Zenith Fleet Passes 150,000 Milestone And Reports Strong Performance In The First Half
Zenith has reported strong interim results for the year ending 31 March 2022, reporting solid results as its fleet surpassed 150,000 units for the first time. Income and operating profits are also ahead of the prior year in each of Zenith’s core divisions: corporate, consumer and commercial.
The strength and resilience of Zenith’s model, covering all vehicle types, a variety of channels, and a wide range of services is a key driver of the group’s continuing strong performance. The long-term contracts and customer relationships that form the foundation of the business are also key to its success.
Zenith leads the way towards carbon neutral.
During the period, Zenith took further strides in its sustainability strategy. Zenith signed up to the EV100 global declaration to accelerate the transition to 100% zero-emission cars and vans, announced on Transport Day at COP26.
The transition of customer fleets in corporate and consumer books continues to accelerate, with battery electric vehicles (BEVs) accounting for 17% of the car fleet and 79% of current orders within salary sacrifice. The BEV order book and Zenith’s ongoing initiatives to enable and influence customers to change to zero-emission vehicles is also expected to transform the fleet in the near future.
Leeds-headquartered, Zenith also became the only UK fleet company to have committed to the Science-Based Targets initiative (SBTi). The science-based targets show companies how much and how quickly they need to reduce their greenhouse gas (GHG) emissions to prevent the worst effects of climate change – and Zenith is proud to have made this demonstrable commitment to reducing our emissions.
Commenting on the results, Tim Buchan, chief executive officer, said:
1. Corporate division
“I’m delighted that Zenith has continued to go from strength to strength, delivering solid results and significant growth across all divisions despite challenging market conditions.
“Alongside these results, we’re also proud to have accelerated our mission to eliminate tailpipe emissions from the UK vehicle parc. Zenith has seen growth across all three of our core divisions and backed this up with meaningful environmental commitments, signing up to the EV100 declaration at COP26, and adopting our own SBTi commitments. These actions, together with our strong performance, further demonstrate how profit and purpose can coexist.
“Whilst we anticipate continued short-term challenges in the automotive sector and the potential of further restrictions related to COVID-19, combined with working from home again, Zenith is well-positioned for the remainder of the year.”
Zenith’s Corporate division continues to strive to deliver the highest levels of customer service that were delivered throughout the difficult COVID-19 lockdowns in 2020/2021 against a backdrop of challenging supply chains across the automotive sector. As a result, and after a sustained period of strong orders, the division now has a record order book to flow through to vehicle deliveries, particularly when the current market conditions in the automotive sector begin to ease. Within the rental business, demand has recovered following the easing of government restrictions in the year. Whilst rental demand has recovered strongly, it is not yet at pre-COVID-19 levels, and the business continues to experience headwinds from ongoing supply chain challenges. Similarly, in-life services within corporate have shown strong recovery bringing activity almost back to pre-COVID-19 levels. However, these negative impacts have been more than offset by Zenith’s performance in disposing of vehicles that have come to the end of their leasing period, with market prices seeing substantial increases during the course of 2021.
2. Commercial division
The integration of the trailer rental and fleet services businesses acquired in 2020 has progressed well. Customer demand across a range of sectors, including distribution and logistics, home shopping, parcel delivery, cash in transit, and construction and infrastructure-related services has remained particularly high, delivering record utilisation of Zenith’s trailer rental fleet. The business has also continued significant investment into mobile service units, a critical service solution for the group’s trailer operators. The business expects to see further progress in customer service and operating performance through the remainder of the year.
3. Consumer division
The ZenAuto personal contract hire (PCH) business unveiled its first nationwide, television marketing campaign during the period, and launched a new used PCH proposition. ZenAuto now has 8,000 vehicles on the road, an increase of 84% year-on-year, whilst the order book has gone from strength to strength.