FleetPartners Group (FPR) H2 2024 earnings summary

Executive summary

• Record new business writings grew 21% year-over-year to $924m, driven by strong demand and improved vehicle supply, with AUMOF up 11% year-over-year.

• Recurring annuity-like revenue now comprises 95% of NOI pre-EOL and Provisions, supporting predictable earnings.

• NPATA was $87.7m, flat year-over-year, despite headwinds from declining used car prices and higher operating expenses.

• Cash conversion reached 128%, marking the fifth consecutive year above 100%, with $116.3m organic cash flow in FY24.

• Share buyback of $30m announced for 1H25, with 32% of shares cancelled since 2021.

Financial highlights

• NOI pre-EOL and Provisions was $158.7m, up 5% year-over-year, with margin at 7.41%.

• EBITDA was $137.3m, down 1% year-over-year; NPATA was $87.7m, also down 1%.

• EPS was 36.5c (cash EPS), up 9% year-over-year; basic EPS was 32.4c.

• End-of-lease income per unit was $6,141, down 19% as used car prices normalized; total EOL income decreased 4% to $70.6m.

• AUMOF grew 11% to a record high, with balance sheet funded AUMOF up 20% to $1.7b.

Outlook and guidance

• Average AUMOF and NOI pre-EOL and Provisions expected to continue growing in FY25, but margin normalization and funding transition will partially offset gains.

• End-of-lease income per vehicle to remain elevated but continue normalizing as used vehicle prices revert to pre-COVID levels.

• Provisions to increase as balance sheet funded portfolio grows; OPEX to reflect Accelerate cost savings, offsetting most inflation-driven increases.

• New business writings expected to be flat in FY25, a strong outcome given prior pipeline unwind.

• FY25 LTI targets EPS CAGR of 5.5–7.0% and ROA of 2.7–2.8%, normalised for end-of-lease income.