Good day and welcome to the Grenke AG publication of the quarterly statements for the Q1 2022. Today's conference is being recorded. At this time, I would like to turn the conference over to Anke Linnartz of Grenke AG. Please go ahead. Good morning, ladies and gentlemen. Welcome to our today's earnings webcast and video conference call. I'm Anke Linnartz, Head of IR, and with me today are our CEO, Michael Bücker, and our CFO, Dr Sebastian Hirsch. We will start off with the presentations by Michael Bücker and Dr Sebastian Hirsch, and are going to have a Q&A session right after the presentations. I stop here and I pass the call on to Michael Bücker. Yeah. Welcome, ladies and gentlemen, to the presentation of our results for the Q1 of 2022. You might have already seen this in our press release this morning, but allow me to repeat our key message. We are back on our growth path. With the end of the Q1 of this year, we are fully on track with our annual guidance for 2022. We operate in an ever-challenging environment caused by the corona pandemic and now the war against Ukraine. Despite this, we are successful once again in strengthening Grenke's equity base and high profitability during the past quarter. Overall, we achieved leasing new business of almost half a billion EUR in the Q1. With an increase of more than 36%, we were significantly above the Q1 of the previous year. I would like to point out that this strong increase occurred in all regions where we operate. We also increased our net profit to EUR 20.5 million in the Q1, which was almost 50% higher than the Q1 of the previous year. This meant that our net profit increased even stronger than our new business. Lastly, our current equity ratio of a comfortable 19.7% clearly exceeded our self-set target of 16%. Now let's turn to our regional performance. We are particularly pleased with the development of our South Europe, North and East Europe regions. Both of these regions had almost identical growth rates of 58%. The growth leader this quarter was Italy, where the investment catch-up effect appears to be particularly strong. With that, I would like to hand over to our CFO, Dr. Sebastian Hirsch, who will explain our Q1 results to you in detail. Sebastian, over to you. Thank you, Michael, and also warm welcome from my side to our call to the results of the Q1 in 2022. Let me first talk about the development of the contribution margin one and two you see on that slide. In comparison with the Q1 of the previous year, we have to take into account the overall view 2021, because the Q1 was influenced by the pandemic and a very selective decision for new leasing business. The average ticket size was below 7,500 EUR per contract. Starting Q4 last year, we accelerated our new business with a clear focus on volume and number of new contracts. With rising new business, the average ticket size came up to 8,000 EUR in Q1 2022. At the same time, we had to deal with a very dynamic interest development and rising interest rates, as you are aware of, which brings us to a migration in our leasing rates to pass it through. The CM1 is the net present value always calculated with a daily market interest plus our current funding spread. During the time of said fluctuation, because of rising interest rates, we will see a time lag in our CM1 ratio as it was in the past. Overall, we are very satisfied with that development. It is in line with our expectation. The increase of CM2 in total gives us enough confidence for our future earnings. In terms of interest rates, it's for sure that our existing portfolio is covered against rising interest rates. Let's talk about our P&L. The overall is absolutely in line with our planned figures, with our planning. We fully met those figures. The decrease of net interest income corresponds with the development of lease receivables because of the volume development over the last quarters. In opposition to that, the costs for settlement of claims and risk provision have dropped significantly. We saw a 29.2% decrease in settlement of claims and risk provision to EUR 31.6 million in the Q1. The corresponding loss ratio was only 1.4% in Q1 2022, 0.6 percentage points lower than in the same period last year with 2.0%. To sum it up, based on a more or less stable cost level, we delivered an earnings before taxes of EUR 27 million and a net profit of EUR 20.5 million. Please let's move to that slide, and here we see the development in settlement of claims and risk provision as of March, per end of March in that year. We provide a view to the balance sheet perspective. It's not the P&L perspective, it's the balance sheet perspective and the risk provisioning and settlement of claims for all the leasing receivables, split it up into Stage one, Stage two, and Stage three. Provision ratio in Stage two and three increased. Stage two was 14.6%. Stage 3 76.2%, as mentioned here. In Germany, to point that out, only 93% of our gross leasing receivables are in Stage one of impairment, roughly 7%. 7% Stage two and Stage three. It's a quite low number, and it's a testimony to our continued high portfolio quality, especially in our home market. The risk provisioning for leasing receivables rose by EUR 12.1 million. With the settlement of claims and risk provisioning in Q1, as I mentioned, the loss rate stood at 1.4%. All in, we are well covered with the risk provisioning level of today, and the payment behavior of our clients is unchanged, stable. That brings us to the cash flow. Because of the stable payment behavior, also our cash inflow is quite stable during quarters and also in Q1. Q1 proves our strategy of matched funding. The existing business continues to be largely cash flow neutral as we enjoy the benefit of our term matched funding strategy. To fund the new business, we raised new funding and used the strong cash position we had with the beginning of the year. The using of cash results in a slight negative cash flow on a periodic view, but that's what we aim for. That we aim for with the beginning of that year to be careful in steering our cash and aim for a lower level than in the previous year. Also going forward, we remain committed to our conservative financing policy with matched maturities. That brings me to the funding mix, and you are aware of that, quite unchanged. We have 51% in the senior unsecured pillar, which is quite important for us to have the capital market access to issuing bonds. I will come to that later on. Stable also Grenke Bank, very important pillar, a very important source of liquidity with the term deposit business, roughly 30%. The asset-based funding is quite important for us, especially to have no maturity transformation, no currency transformation in our portfolio. We're using that in some important markets in Germany and France, but also in U.K., Brazil, for example, to cover also currency risk with that funding. The last slide brings me to our successful senior unsecured bond issuance. We took advantage early last month, sorry, in April, to go to the capital market. It was like a comeback because it was the first new public issuance since September 2020, despite the tap last year. It was quite successful with EUR 150 million coupon, of course, because of rising interest rates, 4.125% per annum. Very well matching in our maturities with the 2024 maturity for that funding. Over 70 investors at the end of the day in the order book, a very international order book, and it gives us confidence that we have access to investors, that we are able to fund our business with bonds. Also our strong cash flow position I showed you before, that access to the capital market will bring us in one of the next transactions maybe to a benchmark bond of going for a bond of EUR 500 million because our cash is strong enough with the rising new business to cover a maturity of EUR 500 million. With that, over back to Michael. Yeah, Sebastian, thank you very much. Ladies and gentlemen, despite the challenging circumstances of the last several months, we have once again delivered excellent results in the Q1 of this year. Facing the war against Ukraine, supply bottlenecks, higher interest rates and inflation, we continue to demonstrate the robustness of our business model and our company with its more than 1,800 employees. Against this background, our expectation for leasing new business for the full year remains unchanged at EUR 2 billion-EUR 2.2 billion after a level of EUR 1.7 billion in the previous year. In terms of net profit, we have laid the foundation to achieve our forecast for the current financial year. Based on the high profitability of the existing contract portfolio and the volume of new business, we expect, as already announced, net profit in the range between EUR 75 million and EUR 85 million, and we are standing by this target. We also continue to be firmly committed to our other targets because here we are also right on track. As announced in our outlook at our annual press conference, the next major milestone we have set ourselves is for 2024. In 2024, we intend to double our net profit and new business compared to 2021. With regard to the net profit, I should emphasize that the 2021 baseline year does not include the extraordinary effect from the sale of our share in Via fintech. How do we intend to double these figures? By building on Grenke's historical strengths, combined with scaling our business at a faster pace. We will leverage our outstanding proximity to the customer, our unique international network of specialist resellers and our distinctive industry product and partner know-how, and our understanding of efficient, simple processes in the small-ticket business. I would like to close here for today. We'll provide more details on Grenke's strategic roadmap tomorrow at our first capital markets update. Yeah, we cordially invite all of you to attend. This will be a hybrid event, and as part of the agenda, we will explain in great detail our corporate strategy. Thank you very much for your interest and your attention this morning, and back to Anke Linnartz. Yeah. Thank you for your presentations. We are now ready to enter our Q&A session. To register for a question, please press star one. The first question comes from HSBC, please, Johannes Thormann. Morning, everybody. Johannes Thormann. Three questions from my side. First of all, regarding the valuation effect in the income from fair value measurement, those EUR 4 million. Will this revert in the next quarters, or do you expect additional gains? Can you elaborate a bit more on this? Secondly, on your costs. If we adjust last year for the EUR 6.7 million extraordinary cost, we've seen a 13% increase in costs, which has been remarkably high. If you could elaborate what has driven this cost increase. Last but not least, you stick to your full-year tax rate guidance of 25% or looking at current performance, what is the better level? Thank you. More or less questions for you, Sebastian. Okay. Thank you, Mr. Thormann, and warm welcome to you. I will take the question at first. The fair value measurement, it's a temporary impact, and over the last quarters, we sometimes have seen a negative impact on that, and that's because of our hedging. Not all instruments are in the hedge accounting because that's not always possible under the rules of IFRS. There are some specific interest rate swaps linked to our ABCP programs. That brings you a difference in the valuation each quarter, at the end of the quarter, because you have to evaluate the interest rates for the derivative on the market perspective as a fair value. The ABCP, which is part of our financial liabilities, is more or less booked to book value. Only you has to take into account the forward exchange rate. There we will always have a time, like during the hedging of time and at the end of the time, that is zero over the total period. We will not see from today's perspective further valuations, but as always, when the parameters of valuation are changing, then that could be that you will see an impact in the one or the other direction. It could be positive or negative, but over a total period, it's a hedging, and that hedging is neutral from the P&L perspective. The cost, thanks for that question, too. That's right, the cost because of the special audit in the last year there, we are today more or less in the process of normalization. The main driver in cost were on the one hand, the sales cost because we are accelerating our sales in Q4 and also in Q1. We think was a very good result in comeback in volume. Also we hired over the last year new people for several function, also internal function for having a better internal control system and better compliance and something like that. That is a part of that we've seen here. We think that the cost level over the year will become more and more normal, that you can see also on the guidance on the cost-income ratio today was roughly 55%, and we guided a cost-income ratio of 52%. Tax rate is always not that easy to look forward, but the 25% is also from today's perspective fair enough to look forward for that year and also for the coming years. Thank you. Okay. Thank you. We move on to Mengxian Sun from Deutsche Bank, please. Yes. Hi. Thank you very much for taking my questions. Three questions from my side as well. The first one is on the revenue. Compared to the last quarter, the profit from service business and the new business was lower compared to for Q 2020 to 2021. Although the contract numbers and also the new business volume was up compared to the last quarter. Are there any changes on the insurance premium or the fee that you charge on your new business in this quarter? What was the driver for the decrease? The second question is on the loss rate. Also compared to the last quarter, the loss rate is at the bottom end of the guidance range, 1.4%, but the last quarter was even lower, below 1%. What is the driver of the loss rate increase in this quarter compared to the last one? The last question is, can you comment on the leasing demand on the general market in the recent quarter from your observation or probably from your discussion with the dealer, if possible? Are you impacted still by the supply chain issues, et cetera? Thank you very much. I start with question number three. Yeah, thank you for the question. That's really interesting at the moment what's happening. In times like these, our services and our type of financing is also for our resellers and for our customers, really essential and more important than ever before. Renting and leasing is liquidity saving. In difficult situations like we have at the moment, liquidity is critical and key, and most important than ever before. Therefore, the way we do our business with all our products we have is in the middle of interest of our resellers and of our customers. There is. We see nothing negative in the development of our sales at the moment. Opposite, it's going on, and we will fulfill our targets. Yes. I will go for the other questions. At first, talking about the loss rate. That's right. When you look only to Q4, there was a loss of roughly 1%, and now we're talking about 1.4%, but we have to take into account the whole fiscal year, 2021. It's always more or less a technical issue in Q4, because when you go to the balance sheet, to making your P&L per end of the year, it's always more a whole year period, and the Q4 is technical like a correction for the whole fiscal year. That was more or less technically why the loss rate in Q4 was only 1%. The whole loss rate over the whole year, that is more or less a better comparison for that year. We are more or less stable from a loss rate perspective, and we feel, as I mentioned, very comfortable with that because the payment behavior is quite stable. No rising in terminations and something like that, and no early indicators showing us that we will see a pretty high loss rate. We stay to our guidance. You're right, it's now on the lower end of the guidance, but we stay to our guidance because of the uncertainties from the macroeconomic perspective. The other question was compared to the revenues, especially the service business. The service business is more or less stable and driven by the number of new leasing contracts, running contracts, and also by the volume of leased assets. That's the main driver for that. There's no change in insurance premium or no change in pricing of that to that quarter. The main driver for that is the running contract, the number of running contracts, and that you have to take into account. The business is quite stable and also quite profitable as it was in the past. I would like to add perhaps something if I like for Lennart. I would say you're asking what's the general demand in general market. I think we see there a long-term trend, and this long-term trend will not fade at the moment for leasing. We will see also in the ESG topic and in medical health a significant demand in what we are offering. Therefore, leasing is growing all over the world at the moment, and we will show tomorrow at our capital markets update what the situation in the market there is. Thank you. Thank you very much. We'd like to move on to Marius Fuhrberg with Warburg Research. Yeah. Hi. Three questions from myself as well. Once again, on the loss rate. In your Q4 call, you mentioned that you're willing to take higher risk in order also to make more business, but also yeah, that your expected credit loss should go up. In line with this, should we expect the loss rate to develop to a more sustainable level, like 1.6% for the full year, instead of the currently rather low loss rate? The second question, on your CM1 discussion. You mentioned that in higher interest rate environment, you temporarily would expect a lower CM1 until you pass through your condition to the customer. Is the yeah so to say downward move which we currently saw in Q1 the maximum amplitude you would expect for this, or should we expect the CM1 to go down even further when interest rates are increasing even more? Third question is on your growth in Italy. I mean, we saw high growth rates in Italy in the past as well, which then translated to higher risk costs in the beginning of the COVID crisis. Did you or do you change your approach nowadays in Italy on what kind of risks or customers you accept there or is it more or less the same? I take it you would say, Andreas. Would you like to start or shall I start? Okay. I will start with the loss rate and what the right expectation for that year. We guided our loss rate, I think, and the 1.4% is more or less a result of today. The development of loss rate is always depends on two things. On the one hand, on the losses on the P&L perspective in terms of risk provisioning and settlement of claims. On the other hand, also on the volume development because that's let's say the denominator of the loss rate. You have to take both in account, and I think in the middle of the guidance that is fair to calculate with that. Maybe it is also a bit conservative could be because as we mentioned in the past, at that time when we are going for new leasing contracts, each leasing contract is an investment of a small medium enterprise, and that in a very difficult economic time. The risk provisioning, the expected credit loss models are more or less looking too conservative of that, decisions of that, let's say, credit portfolio in the crisis. Because it is an investment. It is maybe an investment in a crisis, and that kind of company, small medium enterprises, are more or less healthy. That is not comparable to a client who's going to a bank and asking for a EUR 10,000 cash because you don't know what will happen with the EUR 10,000. We are exactly knowing what will happen with the EUR 10,000 and investment in IT, in other equipment, what is a need, for the company doing the business, and also at that time. That is why we are very comfortable with our, let's say, credit portfolio situation, risk situation, and the loss calculation. I think to expect the middle of the guidance is fair enough, and the rest is maybe more or less your own scenario to go forward. In CM1, it's fair to say that the level of Q1 is also more or less fair maybe. It could be that 25-50 basis points lower. That depends on the dynamic of the interest rates, because we are calculating, as I mentioned, always with the current interest rate of the market to giving the flavor to our sales, what is happening on the market. The assumption is a bit that we are going to refinance each leasing contract today under market conditions. In practice it's not the case because we go into issuing a bond and then going with that bond, making a new business or going on an ABCP program and more or less a package. We are calculating that, and during the time while where interest rates rising, we will see a bit more fluctuation in our CM1, but it was also the case in the past. I think there could be a range of 25-50 basis points lower on the CM1 level. You would like to go- Yeah. Thank you, Sebastian. The same is also for Italy what Sebastian said. I would say during the corona pandemic, we were very selective when it came to new business, especially in Italy and also with our resellers, and we lost some. We have the choice of the best in Italy at the moment, and you can be sure, as a new CEO, I took a deep dive into Italy and into the portfolio of Italy. It's safe, so we're really happy with that. Italy is now coming back, therefore number one in the Q1 in terms of sales, and we are really happy with the development in Italy at the moment. Okay. Thank you very much. Thank you. Could we have Roland Pfänder, please, from Oddo? Yes. Good morning. Two questions from my side. I would like to come back to your risk provisions on the balance sheet. What is the comfort level there? Meaning, do you have meaningful risk buffers you can live from if it's necessary? Or would you even consider maybe in the future having a management overlay just to increase provisions beforehand like some other banks do? Secondly, did you run maybe a correlation regarding macro trends and leasing and new leasing business growth? If you look in the you know, 10 years past, how did this behave? That would be of interest from my point of view. More generally, could you talk about cost flexibility you could use if things would go the other way? Thank you. Well, I would start with question number two. Yes. Yes, we see big macro trends, and we see the mega trends of the European, of the worldwide, economy. Yeah. In sustainability, ESG, medical health, et cetera. We are in the middle of this, and we like to go in the middle of this. We make product development in that case, and we will, especially tomorrow at our capital markets update, speak about what we see in the market also for us. It's a big lever to make more business, and we like to be in the middle of these mega trends, and we like to follow the trends we see in the society. There's unimaginable volumes to finance in the transformation of the society. Grenke will, with its worldwide appearance, be in the middle of this trend. More to that tomorrow at our capital markets update. Yes. Would like to add from the macro trend perspective. If, let's say, more or less normal macro trends and not the pandemic, our experience of the past is that we can deliver a very good leasing growth in several macroeconomic environments. Especially during a macroeconomic crisis, leasing, as Michael mentioned, is a very good opportunity for small, medium enterprise because it's not cash needed. You don't need a bank credit line or something like that. It's quite easy to going for that. It's a good opportunity to taking care for your own cash and liquidity position. That's why leasing, especially in that environment while interest rates rising, inflation might be, banks are more careful than leasing companies, then leasing could be a very good opportunity for small, medium enterprises, especially in that environment. To the risk provisioning on the balance sheet, I guess that we have meaningful risk above us. That's fair to say. It is. It's a quite careful risk calculation. When I look into our risk models, the overall risk modeling, including also macroeconomic parameters. I think it's also quite normal and common in that situation because we are in the crisis because of the pandemic. Nobody knows really how much of the crisis behind us and how much of the crisis will maybe come in the future. The war from Russia, it's a new parameter, so the macroeconomic parameters are not that easy to fill in. There are buffers in our risk measurement, and it's fair enough to say that we are careful, let's say, hedged with that buffers and can be free to looking forward. Cost flexibility, that was always the case in our P&L, looking to the cost structure, that there is a flexibility. When the business will run down, there is an opportunity also to run down cost. In the past, it was during the financial crisis, it was also during the pandemic, we decided to stay with our employees, especially because after the crisis, the next level, the next dimension of growth, will come, and therefore it's quite important to having the employees on board, to having the structure, infrastructure on board to today coming back to the level where we were before and going beyond that. Our strategy is more to staying for that. Of course, that brings us today to a higher cost level, to a higher cost-income ratio. The day after tomorrow will bring us very good profitability on the P&L with our contribution margin and our staffing. Okay. Thank you. We have now Mr. Bahram Assadollahzadeh, please, from Richtwert Capital. Yes. Thank you. Good morning. Thank you for taking my questions. I have three questions. As far as Grenke is involved, typically with the competitive advantages that you have, we have seen Grenke come out of crises quite strongly versus competitors, and maybe the competitive landscape becoming more easy. Now, during the last couple of years, you also had to step back a little bit from pushing the business forward. The first question would be. What does the competitive landscape look like now that you're coming back to the growth models? Do you see typical patterns like you saw during past crises? The second question that I have is, during the last two years, Grenke decided to not focus on small and medium business loans anymore. Now, with the capital becoming more scarce, is that something that is up for review where you say, "Okay, with the existing relationships that you have from the leasing and franchising business, maybe it makes sense to also extend that business again and take that up again"? The third question, I apologize if I missed that. As far as the takeover of the franchises are concerned, has there been any progress regarding valuations and negotiations that you can share with us? Thank you very much. I'm starting, Sebastian, okay? Yeah. Yes, we see big advantages for us and for our business model. Higher interest rates, higher inflation is more or less good for our business model. We spoke about it. Yeah, we are for us in the SME small-ticket leasing segment, the only one who's really standing worldwide. We are in 33 countries around the globe, and no one has this range of business over the globe. We see really advantages for us, and we can play with these advantages in the future, and we will go on on this topic tomorrow with the capital markets update. It is both. It's also our organization, how we do the business, and on the other side, also the products we are newly developing and also the mega trends where we go in. Yes, that's right. We see big advantages for us and for our companies because we are so international and we have the experience of this internationally and no one at this point can follow us all over the world. Yeah. The second question, perhaps, Sebastian, if you allow. Yes. We see exactly for our bank a really interesting topic at the point of sale for our leasing sales. Because we see also especially in terms of ESG and sustainability lots of products lots of objects which should be financed by us where we are a little bit limited with leasing because subsidies came from the state. There are the products of the bank really interesting. To combine the advantages yeah from leasing and bank financing over the bank is really interesting for us and we are working on it. Yeah. Absolutely. As you mentioned before, Michael, there is an additional opportunity, let me tell you like this, the loans with Grenke Bank. Our focus is to double the new business and leasing worldwide, there are a lot of opportunities because of the international competitive landscape of international trends, as Michael mentioned, and that's our focus because that's the base for our future growth, for our future success. We would like to add some additional services, as in the past with the small medium enterprise loans. I would like to say something to the franchisees, and we've also made great progress here, but sometimes it just said not everything can be harmonized on an appointment like today. That's life. We are about to take over the first franchisees, and we are, so to say, on the home straight, but it's not really finished yet. We will come back to you as soon as possible as we finish the first takeovers of the franchisees. Thank you very much. We have no further questions for the time being. Just to remind you, press star one to register. Nobody has registered so far, so I think this is time to conclude our call. Thank you very much for joining us today. If questions spring to your mind after the session, please email to us. Just to remind you, our new business figures are due on. I'm sorry. I wanted to remind you of our capital markets update tomorrow, and I hope to see you there. Have a great day and best luck. You may disconnect now.