The earnings season, in which companies report their figures for the fourth quarter and the full year 2023, has not yet started properly. Nevertheless, in these days a few companies are already presenting some initial key figures. This includes the financial services provider Grenke AG, based in Baden-Baden.

As in previous years, Grenke has already presented some business figures for the fourth quarter of 2023 and for the 2023 financial year in the first days of the new year. But before I explain the figures of Grenke AG in more detail, let me briefly introduce the financial services provider from Baden.

Specialist in financing with banking license The predecessor company of Grenke AG was founded in 1978 by Wolfgang Grenke as a sole proprietorship. In the first years, Grenke specialized in leasing and financing IT products such as PCs, notebooks, screens, software, or telecommunications and copier technology.

In 1997, the company was converted into Grenkeleasing AG, which went public in early 2000. In 2005, Grenkeleasing AG expanded its business activities and entered the factoring business.

Four years later, Grenkeleasing AG took over the Hamburg private bank Hesse Newman & Co., which was renamed Grenke Bank shortly afterwards. With the acquisition of the private bank, Grenke obtained a banking license, allowing the Baden financier to offer banking services.

In early 2016, Grenkeleasing AG changed its name to Grenke AG. This renaming was a logical consequence of the continuous expansion of business activities: the original IT leasing company had become a diversified financial services provider. Today, the Grenke Group is represented worldwide with around 2,100 employees in more than 30 countries.

The latest business figures In the full year 2023, Grenke achieved a new leasing business volume of 2.6 billion euros. This represented an increase of 12.3% compared to the previous year. This placed the company at the lower end of the forecast range for 2023 of 2.6 to 2.8 billion euros.

The profitability (DB2 margin) also improved in the completed financial year, reaching 16.5%, significantly higher than the previous year’s 16.1%. The main reasons for the increase in margins are the continued stabilizing interest rate environment and the resulting catch-up effects in passing on higher refinancing costs.

In addition to the core business of IT leasing, the financing of green economy objects such as e-bikes, solar systems, or wall boxes, which is being driven by Grenke, is gaining importance. This segment accounted for around 8% of new leasing business in 2023. In 2022, it had been 6%.

The second strong growth driver for Grenke is the expansion of the dealer network. In the 2023 financial year, the number of trading partners increased to 36,200, representing an increase of 8.4% compared to the previous year.

The customer base of Grenke AG continued to grow in 2023 to nearly 670,000, which was a slight increase of 0.75%. Direct sales accounted for a stable share of exactly 17% of new leasing business overall (2022: 18%).

The Grenke Bank also remains an important pillar for the refinancing of the company. As of December 31, 2023, the deposit business amounted to 1.62 billion euros, an increase of 40.5% compared to the previous year.

It is gratifying that the demand for leasing for financing investments and optimizing liquidity continues to grow. In the full year 2023, the number of leasing inquiries was significantly higher at around 577,000, compared to the previous year, when Grenke recorded around 530,000 leasing inquiries. The Grenke share was an outperformer on the stock market for many years. However, since a major short attack in 2020, the stock has not really recovered.