Eindhoven, May 7, 2020 – DLL, a global provider of asset-based financial solutions, delivered a solid commercial performance and strong portfolio growth for the 2019 business year, which also marked the company’s 50th year of operations. Dating back to its founding in 1969, the company has been built on a core principle of partnership, and when combined with its global reach, industry specialization, asset knowledge, digital solutions and people, continues to deliver exceptional value to its customers.
DLL recorded net profits of EUR 297 million (USD 333 million) for FY2019. During this same period, total new business volume grew to EUR 26.8 billion (USD 30 billion), representing more than 5% growth over the prior year, when excluding currency movements. The company also realized strong growth in its portfolio, which increased by 8% to EUR 36.2 billion (USD 40.6 billion).
“The 2019 business year was not without challenges,” commented Bill Stephenson, CEO and Chairman of the Executive Board. “We contended with mixed economic conditions in many of our key markets, increased risk costs and a growing slate of regulatory requirements, all of which impacted our business and that of our customers. These conditions had an adverse effect on our net profits, but the underlying performance of our business model remained solid. Despite these challenges, we maintained our partnership focus and continued to work closely with our customers to overcome obstacles and help realize our mutual ambitions.”
Challenging conditions impact results
“Our focused management of lease pricing allowed us to slow margin compression in many of our key markets,” noted Marc Dierckx, CFO and member of the Executive Board. “However, this was offset by significant growth in our risk costs, including IFRS-9 impairments, which continued to increase in line with external market conditions.” DLL reported risk costs grew by 82% year over year to EUR 208 million (USD 233 million), and represented 57 bps of the managed portfolio.
Operating costs grew by 5.8% on a year over year basis, realizing economies of scale, but also reflecting the company’s strategic investments to further accelerate digital transformation and develop new and innovative products for customers, such as Pay Per Use (PPU). These investments are intended to enhance the customer experience and ultimately drive efficiencies in service delivery, contributing to sustainable future business growth and profitability.