2010 Year in Review

De Lage Landen grows net profit significantly

  • Net profit €201 million ($269 million)
  • Net profit growth 79%
  • Total credit portfolio €25.2 billion ($33.8 billion)
  • Vendor Finance expands into China and India
  • Strong new business volume in Consumer Finance and Factoring


De Lage Landen reported a net profit of €201 million ($269 million) over 2010, an increase of 79% compared to 2009 (€112 million ($150 million)). The total credit portfolio increased 6% to €25.2 billion ($33.8 billion) from €23.7 billion ($31.8 billion). Operating income increased 15% to €1.18 billon ($1.58 billion) from €1.03 billion ($1.38 billion).

The company is exploring opportunities in India and now operates in 35 countries with over 5,250 FTEs.

Mission
De Lage Landen wants to enrich the value proposition of its partners by providing them with the best finance products and services to offer to their customers.

CEO statement
“We are back on track,” says De Lage Landen CEO Ronald Slaats. “Looking at these figures makes me very proud. 2009 was a tough year for us, although we remained profitable. In 2010, we re-positioned for accelerated growth, standardizing processes and keeping an eye on costs and risk. Thanks to hard work and team effort, we were able to bounce back quickly.”

“We started the year with ambitious targets, but we worked hard and we exceeded our expectations. Thanks to our focus on cost control and risk management, we were able to improve our profitability. I can proudly say that we have recovered from the crisis.”

“Besides growth, our continued focus in 2010 was on partnership. We worked together more closely with our parent company and shareholder, Rabobank.”

Core activities

Vendor Finance
The Vendor Finance division grew portfolio as well as new business volume irrespective of economic challenges, and expanded into emerging markets. Existing partnerships were extended.

Consumer Finance
Consumer Finance demonstrated organic growth by increasing credit volume through the Rabobank channel and increasing new business volume through its online label, Freo. It also signed an agreement for the acquisition of a €200 million consumer credit portfolio from Achmea Bank, positioning Consumer Finance for the future.

Car Lease
De Lage Landen’s subsidiary Athlon Car Lease is market leader in The Netherlands and has operations in nine European countries. In 2010, it benefited from the improving market for ex-lease cars and was able to turn an average loss per car in January to a small profit per car in December. However, there are significant differences between countries and over the months.

Factoring
Factoring’s credit portfolio grew 28% from €450 million ($602 million) to €574 million ($768 million). Its new business volume was at an all-time high. Despite the heavy growth in new business, Factoring managed to serve existing customers exceptionally well. As a result, customer satisfaction rose to 89%.


Sustainability
Sustainability at De Lage Landen represents business as well as social value.  In 2010, it made further progress in embedding sustainability into its core business.

De Lage Landen continues to expand its portfolio of clean technology and sustainable lighting products and has been proactively applying new insights in global remanufacturing and recycling practices. With the aim to be a responsible financial service provider, De Lage Landen is implementing enhanced client risk assessment tools, setting guidelines on ethical remarketing of equipment, and increasing the overall awareness on sustainable business practices. Through the LEED and BREAAM certification processes, De Lage Landen is also improving the eco-efficiency of its two biggest offices in Wayne (U.S.) and Eindhoven (The Netherlands). Athlon is actively taking the lead in providing sustainable mobility solutions.

De Lage Landen was recognized by Leasing Life as Green Lessor of the Year. A panel of independent analysts and a selection of industry experts concluded that De Lage Landen made remarkable inroads into innovative sustainable financial products and green technology finance, while simultaneously cutting the environmental impact of existing services offered and day-to-day operations.


Outlook
The aftermath of a worldwide economic crisis and a changing regulatory environment - most notably regarding lease accounting changes - combine to provide an unclear picture of the future.

In the construction, transportation and industrial markets, recovery is expected to be slow. Healthcare and food and agriculture have been least impacted by the overall recession, with only modest drops in equipment sales. Office equipment, technology and car lease are expected to recover in line with the global economies. For Athlon, it is expected that in 2011 the European automotive sector will return to long-term trend levels.

Against these circumstances, De Lage Landen believes it is well-positioned for growth.

In the past five years, De Lage Landen invested in the extension of its business model through expanded product offerings, the broadening of its geographical presence, and the enhancement of its technical infrastructure. In the years that are coming up, its aim is to unlock the full potential of these investments by further connecting its business lines across the globe, creating stronger connections with all stakeholders as a result.

A worldwide employee engagement program is set up that will support its goal of truly connecting its members and enabling them to truly connect to vendors, customers, and its shareholder, Rabobank. “In short, I envision a company in which we can be ourselves together,” says CEO Ronald Slaats. “I see connecting and being our true selves as the key to remaining successful and building further on the unique proposition that we aim for in the market: as a global company with great expertise and experience, with true partnership at the core of our organization.”

De Lage Landen will take up Rabobank Group’s strategic priorities in international food & agriculture and all-finance in The Netherlands. It will also continue to treat sustainability as a business priority, recognizing a global market place that increasingly values ethical behavior and eco-friendly, innovative products.

“De Lage Landen will continue to focus on cooperation and connectivity within our company, aiming to further unify our proposition and optimize customer service,” says CEO Ronald Slaats. “After smashing our expectations in 2010, we are starting off with a clean slate and even more ambitious targets in 2011. We are expecting returns on our investments from the last five years and will increase synergies between our business lines and geographical areas.”

 The PDF is available for download here.

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