Profits of BMW Irish finance arm up 41.5% to €9.12m in 2014
Growth in hire purchase contracts has proved huge boost to total revenues
BMW Financial Services Ireland offers finance and leasing deals to BMW and Mini customers
BMW’s finance arm in Ireland recorded a 41.5 per cent rise in profits last year. Accounts for BMW Financial Services Ireland show a profit of €9.12 million for the year ended December 31st 2014, up from €6.4 million the previous year.
The growth in hire-purchase deals, known as personal contract plans, has led to a revenue increase from €18.4 million in 2013 to €22.6 million last year.
Of this, hire purchase contracts rose from €13.2 million to €16.5 million in 2014, while finance leases represented €4.17 million last year, compared to €3.6 million in 2013.
The total loan book by the end of 2014 was €291.06 million. Its hire purchase business grew by 18 per cent last year, with loans of €228.5 million. Its wholesale funding and stocking loans to BMW dealers rose from €31.4 million in 2013 to €52.3 million last year.
Loans overdue by over 30 days came to €1.24 million, while the firm had in place an allowance for impairment of €10.7 million, up from €8.85 million the previous year.
The firm receives all its new funding from BMW Malta Finance Ltd, which is supported by BMW AG. It has loans due to the Maltese arm of €273.3 million. It employed 15 staff last year, with payroll costs of €982,000, down from €1.4 million the previous year.
Figures released last week show new car sales this year have reached 109,960, the first time they have exceeded 100,000 since 2008. Registration figures for July show 27,633 new cars were registered, up 47.68 per cent on the same month last year.
According to Brian Merrigan, managing director of BMW Financial Services, the firm expects to finance 3,500 BMWs and Minis this year.
“The business has grown 20 per cent year-on-year and in July we were up 40 per cent on last year,” he said.