It was short, just over an hour. And a bit “old school”. The general meeting of ALD Automotive, which was held this year at the company’s headquarters in Rueil-Malmaison, in a small committee, had the particularity that the vote on resolutions was done in the old fashioned way, that is to say by a show of hands, therefore without immediate display of the results. Surprising for a company of this size, which advocates digitization. On the other hand, we know that the final quorum was 92.853%.
Workload
At the same time, it must be said that the outcome of the consultation left little room for doubt. Societe Generale holds nearly 80% of the capital of its subsidiary specializing in car fleet management and long-term leasing. Soon, its stake will drop to 53%, once the acquisition of Dutch LeasePlan has been completed, that is to say by the end of the year. The red and black bank will nevertheless remain ALD’s largest shareholder, ahead of Dutch shareholders, who will hold 30.75% of the capital. It’s the ” big event “, as pointed out by Tim Albertsen, the boss of ALD Automotive, who spoke in English throughout the GA. This acquisition, for an amount of 4.9 billion euros, should enable the ” creation of a global leader in sustainable mobility “.
Combined, the new group, baptized “New ALD”, will be at the head of a fleet of 3.5 million vehicles, for a pro forma net profit of 1.5 billion euros. The manager recalled that he is banking on a total amount of pre-tax cost synergies of around 380 million euros by 2025, when the integration will be finalized, accompanied by annual growth in the vehicle fleet. more than 6% and the creation of value for shareholders, with a positive effect on net earnings per share of around 20% for the new ALD in 2023 – it will be more than 5% for Societe Generale from 2024 – and a distribution of the result as a dividend of between 50% and 60%.
The Board of Directors devoted numerous meetings to this operation, including four of the eight held in 2021. A committee ad hoc was even set up to examine the rapprochement (convergence of cultures, conditions for success, methods of synergies, etc.). All work meriting a salary, it was proposed to vote to increase the annual envelope of attendance fees from 250,000 euros to 400,000 euros. Tim Albertsen will also see his salary increase. From 400,000 euros fixed in 2021, it will increase to 550,000 euros. ” The Compensation Committee noted that the fixed compensation of Tim Albertsen and John Saffrett [directeur général adjoint] were lower than market practices in the sector for equivalent positions and wished to proceed with a substantial increase in their fixed compensation, while reducing the target amounts of annual variable performance compensation, so that the target total compensation (excluding exceptional items) increases by moderate way to maintain total compensation consistent with the sector market and taking into account ALD’s current size explained Patricia Lacoste, Independent Director, Chair of the Appointments and Remuneration Committee. The boss of ALD is also eligible for variable compensation and an exceptional variable compensation of up to 412,500 euros in 2022, again due to the workload resulting from the takeover of LeasePlan.
Electricity at the heart of ESG commitments
With this operation, ALD Automotive gains “ in efficiency and in terms ofscale, which is even more important given market movementssaid Tim Albertsen. We will also have the largest fleet of electric vehicles in Europe. »
The GM was an opportunity for the lessor to reconsider its CSR commitments. He highlighted the fact that 26% of vehicles delivered this quarter in Europe are electric. ALD Automotive is rated by several extra-financial rating agencies, including Vigeo Eiris, which gives it an “advanced” level, placing it number one in the Business Support Services category. When asked whether the margin of services related to electric vehicles will drop, management acknowledged that this type of car is easier to maintain. ” We are developing a new charging servicecontinued the boss. The charging market is very fragmented today so there are opportunities.
To the second question posed, namely whether ALD Automotive will continue its pace of resale of used vehicles while the new car market is falling due to the shortage of semiconductors, the group’s management replied that it has already begun, by reducing the volumes sold and by multiplying contract extensions and second-hand rentals. The trend will be more and more for second-hand or even third-hand vehicles. But the second-hand market remains exceptional “, as Tim Albertsen recalled, welcoming, in passing, the record net profit of 873 million euros generated last year, “ highest in ALD history “. For 2022, the forecast unit margin for the resale of vehicles was raised, at the beginning of May, to more than 2,000 euros, against 1,000 euros discounted until then and 1,422 euros in 2021. As of March 31, this margin was 3,101 euros. ” The first quarter was very good, we continued to grow the fleet by 4.8% over one year. »
Regarding the war in Ukraine, it’s business as usual although it may be hard to hear “said Tim Albertsen. However, the lessor, following in the footsteps of its parent company Societe Generale, has undertaken not to sign any new commercial transaction in Russia. The group also had to pass a provision of 27 million in the first quarter, corresponding to 50% of the fleet and trade receivables. Most of the country’s customers are non-domestic multinationals, which continue to pay.
PC