With an overall profit before tax that was 292 percent higher than in 2020 - and 295 percent higher compared to the moving average over the past five years – Nic. Christiansen Group delivered the strongest bottom line in the company’s history in 2021. Especially, the subsidiaries Hyundai Bil Import A/S and Bayern AutoGroup A/S stand out in annual report due to great trust from the customers.
“2021 will be a year to remember. Extraordinary results were generated, and previously loss-making business units performed very well. Our group’s overall result is caused by a fantastic performance from all business units. This makes us very proud and gives us a strong belief in the future,” says Niels Vrist Bertelsen, CEO of Nic. Christiansen Group.
The great progress is due to, among other things, Nic. Christiansen Group's high share of BEVs and PHEVs, which accounted for more than one third (35.7 percent) of the group's total passenger car sales in 2021. This is an increase of 13.3 percent compared to 2020. The demand for electric cars is only expected to increase in the coming years.
2021 was affected by covid19 restrictions, Brexit, and a general lack of microchips, which caused long delivery times. Had it not been for these external factors, Nic. Christiansen Group’s sales could easily have been even higher.
Despite pressure on the supply chains, Nic. Christiansen Group still managed to deliver many cars to the customers. While the total car sales in Denmark dropped 6.5 percent compared to 2020, Nic Christiansen Group's sales increased with 17 percent. At the same time, a historically large order book is brought into 2022.
Well-equipped for the future
Measured in terms of earnings and capital resources, Nic. Christiansen Group has never been stronger financially. At the end of 2021, equity was more than DKK 1 billion and the group’s drawing rights amounted to almost DKK 1.1 billion. This is due to the strong operating profit, but also to the fact that the strong demand has reduced the value of inventories by DKK 477 million.
The group's solidity and strong basic operations mean that Nic. Christiansen Group is solidly equipped for the future. The strong capital resources ensure optimal conditions for continuity in the core business, but also encourage to exploring new business areas and expanding existing ones.
“The future seems bright for the players in the industry who have the financial muscle to take advantage of the opportunities that open up when traditional sales channels are challenged. This is exactly what we want to do. We will seek the opportunities to expand our businesses. Both in terms of expanding the collaboration with existing brands as well as starting collaboration with new ones. We also want to increase investments in the group's own retail stores,” says Niels Vrist Bertelsen.
Nic. Christiansen Group’s strong financial situation secure the opportunity to handle a tax increase with retroactive effect without affecting the group's development opportunities, customers, or partners. In December 2021, the Danish Motor Vehicle Agency decided to increase the taxes for a larger number of cars from Hyundai Bil Import A/S registered in 2016 and 2017. Hyundai Bil Import A/S is now in dialogue with the Danish Motor Agency about the time after 2017.
The net financial effect for the period 2016-2021 for Nic. Christiansen Group is estimated to be in the order of DKK 300 million. Hyundai Bil Import A/S disagrees with the Danish Motor Vehicle Agency's assessment and has brought the case before the Danish Tax Appeals Agency. Since Nic. Christiansen Group expects that Hyundai Bil Import A/S will prevail, the tax increase has not been expensed in Hyundai Bil Import A/S’ accounts for 2021.
Russian aggression will affect the 2022 result
Russia invaded Ukraine on February 24th this year with major human consequences. The war has also affected the global supply chains of the automotive industry, including European car production, which was already challenged by the global shortage of microchips.
The war will affect the supply of cars and cause longer delivery times across the industry and the following uncertainty and inflation will probably lower customers' demand for new cars. The outbreak of war may help to push the car market away from fossil fuels in the long run, but the precondition for this transition is that the supply chains are intact.
"Russia's attack on Ukraine affects us as human beings and as a company. The war has made fossil fuels a central part of the geopolitical debate and made electric driving even more beneficial in a broader context. Participating in the phasing out of fossil fuels was already a strategic aim for Nic. Christiansen Group before the Russian invasion, but the current situation underlines the importance of this transition. We believe that the future of passenger cars is electric, and that petrol and especially diesel will be in sharp decline in the coming years. By going electric, we are helping customers to combat global warming,” says Niels Vrist Bertelsen.
Despite the challenges in the global car market, Nic. Christiansen Group expects another great result in 2022. Although the 2022 result before tax is not expected to match the result of 2021, but most likely is going to be around 35-45 percent lower, Nic. Christiansen Group expects that the entire portfolio of subsidiaries will show their strengths and contribute to a solid annual result, however at a lower level.
Niels Vrist Bertelsen, CEO for the Nic. Christiansen Group, will be at disposal for questions. Contact from the press will be coordinated by Morten Crone, senior advisor at Ulveman & Børsting, who can be reached on 24642047.