. Moreover, our solid financing basis with substantial free financial funds of currently significantly more than EUR 2 billion is making us superbly fit for the future. The new syndicated loan agreed recently of over EUR 750 million, enables us to replace and terminate the non-utilised credit provided under the participation of the state-owned KfW-Bank. Our equity ratio stands at a record level of 31.5%, having increased by 6 percentage points after the deconsolidation of the Leasing business. Along with the successful placement of the EUR 300 million bond in December, this gives SIXT full freedom of action on the capital and financing front once the restrictions to travel activities and tourism end.”
Key Group figures for fiscal 2020 according to preliminary evaluation
Unless otherwise stated, the following key figures for the period 1 January 2020 to 31 December 2020 include the business activities of the Mobility business unit as well as the other continuing operations not allocated to the Mobility business unit. Earnings after taxes for the discontinued Leasing business unit that was sold in July 2020 are disclosed separately in the Income Statement according to IFRS 5. Previous years’ figures have been adjusted for comparison purposes where necessary.
- Consolidated revenue came to EUR 1.53 billion and was thus 38.8% below the previous year’s figure of EUR 2.50 billion. Domestic revenue came to EUR 687.9 million (-30.1%) and foreign revenue to EUR 844.2% (-44.4%). Demand at numerous city offices rebounded during the course of the year and in parts reached pre-Corona levels again. This was offset by weak business at airports, due in part to the complete shutdown of national and international air traffic.
- Corporate EBITDA, which refers to the consolidated operating result including interest result and depreciation and amortisation on rental vehicles, showed a profit of EUR 75.6 million and remained clearly in the positive range (2019: EUR 414.7 million).
- Consolidated earnings before taxes (EBT), the key success figure for the Group, came to EUR -81.5 million and was thus within the guidance of the range last communicated as between EUR -70 million and EUR -95 million (2019: EUR 308.2 million). To this end almost all key cost positions were lowered to substantial degree.
- SIXT reports pre-tax earnings from continued business operations to the amount of EUR -98.8 million (2019: EUR 225.3 million).
- The Group’s annual result (before minority interests), which includes the result from the discontinued Leasing business unit, achieved a positive value of EUR 2.0 million (2019: EUR 246.8 million).
- Fleet investments significantly reduced: In 2020 SIXT added around 175,400 vehicles to its (national and international) rental fleet (2019: 250,900 vehicles) with a total value of EUR 5.48 billion (2019: EUR 7.43 billion). This is equivalent to a decrease of 30.1% in the number of vehicles and 26.3% in the value of vehicles.
Outlook for full-year 2021
In view of the ongoing worldwide restrictions to national and international private and business travel, some of which were tightened further at the start of 2021, SIXT’s market environment continues to be in the grip of much uncertainty at present. It is not currently possible to foresee when demand for mobility services will display any dynamism again and to what extend touristic travel will be possible this year. It also remains to be seen what mid- to long-term effects the pandemic will have on people’s travel behaviour or wider economic developments.
SIXT Group is very well prepared in all its markets for a revitalisation of demand, given the strategic, personnel and financial direction taken in 2020. However, in view of the high market insecurities, the Managing Board can currently not issue a forecast for fiscal year 2021.
Sixt SE with its registered office in Pullach near Munich, is a leading international provider of high-quality mobility services. With its products SIXT rent, SIXT share, SIXT ride and SIXT+ the company offers a uniquely integrated mobility service across the fields of vehicle and commercial vehicle rental, car sharing, chauffeur services and car subscriptions. The products can be booked through one single app, which also integrates the services of its renowned mobility partners. SIXT has a presence in around 110 countries around the globe. The company is characterized by consistent customer orientation, a lived culture of innovation with strong technological expertise, the high share of premium vehicles in its fleet and an attractive price-performance ratio. The SIXT Group generated revenue of EUR 3.31 billion in 2019 and ranks as one of the most profitable mobility companies worldwide. Sixt SE is the parent company of the Group and has been listed on the Frankfurt stock exchange since 1986 (ISIN ordinary share: DE0007231326, ISIN preference share: DE0007231334).
Kathrin Greven / Stefanie Seidlitz
Sixt Central Press Office
Tel.: +49 – (0)89 – 74444 6700
E-mail: [email protected]
The SIXT Group at a glance
(Preliminary data according to IFRS; rounding differences may occur)
|in EUR million||2020||2019||in %|
|Mobility Business Unit||1,520.2||2,494.3||-39.1|
|Thereof rental revenue||1,362.4||2,252.0||-39.5|
|Thereof other revenue from
|in EUR million||2020||2019||in %|
|Depreciation and amortisation expense||458.1||518.5||-11.7|
|Net other operating income/expenses||-354.2||-567.2||-37.6|
|Earnings before net finance costs and taxes (EBIT)||-48.7||338.6||>-100|
|Net finance costs||-32.8||-30.3||+8.3|
|Earnings before taxes (EBT)||-81.5||308.2||>-100|
|Income tax expense||17.3||82.9||-79.2|
|Result from continuing operations||-98.8||225.3||>-100|
|Result from discontinued operations, net of taxes||100.8||21.5||>+100|
|Earnings per share (in EUR)||-0.71||4.99|
|Other key figures for the Group||31 Dec. 2020||31 Dec. 2019||Change in %|
|Total assets (in EUR million)2||4,428.5||6,249.4||-29.1|
|Rental vehicles (in EUR million)||2,204.6||3,033.4||-27.3|
|Equity (in EUR million) 2||1,394.7||1,592.2||-12.4|
|Equity ratio (in %)2||31.5||25.5||+6.0 points|
|2020||2019||Change in %|
|Investments (in EUR billion)1||5.48||7.43||-26.3|
|Average number of rental vehicles (Group)||113,800||150,700||-24.5|
1 Value of vehicles added to the rental fleet
2 Prior-year balance sheet figures not adjusted in accordance with IFRS 5