D’Ieteren sells 40% more cars and makes almost €1 billion operating profit

Brussels-based holding company D’Ieteren, best known for car glass repairer Carglass and as an importer of VW vehicles, posted sharply higher profits in 2023. Last year, that adjusted consolidated profit before tax came to 970.8 million euros or a 28.1% increase compared to 2022.

Things look rosy for D’Ieteren for this year, too: It expects to round the one-billion-euro adjusted pre-tax profit mark in 2024. The holding company is already raising its dividend to 3.75 euros per share, up from 2.1 euros last year.

Cash machine Belron

With an adjusted consolidated profit before tax of almost 971 million euros, D’Ieteren was in line with its expectation of more than 960 million euros. Revenue also rose sky-high, increasing by nearly 43% to 11.66 billion euros. CEO Francis Deprez described 2023 at a press conference on Tuesday as “another year of strong growth, in which almost all divisions were able to improve their margins”.

The bulk of the profit came from car glass repairer Belron (Carglass), of which D’Ieteren owns just over half. Belron made 511 million euros profit on sales, just over 3 billion euros, 17.5% up compared to 2022.

As cars are increasingly equipped with sensors and adaptive cruise control, replacing windows has become a job that can only be done safely by specialists. Belron is a world leader, with 60% of its sales made in the US.

Belron has been the holding company’s cash machine for years, but D’Ieteren and its US private equity partners continue to load debt on Belron’s balance sheet. Belron’s net financial debt, with former AB InBev top executive Carlos Brito at the helm, stood at 4.6 billion euros (100%) at the end of 2023, compared to 4 billion at the end of 2022.

Booming Belgium car market

The D’Ieteren Automotive division, the label under which it imports and distributes the German car group Volkswagen brands in Belgium, achieved a record market share of 24.2% in 2023, mainly thanks to the VW, Skoda, and Cupra brands.

In a booming Belgian car market, the company delivered 124,929 new vehicles last year, +40% compared to 2022. That also produced a record profit (adjusted profit before tax) of 210.7 million euros, almost a third more than the previous year.

D’Ieteren Automotive is the holding company’s largest unit by revenue. It achieved sales of nearly 5.3 billion euros last year. The division also includes the Poppy share cars and the now 19 Lucien bike shops, and it also installs charging stations, solar panels, and home batteries.

Cyber attack weighed on the result of TVH

Passenger car and truck parts and services supplier PHE consolidated for an entire year for the first time in 2023 and achieved a turnover of over 2.5 billion euros and an adjusted pre-tax profit of 137.6 million euros.

Forklift part specialist TVH, of which the holding company owns 40%, suffered a cyber attack in March 2023. At 74.8 million euros, it contributed some one-quarter less to adjusted profit before tax than in 2022.

Operations at TVH were down for several weeks due to the attack, leading to a revenue loss of 85 million euros. In addition, suspending operations in Russia due to the invasion of Ukraine weighed 15 million euros in sales.

And then there is Italian notebook manufacturer Moleskine, the smallest part of the holding company, with an adjusted pre-tax profit of 2.2 million euros, compared to more than five times as much a year earlier.

Heading for profits of above billion

For 2024, D’Ieteren expects adjusted profit before tax to increase by 5 to 9% compared to 2023. This would push the profit above the billion mark, a first in the company’s more than 200-year history.

D’Ieteren expects the Belgian market to remain stable with 480,000 new registrations, compared to 476,675 registrations in 2023. It also hopes for a continued high order book for new vehicles in the first half of 2024, while the visibility in the second half is limited.

Meanwhile, the holding company continues to look for possible acquisitions. “We are always looking for new growth poles. We would like to add another member to the family, but it is very unpredictable when that might happen,” CEO Deprez said. According to the CEO, D’Ieteren has around one billion euros of cash available.