Q1 2017: Europcar Starts the Year with Solid Revenue Growth and the Acquisition of Its Danish Franchisee

  • Revenue of €439 million up 6.6% at constant exchange rates with organic growth of 3.2%
  • Adjusted Corporate EBITDA at -€6 million versus -€5 million in Q1 2016
  • Net income at €19 million versus -€20 million in Q1 2016
  • Europcar confirms its guidance for 2017
  • Acquisition of Europcar’s Danish Franchisee
  • LTM Net Debt / EBITDA below 1x leaves ample headroom to finance further acquisitions

SAINT-QUENTIN-EN-YVELINES, France--()--Regulatory News:

Europcar (Paris:EUCAR) today announced its results for the first quarter 2017.

For Caroline Parot, Chief Executive Officer of Europcar Group:

"We start the year on a solid footing. Our revenue growth of 6.6% is driven by a strong momentum across all of our three major business units. We have continued to deliver significant improvements in both fleet costs per unit down 3.4% YoY and fleet utilisation which is up 140 bps YoY at the Group level. As planned, we have accelerated our investments into our InterRent network as well as into the digitalisation of our customer journey.

We are also pleased to announce the acquisition of our Danish franchisee and delighted to welcome Europcar Denmark as our newest corporate country. Together with the existing management team, we aim to support the continued growth of the business and to achieve significant synergies with our other corporate countries.

Only 4 months after buying our Irish franchisee, we take yet another step in our dynamic acquisition plan, which not only strengthens our European leadership but also brings us a little closer to our 2020 Ambition.

By continuing to focus on improving our customers’ satisfaction and implementing our strategic priorities, we demonstrate our ability to deliver solid revenue growth across all of our business units, as well as an accelerating momentum on the acquisition front. As a result, we confirm all of our objectives for 2017 and feel confident that our current leverage gives us ample headroom to pursue our acquisition strategy.”

All data in €m, except if mentioned   Q1 2017   Q1 2016   Change   Change at constant currency*
Number of rental days (million)   12.9   11.8   9.3%  
Average Fleet (thousand) 192.1 177.3 8.3%
Financial Utilization rate   74.6%   73.2%  


Total revenues 439 418 5.2% 6.6%
Rental revenues 403 388 3.9% 5.3%
Adjusted Corporate EBITDA (6.2) (4.7)



Adjusted Corporate EBITDA Margin -1.4% -1.1% -0,3pt
Last Twelve Months Adjusted Corporate EBITDA 252 250 1.1%
LTM Adjusted Corporate EBITDA Margin 11.6% 11.6% 0.0pt
Operating Income 41 7
Net profit/loss 19 (20) n.m n.m
Corporate Free Cash Flow (27) 0
Corporate Net Debt at end of the period 235 247
Corporate net debt / EBITDA ratio 0.93x 0.99x

Q1 2017 highlights


The Group generated revenues of €439.3 million in the first quarter of 2017, up 6.6% at constant exchange rates compared with the first quarter of 2016. On an organic basis, ie at constant exchange rates, constant perimeter and excluding petrol, the Group revenues grew by 3.2%.

This significant increase in Group revenues was the result of solid growth across all the Group’s major business units with Cars growing by 4.3%, Vans & Trucks growing by 4.5% and InterRent growing by a stellar 49%.

More importantly, these solid revenue numbers were delivered thanks to good momentum in both the leisure and corporate businesses and are once again proof of the strength and robustness of the Group balanced business model.

The number of rental days increased to 12.9 million in Q1 2017, up 9.3% versus Q1 2016. This growth in rental days was spread across all the key divisions with cars growing 6.8%, Vans & Trucks growing 9.7% and InterRent growing 51%. On the other hand, Revenue per rental day decreased by 3.6% at Group level, mostly impacted by (1) a 4.8% decline in the Vans & Trucks business unit reflecting a strategic focus on extending utilization and rental durations, and (2) a 2.3% decline in the Cars business unit as a result of a lower pricing environment linked to the strategy in Q1 17 versus Q1 16 which included Easter week-end.

Adjusted Corporate EBITDA1

Q1 2017 Adjusted Corporate EBITDA declined by €1.5m to -€6.2 million compared to -€4.7 million in Q1 2016. This slight decrease was caused by the positive impact of Easter on Q1 16, the additional investment into the Group customer journey digitalization programme and the InterRent network in Q1 2017 vs Q1 2016 and the net losses incurred in the New Mobility division.

The Group’s profitability was positively impacted by a 140 basis points increase in the Group’s fleet financial utilization which reached 74.6% in Q1 2017 versus 73.2% in Q1 2016, which was mostly due to a significant improvement in utilisation in the Vans & Trucks business in line with the shift in strategy for the business unit and the top line growth strategy in order to manage the shift of Easter from March last year to April this year. Also worth noting is the good control of the Group’s fleet operating costs as well as the good fleet negotiations that occurred in the quarter which enabled the Group to reduce its fleet costs per unit by 3.4% in the first quarter of 2017 versus the first quarter of 2016.

Corporate Operating Free Cash Flow

Q1 2017 Corporate Operating Free Cash Flow was -€27 million compared to 0 million in Q1 2016 impacted by a doubling of the non-fleet capex which reached €12 million in Q1 2017 versus €6 million in Q1 2016. This significant increase in capex mostly related to investments into the IT infrastructure and the network and is fully in line with the Group strong ambition in terms of digitalisation of the customer journey.

Net income

In Q1 2017, the Group posted a net profit of €18.6 million, compared to a €20.1 million net loss in Q1 2016. This significant improvement was caused by the release of a €45 million provision linked to the absence of appeal following the French Antitrust Authority (ADLC) dismissal decision in its case against the French car rental industry in February 2017.

Net debt

Corporate net debt continued to decrease YoY to reach €235 million as of March 31, 2017 (vs. €247 million as of March 31, 2016) as a result of the Group’s strong free cash flow generation.

The fleet debt was €3,014 million as of March 31, 2017 vs. €2,775 million as of March 31, 2016. This increase reflects the higher number of vehicles in the fleet in order to sustain the growth of the Group’s operations and the fleet mix evolution.

2017 guidance confirmed

Europcar confirms its four financial targets for 2017 compared to 2016:

- Accelerating organic revenue growth ie above 3%

- Increase in adjusted corporate EBITDA margin (excluding New Mobility) ie above 11.8%

- A corporate operating free cash flow conversion rate above 50%

- A dividend payout ratio above 30%

The Group also reiterates its strategic ambition to continue the roll out of its acquisition plan in order to increase value creation for its shareholders.

Acquisition of Europcar’s Danish Franchisee

Europcar also announces today the acquisition of its Danish franchisee, one of its biggest in terms of revenue. After the acquisition of its Irish franchisee in December 2016, the Group accelerates the extension of its corporate network from 10 to 11 countries and strengthens its car rental and Vans & Trucks footprint.

Europcar Denmark is the market leader with circa 30% market share in Denmark. It has a strong nationwide branch network of 40 branches throughout Denmark both locally and at all the major airports. The company operates an average rental fleet in excess of 6,000 vehicles covering cars, vans and specialist vehicles. It has a strong customer base, of both leisure and B2B customers. In 2016, Europcar Denmark generated revenues of 60 million euros.

Europcar Denmark’s particular strengths include its vastly experienced management team and the strong relationships it has developed in the entertainment & film/music production and construction industries which today represent a significant part of the business.

Conference Call with Analysts and Investors

Caroline Parot, Chief Executive Officer and Jean-Claude Poupard, Chief Financial Officer, will host a conference call in English today at 2 p.m. Paris time (CET).

You can follow this conference call live via webcast.

A replay will also be available for a period of one year. All documents relating to this publication will be available online on Europcar’s investor website

Investor Calendar

Annual General Meeting       10 May 2017
H1 2017 Results 26 July 2017
Q3 2017 Results 9 November 2017

About Europcar Group

Europcar Group is listed on Euronext Paris. Europcar is the European leader in vehicle rental service and is also a major player in mobility markets. Active in more than 130 countries and territories, including eight subsidiaries in Europe and two in Australia and New Zealand, Europcar serves customers through an extensive vehicle rental network comprised of its wholly-owned subsidiaries as well as sites operated by franchisees and partners. The group operates mainly under the Europcar®, InterRent® and Ubeeqo® brands. Customer satisfaction is at the heart of the group's mission and all of its employees, this commitment fuels the continuous development of new services. The Europcar Lab, based in Paris, was created to better grasp tomorrow’s mobility challenges through innovation and strategic investments, such as Ubeeqo, E-Car Club or Brunel.

Forward-looking statements

This press release includes forward-looking statements based on current beliefs and expectations about future events. Such forward looking statements are not guarantees of future performance and the announced objectives are subject to inherent risks, uncertainties and assumptions about Europcar Groupe and its subsidiaries and investments, trends in their business, future capital expenditures and acquisitions, developments in respect of contingent liabilities, changes in economic conditions globally or in Europcar Groupe’s principal markets, competitive conditions in the market and regulatory factors. Those events are uncertain; their outcome may differ from current expectations which may in turn affect announced objectives. Actual results may differ materially from those projected or implied in these forward-looking statements. Any forward-looking statement contained in this press release is made as of the date of this press release. Europcar Groupe undertakes no obligation to publicly revise or update any forward-looking statements in light of new information or future events.

The results and the Group's performance may also be affected by various risks and uncertainties identified in the "Risk factors" of the Registration Document registered by the Autorité des marchés financiers (the "AMF") May 20, 2015 under the number I.15-041 and its update filed with the AMF on June 12, 2015 and also available on the Group's website: www.europcar-group.com

Further details on our website:

1 Adjusted Corporate EBITDA is defined as current operating income before depreciation and amortization not related to the fleet, and after deduction of the interest expense on certain liabilities related to rental fleet financing. This indicator includes in particular all the costs associated with the fleet. See “Reconciliation with IFRS” attached.

Appendix 1 – Management Profit and Loss

All data in €m       Q1 2017     Q1 2016
Total revenue 439.3 417.6
Fleet holding costs, excluding estimated interest included in operating leases (106.8) (104.9)
Fleet operating, rental and revenue related costs (166.3) (155.3)
Personnel costs (90.5) (83.2)
Network and head office overhead (58.7) (53.5)
Other income and expense 0.5 (0.1)
Personnel costs, network and head office overhead, IT and other (148.7) (136.7)
Net fleet financing expense (13.7) (14.7)
Estimated interest included in operating leases (9.9) (10.6)

Fleet financing expenses, including estimated interest included in
operating leases

(23.6) (25.3)
Adjusted Corporate EBITDA (6.2) (4.7)
Margin -1.4% -1.1%
Depreciation – excluding vehicle fleet (6.6) (8.2)
Other operating income and expenses 39.9 4.7
Other financing income and expense not related to the fleet (15.5) (12.6)
Profit/loss before tax 11.6 (20.8)
Income tax 10.0 3.7
Share of profit/(loss) of associates (3.0) (3.0)
Net profit/(loss) 18.6 (20.1)

Appendix 2 – IFRS Income statement


In € thousands



Revenue     439,291     417,554
Fleet holding costs (116,703) (115,450)
Fleet operating, rental and revenue related costs (166,335) (155,336)
Personnel costs (90,537) (83,172)
Network and head office overhead costs (58,675) (53,458)
Depreciation, amortization and impairment expense (6,595) (8,207)
Other income     466     (140)
Current operating income     912     1,791
Other non-recurring income 45,000 9,149
Other non-recurring expense     (5,136)     (4,411)
Operating income     40,776     6,529
Gross financing costs (22,415) (21,849)
Other financial expenses (7,324) (5,865)
Other financial income 592 413
Net financing costs (29,147) (27,301)
Profit/loss before tax     11,629     (20,772)
Income tax benefit/(expense) 9,966 3,651
Associate (3,037) (3,016)
Net profit/(loss) for the period     18,558     (20,137)
Attributable to:
Owners of ECG 18,609 (19,972)
Non-controlling interests (51) (165)
Basic earnings per share attributable to owners of ECG (in €) 0.129 (0.139)
Earnings per share attributable to owners of ECG (in €) 0.129 (0.139)

Appendix 3 – Reconciliation

All data in €m     Q1 2017     Q1 2016
Adjusted Consolidated EBITDA 100.2 103.3
Fleet depreciation IFRS (39.2) (41.2)
Fleet depreciation included in operating lease rents (43.6) (41.5)
Total Fleet depreciation (82.8) (82.7)
Interest expense related to fleet operating leases (estimated) (9.9) (10.6)
Net fleet financing expenses (13.7) (14.7)
Total Fleet financing (23.6) (25.3)
Adjusted Corporate EBITDA (6.2) (4.7)
Amortization, depreciation and impairment expense (6.6) (8.2)
Reversal of Net fleet financing expenses 13.7 14.7
Reversal of Interest expense related to fleet operating leases (estimated) 9.9 10.6
Adjusted recurring operating income 10.8 12.4
Interest expense related to fleet operating leases (estimated) (9.9) (10.6)
Recurring operating income 0.9 1.8

Appendix 4 – Balance sheet


In € thousands

As at March
31, 2017

As at
December 31,

Goodwill 515,586 459,496
Intangible assets 727,169 715,209
Property, plant and equipment 89,493 84,102
Equity-accounted investments - 14,083
Other non-current financial assets 49,491 67,820
Financial instruments non-current 1,350 -
Deferred tax assets 58,350     58,743
Total non-current assets 1,441,439 1,399,453
Inventories 17,712 16,843
Rental fleet recorded on the balance sheet 1,761,685 1,640,251
Rental fleet and related receivables 761,424 720,623
Trade and other receivables 344,196 365,200
Current financial assets 44,066 77,003
Current tax assets 68,694 35,585
Restricted cash 92,911 105,229
Cash and cash equivalents 168,744     154,577
Total current assets 3,259,432 3,115,311
Total assets       4,700,871     4,514,764
Share capital 146,132 143,409
Share premium 666,579 647,514
Reserves (99,901) (111,681)
Retained earnings (losses) (25,218)     (48,706)
Total equity attributable to the owners of ECG 687,592 630,536
Non-controlling interests       922     730
Total equity       688,514     631,266
Financial liabilities 971,030 953,240
Non-current financial instruments 45,241 56,216
Employee benefit liabilities 136,245 139,897
Non-current provisions 17,759 18,640
Deferred tax liabilities 109,458 107,848
Other non-current liabilities 231     246
Total non-current liabilities 1,279,964 1,276,087
Current portion of financial liabilities 1,079,423 1,224,442
Employee benefits 3,247 3,247
Current tax liabilities 57,347 39,227
Rental fleet related payables 964,505 679,678
Trade payables and other liabilities 459,678 440,065
Current provisions 168,193     220,752
Total current liabilities       2,732,393     2,607,411
Total liabilities       4,012,357     3,883,498
Total equity and liabilities       4,700,871     4,514,764

Appendix 5 – IFRS Cash Flow


In € thousands







Profit/(loss) before tax       11,629     (20,772)
Reversal of the following items

Depreciation and impairment charge on property, plant and

3,834 3,736
Amortization and impairment charge on intangible assets 2,762 4,357
Changes in provisions and employee benefits (55,590) (22,397)
Recognition of share-based payments (192) 1,225
Costs related to the IPO - 146
Profit/(loss) on disposal of assets (30) -
Total net interest costs 24,321 23,263
Redemption premium 1,924
Amortization of transaction costs 1,806 -
Other non-cash items 1,996     -
Financing costs 28,123 25,192
Net cash from operation before changes in working capital       (9,464)     (8,513)
Changes to the rental fleet recorded on the balance sheet (63,040) (46,047)
Changes in fleet working capital 238,980 130,219
Changes in non-fleet working capital 14,952 30,040
Cash generated from operations       181,428     114,212
Income taxes received/paid (6,441) (1,426)
Net interest paid (18,507) (19,064)
Net cash generated from (used by) operating activities       156,480     84,664

Acquisition of intangible assets and property, plant and

(12,715) (6,558)

Proceeds from disposal of intangible assets and property, plant and

896 38
Other investments and loans (3,110) 592
Acquisitions/disposal of financial assets - 259
Acquisition of subsidiaries, net of cash acquired - -
Net cash used by investing activities       (14,929)     (5,669)
Capital increase (net of related expenses) 21,787 -
Issuance of bonds - -
(Purchases) / Sales of treasury shares net (549) (677)
Change in other borrowings (188,084) (107,903)
Payment of transaction costs - -
Net cash generated from (used by) financing activities       (166,846)     (108,580)
Cash and cash equivalents at beginning of period 248,507 229,368

Net increase/(decrease) in cash and cash equivalents after effect of
foreign exchange differences

(25,295) (29,585)
Scope Variation 11,635 -
Effect of foreign exchange differences 799 (415)
Cash and cash equivalents at end of period       235,646     199,368
(1)   In 2017, the change in employee benefits is mainly due to a downward trend in the discount rate in Germany €8 million, the reversal of provision for disputes with French Competition Authority €45 million.
(2) Given the average holding period for the fleet, the Group reports vehicles as current assets at the beginning of the contract. Their change from period to period is therefore similar to operating flows generated by the activity.
(3) The increase of tax cash-out in Q1 2017 versus Q1 2016 is due to prior year’s regularizations in Q1 2016 in UK and Spain.
(4) Mainly related to IT cost capitalized.
(5) Of which (€7 million) of Ubeeqo minority’s stake acquisition, €5.2 million Euroguard investment.
(6) Capital increase reserved for employees of the Company and subsidiaries (ESOP).
(7) Related to Senior notes reimbursement.
(8) In 2017, due to the change of Ubeeqo consolidation method from equity method to full consolidation

Appendix 6 – Debt

€million Pricing Maturity

31, 2017

Dec. 31,

High Yield Senior Notes (a) 5.75% 2022 600 600
Senior Revolving Facility (€350m) E+250bps (b) 2020 20 13

FCT Junior Notes, accrued interest not yet due, capitalized
financing costs and other

(150) (203)
Gross Corporate debt 470 410
Short-term Investments and Cash in operating and holding entities (235) (189)
€million Pricing Maturity

31, 2017

31, 2017


High Yield EC Finance Notes (a) 5.125% 2021 350 350
Senior asset revolving facility (€1.3bn SARF) (c) E+150bps 2020 541 693

FCT Junior Notes, accrued interest, financing capitalized costs
and other

155 200
UK, Australia and other fleet financing facilities Various (d) 532 491
Gross financial fleet debt 1,578 1,734
Cash held in fleet financing entities and Short-term fleet investments 103 (150)
Fleet net debt in Balance sheet 1,475 1,584


Debt equivalent of fleet operating leases - OFF Balance Sheet (e) 1,539 1,461
TOTAL FLEET NET DEBT (incl. op leases) (B) 3,014 3,045
TOTAL NET DEBT (A)+(B) 3,249 3,265

These bonds are listed on the Luxembourg Stock Exchange. The corresponding prospectus is available on Luxembourg Stock Exchange website (http://www.bourse.lu/Accueil.jsp)

(b) Depending on the leverage ratio
(c) Swap instruments covering the SARF structure have been extended to 2020
(d) UK fleet financing maturing in 2018 with one 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).


Europcar / Press relations
Nathalie Poujol, +33 1 30 44 98 82
Europcar / Investor relations
Olivier Gernandt, +33 1 30 44 91 44
Havas Paris
Fabien Aufrechter, +33 1 58 47 93 71


Europcar / Press relations
Nathalie Poujol, +33 1 30 44 98 82
Europcar / Investor relations
Olivier Gernandt, +33 1 30 44 91 44
Havas Paris
Fabien Aufrechter, +33 1 58 47 93 71