Home Business NewsBusinessAutomotive News SIXT grows by 18% to record revenue in 2023 and achieves second-best result in the company’s history

SIXT grows by 18% to record revenue in 2023 and achieves second-best result in the company’s history

4th Mar 24 3:56 pm

SIXT continued its growth trajectory in 2023 and achieved record revenue for the second year in a row.

According to preliminary calculations, the international mobility service provider achieved a consolidated revenue of EUR 3.62 billion, which corresponds to growth of 18.1% compared to the previous year and 44.7% compared to 2019.

All three regional segments of SIXT made a strong contribution to growth: showing the highest growth and expansion of market leadership in Germany (revenue +23.6%), followed by North America with revenue exceeding EUR 1 billion for the first time (+18.5%) and the European markets outside Germany (+14.3%).

As a result of the high level of customer trust and the very positive revenue development, SIXT managed to expand its fleet to a record size of 169,100 rental vehicles on average, compared to 138,400 vehicles in the previous year (excluding franchises for both).

Earnings before interest, taxes, depreciation and amortisation (EBITDA) also reached an all-time high of EUR 1.33 billion (2022: EUR 1.14 billion).

That underscores the very solid condition of SIXT’s operating business. Earnings before taxes (EBT) of EUR 464.3 million in 2023 marked the second-best result in the company’s history, exceeding the pre-Covid record result in 2019 by more than 50%* and falling within the range communicated at the beginning of 2023. With an EBT margin of 12.8%, SIXT also clearly exceeded its minimum margin of 10%.

In view of the very positive business performance in 2023, the Management Board plans to propose a dividend of EUR 3.90 per ordinary share and EUR 3.92 per preference share for the past financial year at the company’s upcoming Annual General Meeting, subject to the approval of the Supervisory Board.

Alexander Sixt, Co-CEO of Sixt SE said, “Thanks to our customers’ trust in us and our employees’ excellent work, we were able to once more achieve a record revenue and have obtained the second-best yearly result in our company’s history.

“We reached our ambitious goals in 2023, both in terms of our business figures and implementation of our strategy. Our earnings are all the more remarkable considering the significant deterioration in market conditions for e-mobility over the course of the year, rising interest rates and continued high levels of investment.

“I would like to sincerely thank all our employees for their accomplishments over the past year.”

The deteriorating market conditions include, in particular, the severely worsened environment for the sale of used electric vehicles over the course of 2023. In Germany, for example, prices for such vehicles fell by more than 20% during the past year.

At SIXT, falling residual values for electric vehicles led to increased depreciation and losses from vehicle sales and thus to a negative impact on earnings in the range of around EUR 40 million for 2023. At the same time, demand for e-mobility as a whole has not yet developed the momentum desired by politics in many places, as evidenced not least by the latest registration figures.

SIXT has also felt the effects of this, despite investing a sum in the millions in high-profile electric car marketing campaigns and investments into charging infrastructure. According to SIXT’s estimates, the lower demand compared to combustion engines resulted in a substantial loss of revenue. SIXT assumes that without these two effects relating to e-mobility, the last financial year would have closed with EBT above the record year 2022.

SIXT reacted quickly to the changed market conditions over the course of the year, particularly in Q4 2023 and Q1 2024: Increased depreciation was carried out and the phasing out of electric risk vehicles – i.e. vehicles for which there are no buyback or leasing agreements and for which SIXT therefore bears the residual value risk itself – was brought forward significantly.

At the end of February 2024, the percentage of such vehicles in the electric SIXT fleet was only around half as high as on 31 March 2023. Compared to its competitors and in terms of its overall fleet, SIXT has a lower share of risk vehicles anyway.

Electric vehicles will continue to make up part of the SIXT fleet in the future. However, further developments require a high degree of flexibility. The key factor is what customers demand from us. The cost situation also plays a role, as do the (changing) long-term strategies of car manufacturers, to which SIXT as a car rental company is ultimately a subsequent party.

Konstantin Sixt, Co-CEO of Sixt SE said, “In order to successfully continue our growth trajectory, we aim to continue attracting a great number of new customers and further strengthen the loyalty of our existing customer base.

“A key driver will be making car pick-up and return even faster and more convenient through digitalisation, while at the same time pushing the availability and quality of service on site to an even better level.”

Prof Dr Kai Andrejewski, CFO of Sixt SE said, “Thanks to its resilient and diversified business model and its clear premium positioning, SIXT has continued to grow in 2023 despite a challenging macroeconomic and political market environment and has achieved an EBT margin of 12.8%, which is clearly above the pre-Covid level.

“Thanks to our excellent capitalisation, high financial strength and flexible cost structure, we are ideally positioned to finance further growth and react quickly to dynamic market conditions. We will continue to invest in quality and at the same time be highly disciplined in further improving our efficiency in all areas, such as fleet planning.”

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