Grenke Finance Plc-2024-250313-FINAL-C-COPY

GRENKE FINANCE PLC

Grenke Finance Plc Report and consolidated financial statements for the year ended 31 December 2024

GRENKE FINANCE PLC

DIRECTORS REPORT AND FINANCIAL STATEMENTS

for the year ended 31 December 2024

TABLE OF CONTENTSPAGE

COMPANY INFORMATION1

DIRECTORS’ REPORT2

INDEPENDENT AUDITOR'S REPORT11

CONSOLIDATED STATEMENT OF PROFIT OR LOSS22

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME23

CONSOLIDATED STATEMENT OF FINANCIAL POSITION24

COMPANY STATEMENT OF FINANCIAL POSITION26

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY28

COMPANY STATEMENT OF CHANGES IN EQUITY29

CONSOLIDATED STATEMENT OF CASH FLOWS30

NOTES TO THE FINANCIAL STATEMENTS32

GRENKE FINANCE PLC

1

COMPANY INFORMATION

DIRECTORS

Patrick Spain

Stephan Denig

John McQuillan

Angelika Onabajo

SECRETARY

Patrick Spain

REGISTERED OFFICE

Suite 306, Q House,

Furze Road,

Sandyford,

Dublin 18

D18 H330

REGISTERED NUMBER OF INCORPORATION

375995

SOLICITORS

Gordon Judge and Company,

123 Baggot Street Lower,

Dublin 2

D02 YK29

AUDITORS

Grant Thornton

Chartered Accountants & Statutory Audit Firm

13-18 City Quay

Dublin 2

D02 ED70

BANKERS

Grenke Bank AG

Neuer Markt 2

76532 Baden-Baden

Germany

GRENKE FINANCE PLC

2

DIRECTORS’ REPORT

for the year ended 31 December 2024

The Directors present their Directors’ Report for the financial year ended 31 December 2024.

GRENKE Finance PLC was incorporated in the Republic of Ireland on 22 September 2003. The GRENKE Finance PLC Group is defined as GRENKE Finance PLC (“Company”) an Irish registered company and three French fonds cummun de titrisation FCT “GK”-Compartment “G2” (FCT GK2), FCT “GK”-Compartment “G4” (FCT GK4), FCT “GK”-Compartment “G5” (FCT GK5) and an Irish limited liability company Elektra Purchase No. 25 Designated Activity Company, (together the “Group”).

PRINCIPAL BUSINESS ACTIVITIES

GRENKE Finance PLC is a wholly owned subsidiary of GRENKE AG which is the ultimate parent.

GRENKE AG is a financial services group with its headquarters in Baden Baden, Germany. It is a public company with a listing on the Frankfurt Stock Exchange. The GRENKE AG Group acts as a global financing partner for small and medium sized enterprises. The GRENKE AG Group operates in 32 countries located in Europe, North and South America, Asia and Australia. Further information about the Grenke AG Group can be accessed at www.grenke.de.

The Company provides finance to the GRENKE AG Group, GRENKE AG Group Companies and to franchisees of the GRENKE AG Group to enable those companies to carry on leasing and factoring activities. This business is known as the treasury business.

The Group and Company carries on its own leasing activities through commission agents, who are GRENKE AG Group companies in various European countries. This business is known as the leasing business.

The Group and Company finances these activities through issuing Bonds on the Luxembourg Stock Exchange, issuing Promissory notes, issuing Commercial papers, obtaining bank loans, selling selected French lease receivables to three asset backed commercial paper programmes and selling selected lease receivables to GRENKE Bank AG.

RESULTS

The Group and Company loss/(profit) for the financial year is €1,509,601 in loss (2023: €46,483,957 in profit).

BUSINESS REVIEW

The Group and Company has incurred a loss of €1,509,601 in year end 31 December 2024 whereas in year end 31 December 2023 it made a profit of €46,483,957.

GRENKE FINANCE PLC

3

DIRECTORS’ REPORT

for the year ended 31 December 2024 (Continued)

BUSINESS REVIEW (Continued)

The Group and Company’s key financial and other performance indicators during the year were as follows:

	2024	2023	Change
	€ 000	€ 000	%
Lease income	171,682	135,921	26%
Expected credit loss allowance on finance
lease receivables	60,870	52,850	15%
Income from protecting lease equipment	35,113	39,295	-11%
Interest income and similar income	129,350	91,495	41%
Interest expense and other charges	213,532	123,419	73%
(Loss)/Profit before tax	(2,184)	52,855	-104%
Increase in amounts due from related parties	265,096	11,754	2155%
Acquisition of new lease equipment	1,135,950	974,474	17%
Expected credit loss charge to the statement
of profit or loss on non performing finance
lease receivables as a % of the average net present
value (NPV) of performing finance lease receivables	2.57%	2.23%	0.34%
Expected credit loss allowance at year end on
performing finance lease receivables as a %
of NPV of performing finance lease receivables
at year end	2.30%	2.58%	-0.28%
Interest and other charges on debt securities in issue as a % of the average of debt securities in issue	4.91%	2.93%	1.98%

The principal reason for the decline in profit before tax of €55m is the increase of €90m in interest expense and other charges and the increase in the movement in expected credit allowance on other financial assets of €30m. These increased charges of €120m were partially offset by an increase in lease income of €36m and interest income of €38m.

The high interest rate environment currently prevailing in the European economy resulted in the interest expense and other charges increasing by €90m to €214m. The interest and other charges on debt securities in issue as a % of the average debt securities in issue increased from 2.93% to 4.91%.

The increase in the movement in expected credit allowance on other financial assets of €30m is due to the Grenke AG Group 1 year risk of default per Bloomberg increasing from 0.12% at 31 December 2023 to 1.28% at 31 December 2024. In the previous year it decreased from 0.483% to 0.12%. The increase in the risk of default % has resulted in a charge to the statement of profit and loss of €24m in respect of expected credit loss allowances on unsecured amounts due from related parties whereas the decrease in the risk of default % in the previous year resulted in a credit to profit and loss statement of €6m. This increase in the movement in expected credit allowance charged to the statement of profit and loss has no effect on cash.

GRENKE FINANCE PLC

4

DIRECTORS’ REPORT

for the year ended 31 December 2024 (Continued)

BUSINESS REVIEW (Continued)

The increase of 1.16% in the Grenke AG Group 1 year risk of default per Bloomberg is due to Bloomberg adjusting the Grenke AG Group 1 year risk of default as a consequence of the Grenke AG Group reducing its guidance to the market for Group earnings in 2024 in an ad hoc announcement to the market on 29 October 2024.

The Group and Company calculate expected credit loss allowances on amounts due from related parties by multiplying the Grenke AG Group 1 year risk of default per Bloomberg by the balances outstanding at the year end. The Company and Group have concluded that the most appropriate measurement for future ECL is to use the GRENKE AG Group 1 Year risk of default as determined by Bloomberg because the Board of Directors of the Company believe there will only be a default on amounts due from related parties if the GRENKE AG Group is in default in respect of its financing obligations.

Lease income increased by €36m (26%) due to 17% growth in the acquisition of new lease equipment in 2024 and 14% growth in the acquisition of new lease equipment in 2023 together with the opportunity to earn higher returns on leases in the current high interest rate environment. The Group and Company new business exceeded €1bn for the first time since incorporation.

The expected credit loss allowance on finance lease receivables increased by 15% to €61m in 2024. The expected credit loss charge to the statement of profit or loss in respect of non performing leases increased from 2.23% in year end 31 December 2023 of the average net present value of performing leases to 2.57% in year end 31 December 2024.

Interest income and similar income increased by €38m to €129m due to the higher interest rate environment currently prevailing in the European economy.

Income from protecting lease equipment was down €4m to €35m due to the Group and Company no longer providing the service of protecting lease equipment in the French market in respect of new business entered into since 1 January 2023 in that market.

The Group and Company had a cash outflow of €26m (2023: inflow €104m).

The Group has a cash outflow from operating activities of €637m due to the growth in the Group’s leasing business which resulted in a net outflow of Cash of €190m, the Group also had a net outflow of Cash of €229m in respect of its treasury business due to the growth in the leasing business of the Group companies and Franchise companies and the Group also had an outflow of cash of €199m due to financing costs of its financial liabilities.

There was a cash inflow from financing activities of €611m which was to finance the growth in the Group’s leasing and treasury business. The growth in the leasing business and the treasury business was funded by increasing financial liabilities by €329m and amounts owed to the Grenke Bank by €282m.

PRINCIPAL RISKS UNCERTAINTIES AND MITIGATIONS

The range of uncertainty over a number of economic factors, including inflation, has increased. This may increase the degree of judgement required by management in determining inputs to the financial statements, and require disclosure of sensitivities to wider range of reasonably

GRENKE FINANCE PLC

5

DIRECTORS’ REPORT

for the year ended 31 December 2024 (Continued)

PRINCIPAL RISKS UNCERTAINTIES AND MITIGATIONS (Continued)

possible outcomes. In the current environment, there are many economic, political, and other uncertainties that can affect financial reporting. Potential examples include the Russia-Ukraine conflict, other conflicts, rising inflation and interest rates, natural disasters, and any other major global events that could occur. The Group and Company have carried out a thorough risk assessment and have concluded that the principal risks faced by the Group and Company are credit risk, liquidity and refinancing risk, market risk, and contractual risks. Details of the risks and strategies to deal with these risks are included in note 43 of the financial statements.

The risk management process at GRENKE Finance PLC has the function of systematically

identifying, assessing, documenting and disclosing risks to the Group and Company. It is designed to enable employees and management to address risks responsibly and make the most of the opportunities that present themselves.

The function of the risk management process and the result of the measures adopted by the Group’s management to monitor and manage are reviewed by the internal audit department of the GRENKE AG Group. The internal audit department reports directly to the Board of Directors of the Company’s ultimate parent GRENKE AG. All internal audit reports on the Group and Company are provided to the Directors of the Group and Company.

CORPORATE GOVERNANCE STATEMENT

Introduction

The Company is subject to and complies with the rules and regulations of the Luxembourg Stock Exchange. The Group and Company are not subject to any specific corporate governance code and has not voluntarily decided to apply a particular code.

Internal control and risk management framework

The internal control and risk management system (ICS) contains all principles, procedures and measures introduced to the Company by its management that are geared towards the implementation of management decisions in the organisation and ensures:

the effectiveness and efficiency of business activities, including the protection of assets and the prevention and detection of losses to assets;

the correctness and reliability of internal and external accounting; and

compliance with the legal provisions relevant to the Company.

The Board of Directors bears overall responsibility for the accounting process at the Company. The posting of transactions is recorded and processed by the responsible administrators in accordance with mandatory schedules for generating qualitative and quantitative information. The four-eye principle is applied. The principles, structures, process organisation and accounting methods used by the ICS are documented in writing and updated at regular intervals.

The electronic systems and the necessary IT infrastructure used for the accounting process are regularly reviewed by the Internal Audit department of the GRENKE AG Group for their compliance with safety requirements. The same applies to the further development of the

systems and processes of the Company’s accounting process and ensuring their effectiveness, especially in terms of new products, issues and changes in the legal regulations. The Group

GRENKE FINANCE PLC

6

DIRECTORS’ REPORT

for the year ended 31 December 2024 (Continued)

CORPORATE GOVERNANCE STATEMENT (Continued)

Internal control and risk management framework (Continued)

and Company also use external consultants if necessary. The employees involved are trained regularly to guarantee the quality of the Company’s accounting.

The Group and Company consider features of the ICS to be significant for accounting processes if they can materially influence the accounting and the overall view presented in the financial statements, including the Directors’ report. This relates to the following elements in particular:

Identification of significant risk and control areas relevant to the accounting process

Controls to monitor the accounting process and its results at the levels of the Board of Directors and the Company included in the financial statements

Preventative control measures in the finance and accounting systems as well as in the operative, performance-oriented Group and Company processes that generate material information for the preparation of the financial statements, including the

Directors’ report, and a separation of functions and pre-defined approval processes in relevant areas

Measures that safeguard the orderly IT-based processing of accounting issues and data

The establishment of an internal audit system to monitor accounting-related ICS

The risk management procedures established for the accounting processes of the Company ensures the preparation of accurate and reliable information for the public.

Diversity

The Company does not apply a diversity policy because it is a one hundred per cent subsidiary of GRENKE AG. The diversity policy of the GRENKE AG Group is set out in its Corporate Governance Statement, which can be viewed at www.grenke.com/en/esg/social/ The Company believes you need to consider the diversity policy of corporate entities on a group basis. It does not believe it is practical to have separate diversity policies for each of the boards of the forty plus entities in the GRENKE AG Group which are usually made up of two to three people. It is not possible to have a diversity policy when the Company Board of Directors has only four people. The Company is of the opinion that the knowledge, skill and experience required for the respective division or area of responsibility should, in fact, be the decisive factor when selecting suitable candidates for the Company.

FUTURE DEVELOPMENTS

The Directors are expecting good growth in its own leasing activities and there is good growth expected in the GRENKE AG Group leasing activity which will result in growth in the Group and Company treasury business.

The expected growth will result in good growth in the value of its gross assets, gross liabilities and its profit excluding expected credit loss allowance on other financial assets.

GRENKE FINANCE PLC

7

DIRECTORS’ REPORT

for the year ended 31 December 2024 (Continued)

FUTURE DEVELOPMENTS (Continued)

Commentary on the outlook for the GRENKE AG Group is included in the Annual Report of the GRENKE AG Group for the year end 31 December 2024, which will be publicly available on www.GRENKE.de from 13 March 2025.

POLITICAL AND CHARITABLE DONATIONS

The Group and Company made no political and charitable donations (2023: Nil) during the financial year.

RESEARCH AND DEVELOPMENT

The Group and Company did not incur any expenditure in research and development during the year (2023: Nil).

BRANCHES

The Group and Company has no branches outside the Republic of Ireland.

DIRECTORS

The Directors of the Company are Patrick Spain (Irish), Angelika Onabajo (German), Stephan Denig (German) non executive director and John McQuillan (Irish) independent non executive director. No other persons were director of the Company in 2024.

DIRECTORS’ AND SECRETARY’S INTERESTS

The Directors and secretary, who held office during the year 31 December 2024, and their

families, had no direct or beneficial interest in the shares, share options, deferred shares,

debentures or loan stock of the Group and Company at any time during the financial years ended 31 December 2023 and 31 December 2024 requiring disclosure in the Directors’ Report pursuant to Section 329 of the Companies Act 2014.

SUBSEQUENT EVENTS

No events have occurred since the Statement of Financial Position date outside the normal course of the Group and Company’s business.

ACCOUNTING RECORDS

The Directors are responsible for ensuring that adequate accounting records, as outlined in Sections 281-285 of the Companies Act 2014, are kept by the Group and Company. To achieve this, the Directors have employed professionally qualified accounting personnel with appropriate expertise and have provided adequate resources to the finance function who ensure that the requirements of Sections 281-285 of the Companies Act 2014 are complied with. The books and records are maintained at the registered office.

GRENKE FINANCE PLC

8

DIRECTORS’ REPORT

for the year ended 31 December 2024 (Continued)

DIRECTORS' RESPONSIBILITIES STATEMENT

The Directors are responsible for preparing the Directors’ Report and financial statements, in accordance with applicable law and regulations.

Company law requires the Directors to prepare financial statements for each financial year. Under that law, they have prepared the Group financial statements in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU and the Company financial statements in accordance with FRS 101 Reduced Disclosure Framework and applicable law.

The Transparency (Directive 2004/109/EC) Regulations 2007 require the Directors to include a fair review of the business as well as the principal risks and uncertainties faced by the Company. The Directors confirm that, to the best of their knowledge, they have complied with

these requirements in preparing the financial statements, including preparation of these financial statements in accordance with IFRS Accounting Standards as adopted by EU ('IFRS') and Company financial statements in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (FRS 101) and in accordance with applicable accounting standards, which give a true and fair view of the assets, liabilities and financial position of the Group and Company as at 31 December 2024 and of the financial performance of the Group for the year then ended. They also confirm that the Directors’ Report includes a fair review of the development and performance of the business and position of the Group and Company, together with a description of the principal risks and uncertainties that the Group and Company faces.

Under Company law the Directors must not approve the Group and Company financial statements unless they are satisfied that they give a true and fair view of the assets, liabilities and financial position of the Group and Company and of the Group’s profit or loss for that year.

In preparing each of the Group and Company financial statements, the Directors are required to:

select suitable accounting policies and then apply them consistently;

make judgments and estimates that are reasonable and prudent;

state that the Group financial statements have been prepared in accordance with IFRS as adopted by the EU and Company financial statements have been prepared in accordance with FRS 101 Reduced Disclosure Framework; and

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and Company will continue in business.

The Directors are responsible for keeping adequate accounting records which disclose with reasonable accuracy at any time the assets, liabilities, financial position and profit or loss of the Group and Company and which enable them to ensure that the financial statements of the Group and Company are prepared in accordance with the applicable accounting framework and comply with the provisions of the Companies Act 2014. They have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and Company and to prevent and detect fraud and

GRENKE FINANCE PLC

9

other irregularities. The Directors are also responsible for preparing a Directors’ Report that complies with the requirements of the Companies Act 2014.

DIRECTORS’ REPORT

for the year ended 31 December 2024 (Continued)

GOING CONCERN

In order to continue as a going concern for at least 12 months following the signing of these financial statements the Group and Company must be able to meet its obligations to repay Debt Securities in issue and bank loans when repayment falls due. There must also be no significant diminution in the lease receivables of the GRENKE AG group because a significant diminution in the GRENKE AG Group’s lease receivables would make it difficult for the Group and Company to recover amounts due from GRENKE AG Group companies and to use such funds collected to service the Group and Company’s debt obligations.

The Directors have made enquiries from its parent GRENKE AG as to the collectability of lease receivables due from the GRENKE AG Group companies and GRENKE AG Group

franchisees with loans due to the Group and Company. The Directors of the Group and Company continually review the collectability of the Group and Company lease receivables.

The Directors have carried out a review of the cash flows from the lease receivables and the cash flows from amounts due from Grenke AG Group Companies and Franchisees over at least twelve months together with their immediately liquid assets. The Directors have also looked at their obligations to repay debt securities in issue and bank loans together with interest due on the Group and Company’s debt obligations. The review of cash flows shows that it is reasonable for the Directors to conclude that the Group and Company will be able to meet their obligations to repay Debt securities in issue, bank loans and financing costs when they fall due.

The Directors have a reasonable expectation that the Group and Company have adequate resources to continue in operational existence for at least twelve months. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.

The Directors do not believe that the loss of €1.5m incurred in the year end 31 December 2024 will impact on it’s ability to continue as a going concern. The directors believe that the Group and Company has net assets of €123m at 31 December 2024 and projected cash flows for the next twelve months which will allow the Group and Company to absorb the loss of €1.5m and continue as a going concern.

DIRECTORS’ COMPLIANCE STATEMENT

The Directors, in accordance with Section 225(2) (a) of the Companies Act 2014 (the “Act”), acknowledge that they are responsible for securing the Group and Company’s compliance with its “relevant obligations.” “Relevant obligations”, in the context of the Group and Company, are the Group and Company’s obligations under:

a)the Act, where a breach of the obligations would be a category 1 or category 2 offence;

b)the Act, where a breach of the obligations would be a serious Market Abuse or Prospectus offence under

Market Abuse (Directive 2003/6/EC) Regulations 2005

GRENKE FINANCE PLC

10

Prospectus (Directive 2003/71/EC) Regulations 2005

EU Transparency Directive (“Transparency Law” in Luxembourg) and Luxembourg Stock Exchange listing and reporting requirements

c)tax law

d)Criminal Justice (Corruption Offenses) Act 2018

e)Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 (Updated 2021)

DIRECTORS’ REPORT

for the year ended 31 December 2024 (Continued)

DIRECTORS’ COMPLIANCE STATEMENT (Continued)

f)General Data Protection Regulation (GDPR) along with further national rules set out in the Irish Data Protection Act 2018

g)Safety, Health and Welfare at Work Act 2005.

Pursuant to Section 225 (2) (b) of the Companies Act 2014, the Directors confirm that:

i.a compliance policy statement has been drawn up by the Group and Company in accordance with Section 225 (3) (a) of the Act setting out the Group and Company’s policies (that, in the Directors’ opinion, are appropriate to the Group and Company) respecting compliance by the Group and Company with its relevant obligations;

ii.appropriate arrangements and structures have been put in place that are, in the directors’ opinion, designed to secure material compliance with the company’s relevant obligations; and

iii.a review has been conducted, during the financial year, of the arrangements and structures referred to in paragraph (ii).

RELEVANT AUDIT INFORMATION

The Directors believe that they have taken all steps necessary to make themselves aware of any relevant audit information and have established that the Group and Company’s statutory auditors are aware of that information. In so far as they are aware, there is no relevant audit information of which the Group and Company’s statutory auditors are unaware.

AUDIT COMMITTEE

The Directors of the Company have decided not to establish an audit committee as permitted

under S167 (2) (b) of the Companies Act 2014 because the Company’s parent, Grenke AG has an established audit committee.

AUDITORS

The auditors, Grant Thornton, have indicated their willingness to continue in office in accordance with Section 383 (2) of the Companies Act 2014.

On behalf of the Directors

GRENKE FINANCE PLC

11

Patrick Spain Angelika Onabajo

Director Director

Date: 13 March 2025

Independent auditor’s report to the members of Grenke Finance Plc

11

Report on the audit of the financial statements

Opinion

We have audited the financial statements of Grenke Finance Plc (the “Company”) and its subsidiaries (the “Group’’), contained within the reporting package 635400ILKD2MBMANBG03-2024-12-31-en.zip which comprise the Consolidated Statement of Profit and Loss, Consolidated Statement of Comprehensive Income, Consolidated Statement of Financial Position, Company Statement of Financial Position, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity and Consolidated Statement of Cash Flows for the financial year ended 31 December 2024, and the related notes to the financial statements, including material accounting policy information.

The financial reporting framework that has been applied in the preparation of the Group financial statements is Irish law, including the Commission Delegated Regulation 2018/815 regarding the single electronic reporting format (ESEF), andIFRS Accounting Standards as adopted by EU ('IFRS') and as regards the Company financial statements, Irish Law and accounting standards issued by the Financial Reporting Council including FRS 101 “Reduced Disclosure Framework” (Generally Accepted Accounting Practice in Ireland).

In our opinion,

the consolidated financial statements give a true and fair view in accordance with IFRS, of the assets, liabilities and financial position of the Group at 31 December 2024 and of the Group’s financial performance and cash flows for the financial year then ended;

the Company’s statement of financial position gives a true and fair view in accordance with Generally Accepted Accounting Practice in Ireland, of the assets, liabilities and financial position of the Company as at 31 December 2024; and

have been properly prepared in accordance with the requirements of the Companies Act 2014 and, as regards the consolidated financial statements, Article 4 of the IAS Regulation.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (Ireland) (‘ISAs (Ireland)) and applicable law. Our responsibilities under those standards are further described in the ‘Responsibilities of the auditor for the audit of the financial statements’ section of our report. We are independent of the Group and Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in Ireland, including the Ethical Standard for Auditors (Ireland) issued by the Irish Auditing and Accounting Supervisory Authority (IAASA), and the ethical pronouncements established by Chartered Accountants Ireland, applied as determined to be appropriate in the circumstances for the Group and Company. We have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independent auditor’s report to the members of Grenke Finance Plc

12

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors’ use of going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors assessment of the entity’s ability to continue as a going concern basis of accounting included:

Obtaining management’s going concern assessment covering at least the next 12 months from the date of the approval of financial statements;

Evaluating management’s going concern assessment. This include:

-discussing the use of going concern basis of accounting with management;

-reviewing cash flow forecasts for the going concern period;

-considering the appropriateness of the assumptions used in the going concern assessment are consistent with our understanding of the business activities of the Group and Company and in the context of the applicable financial reporting framework;

Reviewing the financial position of the Group and Company for solvency from a funding and liquidity perspective, obtaining an understanding of contractual arrangements and reviewing agreements in relation to related party funding arrangements up to the date of approval of the financial statements;

Considering solvency and going concern assessment of the ultimate parent entity;

Making enquiries with management and reviewing board minutes and other available written communication to understand the future plans and to identify potential contradictory information;

Reviewing subsequent events that may warrant a significant uncertainty regarding the going concern assumption; and

Assessing the adequacy of the disclosures made in the financial statements with respect to the going concern assertion.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company’s ability to continue as a going concern for a period of at least twelve months from the date when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current financial period and include the most significant assessed risks of material misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit, and the directing of efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and therefore we do not provide a separate opinion on these matters.

Independent auditor’s report to the members of Grenke Finance Plc

13

Key audit matters (continued)

Overall audit strategy

We designed our audit by determining materiality and assessing the risks of material misstatement in the financial statements. In particular, we looked at where the directors made subjective judgements, for example, in respect of significant accounting estimates that involved

making assumptions, such as Expected Credit Loss (ECL) provisioning, and considering future events that are inherently uncertain.

We also addressed the risk of management override of internal controls, including evaluating whether there was any evidence of potential bias that could result in a risk of material misstatement due to fraud.

Based on our considerations as set out below, our areas of focus included:

Valuation of finance lease receivables and completeness and accuracy of the related ECL provision; and

Existence of finance lease receivables and occurrence and accuracy of related lease income and expenditure.

How we tailored the audit scope

The Group and Company provides finance to GRENKE AG Group (‘the ultimate parent’), GRENKE AG Group Companies and to franchisees of the GRENKE AG Group to enable those companies to carry on leasing and factoring activities. There are a number of critical functions that are outsourced to the ultimate parent, including IT infrastructure, credit modelling and Internal Audit support.

Our audit was scoped by obtaining an understanding of the Group and Company and its environment, including testing of internal controls, and assessing the risks of material misstatement to be able to give an opinion on the consolidated and company financial statements as a whole, taking into account the operational structure of the Group and Company, the accounting processes and controls, the involvement of third parties and the industry in which the Group and Company operates. Audit work on the Group and Company was performed by the same audit team. We also placed reliance on the results of certain centralised audit procedures performed by the GRENKE AG Group auditor in relation to functions outsourced to the ultimate parent entity.

In establishing the overall approach to our audit we assessed the risk of material misstatement taking into account the nature, likelihood and potential magnitude of any misstatement. As part of our risk assessment, we assessed the overall control environment within the Company and Group.

Materiality and audit approach

The scope of our audit is influenced by our application of materiality. We set certain quantitative thresholds for materiality. These, together with qualitative considerations, such as our understanding of the Group and Company and their environment, the history of misstatements, the complexity of the Group and Company and the reliability of the control environment, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements, both individually and on the financial statements as a whole.

Independent auditor’s report to the members of Grenke Finance Plc

14

Key audit matters (continued)

Materiality and audit approach (continued)

Based on our professional judgement, we determined materiality for the Group and Company based on a metric of 1% of total operating income for the financial year ended 31 December 2024. In previous years, we have used a metric of 5% of profit before tax as the benchmark for setting materiality. We had applied this benchmark as the Group and Company are profit oriented and profit before tax is one of the key metrics used by members to assess their performance. However, as the Group and Company reported a loss for the financial year ended 31 December 2024, we have reassessed the basis for our materiality to total operating income, as it is a more appropriate and stable benchmark, as it is less affected by temporary losses and is a key performance indicator.

We have set performance materiality at 60% of our materiality, having considered our prior year experience of the risk of misstatements, business risks and fraud risks associated with the Group and Company and their control environment, our expectations about misstatements and our understanding of the business and processes at the Group and Company. This is to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements in the financial statements exceeds materiality for the financial statements as a whole.

The reporting threshold is set as the amount below which identified misstatements are considered as being clearly trivial. We agreed with the Board and the Grenke AG Audit Committee that we would report to them misstatements identified during our audit of amounts greater than 5% of materiality as well as misstatements below that amount that, in our view, warranted reporting for qualitative reasons.

Significant matters identified

The risks of material misstatement that had the greatest effect on our audit, including the allocation of our resources and effort, are set out below as significant matters together with an explanation of how we tailored our audit to address these specific areas in order to provide an opinion on the financial statements as a whole. This is not a complete list of all risks identified by our audit.

Key audit matter

Our audit response

Valuation of finance lease receivables and completeness and accuracy of the related Expected Credit Loss (ECL) provision

Note 25 to the Financial Statements reflects gross lease receivables of €2,748m (2023: €2,381m) of which impaired leases are €257m (2023: €206m) and the related ECL provision for performing leases is €57m (2023: €55m) and for non-performing leases is €188m (2023: €158m).

At each reporting period, the Group and Company determines the impairment on finance lease receivables based on a

The following audit work has been performed to address the risks:

Obtained an understanding of the process in place including evaluation of the design and implementation of controls relevant to the valuation of lease receivables and related impairment provisions. These relate to relevant IT applications, the estimation of provision rates and IFRS 9 models to calculate resulting ECL provisions on the Group and Company credit exposures.

Independent auditor’s report to the members of Grenke Finance Plc

15

model of expected credit losses in accordance with the requirements of IFRS 9. The assessment of ECL provisions involves the use of complex models and a high degree of estimation uncertainty due to the significant judgments inherent in the IFRS 9 methodology.

The impairment model for non-performing leases derives the percentage provision rates, to be applied to categories of leases depending on their processing status, that are grouped together, as described in Note 4(k) to the Financial Statements. Provisional rates are derived from the historical empirical data and forward-looking information. There is an inherent risk in determining the impairment rates applied due to a high level of estimation uncertainty.

The risk is further increased due to the uncertainty introduced by recent macroeconomic developments, such as changing interest rates and geo-political conflicts, as the historical information may no longer be relevant and it is difficult to predict the shape of future economic recovery. In addition, there is a risk of material misstatement in relation to completeness and accuracy of ECL provision due to incorrect assignment of the processing status.

Due to the material nature of the leases and judgements involved in assessing for impairment and calculating provisions, this was deemed a key audit matter and significant auditor’s attention was deemed appropriate.

Refer to accounting policies on impairment of financial assets in Note 4 to the Financial Statements, pages 41 to 44.

With the assistance from our internal IT specialist, we reviewed and assessed the work performed by the GRENKE AG Group Auditor in relation to the design, implementation and operating effectiveness of IT general controls for all relevant in scope applications.

With the assistance from our internal modelling specialist, we reviewed and assessed the work performed by GRENKE AG Group Auditor around data, assumptions and models relating to ECL calculation on finance lease receivables, and assessed its relevance for the purposes of Group and Company statutory audit.

The procedures included:

oAssessment of changes to GRENKE AG’s impairment policy and conceptual framework and listing of judgements and assumptions applied to determine ECL and components of ECL calculation (PD, lifetime PD, LGD, EAD, SICR, scenarios);

oAssessment of which models are used to determine PDs (stage 1 and 2), EADs, LGDs and SICR and model review regarding IFRS 9 compliance;

oVerification of the implementation and appropriateness of forward-looking information and input parameters for PD and LGD estimation, as well as the data generation process and the implementation of macro-economic information;

oAssessment of SICR and staging using analytical procedures;

oAssessment of the completeness and correct modelling of EAD-relevant components;

oTesting of mathematical accuracy of ECL components;

oReperformance of source codes for the performing model components, including derivation of macroeconomic shift factors.

Independent auditor’s report to the members of Grenke Finance Plc

16

oAssessment of internal validation concepts and model validation results, including backtesting;

oRecomputing ECL in the course of individual file review as well as on portfolio basis.

We performed substantive procedures that are specifically responsive to the identified risk relating to incorrect assignment of the processing status. We have:

oAssessed the accuracy of the categorisation of the processing status grouping (0-9) for a statistical sample of leases in line with the policy;

oChecked the category in the non-performing contract listing as at 31 December 2024 to the status code on the lease system;

oReviewed logbook and other evidence on file, which contained internal discussions and information outlining the reasons for a contract being in particular category; and

oConcluded on the appropriateness of the category assigned, considering all the relevant evidence obtained over the characteristics of a given lease contract.

We reconciled the ECL balances and movements from the underlying credit data to the general ledger and performed overall analytical review over credit risk exposures and related provision coverages, in order to assess the overall reasonableness.

Reviewed and assessed the adequacy of related disclosures in the financial statements in accordance with the requirements of IFRS 7.

Our planned audit procedures were completed without material exception.

Existence of finance lease receivables and occurrence and accuracy of related lease income and expenditure

The consolidated financial statements reflect net finance lease receivables amounting to €2,503m (2023: €2,168m). The consolidated statement of profit or

The following audit work has been performed to address the risks:

Performed an understanding of lease origination and commission model business processes, and performed test of

Independent auditor’s report to the members of Grenke Finance Plc

17

loss reflects lease income of €172m (2023: €136m).

The Group and Company carries on its own leasing activities through commission agents, who are GRENKE AG Group companies in various European countries. These agents write leases on behalf of the Group and Company and are paid commission fees. The agents acquire all equipment to be leased on behalf of Group and Company and also collect all income from leases. All income and expenditure associated with leases is passed onto Group and Company, as the legal and beneficiary lease owner.

Due to the material nature of the leases and related income and expenditure, this was deemed a key audit matter, having the greatest effect on the allocation of resources and where the audit team’s efforts were directed.

Refer to accounting policies on finance lease receivables and lease income in Note 4 to the Financial Statements, page 36 and pages 46 and 47, respectively.

design, implementation and operating effectiveness of relevant controls at Group and Company level.

Obtained and inspected signed lease contracts and other supporting documents, in order to confirm existence for a statistical sample of leases.

Reconciled the balances from transfer sheet to the general ledger and agreed to the respective invoices and bank statements for a sample of months/agents.

Agreed key lease terms to signed lease contracts and ensured these are captured correctly in the system.

For a statistical sample of leases, obtained amortisation schedules, recalculated present values based on the lease terms and agreed amounts to ledger. Capitalised initial direct costs and other lease income were tested concurrently with this procedure.

Performed test of detail using the statistical sampling methodology on lease interest income, secondary lease income and loss on termination, earned during the year by recalculating the interest and other income earned from the lease contracts using the signed lease contracts and other evidence to verify the calculation inputs.

Performed test of detail using the statistical sampling methodology to test accuracy of commission fees and other lease related expenses with reference to cooperation agreements and relevant lease contracts, and traced to invoices.

Assessed the consistency of accounting treatment for finance lease receivables and related income and expenditure with reference to relevant IFRS guidance (i.e. IFRS 9, 15, 16).

Our planned audit procedures were completed without material exception.

Independent auditor’s report to the members of Grenke Finance Plc

18

Other information

Other information comprises information included in the annual report, other than the financial statements and the auditor’s report thereon, including the Directors’ Report. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies in the financial statements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Matters on which we are required to report by the Companies Act 2014

We have obtained all the information and explanations which we consider necessary for the purposes of our audit.

In our opinion the accounting records of the Company were sufficient to permit the financial statements to be readily and properly audited.

The financial statements are in agreement with the accounting records.

In our opinion the information given in the Directors’ Report is consistent with the financial statements. Based solely on the work undertaken in the course of our audit, in our opinion, the Directors’ report has been prepared in accordance with the requirements of the Companies Act 2014, excluding the requirements on sustainability reporting in Part 28.

Matters on which we are required to report by exception

Based on our knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Directors’ Report.

Under the Companies Act 2014 we are required to report to you if, in our opinion, the disclosures of directors’ remuneration and transactions specified by sections 305 to 312 of the Act have not been made. We have no exceptions to report arising from this responsibility.

Corporate governance statement

In our opinion, based on the work undertaken in the course of our audit of the financial statements, the description of the main features of the internal control and risk management systems in relation to the financial reporting process, specified for our consideration and included in the Corporate Governance Statement, is consistent with the financial statements and has been prepared in accordance with section 1373(2)(c) of the Companies Act 2014.

Based on our knowledge and understanding of the Group and Company and their environment obtained in the course of our audit of the financial statements, we have not identified material misstatements in the description of the main features of the internal control and risk management systems in relation to the financial reporting process included in the Corporate Governance Statement.

Independent auditor’s report to the members of Grenke Finance Plc

19

Responsibilities of management and those charged with governance for the financial statements

As explained more fully in the Directors’ responsibilities statement, management is responsible for the preparation of the consolidated financial statements which give a true and fair view in accordance with IFRS, and as regards the company financial statements, in accordance with Generally Accepted Accounting Practice in Ireland, and for such internal control as they determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Group and Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group and Company or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Group and Company’s financial reporting process.

Responsibilities of the auditor for the audit of the financial statements

The auditor’s objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes their opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (Ireland) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Irish Auditing and Accounting Supervisory Authority’s website at: http://www.iaasa.ie/getmedia/b2389013-1cf6-458b-9b8f-

a98202dc9c3a/Description_of_auditors_responsibilities_for_audit.pdf. This description forms

part of our auditor’s report.

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. Owing to the inherent limitations of an audit, there is an unavoidable risk that material misstatement in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (Ireland).

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Based on our understanding of the Group and Company, and the industry in which it operates, we identified that the principal risks of non-compliance with laws and regulations related to compliance with EU Transparency Directive (“Transparency Law” in Luxembourg) and Luxembourg Stock Exchange listing and reporting requirements; and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the

Independent auditor’s report to the members of Grenke Finance Plc

20

Responsibilities of the auditor for the audit of the financial statements (continued)

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud (continued)

financial statements such as Irish tax laws, the Companies Act 2014, and the reporting requirements of the European Single Electronic Format (ESEF). The Audit engagement partner

considered the experience and expertise of the engagement team, including IT specialist and internal modelling specialist in the financial services industry to ensure that the team had

appropriate competence and capabilities to identify or recognise non-compliance with the laws and regulations. We evaluated managements incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override controls) and determined that the principal risks were related to posting inappropriate journal entries to manipulate financial performance and management bias through judgements and assumptions in significant accounting estimates.

We apply professional scepticism through the audit to consider potential deliberate omission or concealment of significant transactions, or incomplete/inaccurate disclosures in the financial statement.

In response to these principal risks, our audit procedures included but not limited to:

enquiries of management on the policies and procedures in place regarding compliance with laws and regulations, including consideration of known or suspected instances of non- compliance and whether they have knowledge of any actual, suspected or alleged fraud;

inspection of the Group and Company’s regulatory and legal correspondence and review of minutes during the year to corroborate inquiries made;

gaining an understanding of the Group and Company’s current activities, the scope of authorisation and the effectiveness of its internal control environment established to mitigate risk related to fraud;

discussion amongst the engagement team in relation to the identified laws and regulations and regarding the risk of fraud, and remaining alert to any indications of non-compliance or opportunities for fraudulent manipulation of financial statements throughout the audit;

identifying and testing journal entries to address the risk of inappropriate journals and management override of controls;

designing audit procedures to incorporate unpredictability around the nature, timing and extent of our testing;

challenging assumptions and judgements made by management in their significant accounting estimates, including determination of impairment of finance lease receivables;

evaluating the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves a true and fair view; and

assessment of the appropriateness of the collective competence and capabilities of the engagement team to identify or recognise non-compliance with the laws and regulations included audit partners’ consideration of the engagement team's:

ounderstanding of, and practical experience with audit engagements of a similar nature and complexity through appropriate training and participation;

oinvolvement of internal IT, modelling and tax specialists;

oknowledge of the finance leasing industry in which the client operates; and

Independent auditor’s report to the members of Grenke Finance Plc

21

Responsibilities of the auditor for the audit of the financial statements (continued)

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud (continued)

ounderstanding of the legal and regulatory requirements specific to the Group and Company including:

the provisions of the applicable legislation;

the regulators rules and related guidance, including guidance issued by relevant authorities that interprets those rules; and

the applicable statutory provisions.

The primary responsibility for the prevention and detection of irregularities rests with those charged with governance and management. As with any audit, there remains a risk of non-detection or irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or override of internal controls.

The purpose of our audit work and to whom we owe our responsibilities

This report is made solely to the company’s members, as a body, in accordance with section 391 of the Companies Act 2014. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Report on other legal and regulatory requirements

We were appointed by the Board of Directors on 10th December 2021 to audit the financial statements for the year ended 31 December 2021, and subsequent years subject to re-appointment. The period of total uninterrupted engagement including previous renewals and reappointments of the firm is four years.

The non-audit services prohibited by the IAASA’s Ethical Standard were not provided to the Group and Company and we remain independent of the Group and Company in conducting our audit.

The audit opinion is consistent with the additional report to the board of directors and Grenke AG audit committee.

Maria Afontsenko

For and on behalf of

Grant Thornton

Chartered Accountants & Statutory Audit Firm

13-18 City Quay

Dublin 2

D02 ED70

Ireland

Date: 13 March 2025

GRENKE FINANCE PLC

22

CONSOLIDATED STATEMENT OF PROFIT AND LOSS

for the financial year ended 31 December 2024

Note

Continuing Operations		2024	2023
		€	€
Lease income	7	171,682,054	135,920,859
Income from protecting lease equipment	8	35,113,350	39,294,558
Interest income and similar income	9	129,350,043	91,495,187
Total operating income		336,145,447	266,710,604
Movement in expected credit loss allowance on finance lease receivables	10	(60,870,008)	(52,849,687)
Movement in expected credit loss allowance on other financial assets	11	(24,058,485)	5,930,735
Interest expense and other charges	12	(213,532,113)	(123,418,952)
Foreign exchange loss	13	(2,771,817)	(11,966,729)
Net (loss)/gain on financial instruments at fair value through profit or loss	14	(5,196,618)	3,806,103
Other income	15	2,238,345	2,322,702
Other operating expenses	16	(34,139,029)	(37,680,232)
(Loss)/profit before tax		(2,184,278)	52,854,544
Taxation	18	674,677	(6,370,587)
(Loss)/profit for the year		(1,509,601)	46,483,957

The accompanying notes form an integral part of these consolidated financial statements.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

GRENKE FINANCE PLC

23

for the financial year ended 31 December 2024

	Note	2024	2023
		€	€
(Loss)/profit for the period		(1,509,601)	46,483,957
Other Comprehensive Income
Items that may be reclassified to profit or loss in
subsequent years
Gains/(losses) relating to cash flow hedges	27	(4,087,847)	(6,387,884)
Tax relating to cash flow hedges	28	510,979	798,485
Other comprehensive loss net of tax		(3,576,868)	(5,589,399)
Total comprehensive (loss)/income for the period		(5,086,469)	40,894,558

The accompanying notes form an integral part of these financial statements.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

GRENKE FINANCE PLC

24

as at 31 December 2024

	Note	2024	2023
NON−CURRENT ASSETS		€	€
Property, plant & equipment	19	866,901	1,047,225
Subordinated loans and reserve accounts	21	44,077,287	53,243,803
Amounts due from related parties	22	850,667,476	688,903,597
Finance lease receivables	25	1,668,547,061	1,407,820,688
Trade and other receivables	26	26,993,282	42,371,289
Derivative financial instruments	27	10,474,214	5,846,454
Corporation tax receivable	29	3,882,462	3,882,462
		2,605,508,683	2,203,115,518
CURRENT ASSETS
Subordinated loans and reserve accounts	21	45,639,432	30,284,456
Leased assets held for sale	24	965,962	943,461
Finance lease receivables	25	834,892,403	759,890,804
Amounts due from related parties	22	1,211,298,102	1,132,024,567
Trade and other receivables	26	154,972,805	132,938,774
Derivative financial instruments	27	4,150,876	6,001,648
Corporation tax receivable	29	3,208,517	-
Cash and cash equivalents	30	117,100,755	143,284,978
		2,372,228,852	2,205,368,688
TOTAL ASSETS		4,977,737,535	4,408,484,206

The accompanying notes form an integral part of these financial statements.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

GRENKE FINANCE PLC

25

as at 31 December 2024 (Continued)

		2024	2023
NON CURRENT LIABILITIES		€	€
Financial liabilities	31	2,245,136,691	2,221,927,003
Amounts due to related parties	33	848,301,863	633,767,332
Derivative financial instruments	27	15,500,354	14,746,375
Lease liabilities	35	850,083	1,083,367
Deferred tax liability	28	360,068	956,386
		3,110,149,059	2,872,480,463
CURRENT LIABILITIES
Financial liabilities	31	1,087,017,990	762,214,695
Amounts due to related parties	33	566,157,979	591,848,419
Lease liabilities	35	260,880	-
Derivative financial instruments	27	6,431,673	5,127,670
Deferred income	36	-	170
Trade and other payables	37	84,264,832	47,507,870
Corporation tax payable	29	-	763,328
		1,744,133,354	1,407,462,152
TOTAL LIABILITIES		4,854,282,413	4,279,942,615
CAPITAL AND RESERVES
Share capital	38	50,000	50,000
Capital contribution	38	67,000,000	67,000,000
Retained earnings		53,037,350	54,546,951
Cash flow hedge reserve	39	3,367,772	6,944,640
TOTAL EQUITY		123,455,122	128,541,591
TOTAL EQUITY AND LIABILITIES		4,977,737,535	4,408,484,206

Approved and authorised by the Board of Directors and signed on its behalf:

Patrick Spain	Angelika Onabajo
Director	Director

13 March 2025

The accompanying notes form an integral part of these financial statements.

GRENKE FINANCE PLC

26

COMPANY STATEMENT OF FINANCIAL POSITION

as at 31 December 2024

Note

2024

2023

NON−CURRENT ASSETS

€

Property, plant & equipment

19

866,901

1,047,225

Investments in controlled undertakings

20

450

Subordinated loans and reserve accounts

21

44,077,287

53,243,803

Amounts due from related parties

23

857,817,819

711,863,662

Finance lease receivables

25

1,668,547,061

1,407,820,688

Trade and other receivables

26

26,993,282

42,371,289

Derivative financial instruments

27

10,474,214

5,846,454

Corporation tax receivable

29

3,882,462

2,612,659,476

2,226,076,033

CURRENT ASSETS

Subordinated loans and reserve accounts

21

45,639,432

30,284,456

Leased assets held for sale

24

965,962

943,461

Finance lease receivables

25

834,892,403

759,890,804

Amounts due from related parties

23

1,217,218,384

1,143,066,712

Trade and other receivables

26

154,972,805

132,938,774

Derivative financial instruments

27

4,150,876

6,001,648

Corporation tax receivable

29

3,208,517

-

Cash and cash equivalents

30

117,100,755

143,284,978

2,378,149,134

2,216,410,833

TOTAL ASSETS

4,990,808,610

4,442,486,866

The accompanying notes form an integral part of these financial statements.

GRENKE FINANCE PLC

27

COMPANY STATEMENT OF FINANCIAL POSITION

as at 31 December 2024 (Continued)

2024

2023

NON CURRENT LIABILITIES

€

Financial liabilities

32

1,946,652,179

1,920,415,028

Amounts due to related parties

34

1,153,937,168

958,239,822

Lease liabilities

35

850,083

1,083,367

Derivative financial instruments

27

15,500,354

14,746,375

Deferred tax liability

28

360,068

956,386

3,117,299,852

2,895,440,978

CURRENT LIABILITIES

Financial liabilities

32

909,461,105

592,023,798

Amounts due to related parties

34

749,635,146

773,081,461

Lease liabilities

35

260,880

-

Derivative financial instruments

27

6,431,673

5,127,670

Deferred income

36

-

170

Trade and other payables

37

84,264,832

47,507,870

Corporation tax payable

29

-

763,328

1,750,053,636

1,418,504,297

TOTAL LIABILITIES

4,867,353,488

4,313,945,275

CAPITAL AND RESERVES

Share capital

38

50,000

Capital contribution

38

67,000,000

Retained earnings

53,037,350

54,546,951

Cash flow hedge reserve

39

3,367,772

6,944,640

TOTAL EQUITY

123,455,122

128,541,591

TOTAL EQUITY AND LIABILITIES

4,990,808,610

4,442,486,866

Approved and authorised by the Board of Directors and signed on its behalf:

Patrick Spain	Angelika Onabajo
Director	Director

13 March 2025

The accompanying notes form an integral part of these financial statements.

GRENKE FINANCE PLC

28

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the financial year ended 31 December 2024

				Cash flow
	Issued	Capital	Retained	hedge
	capital	contribution	earnings	reserve	Total equity
	€	€	€	€	€
As at 1 January 2024	50,000	67,000,000	54,546,951	6,944,640	128,541,591
Loss for the financial yearended 31 December 2024	-	-	(1,509,601)	-	(1,509,601)
Other comprehensive loss	-	-	-	(3,576,868)	(3,576,868)
Total comprehensive loss	-	-	(1,509,601)	(3,576,868)	(5,086,469)
At 31 December 2024	50,000	67,000,000	53,037,350	3,367,772	123,455,122

				Cash flow
	Issued	Capital	Retained	hedge
	capital	contribution	earnings	reserve	Total equity
	€	€	€	€	€
As at 1 January 2023	50,000	67,000,000	118,062,994	12,534,039	197,647,033
Profit for the financial year31 December 2023	-	-	46,483,957	-	46,483,957
Other comprehensive income	-	-	-	(5,589,399)	(5,589,399)
Total comprehensive income	-	-	46,483,957	(5,589,399)	40,894,558
Transactions with owners ofthe company contributionsand distributions (Note 40)	-	-	(110,000,000)	-	(110,000,000)
At 31 December 2023	50,000	67,000,000	54,546,951	6,944,640	128,541,591

GRENKE FINANCE PLC

29

COMPANY STATEMENT OF CHANGES IN EQUITY

for the financial year ended 31 December 2024

Cash flow

Issued

Capital

Retained

hedge

capital

contribution

earnings

reserve

Total equity

€

As at 1 January 2024

50,000

67,000,000

54,546,951

6,944,640

128,541,591

Loss for the financial year

ended 31 December 2024

-

(1,509,601)

-

(1,509,601)

Other comprehensive

loss

-

(3,576,868)

Total comprehensive loss

-

(1,509,601)

(3,576,868)

(5,086,469)

At 31 December 2024

50,000

67,000,000

53,037,350

3,367,772

123,455,122

Cash flow

Issued

Capital

Retained

hedge

capital

contribution

earnings

reserve

Total equity

€

As at 1 January 2023

50,000

67,000,000

118,062,994

12,534,039

197,647,033

Profit for the financial year

31 December 2023

-

46,483,957

-

46,483,957

Other comprehensive income

-

(5,589,399)

Total comprehensive income

-

46,483,957

(5,589,399)

40,894,558

Transactions with owners of

the company contributions

and distributions (Note 40)

-

(110,000,000)

-

(110,000,000)

At 31 December 2023

50,000

67,000,000

54,546,951

6,944,640

128,541,591

GRENKE FINANCE PLC

30

CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2024

2024

2023

CASH INFLOWS FROM OPERATING ACTIVITIES	Note	€	€
(Loss)/profit for the period	SOPL	(1,509,601)	46,483,957
Adjustments:
Operating cash flows before movement in working capital
Taxation	18	(674,677)	6,370,587
Interest expense	5	205,196,166	119,630,404
Interest income	9	(129,350,043)	(91,495,187)
Depreciation	19	233,496	405,696
Expected credit loss allowance on finance lease receivables	10	60,870,008	52,849,687
Expected credit loss allowance/(reversal) on financial assets	5	25,949,283	(5,202,105)
Currency translation differences		(140,893)	11,867,592
Fair value measurement of subordinated loans	14	903,356	(281,178)
Foreign exchange translation adjustment to cash		152	59
Other non-cash income/(expenses)	5	2,313	(153,850)
Increase in subordinated loans and reserve accounts	5	(7,091,816)	(11,254,684)
(Increase)/Decrease in leased assets held for resale	5	(22,501)	105,092
Increase in lease receivables	5	(396,961,614)	(286,389,154)
Change in amounts due from/to related parties	5	(360,087,267)	84,841,660
Decrease in trade and other receivables	5	18,418,372	22,062,040
Change in the fair value of derivative financial instrumentsnot designated as hedges	5	2,011,623	2,042,966
Increase/(Decrease) in other current liabilities	5	2,950,278	(14,666,863)
Interest paid	5	(153,645,968)	(86,980,458)
Interest received	9	129,350,043	91,495,187
Payments to Grenke Bank AG in respect of deferred riskpremium	5	(30,258,470)	(19,110,745)
Tax paid	5	(3,384,987)	(5,300,000)
Net cash outflow from operating activities		(637,242,747)	(82,679,297)

The prior year comparatives have been restated to exclude the line “Payments to lessors classified as interest under IFRS 16 €19,837”. This amount is included in the payment to lessors for right of use assets in the section cash outflows from financing activities in the comparatives in these financial statements.

GRENKE FINANCE PLC

31

CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2024 (continued)

		2024	2023
CASH OUTFLOWS FROM INVESTING ACTIVITIES	Note	€	€
Payments for the acquisition of property, plant and equipment	19	(53,172)	(7,176)
Cash outflow from investing activities		(53,172)	(7,176)
CASH INLFOWS FROM FINANCING ACTIVITIES
Proceeds from financial liabilities	41	2,531,449,267	1,755,026,745
Repayment of financial liabilities	41	(2,202,426,403)	(1,614,644,527)
Proceeds from amounts owed to GRENKE AG Bank	41	735,010,198	607,258,253
Repayment of amounts owed to GRENKE AG Bank	41	(452,871,836)	(450,438,722)
Payment to lessors for right of use assets	41	(49,378)	(194,230)
Dividend paid	40	-	(110,000,000)
Cash inflow from financing activities		611,111,848	187,007,519
Cash and cash equivalents at the beginning of the year	30	143,284,978	38,969,272
Bank overdraft at the beginning of the period	41	-	(5,281)
Foreign exchange translation adjustment		152	59
Cash and cash equivalents at the end of the period	30	117,100,755	143,284,978
Change in cash and cash equivalents during the period		(26,184,071)	104,321,046
Net cash outflow from operating activities		(637,242,747)	(82,679,297)
Cash outflow from investing activities		(53,172)	(7,176)
Cash inflow from financing activities		611,111,848	187,007,519
Total cash (outflow)/inflow		(26,184,071)	104,321,046

The prior year comparative figure “Payment to lessors for the right of use assets” has been restated from €174,393 to €194,230 in the Cash inflow from financing activities to include €19,837 which was classified in the net cash inflow from operating activities as “Payments to lessors classified as interest under IFRS 16” in the prior year financial statements.

GRENKE FINANCE PLC

32

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

1. GENERAL INFORMATION, STATEMENT OF COMPLIANCE AND GOING CONCERN ASSUMPTION

GRENKE Finance PLC is incorporated and domiciled in the Republic of Ireland. Grenke Finance is a public limited company.

The Company issues debt securities listed on the main market of the Luxembourg Stock Exchange.

The Company financial statements were prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (FRS 101) and in accordance with the Companies Act 2014.

The Group consolidated financial statements were prepared in accordance with IFRS Accounting Standards as adopted by EU ('IFRS') and in accordance with the Companies Act 2014.

In these financial statements, the Company has applied the exemptions available under FRS 101 in respect of the following disclosures:

No statement of cash flows for the Company has been included

The requirements of IFRS 7 Financial Instruments: Disclosures have not been followed by the Company when the equivalent disclosures are included in these financial statements in respect of the Group.

The accounting policies applied in the preparation of the Group and Company financial statements for the year ended 31 December 2024 are set out below in note 4 and have been applied consistently by all of the Group’s subsidiaries and have been consistently applied to all years presented, unless otherwise stated.

IFRS, as adopted, by the EU and applied by the Group and the FRS 101 Reduced Disclosure Framework in the preparation of these financial statements are those that were effective for the accounting period ending 31 December 2024.

The Group and Company’s management has made an assessment of the Group and Company’s ability to continue as a going concern and is satisfied that the Group and Company have the resources to continue for the foreseeable future. The Group and Company has recognised a net loss after tax of €1,509,601 for the year ended 31 December 2024 and, as

at that date, the total assets exceed total liabilities by €123,455,122.

The Directors are not aware of any material uncertainties which may cast significant doubt upon the Group and Company’s ability to continue as a going concern, and the Directors have a reasonable expectation that the Group and Company will continue in operational existence for the foreseeable future. For these reasons, they continue to adopt the going concern basis in preparing the annual financial statements.

2. GRENKE AG GROUP

The Group and Company is wholly owned by GRENKE AG, a Company incorporated in Germany. References to the GRENKE AG Group in the Directors’ Report, financial statements and notes to the financial statements refers to the group of companies consisting of GRENKE AG and all of the companies it controls. References to the GRENKE AG Group financial

GRENKE FINANCE PLC

33

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

2. GRENKE AG GROUP (Continued)

statements refer to the consolidated financial statements of the GRENKE AG group. References to the Group and Company’s parent refer to GRENKE AG. Details of the GRENKE

AG Group are included in the GRENKE AG Group financial statements, the 2024 financial statements are expected to be publicly available at www.GRENKE.de on 13 March 2025.

3. CHANGES IN ACCOUNTING POLICIES

(a) Accounting standards implemented in 2024

The following amendments to standards whose application was mandatory as of fiscal year 2024 had no or only an immaterial effect on the Group and Company financial statements:

Amendments to IAS 1 ‘Presentation of Financial Statements’ on the classification of liabilities as current or non-current and classification of non-current liabilities with an ancillary condition

Amendments to IFRS 16 ‘Leases’ on the recognition of lease liabilities from sale and leaseback transactions

Amendments to IAS 7 ‘Statement of Cash Flows’ and IFRS 7 ‘Financial Instruments: Disclosures’ on supplier financing arrangements

Amendments to IAS 1 ‘Presentation of Financial Statements’

The amendments to IAS 1 on the classification of liabilities as current or non-current were published in January 2020. The amendments to IAS 1 clarify that the classification of liabilities as current or non-current is based on the entity's existing rights at the reporting date. In October 2022, the IASB published amendments to IAS 1 on the classification of non-current liabilities with ancillary conditions. The purpose of the amendment to IAS 1 is to clarify that ancillary conditions that must be met before or on the reporting date can have an impact on classification as current or non-current. However, ancillary conditions that only have to be met after the balance sheet date have no effect on classification as current or non-current.

Amendments to IFRS 16 ‘Leases’ on the recognition of lease liabilities from sale and leaseback transactions

The amendments to IFRS 16 serve to clarify the subsequent measurement of a lease liability in the case of a sale and leaseback transaction. In accordance with the amendments to IFRS 16, the lease liability must be measured in such a way that no gain or loss is realised on subsequent measurement if this relates to the retained right of use.

Amendments to IAS 7 ‘Statement of Cash Flows’ and IFRS 7 ‘Financial Instruments: Disclosures’ on supplier financing arrangements

The amendments relate to additional disclosures in the notes in connection with supplier financing agreements, which include reverse factoring agreements in particular. The amendments supplement the requirements already contained in IFRS and require companies to disclose terms and conditions, balance sheet items and carrying amounts at the beginning and end of the reporting period, ranges of payment terms and concentrations of risk with regard to supplier financing agreements.

GRENKE FINANCE PLC

34

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

3. CHANGES IN ACCOUNTING POLICIES (Continued)

(b) Accounting standards and interpretations already published – not yet implemented

The IASB has published further amended standards or interpretations which are set out below, the application of which will only become mandatory at a later date. Several of these standards have already been endorsed by the EU. Voluntary early application is expressly permitted by these standards. The Group and Company does not make use of this option. These standards will be implemented in the consolidated financial statements at the time of mandatory

application.

The effects on the Group and Company consolidated financial statements are being examined. With the exception of IFRS 18, the amendments to standards set out above or interpretations which are set out below are not expected to have a material impact on the reporting in the Group and Company consolidated financial statements.

The IASB published IFRS 18 ‘Presentation and Disclosure in Financial Statements’ on 9 April 2024 and it is expected to have an impact on the reporting in the Group and Company consolidated financial statements. The new standard is intended to provide investors with more transparent and comparable information on the financial performance of companies in order to create a better basis for decision-making. The new standard IFRS

Accounting standard or interpretation	Description	Publication by IASB	Start of Application
IAS 21	Amendments to IAS 21 "The Effects of Changes in Foreign Exchange Rates" (lack of exchangeability)	15.08.2023	01.01.2025
IFRS 18	Presentation and disclosures in the financial statements	09.04.2024	01.01.2027
IFRS 19	Subsidiaries without public accountability: Disclosures	09.05.2024	01.01.2027
IFRS 7, IFRS 9	Amendments to IFRS 9 ‘Financial Instruments’ and IFRS 7 ‘Financial Instruments: Disclosures’ on the classification and measurement of financial instruments	30.05.2024	01.01.2026
IFRS 1, IFRS 7, IFRS 9, IFRS 10, IAS 7	Annual amendment to IFRS	18.07.2024	01.01.2026
IFRS 7, IFRS 9	FRS 7, IFRS 9 Contracts Relating to Nature-Dependent Electricity (amendments to IFRS 9 and IFRS 7)	18.12.2024	01.01.2026

GRENKE FINANCE PLC

35

18 replaces the previous standard IAS 1 ‘Presentation of Financial Statements’ and contains requirements for the presentation and disclosure of information in financial statements.

The main changes resulting from the introduction of IFRS 18 are summarised below. With

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

3. CHANGES IN ACCOUNTING POLICIES (Continued)

(b) Accounting standards and interpretations already published – not yet implemented (Continued)

regard to the income statement, three new categories (operating, investing and financing) with corresponding allocation rules have been introduced. IFRS 18 also requires the presentation of certain totals and subtotals in the income statement. In addition, the notes must in future contain information on management-defined, publicly communicated performance measures (MPMs), including a reconciliation to the nearest comparable IFRS subtotals. Additional principles for the aggregation and disaggregation of items are also introduced. Limited amendments also relate to IAS 7 ‘Statement of Cash Flows’, for example by abolishing the previous allocation options for dividends and interest received and paid. IFRS 18 also leads to selective changes in other IFRSs, such as IAS 33 ‘Earnings per Share’.

The amendments are to be applied for financial years beginning on or after 1 January 2027. For companies that prepare their financial statements in accordance with the IFRS applicable in the EU, the regulations will apply after adoption into European law. Adoption by the EU is still pending, the Group and Company, is currently reviewing the expected impact of the requirements on the consolidated financial statements.

4. ACCOUNTING POLICIES

(a) Basis of preparation

The Group financial statements have been prepared in accordance with IFRS as adopted by the EU and the Company financial statement in accordance with FRS 101 under the historical cost convention, except where assets and liabilities are stated at fair value in accordance with relevant accounting policies. The figures have been rounded to the nearest Euro. The material accounting policies applied in the preparation of these financial statements are set out below in paragraphs 4 (b) to 4 (i).

The preparation of the Group and Company financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities

at 31 December 2024 and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management’s best estimate of the amount,

event or actions, actual results ultimately may differ from those estimates, as outlined in note 4 (j) & (k).

The loss attributable to equity shareholders disclosed in the financial statements of the Company was €1.5m (2023: Profit €46m). In accordance with Section 304 of the Companies Act 2014, GRENKE Finance PLC (the ‘Company’) is availing of the exemption from presenting its individual Statement of Profit or Loss, which forms part of the approved Financial Statements, to the Annual General Meeting and from filing it with the Registrar of Companies.

GRENKE FINANCE PLC

36

Basis of consolidation

The Group Financial Statements comprise the Financial Statements of the Company

undertaking and five structured entities, FCT “GK”-Compartment “G2” (FCT GK 2), FCT “GK”-Compartment “G4” (FCT GK 4), FCT “GK”-Compartment “G5” (FCT GK 5) and Elektra Purchase No. 25 Designated Activity Company.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(a) Basis of preparation (Continued)

The basis for consolidating the four entities is set out in note 4 (j).

(b) Leases

The Company and Group as lessor

Leases are defined as agreements in which the lessor transfers the right to the lessee to use an identifiable asset for an agreed time period in exchange for the payment of consideration for an agreed time period.

Whether an agreement can be considered as a lease or containing a lease, depends on the economic substance of the agreement at the beginning of the agreement. For the lessor, leases are to be classified as either operating leases or finance leases.

FINANCE LEASES

Under a finance lease, all of the significant risks and rewards of legal ownership are transferred from the lessor to the lessee.

Finance leases are initially recognised in the statement of financial position as per the date they are available for use (upon the issue of the lessee’s letter of acceptance) as lease

receivables at an amount equal to the net investment, which represents the sum of outstanding lease payments and non-guaranteed residual values of the underlying assets, discounted at

the interest rate underlying the lease. Lease payments as per the date of the lease object’s availability for use are divided into interest payments and principal payments in such a manner

that they reflect a periodic rate of return for the receivable. Initial direct costs incurred in connection with the conclusion of the contract, e.g. agents and reseller commissions, are taken into consideration when calculating the net investment value.

(c) Foreign currency

The financial statements are prepared in Euro (‘€’). The functional currency of the Company is the Euro (‘€’) the currency of the primary economic environment that all five entities in the Group operate in. The presentational currency in the financial statements is Euro (‘€’).

GRENKE FINANCE PLC

37

Transactions in a currency that differs from the functional currency are first translated into the functional currency at the prevailing spot rate on the day of the transaction. Monetary assets and liabilities denominated in a foreign currency are translated into the functional currency

using the closing rate on each reporting date. The translation differences that result are recognised through Profit or Loss. If the monetary asset or liability denominated in a foreign currency is hedged and the conditions of cash flow hedge accounting are met translation differences that result are then recycled through other comprehensive income.

(d) Measurement of fair values

The Group and Company measures derivative financial instruments at their fair value through the statement of profit or loss and where cash flow hedge accounting is adopted through other

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(d) Measurement of fair values (Continued)

comprehensive income. The Group and Company measure subordinated loans, provided to Coral Purchasing (Ireland) 2 DAC, Opusalpha Purchaser II Limited and Kebnekaise Funding Limited, which provide credit enhancement to the senior investors in the Grenke AG SPVs at

fair value through the statement of profit or loss. The fair value of financial instruments measured at amortised cost are presented in note 42.

The Group and Company uses observable market data, as far as possible, for determining the fair value of an asset or a liability. The fair values are assigned to different levels in the fair value hierarchy based on the input parameters used in the valuation methods:

Level 1: Quoted (unadjusted) prices in active markets for identical assets or liabilities;

Level 2: Measurement procedures in which all input factors having a significant effect on the recognition of fair value are directly or indirectly observable; and

Level 3: Measurement procedures which use input factors that have a significant effect on the fair value recognised and are not based on observable market data.

If the input factors used to determine the fair value of an asset or a liability may be assigned to different levels in the fair value hierarchy, then the measurement at fair value is completely

assigned to that level in the fair value hierarchy, which corresponds to the lowest input factor that is material for the overall measurement.

The Group and Company recognises reclassifications between the different levels of the fair value hierarchy at the end of the reporting period in which the change has occurred. In the reporting year, there were no reclassifications between the three levels of the measurement hierarchy.

(e) Financial Instruments

Categories of financial instruments

Financial instruments within the scope of IFRS 9 “Financial Instruments” are divided into the following classes:

FINANCIAL ASSETS

GRENKE FINANCE PLC

38

Finance lease receivables are recognised in accordance with IFRS 16 (see Note 4 (b)) Finance lease receivables, however, are subject to the provisions of IFRS 9 for derecognition and impairment.

Measured at amortised cost

Cash and cash equivalents, reserve accounts, amounts due from group undertakings, amounts due from franchisees, subordinated loans where the underlying lease

receivables are Group and Company lease receivables, credit support accounts, trade and other receivables and amounts due from subsidiaries.

At fair value through profit or loss

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(e) Financial Instruments (Continued)

Categories of financial instruments (Conitnued)

FINANCIAL ASSETS (Continued)

Derivative financial instruments measured at fair value without hedging relationship.

Subordinated loans, provided to Coral Purchasing (Ireland) 2 DAC, Opusalpha Purchaser II Limited and Kebnekaise Funding Limited, which provide credit enhancement to the senior investors in the Grenke AG SPVs. (subordinated loans to Grenke AG SPVs)

At fair value through other comprehensive income

Derivative financial instruments measured at fair value designated under cash flow hedging relationship, to the extent of the effective portion in the change in fair value.

FINANCIAL LIABILITIES

Measured at amortised cost

Debt securities in issue, amounts owed to GRENKE AG Group undertakings, asset based liabilities, bank loans, accruals and deferred income.

At fair value through profit or loss

Derivative financial instruments measured at fair value without hedging relationship.

At fair value through other comprehensive income

Derivative financial instruments measured at fair value designated under cash flow hedging relationship, to the extent of the effective portion in the change in fair value.

GRENKE FINANCE PLC

39

Measurement of financial instruments

FINANCIAL ASSETS

IFRS 9 provides for three types of subsequent measurement of financial assets:

Measurement at amortised cost (AC)

Measurement at fair value through OCI (FVOCI)

Measurement at fair value through P&L (FVPL)

Financial assets are allocated to the measurement categories upon initial recognition. Reclassifications are only permissible in the event of a change in the business model that results in a significant impact on the business processes. Where appropriate, reclassifications

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(e) Financial Instruments (Continued)

Measurement of financial instruments (Conitnued)

FINANCIAL ASSETS (Continued)

are made prospectively as per the first day of the first reporting period following the change in the business model. No reclassifications took place during the reporting periods.

Financial assets at amortised cost

Debt instruments are accounted for at amortised cost when the contractually agreed payment characteristics consist solely of principal and interest payments ("SPPI criterion") on the

outstanding principal and are held within the scope of a business model whose objective is to hold financial assets in order to collect the contractual cash flows of the financial asset.

The initial measurement in the measurement category is at fair value plus any additional and individually allocable transaction costs which, in the case of financial assets, increase the fair value. This, however, excludes trade receivables with no significant financing components, which are measured at their transaction price. After their initial recognition, financial assets in the category "financial assets at amortised cost" are measured at amortised cost using the

effective interest method less any impairment. Amortised cost includes all discounts and premiums paid upon acquisition and includes all fees that are an integral part of the effective

interest rate, including transaction costs. Impairment is tested based on the expected credit loss model under IFRS 9, which stipulates the recognition of impairment through profit or loss

based on expected future credit losses. Please refer to impairment of financial assets in this note. Financial assets measured at amortised cost are recognised as per the settlement date.

The item cash and cash equivalents and reserve accounts in the consolidated and company statements of financial position comprises cash on hand and balances at banks and central banks with a maturity of less than three months. Bank overdrafts are deducted from cash and cash equivalents in the statement of cash flows.

Financial assets at fair value through profit or loss (FVPL)

GRENKE FINANCE PLC

40

The measurement at fair value with changes recognised in profit or loss is compulsory if either the financial instrument has not been allocated to a portfolio of the other aforementioned business models (AC or FVOCI) or if its cash flows do not meet the SPPI criterion.

The subsequent measurement at amortised cost is not possible for derivatives since they do not regularly meet the SPPI criterion. Derivatives are always to be measured at fair value

through profit or loss provided they are not in a hedging relationship (hedge accounting). The Group and Company does not hold any financial assets at fair value through profit or loss as per the reporting date except for non subsidiary subordinated loans to Grenke AG SPVs and derivatives. Derivative financial instruments held by the Group and Company that are not in a hedging relationship are solely used to hedge currency risk. Changes in the fair value of these derivatives are recorded under "Net (loss)/gain on financial instruments at fair value through profit or loss”. Changes in the fair value of subordinated loans to Grenke AG SPVs are recorded as “Fair value adjustment for subordinated loans” on the Statement of profit or loss.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(e) Financial Instruments (Continued)

Measurement of financial instruments (Continued)

FINANCIAL LIABILITIES

Financial liabilities at amortised cost

Financial liabilities are initially recognised at fair value, net of transaction costs. In subsequent periods, they are recognised at amortised cost. The deducted transaction costs and any debt discounts are amortised over the lease term in profit or loss using the effective interest method.

Refinancing liabilities, which result from the sale of the lease receivables to the respective refinancing party but where the lease receivables remain as an asset because the Group and Company has retained substantially all of the risks and rewards of the asset ownership and also retains control of the transferred asset, are recognised at the present value of the payments yet to be made to the refinancing party. The originally agreed interest rate is used

as the discount rate for fixed interest loans. Upon repayment, regular payments are split into an interest portion and a principal component. The interest portion is recognised as an expense from interest on refinancing.

Financial liabilities are measured at amortised cost using the effective interest method under IFRS 9, except when they are financial liabilities measured at fair value.

Interest expense on financial liabilities are recognised using the effective interest rate method.

GRENKE FINANCE PLC

41

Financial liabilities at fair value

The Group and Company did not hold any financial liabilities at fair value through profit or loss as per the reporting date except for derivatives. Derivative Financial Instruments held by the Group and Company are solely used to hedge interest rate and currency risk. Changes in the fair value of derivatives are recorded under “Net (loss)/gain on financial instruments at fair value through profit or loss” or if hedge accounting has been applied to the derivative financial instrument the effective part of the change in fair value will be recorded under other comprehensive income.

DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING PRACTICES

In order to manage interest rate and foreign currency risks the Group and Company employs derivative financial instruments (principally interest rate swaps, cross-currency swaps and forward foreign exchange contracts). Derivative financial instruments are recognised initially at fair value on the date on which a derivative contract is entered into and are subsequently

remeasured at fair value. The carrying value of derivatives is fair value based on discounted future cash flows and adjusted for counterparty risk. Future floating rate cash flows are estimated based on future interest rates (from observable yield curves at the end of the

reporting period). Fixed and floating rate cash flows are discounted at future interest rates and translated at period-end foreign exchange rates. Forward foreign exchange contracts are used to hedge the spot price risk on currency exposures. The forward price elements of the forward exchange contract is included in a cost of hedging reserve in other comprehensive income if

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(e) Financial Instruments (Continued)

Measurement of financial instruments (Continued)

DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING PRACTICES (Continued)

the forward exchange contract meets the criteria for hedge accounting and is amortized to profit and loss over the life of the forward exchange contract.

At the inception of a derivative transaction, the Group and Company documents the relationship between the hedged item and the hedging instrument together with its risk management objective and the strategy underlying the proposed transaction. The Group and Company also documents its assessment, both at the inception of the hedging relationship and subsequently on an ongoing basis, of the effectiveness of the hedging instrument in offsetting movements in

the cash flows of the hedged items. Where derivatives do not fulfil the criteria for hedge accounting, changes in fair values are reported in the Statement of profit or loss and Statement of financial position.

GRENKE FINANCE PLC

42

The Group and Company uses cash flow hedges in its treasury activities. For the purposes of hedge accounting, hedges are classified as cash flow hedges (which hedge exposure to fluctuations in future cash flows derived from a particular risk associated with a recognised asset or liability, or a highly probable forecast transaction that could affect profit or loss). Where a derivative financial instrument is designated as a hedge of the variability in cash flows of a

recognised asset or liability or a highly probable forecast transaction that could affect profit or loss, the effective part of any gain or loss on the derivative financial instrument is recognised as other comprehensive income, net of the income tax effect, with the ineffective portion being reported in the Statement of profit or loss in the line “Net (loss)/gain on financial instruments at

fair value through profit or loss”. The associated gains or losses that had previously been recognised as other comprehensive income are transferred to the Statement of profit or loss contemporaneously with the materialisation of the hedged transaction. Any gain or loss arising

in respect of changes in the time value of the derivative financial instrument is excluded from the measurement of hedge effectiveness and is recognised immediately in the Statement of profit or loss.

Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated or exercised, or no longer qualifies for hedge accounting. If a hedged transaction is no longer

anticipated to occur, the net cumulative gain or loss previously recognised as other comprehensive income is transferred to the Statement of profit or loss in the period.

IMPAIRMENT OF FINANCIAL ASSETS

At each year end date, the Group and Company determines the impairment on financial assets based on a model of expected credit losses in accordance with the requirements of IFRS 9.

The grouping of performing and non-performing lease receivables is based on processing categories see note 4 (k) Determination of impairment of lease receivables and amounts due

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(e) Financial Instruments (Continued)

Measurement of financial instruments (Continued)

IMPAIRMENT OF FINANCIAL ASSETS (Continued)

from related parties. Determination is based on the expectations prevailing at that time. The performing and non-performing lease receivables are not grouped for the purpose of measuring expected credit losses on a collective basis.

GRENKE FINANCE PLC

43

The impairment allowances under IFRS 9 are applied to amounts due from Grenke AG Group undertakings measured at amortised costs, amounts due from Grenke AG Group franchisees measured at amortised cost, trade debtors and finance lease receivables under IFRS 16 "Leases".

The impairment allowances under IFRS 9 are not applied to cash and cash equivalents because any allowances required would be immaterial.

Stage assignment

The standard provides for a determination of expected credit losses based on a three-step approach. Under the general approach, the loss from expected loss events during the next year (12M ECL) is recognised as a risk provision at the next reporting period end date (Stage 1). If there has been a significant deterioration in the credit risk since the first-time recognition but no credit impairment, the risk provision is recognised at the Stage of the expected credit losses over the entire remaining contractual life (Lifetime Expected Loss – LT ECL) (Stage 2). If there is credit impairment, the risk provisioning must also be set in the amount of the losses expected over the remainder of the entire contract period on the basis of the estimated, expected future cash flows of the asset (LT ECL) (Stage 3). The financial assets remain at

Stage 2 or 3 as long as the conditions for these Stages are met; otherwise they will be reassigned to an appropriate lower Stage.

Financial assets are generally recognised in Stage 1 upon initial recognition. In addition, Stage 1 includes all transactions that have a low credit default risk. Low credit default risk exists in cases where the external credit rating is in the range of investment grade.

In addition to the general approach (three-stage model), IFRS 9 provides for a simplified procedure for trade receivables and contract assets as well as for lease receivables falling

within the scope of IFRS 16. Under the simplified procedure, it is not necessary to track the change in credit risk. Instead, expected losses are to be recognised as a risk provision in the amount of the expected losses over the entire term (LT ECL) – both upon initial recognition and at each subsequent reporting date. An option exists to apply this simplified procedure to those trade receivables and contract assets that contain a material financing component, as well as for lease receivables. The Group and Company uses the simplified procedure for trade receivables. The exercise of the option was waived for determining risk provisions for lease receivables. Therefore, the general approach and classification of lease receivables in three stages applies. The financial assets remain at Stage 1 as long as the conditions for this Stage are met, otherwise they will be reassigned to an appropriate higher Stage.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(e) Financial Instruments (Continued)

Measurement of financial instruments (Continued)

IMPAIRMENT OF FINANCIAL ASSETS (Continued)

GRENKE FINANCE PLC

44

Stage assignment (Continued)

For Stage 1 and Stage 2 financial assets, the Group and Company calculates interest income using the effective interest method on the gross carrying amount (i.e. without deduction of expected credit losses).

Significant increase in credit risk and credit impairment

Determining a significant increase in credit risk is necessary to establish the timing of the transition between Stage 1 and Stage 2 as defined above. Defining credit impairment is relevant to the timing of the transition to Stage 3. The Group and Company assesses a

significant increase in credit risk since initial recognition and defines credit impairment on the basis of appropriate and comprehensible information. The information used is adapted to the circumstances of the respective portfolio and is explained below:

Lease receivables: The Group and Company expects a significant deterioration in the credit quality of lease receivables when contractually agreed payments are more than 30 days past due or when the estimated probability of loss has deteriorated in a comparable manner as was observed in past 30-day-overdue cases. This is the case when the estimated probability of loss for the remaining term has doubled compared to the estimated probability of loss for the same period based on the information available when the contract

was signed. Creditworthiness is impaired if contractually agreed payments are more than 90 days overdue, the contract has been terminated by the Company, or at least one of the two conditions was not met at the measurement date but was met within the three proceeding months. The Group and Company usually terminates a lease contract as soon as the second lease instalment lapses. Once a contract has been terminated due to the lessee not paying lease instalments when due the full amount payable in the event of

default under the terms of the contract is recognised as a non performing lease receivable. The net present value of the lease receivable at the date of termination is excluded from performing finance lease receivables.

A lease is written off when there is no reasonable expectation of recovering the non performing lease receivable for example due to exhausting all possible court proceedings, notification from a liquidator that a liquidation has been concluded and there is no further funds available for distribution or all reasonable efforts have failed to locate a delinquent lessee.

GRENKE FINANCE PLC

45

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(e) Financial Instruments (Continued)

Measurement of financial instruments (Continued)

IMPAIRMENT OF FINANCIAL ASSETS (Continued)

Significant increase in credit risk and credit impairment (Continued)

Amounts due from related parties The Group and Company expects a significant deterioration in the credit quality of non-current receivables from group undertakings and franchisees when a payment is overdue for more than 30 days or after the second reminder. Receivables that are overdue for more than 90 days are said to be credit-impaired.

Trade debtors: The Group and Company applies this simplified impairment model to these receivables. As a result, outstanding receivables are included in Stage 3 as long as they are classified as credit-impaired. Credit is impaired when receivables are more than 180 days past due or there is an objective indication of credit impairment. An objective indication, for example, could be the default or delinquency of a debtor, indications of bankruptcy and other features that indicate a reduction in the expected payments of the debtor.

Cash and cash equivalents and credit support accounts: The assessment of whether credit risk has significantly deteriorated and the determination of credit impairment for these receivables is based on credit ratings, which are determined by observing published external credit ratings.

DERECOGNITION OF FINANCIAL ASSETS

A financial asset (or a part of a financial asset or a part of a group of similar financial assets) is derecognised along with the related impairment when the requirements have been met. The Group and Company derecognises financial assets when its contractual rights to cash flows have expired or the risks and rewards associated with the contractual rights are transferred to a buyer. When the Group and Company transfers its contractual rights to receive the cash

flows of an asset, but the rewards and risks are not transferred to the buyer, then the receivable is not derecognised and a financial liability is recognised in the same amount.

GRENKE FINANCE PLC

46

Writing off an asset also represents a derecognition. This is usually the case at the Group and Company when, after reasonable assessment, it can no longer be assumed that the contractual cash flows of a financial asset can be realised in whole or in part. This is the case,

for example, if legal proceedings are terminated or, in the case of lease transactions, the asset is disposed.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(e) Financial Instruments (Continued)

Measurement of financial instruments (Continued)

DERECOGNITION OF FINANCIAL LIABILITIES

Financial liabilities are derecognised if the contractual obligation underlying the liability is discharged or definitively expires. If an existing financial liability is exchanged for another financial liability of the same lender with substantially different terms, or if the terms of an

existing liability are changed substantially, then such an exchange or change is treated as a derecognition of the original liability and recognition of a new liability. A criterion that leads to a

material change in the contract is when the discounted present value of the cash flows of the new contract conditions deviates by at least 10% from the discounted present value of the

remaining cash flows of the original debt instrument. The difference between the corresponding carrying amounts is recognised in profit or loss.

(f) Leased assets for resale

The value of leased assets for resale are recognised in the statement of financial position on the basis of historical selling prices for similar assets. Appropriate measurement is ensured through the use of maturity bands. The sale proceeds calculated using this approach are netted

against the expenses that are still incurred until the sale in order to correspond to the net realisable value.

(g) Grenke Bank AG Deferred Risk Premiums

The Group and Company borrows money from GRENKE Bank AG, details of which are provided in note 33 of the financial statements. GRENKE Bank AG forgives part of the amount owing if the underlying lease securitising that borrowing is terminated due to non payment of lease instalments. GRENKE Bank AG charges a risk premium for this arrangement on the date the loans are provided. The risk premium fees are amortised through profit or loss over the life of the lease instalments which securitise the borrowing and are classified in interest expense and other charges as amortisation of GRENKE Bank AG risk premium. The amount of the loan forgiven is offset against the deferred risk premiums amortised to profit and loss.

GRENKE FINANCE PLC

47

(h) Taxes

Tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The calculation of the amount is based on the tax rates and tax laws enacted or substantively enacted at the reporting date.

Deferred tax liabilities and deferred tax assets

Deferred tax is recognised using the liability method on temporary differences arising at the reporting date between the tax bases of assets and liabilities and their carrying amounts in the Company and Consolidated Financial Statements. Deferred tax assets are recognised for unused tax loss carryforwards to the extent that it is probable that future taxable profit will be available against which the unused tax loss carryforwards can be utilised. Deferred tax assets

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(h) Taxes (Continued)

Deferred tax liabilities and deferred tax assets (Continued)

and liabilities are recognised using the tax rates expected to apply in the period in which the temporary differences are expected to reverse. The tax rates used are those that are enacted or substantively enacted by the year end date.

Where items are accounted for outside of the statement of profit or loss, the related deferred tax is recognised either in other comprehensive income or directly in equity as appropriate. The measurement of deferred tax liabilities and deferred tax assets must take into account the tax consequences of the manner in which an entity expects to recover the carrying amount of its assets or settle its liabilities at the year end date. Deferred tax assets and liabilities are not discounted.

Value-Added Tax (VAT)

Revenue, expenses, assets and liabilities are recognised net of VAT, with the following exceptions:

a.The VAT incurred on a purchase of assets or services is not recoverable from the tax authorities, in which case the VAT is recognised as part of the acquisition costs of the asset or as part of the expense item; and

b.Stated receivables and liabilities include VAT.

(i) Revenue recognition

The Group and Company acts as a principal and recognises income when it fulfils a performance obligation by transferring a promised good or service to a customer. The transfer is deemed to have occurred when the customer has obtained control over this asset.

Lease Income

GRENKE FINANCE PLC

48

The Lease income recognised as revenue in the statement of profit or loss is made up of the following:

Lease interest income and secondary lease income recognised using the effective interest rate method.

Income from document fees, interim lease rental fees, advance payments made by lessees in respect of leases which have been invoiced in the current year.

Commissions payable by the Group and Company to agents and dealers invoiced in the current year.

Capitalised initial direct costs consist of commissions payable by the Group and Company to agents and dealers less document fees and advance payments made by

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(i) Revenue recognition (Continued)

lessees which can be directly attributed to a lease which are excluded from lease income and the net amount is added to the cost of the equipment acquired to lease.

Losses on termination of leases are made up of the amounts invoiced to lessees in respect of leases which have been terminated together with any amounts invoiced for

the lease object less the net present value of the lease on the date of termination and the net present value off the lease object sold.

Income from protecting lease equipment

Revenue from service and protection business are reported under income from protecting lease equipment. The lease assets must be included under the Group and Company insurance

policy of the Group unless the lessees themselves insure the lease asset. For this service, the lessee will be charged fees on an annual basis that are recognised as revenue. The lessee’s payments are made in advance at the beginning of the respective calendar year or, in the case of newly concluded contracts, at the beginning of the lease term during the year. Deferred income from contracts with customers in the service and protection business is presented as contractual liabilities under the item deferred income from protecting lease equipment. When recognising the revenue from service and protection business, the

performance obligation over a certain period of time can be said to be fulfilled, meaning the income must also be realised over this period. Income is realised by means of output-based methods, under which revenue is determined on a straight-line basis over time.

(j) Accounting judgements

In applying the accounting policies, the senior management has made the following judgements that substantially influence the recognition and amounts in the financial statements. This does not include those decisions involving estimates.

Consolidation of structured companies

GRENKE FINANCE PLC

49

For refinancing, the Company uses various structured entities in the form of asset-backed commercial paper programmes ("ABCP programmes").

A significant activity over the term of these programmes is the selection of the receivables to be transferred. Furthermore, the initial selection of the receivables for each structured entity is defined according to specific selection criteria. In the event of a default of receivables, the settlement is managed by the Company. The rewards and risks of the receivables of the structured entity remain with the Company.

At FCT GK2, FCT GK4 and FCT GK5, 50% of the shares of the funds are held by the Company and are included in consolidation. The shares that are directly held by the Company are an indication for the inclusion in the scope of consolidation, but not the decisive criteria since all assumptions contained in IFRS 10 “Consolidated Financial Statements” must be met for

consolidation. FCT GK2, FCT GK4 and FCT GK5 are included in the scope of consolidation since all control factors are met, and the Company controls the entities by having the power to direct the relevant activities, having the right of variable returns, and also having the power to affect the amount of the returns.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(j) Accounting judgements (Continued)

Consolidation of structured companies (Continued)

Similarly with Elektra Purchase No. 25 Designated Activity Company, the Company has no participating interests but the Company controls the entity by having the power to direct the

relevant activities, having the right of variable returns, and also having the power to affect the amount of the returns.

Leases-The Group and Company as Lessor

All leases are accounted for as finance leases because:

Based on an analysis of its contractual conditions, the Group and Company, as lessor, has concluded that during the basic lease term all relevant opportunities and risks related to the ownership of the lease assets are transferred to the lessee in almost all leases.

Over 99% of the lease contracts have total lease instalments due at the commencement of the initial lease term, which cannot be terminated without payment of all outstanding lease instalments, which are greater than the cost of the equipment which has been acquired by the Group and Company for that specific lease.

Determining the duration of a lease is a discretionary matter. The term of a lease comprises a non-terminable basic term during which a lessee is entitled to use an underlying asset. Extension periods are also included when the exercise of the underlying extension option by

the lessee can be deemed sufficiently certain.

GRENKE FINANCE PLC

50

The contract terms of the Group and Company do not provide early termination options for the lessee until the end of the agreed basic term, under which the lessee could unilaterally terminate the contract without the Group and Company’s consent. Early termination is only allowed by mutual agreement with a corresponding indemnification of damages made to the

Group and Company. Both the lessee and the Group and Company are entitled to terminate the contract at the end of the agreed basic term.

It is possible, however, that after the end of the set basic term, by not giving notice at the end of the basic term, the lessee may obtain an extension of the period of use of the lease object, if the Group and Company does not give notice of termination by the end of the basic term itself, e.g. in case of an attractive disposal opportunity. Experience has shown, however, that at the beginning of the contract it is impossible to judge with sufficient certainty whether the lease will continue to exist beyond the basic term. The initial term of the lease therefore

corresponds to the basic term of the agreement. In assessing the existence of sufficient certainty, the Group and Company takes into account all of the facts and circumstances that give the lessee an economic incentive to exercise or not exercise the extension option.

Leases-The Group and Company as Lessee

The Group and Company in its role as lessee makes assessments affecting the amount of lease liabilities and rights-of-use recognised in the statement of financial position under IFRS

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(j) Accounting judgements (Continued)

Leases-The Group and Company as Lessee (Continued)

16. Such assessments concern, for example, the determination of appropriate incremental borrowing rates for discounting the expected cash flows and the determination of the lease term.

The determination of the lease's term is subject to discretion, as the property agreements concluded regularly include extension and termination options for flexibility purposes that are to be included in the determination of the lease's term when there is sufficient certainty that

these options will be exercised. In assessing the existence of sufficient certainty, the Group and Company takes into account all of the facts and circumstances that give it an economic incentive in its role as lessee to exercise or not exercise the extension or termination option.

Corporation tax receivable

The Group and Company statement of financial position includes a corporation tax asset of €3.9m details of which are disclosed in note 29. This relates to a tax deduction which has been claimed in respect of licence fees and guarantee fees of €31m which were charged by Grenke

GRENKE FINANCE PLC

51

AG to the Group and Company in 2017 and relate to the periods 2010 to 2016. These charges arose as a consequence of a tax audit of Grenke AG carried out by the German tax authorities. A correlative relief claim was submitted to the Irish Tax Authorities on 8 February 2021 for a

tax deduction of the full amount charged of €31m and a corporation tax asset of €3.9m which is equivalent to 12.5% of the expense was recognised in the 2017 accounts. This tax asset continues to be recognised. The claim was made within the required time limits and has been acknowledged by the Irish tax authorities. The Irish Tax Authority issued a letter on 5 March 2024 with 22 questions regarding the claim. The Group and Company tax advisors answered all of these questions on 28 June 2024 and at the date of signing these accounts is awaiting a response from the Irish Tax Authority to that letter. The Group and Company has received professional advice with regard to the correlative relief claim. The Group and Company have considered this advice and are aware that there is uncertainty as to whether the Irish Tax authorities will confirm that the full amount is tax deductible. However, the Group and Company have made the judgement that in estimating the value of the corporation tax asset, it is correct to assume that the Irish tax authorities will accept that the full amount of €31m is tax deductible, and therefore it is correct to accrue a corporation tax asset of €3.9m.

(k) Use of assumptions and estimates

In preparing the Group and Company financial statements, assumptions and estimates have been made that have affected the recognition and carrying amounts of assets, liabilities, income, expenses, and contingent liabilities.

Assumptions and estimates generally relate to the Group and Company uniform determination of the useful lives of assets; the measurement of provisions; the impairment of finance lease receivables and financial instruments; the recognition of unguaranteed residual values of lease

assets. In individual cases, the actual amounts may differ from the assumptions and estimates. Any changes will be recognised, when better information is available in the statement of

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(k) Use of assumptions and estimates (Continued)

financial position and in the statement of profit or loss or if required by accounting standards in the statement of profit or loss over the appropriate period of time.

The key uncertainties in relation to estimates and the associated disclosure requirements are in the following areas:

Determination of impairment of finance lease receivables

Performing lease receivables are generally to be recognised in accordance with the provisions of IFRS 16. Additionally, appropriate risk provisions as defined by IFRS 9 must be taken into account. The Group and Company uses the Expected Credit Loss (ECL) model to determine the expected loss and thus the impairment loss provisions. The ECL is calculated as a multiplication of the three parameters: Probability of Default (PD), Loss Given Default (LGD) and Exposure at Default (EaD). This standard formula for determining the expected loss takes into account the probability of failure (PD), the maximum possible loss on failure (EaD), and ultimately the actual loss (LGD). Depending on whether the twelve-month period or the total

GRENKE FINANCE PLC

52

residual term is considered, different models are used to estimate the parameters taking into account the period under consideration.

In the following, we describe the individual parameters.

PD: The default probability model is determined using a recognised mathematical-statistical method. The model weighs input variables and, based on this weighting, calculates an estimated probability of default. Variables from three areas are included in our PD models. These are customer-specific variables, contract-specific variables and variables that reflect the observed payment behaviour of the lessee. Macroeconomic variables are included in our models in the form of country-specific

parameters that are based on the respective country risk. Countries for which there is insufficient data to calculate a separate PD are summarised. In addition, various

scenarios for the development of macroeconomic variables are considered. The aim here is to obtain forward-looking information on gross domestic product and the unemployment rate in the individual countries. The probabilities of the possible developments of macroeconomic variables are taken from a survey of professional forecasters published by the ECB. The final impact on the PD, and thus the risk provisioning within the individual scenarios, is determined using internal data. The final weighting of the PD derived from the internal data within the individual macroeconomic scenarios with their probability of occurrence according to the ECB expert survey results in the final PD that is decisive for risk provisioning.

EaD: We calculate the EaD for lease receivables as the sum of the outstanding instalments and the IFRS residual value at the date of the loss. Since the time at which the loss event occurs is unknown at the reporting date, an estimate is made about the distribution of loss events during the observation period based on past experience and considered in our EaD model. Discounting takes place at the internal interest rate of the lease contract concerned.

LGD: The LGD models reflect the past loss experience and determine how high the

level of losses will be as a quota of estimated EaD. For countries with insufficient data

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(k) Use of assumptions and estimates (Continued)

Determination of impairment of finance lease receivables (Continued)

for the determination of LGDs, average values of the GRENKE Group are used.

The ECL model, including the input parameters and sub models, is validated at least once a year and updated if necessary.

Terminated lease contracts or contracts in arrears (so called “non-performing lease receivables”) are also to be measured in accordance with the provisions of IFRS 16, taking the appropriate impairment pursuant to IFRS 9 into consideration. The amount of impairment is determined using percentages and processing categories. Percentages are

GRENKE FINANCE PLC

53

calculated using statistical methods, which include both payments as well as expected payments. They are reviewed once a year for validity. Processing statuses are grouped together in processing categories that are set up with respect to risk.

Expected credit allowance on non performing finance lease receivables

The following table lists the processing categories in the leasing business:

The processing categories 2 to 7 are allocated to Stage 3 (see note 4 (f) for an explanation of Stage 3) because the contracts have been terminated due to defaults in payment and are thus

credit-impaired. The impairment rates range between 20% and 100%.

The processing categories 0 and 1 are lease receivables which are classified as performing lease receivables and are allocated to stage 3 if the contractually lease payments are more than 90 days overdue at the reporting date or if the contractual lease payments were more than 90 days overdue in the proceeding three months or if the contract was terminated but reinstated due to arrears being repaid in the proceeding three months .

Determination of loss allowances on unsecured amounts due from related parties

The company since incorporation in 2003 has had approximately €1m of losses on loans provided to related parties.

The Group and Company makes enquiries about the underlying lease receivables and factoring receivables in the related party it has provided funds to with the objective of

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(k) Use of assumptions and estimates (Continued)

Determination of loss allowances on unsecured amounts due related parties (Continued)

determining whether it is likely that the related party will have difficulty in repaying amounts due. There is €2.1bn (2023: €1.8bn) of the amount due from related parties being used by the related parties to finance a highly diversified portfolio of low value finance leases to a highly diversified customer base. The balance of €45m (2023: €56m) of the amounts due from related

parties is used to finance the purchase of low value invoices in Germany, Switzerland, Poland, United Kingdom and Ireland.

GRENKE FINANCE PLC

54

GRENKE AG, the Company’s ultimate parent has also provided a guarantee in respect of €1.3bn (2023: €1.1bn) of the amounts due from related parties at 31 December 2024. There is a clause in each framework agreement in respect of the provision of loans to each related party which states that there is a guarantee from Grenke AG in respect of the loans provided. Grenke AG provides a guarantee in respect of each loan which specifically refers to that framework agreement.

The Company and Group believe it is unlikely that there will be future expected losses on secured amounts due from related parties due to the underlying assets in the related parties.

The Group and Company also believe it is unlikely that there will be future expected losses on loans to related parties due to the guarantee from its parent GRENKE AG.

The Group and Company also believe it is unlikely that there will be a default in any amounts due because apart from a loss of approximately €1m there has not been a default since the Company was incorporated in 2003.

The Group and Company may have difficulty in repaying amounts due on Debt Securities, ABCP programs and to the Grenke bank if it was not repaid amounts due which may have an impact on the credit rating of the Grenke AG Group. The Group and Company believe that Grenke AG would provide support to a related party who was having difficulty in repaying amounts due because any default by the related party may have an impact on the credit rating of the Grenke AG Group. The Grenke AG Group have stated in their 2023 annual report, which is available at www.grenke.de, on page 330 that the primary goal of the Grenke AG Group’s capital management is to ensure that its credit rating is maintained in order to support its operations and safeguard liquidity. The Group and Company believe there will only be a default on amounts due from related parties if the Grenke AG Group as a whole was to have financial difficulties and therefore they believe they should look at what the markets view is of the Grenke AG Group defaulting on its financial obligations. The Company and Group have therefore concluded that the most appropriate measurement for future ECL is to use the GRENKE AG Group 1 Year risk of default as determined by Bloomberg because the Board of Directors of the Company believe there will only be a default on amounts due from related parties if the GRENKE AG Group is in default in respect of its financing obligations.

The Grenke AG Group 1 Year risk of default as determined by Bloomberg at 31 December 2024 was 1.28% (2023: 0.12%). If the risk of default decreased to 0.28% the expected credit

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(k) Use of assumptions and estimates (Continued)

Determination of loss allowances on unsecured amounts due related parties (Continued)

loss would decline by €20m and if the risk of default increased by 1% to 2.28% the expected credit loss would increase by €20m.

Consideration of calculated residual values at the end of the contract term in determining the present value of lease receivables

GRENKE FINANCE PLC

55

Non-guaranteed (calculated) residual values are taken into account when determining the present value of the lease receivables in accordance with the definition in IFRS 16. The residual values calculated at the end of the contract period are determined according to the term of the respective lease contract and include the expected subsequent-business and the expected proceeds from disposals at the end of the term, based on historical experience. The average residual value was 8.7% of the cost of the lease object for all leases which were in the primary period at 31 December 2024.

The calculated residual values are determined on the basis of statistical analyses. In the event of a decrease in the estimated residual value (made up of the estimated sales proceeds from the lease object and the estimated subsequent lease rentals after the expiry of the primary

lease period), the net present value of the existing lease receivables is reduced to take into account the reduced residual value. In the event of an increase in the estimated residual value no adjustment is made to the net present value of the existing lease receivables.

The non-guaranteed residual values are reviewed on a regular basis.

Consideration of calculated residual values when the contract is in the secondary lease period

The Group and Company estimates the net present value of leases which are in the secondary period and the net present value of leases in respect of which secondary lease payments will be received because the lessee has not given notice to terminate the lease under the terms of the lease separately from the net present value of leases which are in the primary period. The estimate of the net present value takes into account all secondary lease rentals which the lessee is legally bound to pay under the terms of the lease contract and adjusts the residual value of the lease object to reflect that the lease object will be utilised for an increased period of time before it is available for sale.

Fair value of financial instruments

The fair values of financial assets and financial liabilities, not derived from information on active markets, are determined using a valuation model. The input parameters of these models are based on observable market data, if possible. If this is not possible, determining the fair values

requires a certain degree of judgement. This judgement relates to input parameters such as liquidity risk, credit risk, and volatility. Changes regarding the assumptions of these input parameters may have an effect on the recognised fair value of financial instruments. If observable prices and parameters are available, they are used to determine the fair value that in turn avoids the large-scale use of estimates.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

4. ACCOUNTING POLICIES (Continued)

(k) Use of assumptions and estimates (Continued)

Recognition and measurement of actual tax refund claims and tax liabilities

Due to the complexity of tax legislation, taxpayers and local tax authorities may have varying constructions and interpretations of the tax laws. This can lead to subsequent tax payments for prior fiscal years. Tax provisions are recognised in the event that the amounts stated in the tax

GRENKE FINANCE PLC

56

declarations are not likely to be realised (uncertain tax items). The amount is determined from the best estimate of the anticipated tax payment. Tax receivables from uncertain tax items are

recognised when it is probable and adequately ensured that they can be realised. The assumptions are based on the management’s assessment of the amount of uncertain tax items.

5. RECONCILIATION OF CERTAIN AMOUNTS IN THE CONSOLIDATED CASH FLOW TO THE NOTES TO THE ACCOUNTS

The information below cross references amounts in the consolidated cash flow to the related information in the notes to the accounts.

	Year	Note	€
Interest and other charges on debt securities in issue	2024	12	126,248,551
Interest on bank loans	2024	12	4,952,662
Interest expense on amounts owed to
Grenke AG Group undertakings	2024	12	9,782,641
Refinancing interest and expenses	2024	12	17,808,100
Interest payable to Grenke Bank	2024	12	42,171,104
Amortisation of Grenke Bank AG guarantee	2024	12	3,293,270
Bank overdraft interest	2024	12	862,863
Interest on lease liabilities	2024	12	76,975
Interest expense add back in Cash Flow			205,196,166

	Year	Note
Expected credit loss allowance on other
financial assets	2024	11	24,058,485
Expected credit loss allowance trade debtors	2024	16	1,890,798

Expected credit loss reversal on financial assets

25,949,283

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

5. RECONCILIATION OF CERTAIN AMOUNTS IN THE CONSOLIDATED CASH FLOW TO THE NOTES TO THE ACCOUNTS (Continued)

	Year	Note	€
Deferred income on financial guarantee

GRENKE FINANCE PLC

57

due within one year	2023	36	(170)
Tax on health insurance premiums			2,483
Other non-cash income/expenses			2,313

	Year	Note	€
Subordinated loans at fair value non current	2023	21	22,345,538
Subordinated loans at amortised cost non current	2023	21	30,898,265
Subordinated loans at fair value current	2023	21	15,225,092
Subordinated loans at amortised cost current	2023	21	15,059,364
Subordinated loans at fair value non current	2024	21	(16,107,440)
Subordinated loans at amortised cost non current	2024	21	(27,969,847)
Subordinated loans at fair value current	2024	21	(25,209,552)
Subordinated loans at amortised cost current	2024	21	(20,429,880)
Fair value adjustment for subordinated loans	2024	14	(903,356)
Increase in subordinated loans and reserve accounts			(7,091,816)

	Year	Note	€
Leased assets held for resale	2023	24	943,461
Leased assets held for resale	2024	24	(965,962)
Increase in leased assets held for resale			(22,501)

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

5. RECONCILIATION OF CERTAIN AMOUNTS IN THE CONSOLIDATED CASH FLOW TO THE

NOTES TO THE ACCOUNTS (Continued)

Year

Note

€

GRENKE FINANCE PLC

58

Finance lease receivables due after one year

2023

25

1,444,380,395

Finance lease receivables due within one year

2023

25

705,035,509

Finance lease receivables past due

not credit impaired

2023

25

25,188,627

Non performing finance lease receivables

2023

25

206,139,512

Finance lease receivables due after one year

2024

25

(1,707,082,435)

Finance lease receivables due within one year

2024

25

(767,201,806)

Finance lease receivables past due

not credit impaired

2024

25

(16,556,323)

Non performing finance lease receivables

2024

25

(257,499,032)

Currency translation differences

on lease receivables

(363,634)

Write off of lease receivables

2024

25

(29,002,427)

Increase in lease receivables

(396,961,614)

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

5. RECONCILIATION OF CERTAIN AMOUNTS IN THE CONSOLIDATED CASH FLOW TO THE

NOTES TO THE ACCOUNTS (Continued)

Year

Note

€

GRENKE FINANCE PLC

59

Secured amounts due from GRENKE AG Group

undertakings due in greater than one year

2023

22

34,106,780

Unsecured amounts due from GRENKE AG Group

undertakings due in greater than one year

2023

22

656,148,585

Secured amounts due from GRENKE AG Group

undertakings due in less than one year

2023

22

119,729,300

Unsecured amounts due from GRENKE AG Group

undertakings due in less than one year

2023

22

909,930,308

Unsecured amounts due from GRENKE AG Group

franchisees

2023

22

105,459,767

Secured amounts due from GRENKE AG Group

undertakings due in greater than one year

2024

22

(62,668,231)

Unsecured amounts due from GRENKE AG Group

undertakings due in greater than one year

2024

22

(799,777,892)

Secured amounts due from GRENKE AG Group

undertakings due in less than one year

2024

22

(131,785,526)

Unsecured amounts due from GRENKE AG Group

undertakings due in less than one year

2024

22

(965,749,030)

Unsecured amounts due from GRENKE AG Group

franchisees

2024

22

(130,489,960)

Amount due on current account

2023

33

(101,561,690)

Amount due on cash pool accounts

2023

33

(158,391,401)

Amount due on current account

2024

33

100,309,273

Amount due on cash pool accounts

2024

33

66,349,547

Currency translation differences on amounts

due from Grenke AG Group undertakings

2024

(1,697,097)

Change in amounts due/to related parties

(360,087,267)

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

5. RECONCILIATION OF CERTAIN AMOUNTS IN THE CONSOLIDATED CASH FLOW TO THE NOTES TO THE ACCOUNTS (Continued)

Year

Note

€

GRENKE FINANCE PLC

60

Overseas withholding tax	2023	26	4,884,925
Overseas withholding tax	2024	26	(4,299,560)
Deferred financing costs non current asset	2024	26	(223,436)
Deferred financing costs non current asset	2023	26	826,391
Overseas VAT current asset	2023	26	99,608,928
Irish VAT current asset	2023	26	45,132
Deferred financing costs current asset	2023	26	594,696
Other assets current asset	2023	26	338,325
Trade debtors current asset	2023	26	2,644,225
Credit support accounts current asset	2023	26	10,050,000
Overseas VAT current asset	2024	26	(81,479,593)
Deferred financing costs current asset	2024	26	(594,696)
Other assets current asset	2024	26	(338,610)
Trade debtors current asset	2024	26	(5,166,570)
Credit support accounts current asset	2024	26	(8,363,000)
Write off of dealers bad debts	2024		(108,785)
Decrease in trade and other receivables			18,418,372
	Year	Note	€
Net liability arising on
derivative financial instruments
not designated as hedges	2023	27	(1,421,902)
Net liability arising on
derivative financial instruments
not designated as hedges	2024	27	3,891,559
Amortisation costs of hedging	2024	14	(458,034)
Change in the fair vlaue of derivative financial
instruments not designated as hedges			2,011,623

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

5. RECONCILIATION OF CERTAIN AMOUNTS IN THE CONSOLIDATED CASH FLOW TO THE NOTES TO THE ACCOUNTS (Continued)

Year

Note

€

GRENKE FINANCE PLC

61

Other accrued expenses	2023	37	(2,132,458)
Trade creditors	2023	37	(9,957,851)
Social welfare tax payable	2023	37	(51,805)
Other accrued expenses	2024	37	3,746,442
Trade creditors	2024	37	11,288,682
Social welfare tax payable	2024	37	56,030
Irish VAT	2024	37	1,238
Decrease in other current liabilities			2,950,278
	Year	Note	€
Interest and other charges on debt securities in issue	2024	12	(126,248,551)
Interest on bank loans	2024	12	(4,952,662)
Interest expense on amounts owed to
Grenke AG Group undertakings	2024	12	(9,782,641)
Refinancing interest and expenses	2024	12	(17,808,100)
Interest paid to Grenke Bank AG	2024	12	(42,171,104)
Bank overdraft interest	2024	12	(862,863)
Accrued interest	2023	37	(35,365,756)
Accrued interest	2024	37	69,172,440
Amortisation of Debt Securities excluded	2024		14,205,608
Amortisation of Deferred costs excluded	2024		167,661
Interest paid			(153,645,968)

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

GRENKE FINANCE PLC

62

5. RECONCILIATION OF CERTAIN AMOUNTS IN THE CONSOLIDATED CASH FLOW TO THE NOTES TO THE ACCOUNTS (Continued)

	Year	Note	€
Amortisation of Grenke Bank AG risk premium	2024	12	(3,293,270)
Deferred risk premium paid to Grenke Bank AG
non current asset	2023	26	36,659,973
Deferred risk premium paid to Grenke Bank AG
current asset	2023	26	22,080,262
Deferred risk premium paid to Grenke Bank AG
non current asset	2024	26	(22,470,286)
Deferred risk premium paid to Grenke Bank AG
current asset	2024	26	(63,235,149)
GRENKE Bank AG deferred risk premium paid			(30,258,470)

	Year	Note	€
Prior year tax adjustment	2024	18	589,341
Corporation tax payable within one year	2023	29	(763,328)
Tax on health insurance premiums	2024		(2,483)
Corporation tax receivable within one year	2024	29	(3,208,517)
Tax paid			(3,384,987)

6. SEGMENTAL REPORTING

The chief operating decision makers (CODM) are the board of directors of the Group and Company.

The Group and Company has two distinct businesses, leasing and treasury. The leasing business is small ticket business to business leasing of principally office equipment, which is carried out in twelve European Countries. The treasury business provides long term and short term loans to GRENKE AG Group companies and franchisees who utilise the funds to carry out small ticket business to business leasing of principally office equipment and small ticket factoring of debt. The figures below provide details of the revenue generated for the year to 31 December 2024 and the operating assets of the two businesses at year end. The operating liabilities of the business have not been disclosed separately because the Directors do not separate the liabilities of the Group and Company between leasing and treasury when reviewing the business or making decisions with regard to the business. No company accounted for revenue greater than 10% of Group and Company revenue in 2024. The Group

and Company for segmental reporting purposes looks at the Leasing and related income business based on the eleven countries it currently carries out leasing in and Italy where it

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

GRENKE FINANCE PLC

63

6. SEGMENTAL REPORTING (Continued)

carried out leasing in the past. The Group and Company for segmental reporting purposes looks at the treasury business based on what countries it lends money to.

GRENKE FINANCE PLC

62

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

6. SEGMENTAL REPORTING (Continued)

Lease income

Total operating income

Other income

Expected credit loss allowance on finance lease receivables

Expected credit loss allownace on other financial assets

Interest expense and other charges

Foreign exchange (loss)/gain

Other operating expenses

Profit before tax

Tax

Profit after Tax

2024

€ 000

France

104,536

-

(34,041)

-

(66,089)

-

(7,896)

(3,490)

1,078

(2,412)

Spain

19,189

193

(15,088)

(58)

(13,488)

-

(4,274)

(13,526)

4,178

(9,348)

Netherlands

14,073

27

(4,346)

-

(9,657)

-

(908)

(811)

250

(561)

Finland

12,207

-

(2,889)

1

(9,761)

-

(872)

(1,314)

406

(908)

Portugal

10,344

-

(2,310)

-

(8,949)

-

(1,095)

(2,010)

621

(1,389)

Romania

7,352

-

(1,280)

(37)

(4,388)

-

(351)

1,296

(400)

896

Slovenia

1,827

-

(174)

-

(1,415)

-

(106)

132

(41)

91

GRENKE FINANCE PLC

65

Luxembourg	1,373	-	(1,394)	(4)	(988)	-	(463)	(1,476)	456	(1,020)
Malta	486	-	419	(3)	(558)	-	(97)	247	(76)	171
Hungary	469	-	91	(2)	(262)	(364)	(55)	(123)	38	(85)
Italy	401	-	-	-	-	-	-	401	(124)	277
Germany	(576)	-	217	-	(115)	-	(7)	(481)	148	(333)
Lease income	171,681	220	(60,795)	(103)	(115,670)	(364)	(16,124)	(21,155)	6,534	(14,621)

GRENKE FINANCE PLC

63

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

6. SEGMENTAL REPORTING (Continued)

Income from protecting lease equipment

Total operating income

Other operating expenses

Profit before tax

Tax

Profit after Tax

2024

€ 000

France

15,335

(5,681)

9,654

(2,982)

6,672

Spain

5,141

(1,933)

3,208

(991)

2,217

Portugal

4,002

(1,555)

2,447

(756)

1,691

Netherlands

3,757

(1,364)

2,393

(739)

1,654

Finland

2,831

(1,111)

1,720

(531)

1,189

Romania

2,288

(855)

1,433

(443)

990

Slovenia

870

(330)

540

(167)

373

Luxembourg

560

(199)

361

(111)

250

Hungary

165

(58)

107

(33)

74

Malta

164

(52)

112

(34)

78

Germany

-

(1)

-

(1)

Income from protecting lease equipment

35,113

(13,139)

21,974

(6,787)

15,187

GRENKE FINANCE PLC

64

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

6. SEGMENTAL REPORTING (Continued)

Treasury income and other income

	Total operating income	Other income	Expected credit loss allowance on finance lease receivables	Expected credit loss allownace on other financial assets	Interest expense and other charges	Foreign exchange (loss)/gain	Net gain/(loss) on financial instruments at fair value through profit or loss	Other operating expenses	Profit before tax	Tax	Profit after Tax
	2024	2024	2024	2024	2024	2024	2024	2024	2024	2024	2024
	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000
Germany	42,070	-	-	(6,844)	(32,971)	-	(1,412)	(877)	(34)	10	(24)
Italy	29,558	-	-	(6,698)	(26,220)	-	-	(727)	(4,087)	1,262	(2,825)
Australia	8,377	-	-	(1,467)	(5,182)	1,112	(2,089)	(976)	(225)	69	(156)
Sweden	7,314	-	-	(1,459)	(5,460)	(3,682)	3,242	(145)	(190)	59	(131)
Canada	6,281	-	-	(1,027)	(3,764)	(465)	(257)	(100)	668	(206)	462
Denmark	6,023	-	-	(1,568)	(5,373)	(63)	(1,012)	(143)	(2,136)	660	(1,476)
United Kingdom	5,282	-	-	(696)	(2,154)	1,760	(2,664)	(57)	1,471	(454)	1,017
Spain	5,163	-	-	(1,241)	(4,572)	-	-	(122)	(772)	238	(534)

GRENKE FINANCE PLC

68

United Arab Emirates	3,744	-	-	(336)	(2,162)	3,073	(3,743)	(58)	518	(160)	358
Chile	3,674	-	-	(516)	(1,800)	(4,579)	3,366	(415)	(270)	83	(187)
Poland	3,585	-	-	(519)	(1,893)	434	(1,786)	(409)	(588)	182	(406)
Belgium	2,856	-	-	(517)	(2,243)	-	-	(60)	36	(11)	25
Hungary	993	-	-	(193)	(599)	(87)	(122)	(16)	(24)	7	(17)
Czech Republic	861	38	(50)	3	(511)	(106)	27	(14)	248	(76)	172
Finland	757	-	-	(210)	(476)	-	-	(13)	58	(18)	40

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

6. SEGMENTAL REPORTING (Continued)

Treasury income and other income (Continued)

	Total operating income	Other income	Expected credit loss allowance on finance lease receivables	Expected credit loss allownace on other financial assets	Interest expense and other charges	Foreign exchange (loss)/gain	Net gain/(loss) on financial instruments at fair value through profit or loss	Other operating expenses	Profit before tax	Tax	Profit after Tax
	2024	2024	2024	2024	2024	2024	2024	2024	2024	2024	2024
	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000
USA	649	-	-	(130)	(379)	5	(141)	(10)	(6)	2	(4)
Ireland	638	-	-	(300)	(789)	-	-	(21)	(472)	146	(326)

GRENKE FINANCE PLC

69

Slovakia	608	-	-	(94)	(469)	-	-	(12)	33	(10)	23
Switzerland	228	-	-	(52)	(297)	(57)	1,267	(8)	1,081	(334)	747
Malta	201	-	-	(32)	(120)	-	-	(3)	46	(14)	32
Romania	128	-	-	15	(104)	231	(2)	(3)	265	(82)	183
Netherlands	126	-	-	(71)	(233)	-	-	(6)	(184)	57	(127)
France	106	-	-	-	-	-	-	-	106	(33)	73
Singapore	101	-	-	(5)	(87)	15	128	(7)	145	(45)	100
Portugal	25	-	-	-	-	-	-	-	25	(8)	17
Luxembourg	3	-	-	-	(4)	-	-	-	(1)	-	(1)
Total treasury income	129,351	38	(50)	(23,957)	(97,862)	(2,409)	(5,198)	(4,202)	(4,289)	1,324	(2,965)
Other Income	-	1,981	(25)	-	-	-	-	(674)	1,282	(396)	886
Total	336,145	2,239	(60,870)	(24,060)	(213,532)	(2,773)	(5,198)	(34,139)	(2,188)	675	(1,513)

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

6. SEGMENTAL REPORTING (Continued)

Lease income (continued)

GRENKE FINANCE PLC

70

	Total operating income	Other income	Expected credit loss allowance on finance lease receivables	Expected credit loss allownace on other financial assets	Interest expense and other charges	Foreign exchange (loss)/gain	Net gain/(loss) on financial instruments at fair value through profit or loss	Other operating expenses	Profit before tax	Tax	Profit after Tax
	2023	2023	2023	2023	2023	2023	2023	2023	2023	2023	2023
	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000
France	85,163	-	(29,487)	-	(38,280)	-	-	(9,559)	7,837	(945)	6,892
Spain	15,113	-	(13,552)	-	(7,703)	-	-	(4,301)	(10,443)	1,259	(9,184)
Netherlands	11,943	-	(3,246)	-	(5,194)	-	-	(1,151)	2,352	(283)	2,068
Portugal	7,181	-	(2,861)	36	(4,970)	-	-	(1,084)	(1,698)	205	(1,493)
Romania	7,400	-	(1,672)	-	(4,896)	-	-	(1,375)	(543)	65	(477)
Finland	5,361	-	(1,414)	16	(2,121)	-	-	(435)	1,407	(170)	1,238
Slovenia	1,454	-	(203)	1	(844)	-	-	(164)	244	(29)	214
Hungary	942	-	(51)	(0)	(291)	641	(1,019)	(98)	123	(15)	108
Malta	716	-	(760)	1	(538)	-	-	(230)	(812)	98	(714)
Luxembourg	473	-	157	0	(284)	-	-	(176)	170	(21)	150

GRENKE FINANCE PLC

71

Germany	374	206	-	-	(647)	-	-	(125)	(193)	23	(170)
Italy	(199)	-	304	-	(124)	-	-	(25)	(44)	5	(39)
Lease income	135,921	206	(52,785)	54	(65,892)	641	(1,019)	(18,723)	(1,600)	192	(1,407)

GRENKE FINANCE PLC

67

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

6. SEGMENTAL REPORTING (Continued)

Income from protecting lease equipment

Total operating income

Other operating expenses

Profit before tax

Tax

Profit after Tax

2023

€ 000

France

22,187

(8,098)

14,089

(1,698)

12,391

Spain

4,522

(1,654)

2,868

(346)

2,522

Portugal

3,465

(1,383)

2,081

(251)

1,830

Netherlands

3,169

(1,163)

2,006

(242)

1,764

Finland

2,372

(921)

1,450

(175)

1,275

Romania

2,037

(729)

1,308

(158)

1,150

Slovenia

748

(275)

473

(57)

416

Luxembourg

463

(168)

294

(35)

259

Hungary

212

(80)

132

(16)

116

Malta

119

(45)

74

(9)

66

Germany

1

(5)

(4)

1

(4)

Income from protecting lease equipment

39,295

(14,521)

24,771

(2,986)

21,785

GRENKE FINANCE PLC

68

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

6. SEGMENTAL REPORTING (Continued)

Treasury income and other income

	Total operating income	Other income	Expected credit loss allowance on finance lease receivables	Expected credit loss allownace on other financial assets	Interest expense and other charges	Foreign exchange (loss)/gain	Net gain/(loss) on financial instruments at fair value through profit or loss	Other operating expenses	Profit before tax	Tax	Profit after Tax
	2023	2023	2023	2023	2023	2023	2023	2023	2023	2023	2023
	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000
Italy	24,397	-	-	2,372	(17,527)	-	-	(763)	8,480	(1,022)	7,458
Germany	25,791	3	-	1,726	(18,882)	-	(468)	(822)	7,349	(886)	6,463
Australia	6,059	-	-	243	(2,573)	(4,240)	3,408	(718)	2,180	(263)	1,917
Canada	5,235	-	-	207	(2,014)	(3,938)	2,802	(88)	2,205	(266)	1,939
Sweden	5,050	-	-	345	(3,102)	(4,256)	3,381	(135)	1,283	(155)	1,128
Denmark	3,624	-	-	272	(2,666)	(21)	60	(116)	1,152	(139)	1,013
Spain	3,371	-	-	275	(2,528)	-	-	(110)	1,007	(121)	886
Poland	2,869	-	-	78	(929)	1,184	(2,556)	(327)	319	(38)	280

GRENKE FINANCE PLC

74

Belgium	2,027	-	-	483	(2,454)	-	-	(107)	(51)	6	(45)
United Arab Emirates	2,539	-	-	(426)	(1,109)	(1,482)	811	(48)	286	(34)	251
United Kingdom	2,465	-	-	105	(966)	399	(829)	(42)	1,132	(136)	996
Chile	2,864	-	-	10	(651)	81	(1,339)	(315)	650	(78)	571
Singapore	1,594	-	-	111	(401)	(477)	116	(97)	845	(102)	743
Czech Republic	782	32	(126)	13	(312)	(305)	(182)	(14)	(111)	13	(97)

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

6. SEGMENTAL REPORTING (Continued)

Treasury income and other income (continued)

	Total operating income	Other income	Expected credit loss allowance on finance lease receivables	Expected credit loss allownace on other financial assets	Interest expense and other charges	Foreign exchange (loss)/gain	Net gain/(loss) on financial instruments at fair value through profit or loss	Other operating expenses	Profit before tax	Tax	Profit after Tax
	2023	2023	2023	2023	2023	2023	2023	2023	2023	2023	2023
	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000
Switzerland	590	-	-	49	(298)	611	(275)	(13)	664	(80)	584
Ireland	597	-	-	19	(233)	-	-	(10)	372	(45)	327

GRENKE FINANCE PLC

75

Slovakia	450	-	-	(30)	(280)	-	-	(12)	127	(15)	112
Hungary	500	-	-	(11)	(143)	-	(151)	(6)	187	(23)	165
United States of America	326	-	-	9	(131)	(112)	48	(6)	135	(16)	119
Malta	170	-	-	6	(65)	-	-	(3)	108	(13)	95
Romania	135	-	-	8	(77)	(53)	1	(3)	10	(1)	9
Luxembourg	32	-	-	3	(13)	-	-	(1)	22	(3)	19
Netherlands	29	-	-	14	(118)	-	-	(5)	(80)	10	(70)
Finland	-	-	-	(4)	(53)	-	-	(2)	(59)	7	(52)
Total treasury income	91,496	35	(126)	5,877	(57,525)	(12,609)	4,827	(3,763)	28,212	(3,400)	24,811
Other Income	-	2,082	60	-	-	- 0	-	(671)	1,470	(177)	1,293
Total	266,712	2,323	(52,851)	5,931	(123,417)	(11,968)	3,808	(37,678)	52,853	(6,371)	46,482

GRENKE FINANCE PLC

70

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

6. SEGMENTAL REPORTING (continued)

Leasing operating assets

	2024	2023
	€	€
France	1,465,897,963	1,317,169,099
Spain	302,683,001	265,295,339
Finland	227,533,976	183,521,685
Netherlands	222,334,358	184,341,001
Portugal	198,634,635	178,228,434
Romania	107,081,343	77,718,775
Slovenia	30,446,013	29,153,279
Luxembourg	22,427,737	19,159,432
Malta	13,588,776	9,890,347
Hungary	3,698,258	7,326,185
Germany	1,875,000	2,959,696
Leasing operating assets	2,596,201,060	2,274,763,272

GRENKE FINANCE PLC

77

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

6. SEGMENTAL REPORTING (continued)

Treasury operating assets

	2024	2023
	€	€
Germany	716,968,481	671,453,177
Italy	569,072,680	535,070,354
Denmark	129,953,611	96,319,723
Sweden	122,568,463	107,349,368
Australia	122,098,946	96,125,090
Spain	103,962,243	88,589,023
Canada	85,993,602	72,504,464
United Kingdom	56,860,466	33,861,930
Dubai	51,134,535	39,927,632
France	48,423,086	45,996,996
Belgium	44,186,606	50,278,885
Poland	43,402,305	36,323,201
Chile	42,888,256	32,918,661
Ireland	23,987,877	9,218,279
Finland	16,546,825	3,484,623
Hungary	15,754,905	9,484,722
Czech	11,447,714	10,091,095
USA	10,515,640	5,445,842
Slovakia	10,355,525	9,412,588
Netherlands	5,859,869	3,947,656
Switzerland	4,764,453	7,730,340
Malta	2,663,971	2,403,906
Romania	1,805,207	2,555,602
Singapore	637,484	3,006,631
Luxembourg	-	158,379
Unallocated cash	117,100,755	143,284,978
Treasury operating assets	2,358,953,505	2,116,943,145
Non-operating assets	22,582,970	16,777,789
Total assets	4,977,737,535	4,408,484,206

GRENKE FINANCE PLC

78

Property, plant & equipment, corporation tax, derivative financial instruments and deferred tax which are disclosed have been classified as non-operating assets for segmental reporting purposes.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

7. LEASE INCOME

	2024	2023
	€	€
Lease interest income	193,707,595	154,867,140
Capitalised initial direct costs	76,121,247	71,680,832
Secondary lease income	63,797,437	60,510,889
Other lease income	10,205,917	11,347,065
Loss on termination of leases	(46,936,105)	(50,061,232)
Commissions payable to agents and dealers	(125,197,537)	(112,405,835)
Asset storage	(16,500)	(18,000)
	171,682,054	135,920,859

Lease interest income and secondary lease income is the only part of lease income which is calculated using the effective interest rate method.

The loss on termination of leases is calculated by taking any proceeds from the termination of leases and deducting the net present value of the lease receivable at the date of termination.

8. INCOME FROM PROTECTING LEASE EQUIPMENT

	2024	2023
	€	€
Income from lessees for protecting lease equipment	36,419,743	40,642,352
Cost of equipment replaced	(1,311,457)	(1,323,836)
Adjustments to insurance claims made to insurer	5,064	(23,958)
	35,113,350	39,294,558

Some lessees pay fees to the Group and Company to avail of insurance on the leased equipment. It should be noted that the Group and Company do not directly insure the equipment and only includes the lessees under their insurance policy, which is availed of from a third party insurer. When this fee has been paid the Group and Company, through the insurance policy, will replace damaged or stolen lease equipment without charging the lessee for this loss.

GRENKE FINANCE PLC

79

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

9. INTEREST INCOME AND SIMILAR INCOME

	2024	2023
	€	€
Interest income from GRENKE AG group loans	111,888,854	76,226,318
Interest income from subordinated loans	2,708,901	2,590,492
Interest income from franchise loans	9,955,043	8,117,791
Interest income from banks	4,797,245	4,560,586
	129,350,043	91,495,187

Interest income from GRENKE AG group companies relates to interest on loans provided to GRENKE AG group companies and interest on overnight cash provided to GRENKE AG group companies.

10. MOVEMENT IN EXPECTED CREDIT LOSS ALLOWANCE ON FINANCE LEASE

RECEIVABLES

	2024	2023
	€	€
Movement in expected credit loss allowance on:
non performing finance lease receivables (stage 3)	59,348,057	45,561,347
performing finance lease receivables (stage 1/2)	1,447,181	7,222,243
non performing finance lease receivables acquired
under guarantee (stage 3)	24,842	(59,578)
non performing finance lease receivables acquired
relating to loans to Grenke AG group companies
(stage 3)	49,928	125,675
	60,870,008	52,849,687

Details of how the expected credit loss on non performing leases and the expected credit loss allowances are calculated together with an explanation of the different Stages are provided in the accounting policy notes 4 (e) & (k).

GRENKE FINANCE PLC

80

Non performing leases are leases in processing category 2-7 which are described in note 4 (k).

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

11. MOVEMENT IN EXPECTED CREDIT LOSS ALLOWANCE ON OTHER

FINANCIAL ASSETS

	2024	2023
	€	€
Movement in expected credit loss allowance on
amounts due from related parties	24,058,485	(5,930,735)

The increase in the movement in expected credit allowance on other financial assets of €30m is due to the Grenke AG Group 1 year risk of default per Bloomberg increasing from 0.12% at 31 December 2023 to 1.28% at 31 December 2024. In the previous year it decreased from 0.483% to 0.12%. The increase in the risk of default % has resulted in a charge to the statement of profit and loss of €24m in respect of expected credit loss allowances on unsecured amounts due from related parties whereas the decrease in the risk of default % in the previous year resulted in a credit to profit and loss statement of €6m. This increase in the movement in expected credit allowance charged to the statement of profit and loss has no effect on cash.

The increase of 1.16% in the Grenke AG Group 1 year risk of default per Bloomberg is due to Bloomberg adjusting the Grenke AG Group 1 year risk of default as a consequence of the Grenke AG Group reducing its guidance to the market for Group earnings in 2024 in an ad hoc announcement to the market on 29 October 2024.

The Group and Company calculate expected credit loss allowances on amounts due from related parties by multiplying the Grenke AG Group 1 year risk of default per Bloomberg by the balances outstanding at the year end. The Company and Group have concluded that the most appropriate measurement for future ECL is to use the GRENKE AG Group 1 Year risk of default as determined by Bloomberg because the Board of Directors of the Company believe there will only be a default on amounts due from related parties if the GRENKE AG Group is in default in respect of its financing obligations.

Accounting policy note 4 (k) explain why the Group and Company uses the Grenke AG 1-Year risk of default for calculating expected credit loss allowances on amounts due from Grenke AG Group undertakings and franchisees.

GRENKE FINANCE PLC

81

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

12. INTEREST EXPENSE AND OTHER CHARGES

	2024	2023
	€	€
Interest and other charges on debt securities in issue	126,248,551	67,319,142
Interest on bank loans	4,952,662	2,650,580
Interest expense on amounts owed to Grenke AG Group undertakings	9,782,641	2,656,016
Refinancing interest and expenses	17,808,100	13,973,794
Interest payable to Grenke Bank	42,171,104	25,639,478
Amortisation of Grenke Bank AG risk premium	3,293,270	6,511,758
Guarantee fee payable to Grenke AG	6,905,945	2,784,188
Amortisation of guarantee paid to franchisees	-	5,634
Bank overdraft interest and other charges	862,863	854,165
Bank charges	1,430,002	1,004,360
Interest on lease liabilities	76,975	19,837
	213,532,113	123,418,952

Interest on other charges on debt securities in issue increased by €51m due to the average interest rate on debt securities increasing from 2.93% to 4.91% and by €8m due to the increase in the volume of debt securities in issue. The increase in the average interest rate is due to debt securities with low interest rates maturing and being replaced by debt securities with higher interest rates due to the European central bank increasing interest rates in order to counter inflationary pressures in the European economy.

Interest payable to Grenke Bank increased by €10m m due to the average interest rate on amounts payable to Grenke Bank increasing from 2.89% to 3.81% and by €6m due to the increase in the volume of amounts owed to Grenke Bank. The increase in the average interest rate is due to the European central bank increasing interest rates in order to counter inflationary pressures in the European economy.

The guarantee fee is for the provision by GRENKE AG of guarantees, personal sureties and letters of comfort in respect of the Group and Company external liabilities and in respect of amounts due from GRENKE AG Group undertakings and GRENKE AG Group franchisees.

GRENKE FINANCE PLC

82

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

13. FOREIGN EXCHANGE LOSS

	2024	2023
	€	€
Foreign exchange (loss)/gain	(9,590,293)	4,271,369
Reclassified from other comprehensive income
- forward exchange contracts	2,201,625	(7,738,003)
- cross currency swaps	4,616,851	(8,500,095)
	(2,771,817)	(11,966,729)

The net foreign exchange (loss)/gain is as a result of transactions during the year in other currencies which were translated at the rate of exchange ruling at the date of the transaction and monetary assets and liabilities in other currencies were translated to Euro at the rates of exchange ruling at the reporting date. The net foreign exchange loss after taking account of the foreign exchange gain, recycling of gains from other comprehensive income and the fair value movement on forward exchange contracts, amortisation of the cost of hedging and also the realised loss on forward exchange contracts disclosed in note 14 was €6,556,679 (2023: €7,692,458).

14. NET GAIN/(LOSS) ON FINANCIAL INSTRUMENTS

AT FAIR VALUE THROUGH PROFIT OR LOSS

	2024	2023
	€	€
Fair value adjustment for subordinated loans	(903,356)	281,178
Fair value movement on interest rate swaps
not designated in hedge relationships	(508,400)	(749,346)
Fair value movement on forward exchange
contracts not designated in hedge relationships	(1,961,258)	397,878
Amortisation of cost of hedging	458,034	(1,691,496)
Realised (loss)/gain on forward exchange contracts	(2,281,638)	5,567,889
	(5,196,618)	3,806,103

GRENKE FINANCE PLC

83

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

15. OTHER INCOME

	2024	2023
	€	€
Accounting services	1,961,793	1,812,800
Commission financial guarantee	170	3,005
Interest income from tax repaid late	220,043	205,779
Rental income	18,780	269,071
Income from security on securitised loans	37,559	32,047
	2,238,345	2,322,702

The Group and Company provides accounting services to other companies in the GRENKE AG Group and to franchise companies of the GRENKE AG Group.

16. OTHER OPERATING EXPENSES

	2024	2023
	€	€
Commissions paid to agents for
sale of lease equipment protection	12,734,933	14,221,999
Insurance	406,043	302,843
Licence fee	4,162,862	8,809,295
Fees in respect of recovering debts	7,116,895	6,273,710
Expected credit loss
allowance trade debtors (stage 3)	1,890,798	728,630
Wages and salaries	1,988,912	1,821,735
Professional fees	2,920,119	3,046,501
Overseas tax	1,568,742	1,258,894
Management charges	337,032	277,843
Non recoverable VAT	488,747	289,789
Property costs	91,275	93,622
Depreciation on right of use assets	214,181	324,571

GRENKE FINANCE PLC

84

Depreciation

19,315

81,125

Other

125,653

65,630

Information technology costs

40,862

39,795

Recruitment

27,600

23,300

Training

5,060

20,950

34,139,029

37,680,232

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

16. OTHER OPERATING EXPENSES (Continued)

The licence fee expenses relates to the provision by GRENKE AG of the use of an intangible asset in the form of a uniform business model that is based on its expertise and comprises in particular the business idea, methods for assessing risk and using the group’s uniform software

in the course of its operating business. The licence fee is also for the right to use the GRENKE brand.

The fees in respect of recovering debts relates to fees payable to debt collection agents and lawyers when they have been instructed to assist in recovering amounts due in respect of impaired leases.

Included in trade and other receivables is trade debtors of €5.2m (2023: €2.6m) in respect of amounts due from dealers. These balances are primarily due in respect of lease objects which have been sold to the dealers when a lease has been terminated. The Group and Company has made a 100% expected credit loss allowance of €4.2m (2023: €2.4m) in respect of all amounts which are overdue by 180 days.

17. PROFIT BEFORE TAXATION

2024

2023

The profit before tax is stated after charging:

€

Staff costs

1,988,912

1,821,735

Depreciation

19,315

81,125

Depreciation on right of use assets

214,181

324,571

Net foreign exchange loss on foreign currency

(6,556,679)

(7,692,458)

2024

2023

Fees payable to Grant Thornton:

€

Statutory audit

229,800

220,500

Comfort letter in respect of financial information in debt issuance programme prospectus

22,600

22,050

252,400

242,550

GRENKE FINANCE PLC

85

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

17. PROFIT BEFORE TAXATION (Continued)

	2024	2023
The staff cost comprises:	€	€
Salaries	1,614,631	1,488,839
Benefit in kind	28,337	25,082
Contributions to defined contribution plans	165,726	142,587
Social welfare costs	180,218	165,227
	1,988,912	1,821,735

There is €9,398 (2023: €11,456) payable in respect of pensions as at 31 December 2024. The Group and Company contributes to defined contribution funds on behalf of employees and Directors. These pension funds are wholly independent of the Group and Company and the Group and Company has no liability to the pension funds other than the monthly contributions it makes on behalf of employees as part of their remuneration package.

The average number of people employed by the
Group and Company during the period was as	2024	2023
follows:	Number	Number
Administration	22	19

Included in staff cost above is directors'	2024	2023
remuneration of:	€	€
Salaries	374,129	360,675
Benefit in kind	5,169	4,107
Contributions to defined contribution plans	90,980	83,036
Social welfare costs	40,901	39,314
	511,179	487,132

Three of the directors received remuneration and all of the remuneration they received is included in the disclosure above.

GRENKE FINANCE PLC

86

The key management of the Company are the three directors who receive remuneration. The payments to its directors set out above represent key management compensation.

One director is employed by the Group and Company’s parent Grenke AG and he did not receive any remuneration from the Group and Company. Part of the salary €9,000 (2023: €9,000) paid to the director by Grenke AG was allocated for his services to the Group and Company.

The Company’s subsidiaries did not have any employees during the year (2023: None).

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

18. TAXATION

	2024	2023
	€	€
Current year tax charge	-	6,419,318
Prior year tax adjustment	(589,341)	(33,164)
	(589,341)	6,386,154
Deferred tax	(85,336)	(15,567)
Taxation	(674,677)	6,370,587

Reconciliation of the expected tax charge at the standard tax rate to the actual tax charge at the effective rate

The tax assessed for the year is less than the standard rate of corporation tax in the Republic of Ireland (12.5%) (2023: 12.5%). The differences are explained below:

	2024	2023
	€	€
(Loss) /profit before tax	(2,184,278)	52,854,544
(Loss)/profit multiplied by standard rate of corporation tax in the Republic of Ireland of 12.5%	(273,035)	6,606,818
Effects of:
Adjustment to prior year corporation tax	(589,341)	(33,164)
Foreign tax adjustments	196,093	(184,858)
Other adjustments	(8,394)	(18,209)
Current year tax charge/credit	(674,677)	6,370,587

Foreign tax adjustments relate to Irish tax credits and Irish tax deductions in respect of foreign withholding tax on interest and lease payments in arriving at the Irish corporation tax charge.

GRENKE FINANCE PLC

87

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

19. PROPERTY, PLANT & EQUIPMENT CONSOLIDATED AND COMPANY

	Right of	Leasehold	Fixtures and
	use assets	improvements	fittings	Total
	€	€	€	€
Cost
At 31 December 2023	1,070,907	320,482	476,861	1,868,250
Additions	-	48,743	4,429	53,172
At 31 December 2024	1,070,907	369,225	481,290	1,921,422
Accumulated Depreciation
At 31 December 2023	35,696	312,110	473,219	821,025
Charge for the year	214,181	9,407	9,908	233,496
At 31 December 2024	249,877	321,517	483,127	1,054,521
Net book amounts
At 31 December 2024	821,030	47,708	(1,837)	866,901
At 31 December 2023	1,035,211	8,372	3,642	1,047,225

The Group and Company has only four leases. The leases are in respect of Units 209/210, Unit 310, Unit 306/307 and Unit 410/411, Q House, Furze Road, Sandyford Industrial Estate, Dublin 18. The leases on these units were terminated as permitted by the terms of the lease on 6 November 2023. The Group and Company then entered into new leases in respect of those units.

The new leases commenced on 7 November 2023. The lease term is from 7 November 2023 to 6 November 2033 with an option to break on 6 November 2028. The annual rent is €308,671 and the first year is rent-free. The addition to the right of use assets is based on the assumption that the Group and Company will exercise the option to break the lease on 6 November 2028.

GRENKE FINANCE PLC

88

The total rent payable for the period 7 November 2023 to 6 November 2028 is €1,234,682. If the Group and Company decides not to exercise the option to break the lease the rent will be adjusted to whatever the market rent is on 7 November 2028.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

19. PROPERTY, PLANT & EQUIPMENT CONSOLIDATED AND COMPANY (Continued)

	Right of	Leasehold	Fixtures and
	use assets	improvements	fittings	Total
	€	€	€	€
Cost
At 31 December 2022	1,832,734	320,482	469,685	2,622,901
Additions	1,070,907	-	7,176	1,078,083
Disposals	(1,832,734)	-	-	(1,832,734)
At 31 December 2023	1,070,907	320,482	476,861	1,868,250
Accumulated Depreciation
At 31 December 2022	1,543,859	278,273	425,931	2,248,063
Charge for the year	324,571	33,837	47,288	405,696
Disposals	(1,832,734)	-	-	(1,832,734)
At 31 December 2023	35,696	312,110	473,219	821,025
Net book amounts
At 31 December 2023	1,035,211	8,372	3,642	1,047,225
At 31 December 2022	288,875	42,209	43,754	374,838

20. INVESTMENTS IN CONTROLLED UNDERTAKINGS

	2024	2023
	€	€
Investment in equity
Investment in FCT “GK” COMPARTMENT “G2”	150	150

GRENKE FINANCE PLC

89

Investment in FCT “GK4” COMPARTMENT “G4”	150	150
Investment in FCT “GK5” COMPARTMENT “G5”	150	150
	450	450

The Company holds a 50% interest in FCT “GK”COMPARTMENT “G2”, (FCT GK 2), a 50% interest in FCT “GK”COMPARTMENT “G4”, (FCT GK 4) and a 50% interest in FCT “GK”COMPARTMENT “G5”, (FCT GK 5). The investments in FCT GK 2 of €150 (2023: €150), FCT GK 4 of €150 (2023: €150) and FCT GK 5 of €150 are shown at cost less impairment. FCT GK 2 is a French securitisation vehicle which was set up in 2012, FCT GK 4 is a French

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

20. INVESTMENTS IN CONTROLLED UNDERTAKINGS (Continued)

securitisation vehicle set up in 2019 and FCT GK 5 is a French securitisation vehicle set up in 2023. FCT GK 2 is financed through the issue of FCT notes, which are exclusively subscribed by Special Purpose Vehicle Elektra Purchase No. 25 Designated Activity Company. FCT GK 4 is financed through the issue of FCT notes, which are exclusively subscribed by Special Purpose Vehicle Opusalpha Purchaser II Limited. FCT GK 5 is financed through the issue of FCT notes, which are exclusively subscribed by Special Purpose Vehicle Coral Purchasing Ireland 2 DAC. The Company does not make a gain or a loss on the sale of the French lease receivable contracts because the leases remain on the Statement of Financial Position of the Company and the contractual cashflow payments due to FCT GK 2, FCT GK 4 and FCT GK 5 are shown as financial liabilities.

The maximum exposure to credit loss is the carrying amount of the investment held.

21. SUBORDINATED LOANS AND RESERVE ACCOUNTS CONSOLIDATED AND

COMPANY

	2024	2023
Non − Current	€	€
Unlisted:
Subordinated loans at fair value	16,107,440	22,345,538
Subordinated loans at amortised cost	27,969,847	30,898,265
Financial assets classified as non current	44,077,287	53,243,803
Current
Unlisted:
Subordinated loans at fair value	25,209,552	15,225,092
Subordinated loans at amortised cost	20,429,880	15,059,364
Financial assets classified as current	45,639,432	30,284,456
	2024	2023
Reconciliation of Financial Assets:	€	€
At beginning of year	83,528,259	71,992,397

GRENKE FINANCE PLC

90

Payment out on subordinated loans and on reserve

accounts

42,632,293

Repayment of subordinated loans and reserve

accounts

(35,540,477)

(31,377,609)

Movement in fair value

(903,356)

281,178

Closing balance

89,716,719

83,528,259

The Group and Company enters into subordinated loan agreements with special purpose vehicles (SPVs) as part of the asset backed conduit transactions that are jointly entered into

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

21. SUBORDINATED LOANS AND RESERVE ACCOUNTS CONSOLIDATED AND

COMPANY (Continued)

with the GRENKE AG Group. In order for the SPVs to obtain third party finance to acquire the lease receivables from GRENKE AG Group subsidiaries and the Company, the agreement

requires the Company to provide a subordinated loan equal to certain percentages of the sold receivables.

The subordinated loans which provide credit enhancement to the senior investors in the special purpose vehicles Coral Purchasing (Ireland) 2 DAC, Kebnekaise Funding Limited and

Opusalpha Purchaser II Limited are mandatorily measured at fair value because they fail the solely payments of principal and interest criterion which would allow the subordinated loans to be measured at amortised cost under IFRS 9. The Group and Company has provided three subordinated loans to Opusalpha Purchaser II Limited and only the loan which provides credit

enhancement to the senior investors in respect of the lease receivables bought from Grenke AG is measured at fair value. The Group and Company has provided three subordinated loans to Coral Purchasing (Ireland) 2 DAC and only the loan which provides credit enhancement to the senior investors in respect of the lease receivables bought from Grenke AG is measured at fair value.

The fair value of the subordinated loans is measured by applying Euro cost of borrowing plus the Grenke AG risk of default to the projected future cash flows from the subordinated loans.

The two subordinated loans provided to Opusalpha Purchaser II Limited which provide credit enhancement to senior investors in FCT GK 4 are measured at amortised cost. In the event of loss on these two subordinated loans there will be an equal and offsetting gain on asset based financial liabilities due to the loss resulting from the Group and Company’s failure to make the payments due in respect of its asset based financial liabilities. Details of the asset based financial liabilities are set out in note 31.

The two subordinated loans provided to Coral Purchasing (Ireland) 2 DAC which provide credit enhancement to senior investors in FCT GK 5 are measured at amortised cost. In the event of loss on these two subordinated loans there will be an equal and offsetting gain on asset based financial liabilities due to the loss resulting from the Group and Company’s failure to make the payments due in respect of its asset based financial liabilities. Details of the asset based financial liabilities are set out in note 31.

GRENKE FINANCE PLC

91

Details of the Group and Company subordinated loans to the Grenke AG SPVs which are measured at fair value on 31 December are set out below:

The Group and Company is required under the terms of the subordinated loan agreements to provide credit enhancement loans equal to a % of the net present value of the lease receivables

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

21. SUBORDINATED LOANS AND RESERVE ACCOUNTS CONSOLIDATED AND

COMPANY (Continued)

held by the SPV at a point in time each month, the collection payment date. The required % is set out in the table above under the column “% of NPV of lease receivables”. The collection payment date for the SPV Coral Purchasing (Ireland) 2 DAC is the 20th of the month, Opusalpha Purchaser II Limited is the 4th of the month and for Kebnekaise Funding Limited is the 18th of the month.

The table below sets out the nominal value of the subordinated loans to the Grenke AG SPVs measured at fair value in 2024.

Details of the Group and Company subordinated loans to the SPVs on 31 December which are measured at amortised cost are set out below:

The Group and Company is required under the terms of a loan agreements to provide two credit enhancement loans to Opusalpha Purchaser II Limited equal to a % of the net present

GRENKE FINANCE PLC

92

value of the lease receivables held by the SPV, FCT GK4 on the 4th of each month. The Group and Company is required under the terms of a loan agreements to provide two credit enhancement loans to Coral Purchasing (Ireland) 2 DAC equal to a % of the net present value of the lease receivables held by the SPV, FCT GK5 on the 15th of each month. The required % is set out in the table above under the column “% of NPV of lease receivables”.

The Group has concluded that the SPVs in whom the Company invests by way of subordinated loans, but that it does not consolidate, meet the definition of structured entities because:

-The voting rights in the SPVs are not dominant rights in deciding who exercises control due to the debt financing nature of securitisation and net assets are virtually nil; and

-Each SPVs activities are restricted by the terms of the prospectus;

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

21. SUBORDINATED LOANS AND RESERVE ACCOUNTS CONSOLIDATED AND

COMPANY (Continued)

At 31 December 2024
	Total asset value of the SPVs	Group and Company Investment in the SPVs
	€	€
Coral Purchasing (Ireland) 2 DAC	153,392,070	15,645,990

Opusalpha Purchaser II Limited	159,095,902	14,318,631
Kebnekaise Funding Ltd	139,938,751	11,195,100

The Group and Company has also provided subordinated loans of €21,079,079 to Opusalpha Purchaser II Limited in respect of FCT GK 4. The total amount owing to the investors in FCT GK 4 is shown as an asset based financial liability in the consolidated Statement of Financial Position in note 31. The amount owing to FCT GK4 investors would be reduced by any amount not recovered on the Opusalpha Purchaser II Limited subordinated loans relating to FCT GK 4 and therefore these loans have not been included in the table above because there is no exposure to credit loss on these subordinated loans. There is no exposure to credit loss on the Opusalpha Purchaser II Limited subordinated loans relating to FCT GK 4 because the FCT GK 4 asset based financial liability would be reduced by the amount of the loss on the subordinated loan and therefore the net impact on the statement of profit or loss would be zero.

The Group and Company has also provided subordinated loans of €27,775,111 to Coral Purchasing (Ireland) 2 DAC in respect of FCT GK 5. The total amount owing to the investors in FCT GK 5 is shown as an asset based financial liability in the consolidated Statement of Financial Position in note 31. The amount owing to FCT GK5 investors would be reduced by any amount not recovered on the Coral Purchasing (Ireland) 2 DAC subordinated loans relating to FCT GK 5 and therefore these loans have not been included in the table above because there is no exposure to credit loss on these subordinated loans. There is no exposure to credit loss on the Coral Purchasing (Ireland) 2 DAC subordinated loans relating to FCT GK 5 because

GRENKE FINANCE PLC

93

the FCT GK 5 asset based financial liability would be reduced by the amount of the loss on the subordinated loan and therefore the net impact on the statement of profit or loss would be zero.

The table below describes the types of structured entities that the Company does not consolidate but in which it holds an interest.

Type of structured entity	Nature and purpose	Interest held by the Group and Company
Special purpose vehicle	To manage a portfolio of assets in order to generate returns for noteholders.The vehicles are funded through raising debt finance from the Company and other investors.	Subordinated loan

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

21. SUBORDINATED LOANS AND RESERVE ACCOUNTS CONSOLIDATED AND

COMPANY (Continued)

The subordinated loans have recourse only to the returns from the assets purchased by the SPVs, in the event that the lease receivables purchased by the SPVs do not create sufficient

cash flow to meet the principal and interest repayment on the debt in the SPV, repayments will be made under the terms of the priorities of payment of the SPV. The subordinated loan is the junior creditor. The subordinated loans are not guaranteed by the GRENKE AG Group. The

Company has not suffered historic losses on the subordinated loans because Grenke AG has always bought back non performing leases from Coral Purchasing (Ireland) 2 DAC,

Opusalpha Purchaser II Limited, Kebnekaise Funding Limited and the Company has always bought back non performing leases from FCT GK 4 and FCT GK 5.

22. AMOUNTS DUE FROM RELATED PARTIES CONSOLIDATED

	2024	2023
	€	€
Amount due in greater than one year
Secured amounts due from GRENKE AG Group
undertakings	62,668,231	34,106,780
Unsecured amounts due from GRENKE AG Group
undertakings	799,777,892	656,148,585
Expected credit loss allowance	(11,778,647)	(1,351,768)
	850,667,476	688,903,597
Amount due in less than one year
Secured amounts due from GRENKE AG Group
undertakings	131,785,526	119,729,300
Unsecured amounts due from GRENKE AG Group
undertakings	965,749,030	909,930,308
Unsecured amounts due from GRENKE AG Group
franchisees	130,489,960	105,459,767

GRENKE FINANCE PLC

94

Expected credit loss allowance	(16,726,414)	(3,094,808)
	1,211,298,102	1,132,024,567

Secured amounts of €73m (2023: €59m) are in respect of payments made to purchase lease instalments from GRENKE AG Group companies. The lease instalments purchased from the GRENKE AG Group companies remain as an asset in the GRENKE AG Group companies’ financial statements because the GRENKE AG Group companies have retained substantially all of the risks and rewards of the asset ownership and also retains control of the transferred asset. The net present value of the securitised lease receivables is in excess of the securitised amount. The balance of the secured amounts €122m (2023: €94m) are in respect of loans to GC Melbourne Pty Limited and GC Sydney Pty Limited which are secured on the lease receivables held by those two companies.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

22. AMOUNTS DUE FROM RELATED PARTIES CONSOLIDATED (Continued)

The unsecured amounts due from GRENKE AG Group undertakings are monies loaned to group undertakings to finance their leasing activities and amounts due from Grenke AG Group

undertakings on clearing accounts. Unsecured amounts are usually loaned for periods of three years with the full principal being repayable at the end of the three year period, or if loaned for

a different term at the end of that term. Interest is charged on the principal at Euribor plus a spread, which reflects the risk premium on the lending, and, if loaned in currencies other than Euro, the currency risk.

From the amounts due from related parties 68% (2023: 67%) have a fixed interest rate and 32% (2023: 33%) have a variable interest rate. The weighted average maturity period and

the weighted average effective interest rate of the amounts due from Group companies during the financial year are:

	2024	2023
Weighted average maturity period in years	0.80	1.10
Weighted average effective interest rate (in %)	6.37%	5.63%

The following table shows the maturity structure of the amounts due from group companies without any adjustment for extra credit loss allowances.

	2024	2023
	€	€
Due within one year	1,227,973,239	1,135,119,375
Due between one and five years	861,833,822	690,201,441
More than five years	663,578	53,924
	2,090,470,639	1,825,374,740

GRENKE FINANCE PLC

95

The following overview shows the amount due from group companies broken down into the default rating class. The Company and Group have concluded that the most appropriate measurement for future expected credit losses in respect of balances €1.9bn (2023: €1.8bn) of the amounts due to group companies is to use the GRENKE AG 1-Year Default Risk from Bloomberg. An explanation of why we use the Bloomberg GRENKE AG 1-Year default is set out in accounting policy note 4 (k). The amounts referred to here are all classified in Stage 1. The Expected credit loss allowances in respect of these amounts are €24.1m (2023: €2.1m).

There are additional loans of €72.9m (2023: €59.4m) due from Grenke AG group companies

in Slovakia, Czech Republic, Romania and United Arab Emirates. They relate to payments

made to purchase lease instalments. The Group and Company under the terms of the financing agreement have the risk of impairment and therefore the Group and Company has provided

for expected losses on the underlying lease receivables. As at 31 December 2024 the Grenke AG group companies in Slovakia, Romania and United Arab Emirates have always bought

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

22. AMOUNTS DUE FROM RELATED PARTIES CONSOLIDATED (Continued)

back the non performing leases at the net present value of the amount due to the Company in order to avoid increased financing charges under the terms of the financing agreement and

consequently the Group and Company has not incurred losses on these loans. The relevant amounts due from these three sister companies was €62m in 2024 and €50m in 2023. All of

the balances in the tables below at Stage 2 and Stage 3 relate to amounts due under the financing arrangement where the Group and Company secure the lending by purchasing the underlying lease instalments. There is also expected credit loss allowances of €2.0m (2023: €1.7m) in respect of the financing arrangement where the Group and Company secure the lending by purchasing the underlying lease instalments in Stage 1.

	2024	2024	2024	2024
	Stage 1	Stage 2	Stage 3	Total
	€	€	€	€
Low risk	2,034,037,001	4,915	-	2,034,041,916
Higher risk	50,839,705	2,422,372	-	53,262,077
Doubtful receivables	-	-	3,166,646	3,166,646
Total gross receivables	2,084,876,706	2,427,287	3,166,646	2,090,470,639
Expected credit loss allowance	(27,839,068)	(184,827)	(481,166)	(28,505,061)
Carrying amounts	2,057,037,638	2,242,460	2,685,480	2,061,965,578

2023

Stage 1

Stage 2

Stage 3

Total

GRENKE FINANCE PLC

96

€

Low risk

1,781,409,280

17,291

-

1,781,426,571

Higher risk

39,853,459

2,142,792

-

41,996,251

Doubtful receivables

-

1,951,918

Total gross receivables

1,821,262,739

2,160,083

1,951,918

1,825,374,740

Expected credit loss allowance

(3,817,630)

(180,033)

(448,913)

(4,446,576)

Carrying amounts

1,817,445,109

1,980,050

1,503,005

1,820,928,164

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

22. AMOUNTS DUE FROM RELATED PARTIES CONSOLIDATED (Continued)

The following table show changes in the expected credit loss in the years beginning 1 January 2024:

	Stage 1	Stage 2	Stage 3	Total
	€	€	€	€
Expected credit loss allowance
as per January 1, 2024	3,817,630	180,033	448,913	4,446,576
Newly extended or acquired
financial assets	861,907	59,546	172,684	1,094,137
Reclassifications				-
to Stage 1	73,177	(38,029)	(35,148)	-
to Stage 2	(105,032)	127,525	(22,493)	-
to Stage 3	(30,323)	(19,038)	49,361	-
Change in credit loss allowance
due to change in stage	(61,592)	(49,841)	127,519	16,086

GRENKE FINANCE PLC

97

Mutually agreed termination of
contracts or payment for
financial assets (without
derecognition)	(869,414)	(79,204)	(56,240)	(1,004,858)
Change in credit loss allowance
due to change in processing
category (processing categories
explained in note 4 (p))	-	-	(94,604)	(94,604)
Change in models/risk
parameters used in extra credit
loss allowance calculation	23,840,793	(21,599)	(149,357)	23,669,837
Derecognition of financial assets	-	-	-	-
Currency translation and other
differences	99,742	7,444	15,483	122,669
Accrued interest	212,180	17,990	25,048	255,218
Expected credit loss allowance
as per 31 December, 2024	27,839,068	184,827	481,166	28,505,061

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

22. AMOUNTS DUE FROM RELATED PARTIES CONSOLIDATED (Continued)

The following table show changes in the expected credit loss in the years beginning 1 January 2023:

Stage 1

Stage 2

Stage 3

Total

GRENKE FINANCE PLC

98

€

Expected credit loss allowance

as per January 1, 2023

9,800,058

200,526

376,727

10,377,311

Newly extended or acquired

financial assets

881,093

30,175

86,504

997,772

Reclassifications

-

to Stage 1

82,518

(49,939)

(32,579)

-

to Stage 2

(122,161)

138,629

(16,468)

-

to Stage 3

(79,060)

(9,790)

88,850

-

Change in credit loss allowance

due to change in stage

(62,963)

(37,874)

194,566

93,729

Mutually agreed termination of

contracts or payment for

financial assets (without

derecognition)

(672,909)

(123,941)

(101,861)

(898,711)

Change in credit loss allowance

due to change in processing

category (processing categories

explained in note 4 (o))

-

(1,897)

Change in models/risk

parameters used in extra credit

loss allowance calculation

(6,126,673)

19,455

(142,228)

(6,249,446)

Derecognition of financial assets

(116)

-

(116)

Currency translation and other

differences

(51,758)

(4,174)

(10,214)

(66,146)

Accrued interest

169,601

16,966

7,513

194,080

Expected credit loss allowance

as per 31 December, 2023

3,817,630

180,033

448,913

4,446,576

GRENKE FINANCE PLC

99

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

23. AMOUNTS DUE FROM RELATED PARTIES COMPANY

	€	€
Amount due in greater than one year
Secured amounts due from GRENKE AG Group
undertakings	62,668,231	34,106,780
Unsecured amounts due from GRENKE AG Group
undertakings	799,777,892	656,148,585
Expected credit loss allowance	(11,778,647)	(1,351,768)
Subordinated loans to subusidiary SPVs	3,238,552	10,082,672
Reserve accounts held with subsidiary SPVs	3,911,791	12,877,393
	857,817,819	711,863,662
Amount due in less than one year
Secured amounts due from GRENKE AG Group
undertakings	131,785,526	119,729,300
Unsecured amounts due from GRENKE AG Group
undertakings	965,749,030	909,930,308
Unsecured amounts due from GRENKE AG Group
franchisees	130,489,960	105,459,767
Expected credit loss allowance	(16,726,414)	(3,094,808)
Subordinated loans to subusidiary SPVs	5,613,310	9,935,405
Reserve accounts held with subsidiary SPVs	306,972	1,106,740
	1,217,218,384	1,143,066,712

The subsidiary SPVs referred to in the narrative below is the SPV FCT GK 2.

Details of the Company subordinated loans as at 31 December are set out below:

GRENKE FINANCE PLC

100

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

23. AMOUNTS DUE FROM RELATED PARTIES COMPANY (Continued)

The Company is required under the terms of a loan agreements to provide two credit enhancement loans to Electra Purchase No. 25 Designated Activity Company equal to a % of the net present value of the lease receivables held by the SPV, FCT GK2 on the 15th of each month. The required % is set out in the table above under the column “% of NPV of lease receivables”.

The subordinated loans to subsidiary SPVs have recourse only to the returns from the assets purchased by the subsidiary SPVs, in the event that the lease receivables purchased by the subsidiary SPVs do not create sufficient cash flow to meet the principal and interest repayment on the debt in the subsidiary SPV, repayments will be made under the terms of the priorities of payment of the subsidiary SPV. The subordinated loan is the junior creditor. The Company has not suffered historic losses on the subordinated loans to subsidiary SPVs because the Company has always bought back non performing leases from FCT GK 2.

The reserve accounts cover liabilities which FCT GK 2, FCT GK 4 and FCT G5 may have under interest rate swaps they have in place to hedge the interest rate risk. These reserves are collateral to the subsidiary SPVs, which will be used to pay the subsidiary SPV in the event of the Company being unable to fulfil its obligations under interest rate swap agreements.

Any loss on subordinated loans to subsidiary SPVs providing credit enhancement to the Company’s ABCP programmes will be offset by an equivalent reduction in the amount owed to the subsidiary SPV it is providing credit enhancement in respect of and therefore there will be net loss of zero.

24. LEASED ASSETS HELD FOR RESALE CONSOLIDATED AND COMPANY

	2024	2023
	€	€
Leased assets held for resale	965,962	943,461

The value of leased assets for resale are recognised in the statement of financial position on the basis of historical selling prices for similar assets.

GRENKE FINANCE PLC

101

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

25. FINANCE LEASE RECEIVABLES CONSOLIDATED AND COMPANY

2024

2023

€

Finance lease receivables due after one year

1,707,082,435

1,444,380,395

Expected credit loss allowance on performing

finance lease receivables

(38,535,374)

(36,559,707)

1,668,547,061

1,407,820,688

Finance lease receivables due within one year

767,201,806

705,035,509

Finance lease receivables past due not credit

impaired

16,556,323

25,188,627

Non performing finance lease receivables

257,499,032

206,139,512

Expected credit loss allowance on non performing

finance lease receivables

(188,015,089)

(157,594,690)

Expected credit loss allowance on performing

finance lease receivables

(18,349,669)

(18,878,154)

834,892,403

759,890,804

The cost of assets acquired for the purpose of leasing under finance leases during the period

was €1,136 m (2023: €974m). During 2024, the Group and Company made a net investment in new finance leases of €1,212m (2023: €1,046m). In addition to the cost of the assets, the net investment includes commissions paid to the agents and dealers less any upfront payments and document fees paid by the lessee.

€501m (2023: €510m) of the finance lease receivables provide security in the event of the Group and Company defaulting on its obligations in respect of asset based financial liabilities details of which are provided in note 31.

€1,294m (2023: €1,015m) of the finance lease receivables provide security in the event of the Group and Company defaulting on its obligations in respect of amounts due to Grenke Bank

GRENKE FINANCE PLC

102

AG details of which are provided in note 33.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

25. FINANCE LEASE RECEIVABLES CONSOLIDATED AND COMPANY (Continued)

A reconciliation of the gross investment in finance lease receivables to the net investment is set out below together with the maturity of the lease payments.

	2024	2023
	€	€
Outstanding minimum lease payments	2,870,115,129	2,454,314,648
Guaranteed residual values	484,763	489,603
Outstanding minimum lease payments	2,870,599,892	2,454,804,251
Non-guaranteed residual values	322,437,980	279,474,306
Gross investment	3,193,037,872	2,734,278,557
Present value of unguaranteed residual values	(252,640,732)	(225,706,590)
Unrealised finance income	(444,698,276)	(353,534,514)
Present value of minimum lease payments	2,495,698,864	2,155,037,453
Present value of unguaranteed residual values	252,640,732	225,706,590
Expected credit loss allowance	(244,900,132)	(213,032,551)
Net investment	2,503,439,464	2,167,711,492
	2024	2023
	€	€
Due within one year	1,181,661,917	1,036,684,305
Due between one and two years	699,463,616	592,629,638
Due between two and three years	511,895,034	428,230,754
Due between three and four years	318,431,282	266,690,305
Due between four and five years	138,665,702	115,955,764

GRENKE FINANCE PLC

103

Due in greater than five years

19,997,578

14,123,882

Outstanding minimum lease payments

2,870,115,129

2,454,314,648

Due to effective risk management and a granular contract and lessee portfolio, the leasing receivables have a pronounced diversified risk structure with regard to credit risk quality. In all cases, the Company and Group remains the legal owner of the leased assets by which the leasing receivables are secured.

The following overview shows the gross receivables broken down into the default risk rating class of the leasing receivables defined in the Company and Group and the expected credit loss allowance on the leasing receivables in 2024 and 2023. The impairment loss and the definition of the default risk rating class are determined by the procedure described in the

accounting policy note 4(k) “Use of assumptions and estimates” under the heading “Determination of impairment of finance lease receivables.”

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

25. FINANCE LEASE RECEIVABLES CONSOLIDATED AND COMPANY (Continued)

	2024	2024	2024	2024
	Stage 1	Stage 2	Stage 3	Total
	€	€	€	€
Low risk	1,755,144,831	1,914,430	-	1,757,059,261
Higher risk	498,862,726	170,134,528	-	668,997,254
Doubtful receivables	-	-	322,283,081	322,283,081
Total gross receivables	2,254,007,557	172,048,958	322,283,081	2,748,339,596
Expected credit loss allowance	(26,541,445)	(15,604,021)	(202,754,666)	(244,900,132)
Carrying amounts	2,227,466,112	156,444,937	119,528,415	2,503,439,464

	2023	2023	2023	2023
	Stage 1	Stage 2	Stage 3	Total
	€	€	€	€
Low risk	1,549,444,014	1,914,298	-	1,551,358,312
Higher risk	414,113,414	150,965,613	-	565,079,027
Doubtful receivables	-	-	264,306,704	264,306,704
Total gross receivables	1,963,557,428	152,879,911	264,306,704	2,380,744,043
Expected credit loss allowance	(23,974,893)	(17,257,155)	(171,800,503)	(213,032,551)
Carrying amounts	1,939,582,535	135,622,756	92,506,201	2,167,711,492

GRENKE FINANCE PLC

104

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

25. FINANCE LEASE RECEIVABLES CONSOLIDATED AND COMPANY (Continued)

The following tables show changes in expected credit loss allowance for finance lease receivables in the years beginning 1 January 2024 and 1 January 2023:

	Stage 1	Stage 2	Stage 3	Total
	€	€	€	€
Expected credit loss allowance
as per January 1, 2024	23,974,893	17,257,155	171,800,503	213,032,551
Newly extended or acquired
financial assets*	11,216,604	6,290,300	14,831,471	32,338,375
to Stage 1	1,881,126	(1,234,252)	(646,874)	-
to Stage 2	(1,034,627)	4,253,699	(3,219,072)	-
to Stage 3	(1,275,714)	(4,772,028)	6,047,742	-
Change in credit loss allowance
due to change in stage	(1,603,825)	6,587	35,735,123	34,137,885
Mutually agreed termination of
contracts or payment for
financial assets (without

GRENKE FINANCE PLC

105

derecognition)	(10,733,649)	(5,429,231)	(8,761,501)	(24,924,381)
Change in credit loss allowance
due to change in processing
category (processing categories
explained in note 4 (p))	-	-	14,429,818	14,429,818
Change in models/risk
parameters used in extra credit
loss allowance calculation	2,234,893	(1,983,441)	(5,789,915)	(5,538,463)
Derecognition of financial assets	(11,574)	(110,949)	(22,721,193)	(22,843,716)
Currency translation and other
differences	(2,305)	(2,425)	(22,326)	(27,056)
Accrued interest	1,895,623	1,328,606	1,070,890	4,295,119
Expected credit loss allowance
as per 31 December, 2024	26,541,445	15,604,021	202,754,666	244,900,132

*The values stated in Stages 2 and 3 relate to lease receivables newly extended in the fiscal year that were allocated at their time of acquisition into Stage 1 but were reallocated to another Stage during the fiscal year.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

25. FINANCE LEASE RECEIVABLES CONSOLIDATED AND COMPANY (Continued)

Stage 1

Stage 2

Stage 3

Total

€

Expected credit loss allowance

as per January 1, 2023

22,899,882

15,822,615

144,128,335

182,850,832

Newly extended or acquired

financial assets*

10,923,516

5,807,410

12,766,075

29,497,001

to Stage 1

1,631,489

(1,127,106)

(504,383)

-

GRENKE FINANCE PLC

106

to Stage 2	(1,231,339)	3,405,669	(2,174,330)	-
to Stage 3	(1,115,191)	(4,397,252)	5,512,443	-
Change in credit loss allowance
due to change in stage	(1,389,839)	1,333,656	30,286,584	30,230,401
Mutually agreed termination of
contracts or payment for
financial assets (without
derecognition)	(9,444,938)	(5,355,764)	(8,816,907)	(23,617,609)
Change in credit loss allowance
due to change in processing
category (processing categories
explained in note 4 (p))	-	-	8,985,721	8,985,721
Change in models/risk
parameters used in extra credit
loss allowance calculation	115,580	743,463	(1,012,934)	(153,891)
Derecognition of financial assets	(15,336)	(56,966)	(18,136,793)	(18,209,095)
Currency translation and other
differences	2,917	3,909	17,199	24,025
Accrued interest	1,598,152	1,077,521	749,493	3,425,166
Expected credit loss allowance
as per 31 December, 2023	23,974,893	17,257,155	171,800,503	213,032,551

*The values stated in Stages 2 and 3 relate to lease receivables newly extended in the fiscal year that were allocated at their time of acquisition into Stage 1 but were reallocated to another Stage during the fiscal year.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

25. FINANCE LEASE RECEIVABLES CONSOLIDATED AND COMPANY (Continued)

The following table reconciles the expected credit loss allowance on finance lease receivables

GRENKE FINANCE PLC

107

to the charge in the statement of profit or loss:

	2024	2023
	€	€
Expected credit loss allowance at 1 January	213,032,551	182,850,832
Expected credit loss allowance on finance
lease receivables charged to the statement of profit
or loss	60,870,008	52,849,687
Exclude write off of lease receivables	(29,002,427)	(22,667,968)
Expected credit allowance at 31 December	244,900,132	213,032,551

A sensitivity analysis on the possible expected credit loss allowances due to changes in the credit performance of the Group and Company lessees is set out in note 43.

26. TRADE AND OTHER RECEIVABLES CONSOLIDATED AND COMPANY

	2024	2023
	€	€
Non current assets
Overseas withholding tax	4,299,560	4,884,925
Deferred risk premium paid to Grenke Bank AG	22,470,286	36,659,973
Deferred financing costs	223,436	826,391
	26,993,282	42,371,289
Current assets
Overseas VAT	81,479,593	99,608,928
Irish VAT	-	45,132
Deferred risk premium paid to Grenke Bank AG	63,235,149	22,080,262
Deferred financing costs	594,696	594,696
Other assets	338,610	338,325
Trade debtors	5,166,570	2,644,225
Expected credit loss allowance	(4,204,813)	(2,422,794)
Credit support accounts	8,363,000	10,050,000
	154,972,805	132,938,774

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

26. TRADE AND OTHER RECEIVABLES CONSOLIDATED AND COMPANY (Continued)

GRENKE FINANCE PLC

108

The Group and Company has been charged a risk premium in respect of lease instalments sold to GRENKE Bank AG as part of a financing arrangement described in note 45, the Group and Company writes this premium off over the life of the underlying lease instalments sold to GRENKE Bank AG.

Trade Debtors are amounts due from dealers in respect of termination of leases. All of the trade debtors which are over 180 days overdue are included in Stage 3. A 100% expected credit allowance of €4.2m (2023 €2.4m) has been made for all amounts 180 days overdue because all amounts due from dealers in respect of termination of leases is payable on presentation of the invoice. It is therefore unlikely than any amount which is 180 days overdue will be recovered.

The Group and Company has credit support annex agreements with Deutsche Bank, HSBC, SEB, DZ Bank, Bayerische Landesbank, and Landesbank Hessen-Thüringen, which are dependent on the value of derivative financial instruments the Group and Company has with the respective counterparty. The Group and Company places money on deposit with the respective counterparty if the value of the derivative financial instrument is in favour of the counterparty. If the value is in favour of the Group and Company, the counterparty places money on deposit with the Group and Company. Details of the derivative financial instruments are included in note 27.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

27. DERIVATIVE FINANCIAL INSTRUMENTS CONSOLIDATED AND COMPANY

GRENKE FINANCE PLC

109

The fair values of derivative financial instruments are analysed by year of maturity and by accounting designation as follows:

	Cash flow hedges	Not designated as hedges	Total
	€	€	€
At 31 December 2024
Derivative assets
Within one year - current assets	3,935,278	215,598	4,150,876
Between one and five years	7,412,225	105,562	7,517,787
After five years	2,956,427	-	2,956,427
Non current assets	10,368,652	105,562	10,474,214
Total derivative assets	14,303,930	321,160	14,625,090
Derivative liabilities
Within one year - current liabilities	4,119,172	2,312,501	6,431,673
Between one and five years	13,600,136	1,900,218	15,500,354
Non-current liabilities	13,600,136	1,900,218	15,500,354
Total derivative liabilities	17,719,308	4,212,719	21,932,027
Net liability arising on derivative financial instruments	(3,415,378)	(3,891,559)	(7,306,937)

GRENKE FINANCE PLC

110

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

27. DERIVATIVE FINANCIAL INSTRUMENTS CONSOLIDATED AND COMPANY

(Continued)

The equivalent disclosure for the prior year is as follows:

	Cash flow hedges	Not designated as hedges	Total
	€	€	€
At 31 December 2023
Derivative assets
Within one year - current assets	5,102,306	899,342	6,001,648
Between one and five years	179,337	604,155	783,492
After five years	5,062,962	-	5,062,962
Non current assets	5,242,299	604,155	5,846,454
Total derivative assets	10,344,605	1,503,497	11,848,102
Derivative liabilities
Within one year - current liabilities	3,582,810	1,544,860	5,127,670
Between one and five years	4,592,992	1,380,539	5,973,531
After five years	8,772,844	-	8,772,844
Non-current liabilities	13,365,836	1,380,539	14,746,375

GRENKE FINANCE PLC

111

Total derivative liabilities	16,948,646	2,925,399	19,874,045
Net liability arising on derivative financial instruments	(6,604,041)	(1,421,902)	(8,025,943)

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

27. DERIVATIVE FINANCIAL INSTRUMENTS CONSOLIDATED AND COMPANY

(Continued)

The Euro amounts that will be received in respect of the euro leg of forward exchange contracts which have been accounted for as cash flow hedges are set out below. The foreign currency leg of the relevant forward exchange contract will be satisfied by utilising foreign currency loan repayments from Grenke AG Group undertakings and franchisees which are highly probable.

The Euro amounts that will be paid by the Group and Company to satisfy the Euro leg of foreign currency swaps are also included in the table below. The foreign currency received in respect of the foreign currency leg of the cross currency swap will be utilised to make fixed interest and capital repayments on foreign currency bonds.

Hedge Effectiveness

IFRS accounting requires documentation and a risk analysis when derivative financial instruments are employed. The relationship between the critical terms of the underlying

transaction and the hedging instrument determines the effectiveness of a hedging relationship. By employing derivatives for foreign currency hedging on foreign currency bonds and loans to

Group and Franchise Companies and interest rate swaps on variable interest rate payable on asset based liabilities, the Group and Company applies hedge accounting in accordance with IFRS 9. Hedge effectiveness, as required by IFRSs, is in line with Group and Company’s intention of using derivatives only to hedge risks from the designated underlying transaction and to never enter into derivatives for speculative reasons.

To date, the hedging relationships between the cross-currency swaps and the foreign currency bonds has proven to be highly effective. The critical terms of the hedging instrument and the hedged item match. The hedging relationships between the foreign currency loans to group companies and franchise companies and the forward exchange contracts when there has been a hedging relationship designated has proven to be highly effective. The hedging relationships between the interest rate swaps and the asset based liabilities when there has been a hedging relationship designated has proven to be highly effective.

GRENKE FINANCE PLC

112

One to Three months

Three to twelve months

One to five years

Five to ten years

Total

At 31 December 2024

Foreign exchange contracts (highly

probable loan repayments)

Notional amounts (in € 000)

3,952

Average forward rate (Eur/AED)

3.87

Notional amounts (in € 000)

25,719

76,882

20,897

123,498

Average forward rate (Eur/AUD)

1.65

1.67

Notional amounts (in € 000)

32,146

53,661

85,807

Average forward rate (Eur/CAD)

1.49

Notional amounts (in € 000)

4,861

Average forward rate (Eur/CHF)

0.93

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

27. DERIVATIVE FINANCIAL INSTRUMENTS CONSOLIDATED AND COMPANY

(Continued)

Hedge Effectiveness (Continued)

	One to Three months	Three to twelve months	One to five years	Five to ten years	Total
At 31 December 2024
Notional amounts (in € 000)	41,363	965			42,328
Average forward rate (Eur/CLP)	1,039	1,036
Notional amounts (in € 000)	7,655	24,378	98,430		130,463
Average forward rate (Eur/DKK)	7.45	7.42	7.42
Notional amounts (in € 000)	40,809	12,640			53,449
Average forward rate (Eur/GBP)	0.84	0.83
Notional amounts (in € 000)	34,102	5,527			39,629
Average forward rate (Eur/PLN)	4.31	5.61
Notional amounts (in € 000)	9,558	34,396	78,313		122,267
Average forward rate (Eur/SEK)	10.99	11.48	11.49
Notional amounts (in € 000)	630				630
Average forward rate (Eur/SGD)	1.427
Notional amounts (in € 000)	888	3,833	4,482		9,203
Average forward rate (Eur/USD)	1.13	1.11	1.12
Notional amounts (in € 000)	1,156	667	4,055		5,878
Average forward rate (Eur/HUF)	443.83	403.46	422.22

GRENKE FINANCE PLC

113

Cross currency swaps (certain
foreign currency bond interest
and bond repayments)
Notional amounts (in € 000)	480	480	61,394		62,354
Average hedged rate (Eur/JPY)	117.60	117.60	117.60
Notional amounts (in € 000)	338	565	61,343	35,576	97,822
Average hedged rate (Eur/HKD)	9.36	9.36	9.36	9.36
Interest rate swaps variable
interest rate payments on asset
based liabilities
Notional amounts (in € 000)	350,000	245,000	40,000		635,000
Average interest rate	2.94%	2.93%	2.88%

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

27. DERIVATIVE FINANCIAL INSTRUMENTS CONSOLIDATED AND COMPANY

(Continued)

Hedge Effectiveness (Continued)

	One to Three months	Three to twelve months	One to five years	Five to ten years	Total
At 31 December 2023
Foreign exchange contracts (highly
probable loan repayments)
Notional amounts (in € 000)	4,253				4,253
Average forward rate (Eur/AED)	4.04
Notional amounts (in € 000)	33,675	59,100			92,775
Average forward rate (Eur/AUD)	1.65	1.66
Notional amounts (in € 000)	41,072	28,821			69,893
Average forward rate (Eur/CAD)	1.48	1.50
Notional amounts (in € 000)	13,395				13,395
Average forward rate (Eur/CHF)	0.95
Notional amounts (in € 000)	6,635	26,774			33,409
Average forward rate (Eur/CLP)	979.68	921.32
Notional amounts (in € 000)	7,317	22,020	66,132		95,469
Average forward rate (Eur/DKK)	7.45	7.45	7.42
Notional amounts (in € 000)	30,871				30,871
Average forward rate (Eur/GBP)	0.86
Notional amounts (in € 000)	24,729	2,299	5,527		32,555
Average forward rate (Eur/PLN)	4.39	5.22	5.61

GRENKE FINANCE PLC

114

Notional amounts (in € 000)	10,651	33,009	61,831		105,491
Average forward rate (Eur/SEK)	10.33	10.72	11.48
Notional amounts (in € 000)	2,666				2,666
Average forward rate (Eur/SGD)	1.447
Notional amounts (in € 000)	461	2,923	1,344		4,728
Average forward rate (Eur/USD)	1.08	1.11	1.12
Notional amounts (in € 000)		737	2,471		3,208
Average forward rate (Eur/HUF)		415.92	432.92
Cross currency swaps (certain
foreign currency bond interest
and bond repayments)
Notional amounts (in € 000)	480	480	3,838	58,516	63,314
Average hedged rate (Eur/JPY)	116.86	116.86	116.86	116.86
Notional amounts (in € 000)	336	562	3,602	94,221	98,721
Average hedged rate (Eur/HKD)	9.50	9.50	9.50	9.50

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

27. DERIVATIVE FINANCIAL INSTRUMENTS CONSOLIDATED AND COMPANY

(Continued)

Hedge Effectiveness (Continued)

	One to Three months	Three to twelve months	One to five years	Five to ten years	Total
At 31 December 2023

Interest rate swaps variable
interest rate payments on asset
based liabilities
Notional amounts (in € 000)	290,000	247,778	25,104	562,882
Average interest rate	3.02%	3.45%	3.60%

GRENKE FINANCE PLC

115

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

27. DERIVATIVE FINANCIAL INSTRUMENTS CONSOLIDATED AND COMPANY

(Continued)

The nominal values and fair values of derivative financial instruments are shown in the following analysis. In accordance with internal guidelines, the nominal amounts of the derivative financial instruments correspond to the volume of exposures being covered with derivatives.

	Nominal	Fair	Nominal	Fair
	Value	Value	Value	Value
	2024	2024	2023	2023
	€	€	€	€
Assets
Cash flow hedges
Interest Rate Swaps	80,000,000	11,692	150,000,000	900,997
Cross Currency Swaps	97,822,353	9,123,191	98,720,454	5,062,962
Forward Exchange Contracts	449,668,988	5,169,047	171,414,737	4,380,645
	627,491,341	14,303,930	420,135,191	10,344,604
Not designated as hedges
Interest Rate Swaps	40,000,000	2,613	125,000,000	323,297

GRENKE FINANCE PLC

116

Forward Exchange Contracts	33,134,625	318,547	38,416,503	1,180,201
	73,134,625	321,160	163,416,503	1,503,498
	700,625,966	14,625,090	583,551,694	11,848,102
Liabilities
Cash flow hedges
Interest Rate Swaps	275,000,000	967,645	295,000,000	1,174,029
Cross Currency Swaps	62,353,643	12,649,104	63,313,106	8,772,844
Forward Exchange Contracts	172,298,215	4,102,559	335,363,128	7,001,773
	509,651,858	17,719,308	693,676,234	16,948,646

Not designated as hedges
Interest Rate Swaps	110,000,000	597,932	45,000,000	410,216
Forward Exchange Contracts	69,079,520	3,614,787	45,918,777	2,515,183
	179,079,520	4,212,719	90,918,777	2,925,399
	688,731,378	21,932,027	784,595,011	19,874,045

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

27. DERIVATIVE FINANCIAL INSTRUMENTS CONSOLIDATED AND COMPANY

(Continued)

At 31 December 2024 and 2023, the Group and Company had no master netting or similar arrangements, or enforceable right of set-off agreements with any of its derivative counterparts.

Cash flow hedges consist of forward exchange contracts, cross-currency swaps and interest rate swaps. These instruments hedge risks arising to future cash flows from movements in foreign exchange rates and interest rates. Cash flow hedges are expected to affect profit or loss over the period to maturity.

The profit/(loss) arising on cash flow hedges and related hedged items reflected in the Statement of other comprehensive income is shown below:

GRENKE FINANCE PLC

117

Components of other comprehensive income -cash flow hedges

2024

2023

Gains/(losses) arising during the year

€

- cross currency swaps

183,967

(10,854,793)

- forward exchange contracts

3,687,616

(9,090,605)

- interest rate swaps	(682,921)	(4,372,079)
Reclassified into the statement of profit and loss
- cross currency swaps	(4,616,851)	8,500,095
- forward exchange contracts	(2,659,658)	9,429,498
	(4,087,847)	(6,387,884)
Fair value hierarchy	2024	2023
Assets measured at fair value	Level 2	Level 2
Cash flows hedges	€	€
Interest rate swaps	11,692	900,997
Cross currency swaps	9,123,191	5,062,962
Forward exchange contracts	5,169,047	4,380,645
Not designated as hedges
Interest rate swaps	2,613	323,297
Forward exchange contracts	318,547	1,180,201
	14,625,090	11,848,102

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

27. DERIVATIVE FINANCIAL INSTRUMENTS CONSOLIDATED AND COMPANY

(Continued)

Fair value hierarchy	2024	2023
Liabilities measured at fair value	Level 2	Level 2
Cash flows hedges	€	€
Interest Rate Swaps	967,645	1,174,029
Cross currency swaps	12,649,104	8,772,844
Forward exchange contracts	4,102,559	7,001,773
Not designated as hedges

GRENKE FINANCE PLC

118

Interest Rate Swaps	597,932	410,216
Forward exchange contracts	3,614,787	2,515,183
	21,932,027	19,874,045

At 31 December 2024 and 2023 there were no derivatives valued using Level 1 or Level 3 fair value techniques.

The inputs to level 2 valuations are set out in note 42.

28. DEFERRED TAX CONSOLIDATED AND COMPANY

	2024	2023
	€	€
Deferred tax liability	360,068	956,386
	2024	2023
Deferred tax asset/(liability) is comprised of:	€	€
Corporation tax losses carried forward	76,708
Taxable temporary differences attributable to
accelerated tax depreciation	6,919	9,743
Leased right of use assets	36,242	25,117
Other deductible temporary differences	1,174	845
Tax relating to cash flow hedges	(481,111)	(992,091)
	(360,068)	(956,386)

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

28. DEFERRED TAX CONSOLIDATED AND COMPANY (Continued)

	2024	2023
	€	€
Opening balance at start of year	(956,386)	(1,770,438)
Corporation tax losses carried forward	76,708
Taxable temporary differences attributable to
accelerated tax depreciation	(2,824)	2,801
Leased right of use assets	11,125	12,158

GRENKE FINANCE PLC

119

Other deductible temporary differences

330

608

Tax relating to cash flow hedges

510,979

798,485

(360,068)

(956,386)

Components of other comprehensive income -

2024

2023

Tax relating to cash flow hedges	€	€
Gains/(losses) arising during the year
- cross currency swaps	(22,996)	1,356,849
- forward exchange contracts	(460,952)	1,136,326
- interest rate swaps	85,365	546,510
Reclassified into the statement of profit and loss
- cross currency swaps	577,106	(1,062,512)
- forward exchange contracts	332,456	(1,178,688)
	510,979	798,485

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

29. CORPORATION TAX

	2024	2023
Corporation tax asset
Amounts due in greater than one year	€	€
Corporation tax receivable	3,882,462	3,882,462

GRENKE FINANCE PLC

120

Amounts due within one year

Corporation tax receivable

3,208,517

-

Corporation tax liability

Amounts due within one year

Corporation tax payable	-	763,328
Net asset	7,090,979	3,119,134

The corporation tax asset greater than one year relates to a deduction, which has been claimed in respect of licence fees and guarantee fees of €31m, which were charged by GRENKE AG in respect of the years 2010 to 2016. A correlative relief claim was submitted to the Irish Tax Authorities on 8 February 2021 in respect of this amount. The Irish Tax Authorities have requested clarification with regard to some of the information provided in the claim but have not expressed any views on the claim.

The corporation tax asset due within one year relates to preliminary tax paid in respect of the year end 31 December 2024 which is now recoverable due to the Group and Company having nil profits chargeable to corporation tax in the year end 31 December 2024.

30. CASH AND CASH EQUIVALENTS

	2024	2023
	€	€
Cash at bank	117,100,755	143,284,978
	117,100,755	143,284,978

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

31. FINANCIAL LIABILITIES CONSOLIDATED

	2024	2023
	€	€
Repayable in more than one year but less
than five years
Debt securities in issue	1,841,976,983	1,742,250,000

GRENKE FINANCE PLC

121

Asset based financial liabilities	297,963,219	301,448,663
Unamortised discount on bonds and notes in issue	(3,177,409)	(5,194,645)
Deferred set up costs	(1,302,569)	(696,612)
Repayable in more than five years
Debt securities in issue	109,149,791	183,961,922
Asset based financial liabilities	527,317	171,269
Unamortised discount on bonds and notes in issue	(328)	(6,452)
Deferred set up costs	(313)	(7,142)
Total non current financial liabilities	2,245,136,691	2,221,927,003
Current liabilities
Debt securities in issue	826,523,000	434,673,000
Asset based financial liabilities	177,656,966	170,356,706
Unamortised discount on bonds and notes in issue	(6,428,714)	(12,196,449)
Deferred set up costs	(733,262)	(618,562)
Bank loans	90,000,000	170,000,000
Total current financial liabilities	1,087,017,990	762,214,695
Total financial liabilities	3,332,154,681	2,984,141,698

The bonds in issue at 31 December 2024 under the debt issuance programme comprise:

Interest	Currency	Issue volume	Weighted average	Weighted average
		in millions	maturity period	effective interest rate
			(in years)	(in %)
Fixed	Eur	2,485	2.43	4.86
Variable	Eur	10	1.15	3m Euribor + 2.92
Fixed	JPY	7,000	4.51	0.95
Fixed	HKD	800	4.89	2.72

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

31. FINANCIAL LIABILITIES CONSOLIDATED (Continued)

The bonds in issue at 31 December 2023 under the debt issuance programme comprise:

GRENKE FINANCE PLC

122

Interest	Currency	Issue volume	Weighted average	Weighted average
		in millions	maturity period	effective interest rate
			(in years)	(in %)
Fixed	Eur	2,083	1.80	3.91
Variable	Eur	10	2.15	3m Euribor + 2.92
Fixed	JPY	7,000	5.51	0.95
Fixed	HKD	800	5.89	2.72

The bonds issued carry an unconditional and irrevocable guarantee for the proper and punctual payment of principal, interest and other amounts due on the debenture from the ultimate parent GRENKE AG.

The Debt Issuance Programme (DIP) provides a standardised framework for future borrowings. The DIP allows the Company to have in issue bonds with nominal value of €5bn at any time. These bonds are listed on the Luxembourg Stock Exchange. The programme was updated

with effect as of 6 March 2024. The programme was approved by the Finance Sector Supervisory Committee (“Commission de Surveillance du Secteur Financier”: CSSF).

Two (2023: Three) euro bonds were issued in the current year under the Debt Issuance Programme with a nominal value of €1,000m (2023: €600m). An addition of €50m (2023: €50m) was added to a €150m 6.75% bond already issued.

Bonds with a nominal amount of €647.852m (2023: €954.38m) were repaid in 2024.

Under the terms of cross-currency swaps put in place when the foreign currency bonds were issued, €151m (2023: €151m) will be repayable when the bonds mature. Under the terms of the foreign currency swaps the following amounts will be payable annually to pay interest, foreign currency swap fees and bond fees on the foreign currency bonds. The € amounts payable will not change over the life of the foreign currency bonds under the terms of foreign currency swaps.

Foreign currency	Euro amount	Annual	Effective
bond	Repayable	Payment	Interest Rate	Final Payment
¥7,000,000,000	€57,556,323	€959,464	1.67%	02/07/2029

HK$500,000,000

€57,745,589

€561,691

0.97%

13/09/2029

HK$300,000,000

€35,238,565

€338,290

0.96%

11/03/2030

The promissory loan notes in issue at 31 December 2024 comprise:

Interest	Currency	Issue volume	Weighted average	Weighted average
		in millions	maturity period	effective interest
			(in years)	rate (in %)
Fixed	Eur	81	1.57	5.28

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

31. FINANCIAL LIABILITIES CONSOLIDATED (Continued)

The promissory loan notes in issue at 31 December 2023 comprise:

GRENKE FINANCE PLC

123

Interest	Currency	Issue volume	Weighted average	Weighted average
		in millions	maturity period	effective interest
			(in years)	rate (in %)
Fixed	Eur	81	2.57	5.28

All promissory notes are bullet debt securities and are subject to constant rating. No promissory notes (2023: €57.5m) were issued in the current year. No promissory notes (2023: €37m) were repaid in the current year. If the Standard & Poor’s rating for the GRENKE AG Group were to be downgraded below BBB− there is a step up clause in the Group and Company’s promissory note agreements. If that happens, the noteholder can cancel the contract and seek immediate repayment or the noteholder will be entitled to a step up on the interest rate of 0.75% on top of the initially agreed interest rate. GRENKE AG’s Group rating is currently BBB by Standard & Poor.

The commercial paper in issue at 31 December 2024 comprise:

Interest	Currency	Issue volume	Weighted average	Weighted average
		in millions	maturity period	effective interest rate
			(in years)	(in %)
Fixed	Eur	60	0.24	3.45

The commercial paper in issue at 31 December 2023 comprise:

Interest	Currency	Issue volume	Weighted average	Weighted average
		in millions	maturity period	effective interest rate
			(in years)	(in %)
Fixed	Eur	50	0.13	4.46

Commercial paper with a nominal value of €300m (2023: €185m) was issued in 2024 and €290m (2023: €160m) was repaid in 2024.

The discounts and premiums on debt securities in issue are released to the Statement of Profit and Loss over the term of the debt securities.

Asset based financial liabilities are liabilities in connection with the ABCP programmes.

The following consolidated special purpose vehicles were in place at the year end date FCT "GK"-COMPARTMENT "G 2" and Elektra Purchase No. 25 Designated Activity Company (UniCredit is the sponsoring bank) (FCT GK 2), FCT "GK"-COMPARTMENT "G 4" (Landesbank Hessen-Thuringern Girozenrale (HeLeBa) is the sponsoring bank) (FCT GK 4), FCT "GK"-COMPARTMENT "G 5" (DZ Bank is the sponsoring bank) (FCT GK 5) and “Kebnekaise Funding Limited” (sponosor: SEB AB) (Kebnekaise Funding limited).

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

31. FINANCIAL LIABILITIES CONSOLIDATED (Continued)

The ABCP programmes grant the Group and Company the right to refinance or to sell receivables to the respective programmes for a certain period of time. The cap on the purchase

GRENKE FINANCE PLC

124

volume is determined by the volume of the programme, which is normally backed by the organising bank in the form of a liquidity commitment in the corresponding amount. The carrying amount is calculated using the effective interest method, whereby incurred transaction costs are amortised over the term of the underlying refinancing package.

The structured entities are refinanced by issuing commercial papers, usually with a term of one month, on a revolving basis. The interest on the commercial papers is based on one-month Euribor. This is a floating interest rate.

There is no currency risk in ABCP refinancing as only euro transactions and euro-based leases are involved.

The asset based liabilities in connection with each ABCP programme and the net present value of the lease receivables which have been sold to the SPV to securitise that liability are set out below:

	Asset Based	NPV of lease	Asset Based	NPV of lease
	liability	receivables	liability	receivables
		sold to SPV		sold to SPV
	31 December	31 December	31 December	31 December
	2024	2024	2023	2023
SPV	€	€	€	€

FCT GK2	(52,662,753)	62,135,597	(116,551,993)	140,334,353
FCT GK4	(182,899,799)	184,999,949	(179,214,848)	184,999,998
FCT GK5	(172,194,188)	173,692,269	(151,293,219)	155,728,369
Kebnekaise Funding Limited	(68,390,762)	80,459,721	(24,916,578)	29,313,621
	(476,147,502)	501,287,536	(471,976,638)	510,376,341

The net present value of the lease receivables sold to the SPV remain on the statement of financial position because the Company has retained substantially all of the risks and rewards of the asset ownership and also retains control of the transferred asset. The amounts due to SPV are a refinancing liability and the sale of the lease receivables is to securitise that refinancing liability.

Professional fees of €299,194 were incurred in setting up FCT GK 4. These fees have been classified as deferred set up costs and will be amortised to the statement of profit or loss from

the date that the first lease receivables were sold to FCT GK4, which was 6 August 2019, and the earliest date that the programme may be terminated which is 4 December 2025.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

31. FINANCIAL LIABILITIES CONSOLIDATED (Continued)

Professional fees of €289,336 were incurred in setting up FCT GK 5. These fees have been classified as deferred set up costs and will be amortised to the statement of profit or loss from

GRENKE FINANCE PLC

125

the date that the first lease receivables were sold to FCT GK5, which was 19 April 2022, and the initial latest date, 31 December 2025, that lease receivables could be sold to FCT GK5 without a formal extension of the program.

Professional fees of €256,500 were incurred in setting up Kebnekaise funding limited. These fees have been classified as deferred set up costs and will be amortised to the statement of profit or loss from the date that the first lease receivables were sold to Kebnekaise funding limited, which was 5 October 2023 and the initial latest date, 5 October 2025, that lease receivables could be sold to FCT GK5 without a formal extension of the program.

If no options are taken to terminate the ABCP programmes at an earlier date the latest date currently the company can sell leasing receivables to FCT GK 2 is April 2025 subject to UniCredit’s consent, December 2025 for FCT GK 4 and December 2025 for FCT GK 5.

If no options are taken to terminate the ABCP programmes at an earlier date the latest date currently the company can sell leasing receivables to Kebnekaise Funding Limited is October 2025.

Details of the bank loans are set out below:

	2024	2023
	€	€
Syndicated loan facility	90,000,000	150,000,000
Money market lines	-	20,000,000
	90,000,000	170,000,000

The Group and Company’s parent Grenke AG signed a syndicated revolving loan facility with eight banks for an initial period of two years on 30 June 2021. This agreement was renewed on 26 May 2023. The eight banks will provide short term revolving loans of up to €400m in total under the facility. Under the terms of the facility the Group and Company may draw down funds of up to €400m for short term periods. The Group and Company sister companies in Switzerland, the United Kingdom and in Canada (once the Canadian franchises become wholly-owned by Grenke AG as subsidiaries) are also permitted to utilise the facility up to €130m each.

At 31 December 2024 the Group and Company had three outstanding loans under the facility totalling €90m (2023: €150m) which had an average maturity 71 days (2023: 38 days) and an average effective interest rate of 4.12% (2023: 5.07%).

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

32. FINANCIAL LIABILITIES COMPANY

2024

2023

GRENKE FINANCE PLC

126

Non current liabilities
Debt securities in issue	1,946,652,179	1,920,415,028
Current liabilities
Debt securities in issue	819,461,105	422,023,798
Bank loans	90,000,000	170,000,000
Total current financial liabilities	909,461,105	592,023,798
Total financial liabilities	2,856,113,284	2,512,438,826

33. AMOUNT DUE TO RELATED PARTIES CONSOLIDATED

	2024	2023
	€	€
Non current liabilities
Amount owed to GRENKE Bank AG	848,301,863	633,767,332
Current liabilities
Amount owed to GRENKE Bank AG	399,499,159	331,895,328
Amount due on current account	100,309,273	101,561,690
Amount due on cash pool accounts	66,349,547	158,391,401
	566,157,979	591,848,419

The amounts due to GRENKE Bank AG are in respect of proceeds received for the sale of lease instalments. Interest was payable on the balances due to GRENKE Bank AG at an average rate of interest of 3.99% (2023: 2.8%).

The lease instalments sold to Grenke Bank AG remain on the statement of financial position because the Company has retained substantially all of the risks and rewards of the asset ownership and also retains control of the transferred asset. The amounts due to Grenke Bank AG are a refinancing liability and the sale of the lease instalments is to securitise that refinancing liability.

The tables below show the amounts due to GRENKE Bank AG and the net present value of the lease receivables in respect of which the lease instalments due for the balance of the primary period have been sold to GRENKE Bank AG.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

33. AMOUNT DUE TO RELATED PARTIES CONSOLIDATED (Continued)

2024

2023

GRENKE FINANCE PLC

127

€

Amount due to GRENKE Bank AG

1,247,801,022

965,662,660

Net present value of lease receivables sold to GRENKE Bank AG recognised

Bank AG recognised as an asset

1,293,706,786

1,015,362,813

Net difference

(45,905,764)

(49,700,153)

The amounts due on current account are the intergroup account balances with GRENKE AG Group companies. The balances on the intergroup accounts are non interest bearing and they are not secured.

The cash pool amounts due are surplus cash from GRENKE AG Group companies placed on overnight deposit with the Group and Company. The cash pool balances are interest bearing and they are not secured.

34. AMOUNT DUE TO RELATED PARTIES COMPANY

	2024	2023
Non current liabilities
Amount owed to GRENKE Bank AG	848,301,863	633,767,332
Amount owed to special purpose vehicles	305,635,305	324,472,490
	1,153,937,168	958,239,822
Current liabilities
Amount owed to GRENKE Bank AG	399,499,159	331,895,328
Amount owed to special purpose vehicles	183,477,167	181,233,042
Amount due on current account	100,309,273	101,561,690
Amount due on cash pool accounts	66,349,547	158,391,401

749,635,146

773,081,461

The amounts owed to the SPVs in the Company balance sheet are equal to the net present value of the lease receivables sold to the SPVs, FCT GK 2, FCT GK 4, FCT GK 5 and Kebnekaise Funding Limited to securitise the funding provided by the SPV to the Company. Details of ABCP programmes are provided in note 31.

The Company has provided subordinated loans of €57m details of which are in note 21 (€48m) and note 23 (€9m). The subordinated loans provide additional security in respect of the amounts owed to the SPVs.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

35. LEASE LIABILITIES CONSOLIDATED AND COMPANY

2024

2023

GRENKE FINANCE PLC

128

	€	€
Lease liabilities due in greater than one year	850,083	1,083,367
Lease liabilities due within one year	260,880	-

The Group and Company has only four leases. The leases are in respect of Units 209/210, Unit 310, Unit 306/307 and Unit 410/411, Q House, Furze Road, Sandyford Industrial Estate, Dublin 18. The Group and Company entered into the four leases on 14 November 2023. The leases are for ten years from 6 November 2023. The Group and Company has an option to terminate the leases on 5 November 2028. Should the Group and Company decide not to terminate the leases on 5 November 2028 the rent on the leases will be adjusted to the market rent as of 5 November 2028.

These lease liabilities are accounted for in accordance with IFRS 16. Details of the right of use assets related to these lease liabilities are included in note 19. It has been assumed for

accounting under IFRS 16 that the Group and Company will exercise its right to terminate the lease on 5 November 2028.

The lease liabilities at the time of first application were discounted using individual marginal borrowing rates as of 6 November, 2023. The weighted average marginal borrowing rate as of November 6, 2023 was 6.92% per annum.

The Group and Company was availing of a rent free period from the commencement of the

leases on 6 November 2023 to 5 November 2024. The Group and Company pays annual

rent of €309k for the period 6 November 2024 to 5 November 2028.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

36. DEFERRED INCOME CONSOLIDATED AND COMPANY


	2024	2023

GRENKE FINANCE PLC

129

Amounts due within one year	€	€
Deferred income on financial guarantee	-	170
	-	170

37. TRADE AND OTHER PAYABLES CONSOLIDATED AND COMPANY

2024

2023

€

Other accrued expenses

3,746,442

2,132,458

Trade creditors

11,288,682

9,957,851

Social welfare tax payable

56,030

51,805

Accrued interest

69,172,440

35,365,756

Irish vat

1,238

-

84,264,832

47,507,870

38. CALLED UP SHARE CAPITAL, CAPITAL CONTRIBUTION CONSOLIDATED AND COMPANY

2024

2023

€

Authorised

Ordinary shares of €1 each

50,000

Allotted, called up and fully paid

Ordinary shares of €1 each

50,000

2024

2023

€

Capital contribution

67,000,000

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

38. CALLED UP SHARE CAPITAL, CAPITAL CONTRIBUTION CONSOLIDATED AND COMPANY (Continued)

GRENKE FINANCE PLC

130

The Group and Company’s parent Grenke AG made a capital contribution of €67m. €22m was

contributed in 2015 and €45m was contributed in 2016 in order to enhance the value of their investment in the Group and Company.

39. CASH FLOW HEDGE RESERVE

The following table shows the reconciliation of the cash flow hedge reserve

2024

2023

€

Balance at 1 January

6,944,640

12,534,039

Gains/(losses) arising during the year

- cross currency swaps

183,967

(10,854,793)

- forward exchange contracts

3,687,616

(9,090,605)

- interest rate swaps

(682,921)

(4,372,079)

Reclassified into the statement of profit and loss

- cross currency swaps

(4,616,851)

8,500,095

- forward exchange contracts

(2,659,658)

9,429,498

Taxes on unrealised gains/losses and on reclassifications

510,979

798,485

Balance at 31 December

3,367,772

6,944,640

40. TRANSACTIONS WITH OWNERS OF THE COMPANY CONTRIBUTIONS AND DISTRIBUTION

	2024	2023
	€	€
Distribution	-	110,000,000

The Group and Company paid a dividend of Nil (2023: €2,200) per share to its parent company Grenke AG in 2024 (2023: 29 December 2023). There have been no dividends paid, proposed or declared since 31 December 2024.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

41. RECONCILIATION OF LIABILITIES FROM FINANCING ACTIVITIES TO THE

CONSOLIDATED STATEMENT OF CASH FLOWS

GRENKE FINANCE PLC

131

	Financial liabilities	Amount due to Grenke Bank AG	Lease liabilities
Year	2024	2024	2024
Accounting Note	31	33	35
	€	€	€
Non-current	2,221,927,003	633,767,332	1,083,367
Current	762,214,695	331,895,328	-
Opening Balance	2,984,141,698	965,662,660	1,083,367
Cash outflows	(2,202,426,403)	(452,871,836)	(49,378)
Cash inflows	2,531,449,267	735,010,198	-
Non cash movements
Amortisation of discounts	13,536,095	-	-
Amortisation of deferred
professional fees	669,512	-	-
Deferral of transaction costs	167,661	-	-
Foreign exchange	4,616,851	-	-
Interest on lease	-	-	76,974
Closing Balance	3,332,154,681	1,247,801,022	1,110,963

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

41. RECONCILIATION OF LIABILITIES FROM FINANCING ACTIVITIES TO THE

GRENKE FINANCE PLC

132

CONSOLIDATED STATEMENT OF CASH FLOWS (Continued)

Financial liabilities

Amount due to Grenke Bank AG

Lease liabilities

Year

2023

Accounting Note

31

33

35

€

Non-current

1,869,790,843

502,085,002

-

Current

971,564,013

306,758,127

339,631

Opening Balance

2,841,354,856

808,843,129

339,631

Cash outflows

(1,614,649,808)

(450,438,722)

(194,230)

Cash inflows

1,755,026,745

607,258,253

-

Non cash movements

Amortisation of discounts

10,381,069

-

Amortisation of deferred

professional fees

350,371

-

Deferral of transaction costs

178,560

-

Foreign exchange

(8,500,095)

-

Recognition of lease liability

1,070,907

Interest on lease

-

19,837

Prepayment correction

(152,778)

Closing Balance

2,984,141,698

965,662,660

1,083,367

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

GRENKE FINANCE PLC

133

42. FAIR VALUE OF FINANCIAL INSTRUMENTS CONSOLIDATED

Measurement Methods and Input Parameters Used

The following table presents the measurement methods used to determine the fair values and the applied input parameters and assumptions:

Type and level	Measurement method	Input parameters
FAIR VALUE HIERARCHY LEVEL 1
Exchange-listed bonds	n/a	Quoted market price as per the reporting date
FAIR VALUE HIERARCHY LEVEL 2
Forward exchange contracts	Market-to-marketdiscounted present value of estimated future cash flows	Available interest rates at the end of the term in the traded currencies using the own counterparty risk (Debt Value Adjustment [DVA]) or the counterparty's credit risk (CVA [Credit Value Adjustment]) derived from available credit default swap (CDS) quotes
Cross-currency swaps	Market-to-marketdiscounted present value of estimated future cash flows	Available interest rates at comparable terms and residual maturities using own counterparty risk DVA or counterparty risk CVA used from available CDS quotations
Interest rate swaps	Market-to-marketdiscounted present value of estimated future cash flows	Available interest rates at comparable terms and residual maturities using own counterparty risk DVA or counterparty risk CVA used from available CDS quotations
Subordinated loans	Discounted present value of estimated future cash flows	Available interest rates at comparable conditions and residual terms using the counterparty’s credit risk.
Other financial assets	Discounted present value of estimated future cash flows	Available interest rates at comparable conditions and residual terms using the counterparty’s credit risk.

Financial liabilities (liabilities from the refinancing of the leasing business, promissory notes, bank liabilities)

Discounted present value of estimated

future cash flows

Available interest rates at comparable conditions and residual terms using the own credit risk DVA

Fair Values of Subordinated Loans and Derivative Financial Instruments

At the end of the reporting period, all derivative financial instruments and subordinated loans to special purpose vehicles which provide credit enhancement to senior investors in special purpose vehicles which buy lease receivables from the Group’s parent Grenke AG are recognised at fair value by the Group. All subordinated loans and derivative financial instruments are assigned to level 2 of the fair value hierarchy.

The fair value of subordinated loans and derivative financial instruments are set out below:

NOTES TO THE46 FINANCIAL STATEMENTS

AT 31 December 2024

GRENKE FINANCE PLC

134

42. FAIR VALUE OF FINANCIAL INSTRUMENTS CONSOLIDATED (Continued)

Fair Values of Subordinated Loans and Derivative Financial Instruments (Continued)

	Fair Value	Fair Value
	and carrying	and carrying
	amount	amount
	2024	2023
	€	€
Financial assets
Subordinated loans	41,316,992	37,570,630
Interest rate swaps
with hedging relationship	11,692	900,997
Cross currency swaps
with hedging relationship	9,123,191	5,062,962
Forward exchange contracts
with hedging relationship	5,169,047	4,380,645
Interest rate swaps
not designated as hedges	2,613	323,297
Forward exchange contracts
not designated as hedges	318,547	1,180,201
Total	55,942,082	49,418,732

GRENKE FINANCE PLC

135

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

42. FAIR VALUE OF FINANCIAL INSTRUMENTS CONSOLIDATED (Continued)

Fair Values of Subordinated Loans and Derivative Financial Instruments (Continued)

Fair Value

and carrying

	amount	amount
	2024	2023
	€	€
Financial liabilities
Interest rate swaps
with hedging relationship	967,645	1,174,029
Cross currency swaps
with hedging relationship	12,649,104	8,772,844
Forward exchange contracts
with hedging relationship	4,102,559	7,001,773
Interest rate swaps
not designated as hedges	597,932	410,216
Forward exchange contracts
not designated as hedges	3,614,787	2,515,183
Total	21,932,027	19,874,045

The fair value of the subordinated loans is measured by applying Euro cost of borrowing plus the Grenke AG risk of default to the projected future cash flows from the subordinated loans.

The projected future cash flows were discounted at 31 December 2024 and at 31 December 2023 on the basis of the following interest rates:

2024

2023

GRENKE FINANCE PLC

136

	%	%
Interest rate for 3 months	2.823%	3.910%
Interest rate for 6 months	3.016%	3.874%
Interest rate for 9 months	3.317%	3.705%
Interest rate for 1 year	3.615%	3.575%
Interest rate for 2 years	4.502%	3.582%
Interest rate for 3 years	5.264%	3.972%
Interest rate for 4 years	5.840%	4.369%
Interest rate for 5 years	6.321%	4.779%
Interest rate for 6 years	6.348%	4.780%
Interest rate for 10 years	6.439%	4.841%

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

42. FAIR VALUE OF FINANCIAL INSTRUMENTS CONSOLIDATED (Continued)

Fair Values of Subordinated Loans and Derivative Financial Instruments (Continued)

Fair values of forward exchange contracts and cross-currency swaps are determined based on valuation models, which include observable input parameters.

The Group and Company uses the so-called OTC derivatives ("over the counter"). These are directly concluded with counterparties having at least an investment grade status. Thus, there are no quoted market prices available.

Forward exchange contracts, interest rate swaps and cross-currency swaps are measured on the basis of a market-to-market valuation model. The input parameters applied in the valuation models are derived from market quotes.

Interest rates with matching maturities in the traded currencies are used for forward exchange contracts and cross-currency contracts. In order to obtain the fair value of such OTC derivatives, the determined amounts are multiplied with the counterparty's credit default swaps (CDS) with matching maturities which are observable on the market or their own credit risk using a so-called "add-on method", including the coupons.

In order to obtain the fair value of interest rate swaps interest rates at comparable terms and residual maturities are used taking into account own counterparty risk DVA (debt value adjustment) or counterparty risk CVA (credit value adjustment) from available credit default swap (CDS) quotations.

Fair Value of Primary Financial Instruments

The following table presents the carrying amounts and fair values of financial assets and financial liabilities of the Group and Company by category of financial instruments, which are not measured at fair value. The table does not contain information on the fair value of financial assets and financial liabilities if the carrying amount represents an appropriate approximation to the fair value. This includes the following line items of the Group and Company Statement

of Financial Position: financial investments, leased assets held for sale, non performing lease receivables, trade receivables, credit support accounts, cash and cash equivalents, and trade payables. All primary financial instruments are assigned to level 2 of the fair value hierarchy

GRENKE FINANCE PLC

137

except for exchange-listed bonds, which are included in debt securities in issue and which are assigned to level 1 of the fair value hierarchy. As per the reporting date, the carrying amount of exchange-listed bonds was €2,495,071,000 (2023: €2,230,384,922) and their fair value amounted to €2,660,938,871 (2023: €2,431,361,587). For all other financial instruments the discounted cash flow method was used, taking account of the Grenke AG Group’s credit risk. These fair values are allocated as Level 2.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

42. FAIR VALUE OF FINANCIAL INSTRUMENTS CONSOLIDATED (Continued)

	Fair Value	Carrying Amount	Fair Value	Carrying Amount
	2024	2024	2023	2023
	€	€	€	€
Financial assets
Lease receivables (performing)	2,600,636,023	2,417,399,198	2,233,055,712	2,093,978,043
Amount due from related parties	2,088,111,988	2,061,965,578	1,857,999,303	1,820,928,164
Subordinated loans	47,394,229	48,399,727	45,149,565	45,957,629
Financial liabilities
Financial liabilities	3,364,406,927	3,333,797,276	3,218,160,949	3,002,861,560
Amounts due to related parties	1,390,339,308	1,414,459,842	1,239,594,341	1,225,615,751

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY

The exposure of the Company can be broken down into two main categories: financial and non-financial risks.

Risk Management Framework

The board of directors has overall responsibility for the establishment and oversight of the Company’s risk management framework. The formal procedures and policies operated by the Group and Company to cover leasing, banking, foreign exchange and other treasury matters

GRENKE FINANCE PLC

138

are consistent with objectives and policies for financial risk management within the GRENKE AG Group. As the Group and Company is dependent on the cash inflow from leases to third parties and loans to Group companies and Franchisees the principal financial risk facing the

Company is the inability to service its payment obligations due to the inability of counterparties to service their leases or their loans from the Group and Company. This note presents

information about the Group and Company’s exposure to each of the risks identified by the board and the Company’s management of these risks.

Solvency

Given its objectives and strategy, the Company is economically interrelated with the parent company, GRENKE AG. In assessing the general risk profile of the Company, the solvency of the Grenke AG Group as a whole, headed by GRENKE AG, needs to be considered. Solvency is assured by managing and monitoring the liquidity situation based on a rolling cash flow forecast. The resulting funding requirements are secured by a variety of instruments placed on the financial markets. The objective is to minimize solvency risk by matching maturities for the Grenke AG Group’s financing requirements within the framework of the target debt ratio. The Grenke AG Group has good access to capital markets as a result of its solid financial position and a diversified refinancing strategy.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Solvency (Continued)

This is underpinned by the long-term ratings (Standard & Poor’s as of November 2024 BBB stable outlook and Fitch as of June 2024 BBB stable outlook) and short term ratings (Standard & Poor’s as of November 2024 A-2 stable outlook and Fitch as of June 2024 F2 stable outlook). The debt securities are guaranteed by Grenke AG.

At present, no risks have been identified which could threaten the going concern status of the Company or which could have a materially adverse impact on the net assets, financial position or results of operations of the Company.

Credit Risk

The amount recognised in the Statement of Financial Position is the maximum credit risk in the case that counterparties are unable to fulfil their contractual obligations. In the case of derivative financial instruments, the Company is also exposed to credit risk, which results from the non-performance of contractual agreement on the part of the counterparty.

The maximum exposure to credit risk at the reporting date was:

	2024	2023
	€	€
Subordinated loans and reserve accounts	89,716,719	83,528,259
Finance lease receivables	2,503,439,464	2,167,711,492
Amount due from related parties	2,061,965,578	1,820,928,164
Trade debtors	961,757	221,428

GRENKE FINANCE PLC

139

Credit support accounts

8,363,000

10,050,000

Cash and cash equivalents

117,100,755

143,284,978

Derivative financial instruments	14,625,090	11,848,102
Guarantees to Grenke AG and Grenke Limited	-	2,103
Gross Exposure	4,796,172,363	4,237,574,526
Guaranteed by GRENKE AG	1,315,340,498	1,121,847,928
Subordinated Loans (netting with asset based liabilities)	48,399,728	45,957,629
Credit support accounts (netting with liability derivative positions)	8,363,000	10,050,000
Residual maximum exposure	3,424,069,137	3,059,718,969

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Credit Risk – Leasing

Credit risk management is focused on ensuring that prior to entering into new leases the credit risk is minimised. Strategies to minimise risk include

entering into a high volume of low value leases

entering into leases for a short duration

direct debit payment of lease instalments

no concentration of industrial sectors

no concentration of sellers of equipment to be leased

no geographic concentration

There is an effective credit approval system which means that leases of a relatively small amount have to be approved by the credit centre and ultimately by the Grenke AG board. The total exposure of a lessee to the Grenke AG Group is always taken into consideration as part

of the approval process. There is also an annual review carried out of lessees with a modest overall credit exposure.

The Group and Company also seeks to minimise losses on leases in existence by terminating leases once two instalments have not been paid with the objective of recovering immediately all unpaid instalments including lease instalments due after the termination date.

The following sets out the credit profile of new business entered into the new year.

The Group and Company determines the creditworthiness of clients by calculating expected values for losses. In doing so lessees are assigned a decision value based on a creditworthiness rating of 1 to 6. Category 1 corresponds to the best possible creditworthiness

GRENKE FINANCE PLC

140

and Category 6 is equivalent to the worst. As per December 31, 2024, the average decision value on new business was 2.46 after 2.44 in the previous year.

New business according to risk category	2024	2023
Percent	%	%
Class 1	34.20%	34.11%
Class 2	25.69%	25.80%
Class 3	16.92%	16.76%
Class 4	11.52%	12.27%
Class 5	6.93%	7.00%
Class 6	4.74%	4.07%

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Credit Risk – Leasing (continued)

The distribution of the Group and Company new business according to size can be found in the following table:

New business by size
(based on net acquisition values)	2024	2023
Percent	%	%
< €2.5k	29.50%	29.95%
€2.5k - €5k	29.32%	29.97%
€5k - €12.5k	24.85%	25.03%
€12.5k - €25k	9.50%	8.94%
€25k - €50k	4.29%	4.02%
€50k - €100k	1.83%	1.53%
€100k - €250k	0.63%	0.50%
> €250k	0.09%	0.07%

The average term of the new business contracted in the reporting period was 51 months (2023: 50 months).

New business by term category

2024

2023

GRENKE FINANCE PLC

141

Percent

%

< 36 Months

28.02%

30.01%

37 - 48 Months

15.33%

15.75%

49 - 60 Months

33.04%

30.16%

> 60 Months

23.61%

24.08%

The Group and Company consider the credit risk of its lessees to be a significant business risk.

This risk is evaluated and controlled using statistical models. The Group and Company credit centre is an additional tool to limit risk. The statistical models utilised by the Group and Company lead to an expected value of future credit losses, which are taken into account as an imputed cost of risk in the contribution margin calculation.

A review of credit risk is performed regularly and at least once per quarter on the basis of actual loss figures using database reports containing both publicly available data and internally gen- erated historical data. This system is continually enhanced by the Group and Company.

Target / actual comparisons are carried out continually for all portfolios, in which the initially expected credit losses are compared with the updated loss expectancy. Findings from this comparison flow into statistical models, thereby forming a loop system. The plan ensures that

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Credit Risk – Leasing (continued)

the ongoing costs of operations can still be generated even when the actual losses significantly exceed the expected losses.

When contracting lease agreements attention is given to achieve the broadest diversified port- folio possible based on the following:

Lessees: Diversified portfolio of lessees consisting of business and corporate clients (B2B). Leases were contracted with 95,602 (2023: 89,114) different lessees of which the top 10 accounted for 3.10% (2023: 1.66%) of new business and the top 100 accounted for 7.27% (2023: 5.79%) of new business and the average value of new business contracted with each lessee was €12,919 (2023: €11,793).

Resellers / manufacturers: No individual dependencies

Leased assets: No significant outstanding residual values (full cost recovery); maintenance and warranty risks are always borne by suppliers / manufacturers; leased assets are seen as part of the customer’s value chain

Categories of lease items: IT products, small machinery and systems and medical devices

Lease agreements: A large number of new contracts with an average contract term of roughly four years and a focus on small tickets below EUR 25k each (93 percent of all new lease contracts)

Sales channels: Our agents have a variety of sales channels with an extensive network of resellers, direct business and brokers

GRENKE FINANCE PLC

142

Geographic presence: The Group and Company is represented in eleven European economies

The majority of finance leases concluded provide for full economic cost recovery. This means that payments made by the lessee during the basic lease period, including the guaranteed residual values, exceed the acquisition and contract costs. Accordingly, there are no material residual value risks in the Group and Company leasing business model. In accordance with IFRS 16, residual values are calculated for the recognition of lease receivables on a portfolio basis. Therefore, over the total period, gains / losses from disposals do not contribute a material amount to earnings.

The revenue that is generated from rentals in the secondary lease period together with proceeds from the sale of the lease is expected to result in a break-even result from disposals.

The high degree of portfolio diversification is demonstrated by the comparatively low mean acquisition value per leasing contract of the Group and Company. The mean acquisition value of all leases that were active in 2024 was €8,539. A concentration of risk is largely avoided through the Group and Company’s focus on small-ticket leasing. Within Group and Company, the total exposure to any single lessee did not exceed 7.7 percent of the Group and Company’s equity. At the end of the 2024 fiscal year there were 17 borrowers in the leasing business whose exposure exceeded the limit of EUR 1.5 million. Together they amounted to less than 2.02 per- cent of the total performing lease receivables. Commitments above a size of EUR 750k are monitored closely, as are cluster risks of our sales partners with regard to individual

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Credit Risk – Leasing (continued)

resellers or agents.

To determine risk provisions for lease receivables pursuant to IFRS 9, the receivables are divided into three Stages depending on their respective credit risk. Impairment losses for Stage 1 leases correspond to the expected loss for a twelve-month period. For lease receivables in Stage 2, impairment losses are recognised in the amount of the expected loss for the entire remaining contract period. For Stage 3 lease receivables, expected losses are recognised as impairment. As per December 31, 2024, 88.97 percent of the net receivables of the Leasing

segment were allocated to Stage 1. The expected credit loss allowance charge to the statement of profit or loss on finance lease receivables was €60.9(2023: €52.8m).

Country risk at the end of the 2024 fiscal year was concentrated in France which accounted for 57 percent of the total performing finance lease receivables volume of the leasing business. The respective Allianz Trade Country Risk Rating for France is “AA1 Low Risk”. Of the countries in which the Group and Company carries out leasing 96% of the performing lease receivables are located in countries with Allianz Trade risk rating of “A1 Low Risk” or a better risk rating. The Group and Company has performing finance lease receivables in Hungary of €3m (0.12% of total performing finance lease receivables) which is given a B2 medium risk rating by Allianz Trade. There are performing finance lease receivables of €99m (4.02% of total performing finance lease receivables) from Romania which have an Allianz trade risk rating of B3 sensitive risk.

GRENKE FINANCE PLC

143

The split of performing finance lease receivables by where the lease is located in the Allianz Trade risk ratings is set out below:

Allianz Trade Risk Rating

2024

2023

AA/1 (Low)	76%	76%
A/1 (Low)	20%	12%
A2 (Medium)	-	1%
BB/1 (Low)	-	7%
B/3 (Sensitive)	4%	4%

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Sensitivity Analysis – Leasing

The calculation of impairment losses on financial assets is based on assumptions and estimates regarding the risk of default and the expected loss rates. The Group and Company exercises judgement in determining these assumptions and in selecting the input factors for the calculation of impairment. The most important assumptions and input factors used are set out in the accounting policies note 4.

To determine the risk provision in accordance with IFRS 9, expected credit defaults of various macroeconomic scenarios are weighted. GRENKE calculates a negative, a positive and a base scenario for this purpose.

The assumed development of gross domestic product for each scenario is shown in the following table:

GRENKE FINANCE PLC

144

Gross domestic product (in % compared to GDP at year end 31.12.2025	01.01.2025 – 31.12.2025			01.01.2026 – 31.12.2026			01.01.2027 – 31.12.2027
	negative	Base	positive	negative	Base	positive	negative	Base	positive
Euro area	-6.30%	1.20%	2.60%	1.20%	1.40%	2.60%	1.40%	1.40%	2.60%
France	-7.60%	1.10%	2.40%	1.10%	1.30%	2.40%	1.30%	1.40%	2.40%
Spain	-10.90%	2.10%	3.50%	2.10%	1.80%	3.50%	1.80%	1.60%	3.50%

The amount of risk provisioning of current lease receivables per scenario is shown in the following table:

Scenarios at 31 December 2024

	negative	Base	positive
Risk provisioning	53,570,212	48,444,745	46,769,717

Scenarios at 31 December 2023

	negative	Base	positive
Risk provisioning	54,688,710	46,642,422	39,551,264

In the base scenario, A stable geopolitical situation and moderate trade relations promote a cautious recovery. Inflation remains under control, allowing central banks to adopt a cautious geopolitical stance. Unemployment rate slowly decreases due to support from labour market

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Sensitivity Analysis – Leasing (Continued)

and retraining programmes. Economic growth continues, but without explosive growth rates, driven by moderate investment in infrastructure and new technologies. Inflation stabilises within the ECB's target range (in the eurozone) and fiscal policy remains moderately expansionary to support growth. Unemployment is gradually falling, supported by structural reforms and targeted programmes to promote employment.

The negative scenario assumes persistent geopolitical uncertainties and trade conflicts reduce consumer and business confidence, leading to lower economic activity. Persistently high inflation, caused by supply chain problems and increased production costs, forces central banks to take restrictive monetary policy measures. These measures are having a negative impact on investment in key industries, which is further worsening long-term growth prospects. The unemployment rate is rising as companies cut costs and shed jobs, which is exacerbating the economic weakness.

GRENKE FINANCE PLC

145

In the positive scenario stable geopolitical situation and improved trade relations strengthen consumer and business confidence, leading to robust economic growth. Moderate inflation enables a supportive monetary policy from the central banks, which promotes economic growth. Unemployment is falling, supported by targeted labour market programmes and increasing investment in education and retraining. Sustainable growth is promoted by investment in green technologies and digitalisation, which increases productivity and competitiveness. Long-term economic growth is supported by technological innovation and ecological transformation, while robust labour markets and stable security systems ensure long-term economic stability.

Various minimum default rates (floors) are taken into account in all scenarios.

The probabilities of occurrence of the macro scenarios are determined on a country-specific basis in order to recognise the different economic and political circumstances of the respective country. These scenario weights are derived on the one hand from public data from the ECB. The ECB used a survey of various analysts to draw up a probability distribution for GDP for the years 2024 to 2026. The probability of occurrence for individual scenarios can be calculated from these probability distributions. Secondly, the publicly available GDP expectations and the IMF's historical GDP analyses are used to determine country-specific probabilities of occurrence.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Sensitivity Analysis – Leasing (Continued)

As at 31 December 2024, the scenarios in the core markets of the Group and Company are weighted as follows:

Scenario weighting

01.01.2025 – 31.12.2025

01.01.2026 – 31.12.2026

01.01.2027 – 31.12.2027

negative

Base

positive

negative

Base

positive

negative

Base

positive

France

10.40%

85.20%

4.30%

8.60%

82.40%

9.00%

7.90%

81.40%

10.70%

Spain

1.40%

94.50%

4.00%

5.30%

91.40%

3.30%

6.40%

91.10%

2.60%

Due to the increased economic uncertainty, various sensitivity analyses were also carried out. In these sensitivity analyses, the effects on risk provisioning were analysed by shifting various input parameters. Specifically, the probability of default (PD) was multiplied by a

GRENKE FINANCE PLC

146

factor of 1.15 and thus shifted up or down by 15 per cent. A 15 per cent increase in PD would result in a EUR 5,860,621 higher risk provision. A 15 per cent lower PD would result in a EUR 6,014,195 lower risk provision. In addition, the macro scenario was shifted up or down by 20 per cent. A 20 per cent improvement in the macro scenario would result in EUR 100,626 lower risk provisions. If the macro scenario worsened by 20 per cent, the risk provision would be EUR 98,207 higher. The post-model adjustment formed on the basis of these sensitivity analyses takes account of the increased economic uncertainties.

Credit Risk - Amounts due from related parties

The counterparty for the Group and Company amounts due from related parties is the specific group or franchise company. The specific related party will be able to repay the loan provided by the Group and Company if it does not have a major default in its portfolio of lease receivables or invoices purchased. Therefore, the main risk to the Group and Company is the collectability of lease receivables and invoices purchased by the related party.

The Group and Company has lent €2.1bn (2023: €1.8bn) to related parties who are carrying out leasing activities. The collectability of these loans is dependent on the performance of the underlying lease receivables in those Group companies. The Group portfolio of lease receivables has a similar profile to that which has been presented above in respect of the Group and Company lease receivables. All that has been set out above with regard to the Group and Company lease receivables can be applied to the underlying lease receivables in the GRENKE AG Group companies to which the Group and Company lends money.

The Group and Company also lends money to related parties that carry out factoring business, €45m at 31 December 2024. If these related parties had difficulties in collecting amounts due to them it would result in the Group and Company having difficulties in collecting the amounts due from the related party carrying out factoring. The GRENKE AG Group’s factoring business is also focused on the small-ticket segment. The GRENKE AG factoring entities located in Germany, Switzerland, Ireland and Poland mainly offer so-called "notification factoring". The advantage for the Group and Company and for the factoring customers is that the invoice recipient (debtor) is notified of the assignment of existing receivables, which provides an

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Credit Risk - Amounts due from related parties (Continued)

opportunity to address the recipient directly in the event of default. This leads to relief for the factoring customers and also provides transparency with regard to the monitoring of the outstanding receivables. Under certain conditions, the GRENKE AG Group also offer non-notification factoring contracts. As opposed to notification factoring, the debtor is not notified of their outstanding receivables being assigned to the factoring company.

The main criteria for selection include creditworthiness, average annual revenues, industry affiliation, and the accounts receivables ledger of the factoring clients. The ongoing monitoring of factoring customers allows for risk-adjusted pricing. Under the loan decision, a credit check

of the accounts receivable of the factoring clients on the basis of data from external credit reporting agencies is performed, which is evaluated by GRENKE AG's credit support centre.

GRENKE FINANCE PLC

147

For the most part, contracts with domestic debtors are processed since the verifiability of foreign debtors is associated with significant risks. An ongoing review and evaluation of the customer is made within the contract period on the basis of payment history. With only a few

exceptions, the factoring Group and Company is exposed to counterparty default risk solely with respect to the debtor.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Credit Risk - Amounts due from related parties (Continued)

The amounts due from Grenke AG Group Companies and Franchisees by geographical region is set out below:

Amounts due from related parties	2024	2023
	€	€
Germany	588,760,666	565,197,578
Italy	573,304,787	532,421,231
Denmark	131,575,085	96,353,201
Sweden	124,097,791	107,386,679

GRENKE FINANCE PLC

148

Australia	123,622,415	96,158,500
Spain	109,642,494	88,619,814
Canada	87,066,573	72,529,665
United Kingdom	57,569,933	33,873,699
United Arab Emirates	53,424,906	41,872,248
Belgium	44,742,989	50,296,360
Poland	43,943,850	36,335,826
Chile	43,423,387	32,930,103
Ireland	24,280,801	9,202,754
Finland	16,753,286	4,387,157
Hungary	16,082,915	9,512,085
Czech	11,121,605	9,831,426
USA	10,646,848	5,447,735
Slovakia	10,604,994	9,565,133
Netherlands	5,932,985	3,949,028
Romania	5,024,635	5,586,943
Switzerland	4,823,901	7,733,027
Malta	2,965,376	2,404,741
Singapore	645,438	3,007,676
Luxembourg	361,700	772,131
Slovenia	51,277	-
	2,090,470,637	1,825,374,740

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Credit Risk - Amounts due from related parties (Continued)

The table below sets out how the amounts due from related parties are split in terms of the Allianz Trade risk rating of the country where the loan is located:

Allianz Trade Risk Rating	2024	2023
AA/1 (Low)	59%	56%
AA/2 (Medium)	-	2%
A/1 (Low)	5%	6%

GRENKE FINANCE PLC

149

A/2 (Medium)	27%	29%
BB/1 (Low)	5%	-
BB/2 (Medium)	2%	7%
B/2 (Medium)	1%	-
B/3 (Sensitive)	1%	1%

Credit Risk – Cash and Derivative Financial Instruments

The credit risk for treasury activities is mitigated by entering into such contracts only with parties of first-class credit standing. Cash is on deposit with the following banks:

2024

2023

Bank

Credit Rating

€

DZ Bank

A-1 S&P

91,735,491

62,062,277

Deutsche Bank

A-1 S&P

20,233,856

34,283,034

SEB

A-1 S&P

7,179,683

50,920,238

HSBC

A-2 S&P

5,390,577

4,489,911

Credit Lyonais

A-1 S&P

499,469

19

Nord LB

P-1 Moody's

160,198

155,345

Grenke Bank

A-2 S&P

156,012

140,860

Heleba

P-1 Moody's

108,469

1,279,571

Bayern LB

P-1 Moody's

-

3,723

125,463,755

153,334,978

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Credit Risk – Cash and Derivative Financial Instruments (Continued)

Shown on the statement of financial positions as follows:

Note

GRENKE FINANCE PLC

150

Credit support accounts

26

8,363,000

10,050,000

Cash and cash equivalents

30

117,100,755

143,284,978

125,463,755

153,334,978

The counterparty bank for the derivative financial instruments shown as assets in the Statement of Financial Position are as follows:

2024

2023

Bank

Credit Rating

€

HSBC

A-2 S&P

9,675,334

7,219,130

SEB

A-1 S&P

969,211

1,801,763

Deutsche Bank

A-1 S&P

2,087,045

1,507,925

DZ Bank

A-1 S&P

1,268,935

1,152,122

Nord LB

P-1 Moody's

460,002

118,074

Bayern LB

P-1 Moody's

5,299

39,367

Heleba

P-1 Moody's

159,264

9,721

14,625,090

11,848,102

Liquidity and refinancing risk

The Group and Company refinances itself independently of individual banking institutions and has direct access to the capital markets. The Group and Company also ensures that its liabilities are well diversified and work together with several partner banks.

The Group and Company’s refinancing instruments range from traditional bank financing to revolving loan facilities and ABCP programs. This financing is fixed with agreed terms and maturities so that there are no risks relating to their availability within the agreed framework. In addition, the Group and Company has direct access to the capital markets because of the Group and Company’s debt issuance program. Using these instruments the Group and Company can make use of the most attractive financing channels offered at any time on the capital markets.

The ABCP programmes are financing loans based on defined underlying assets, i.e. lease receivables. Other refinancing instruments described are not asset−oriented, making them

appropriate for use in line with the business performance as the Group and Company deems necessary.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Liquidity and refinancing risk (Continued)

The management of liquidity risk ensures that the Group and Company is always able to meet its payment obligations on time.

GRENKE FINANCE PLC

151

The table below shows the cash that the Group and Company expects to generate from its assets held at 31 December 2024 inclusive of future income not credited to the statement of profit or loss at 31 December 2024. The overseas withholding tax of €5m (Note 26) and corporation tax receivable of €4m (Note 29) have not been included in the table below because of the difficulty of projecting the precise time that the claims will be agreed with the relevant tax authority. The table also includes details of the Group and Company financial obligations in

respect of its liabilities at 31 December 2024 inclusive of future financial expenses not charged to the statement of profit or loss at 31 December 2024.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Liquidity and refinancing risk (Continued)

	On Demand	Up to 3 Months	4 to 12 Months	1 to 5 Years	5 to 10 Years	Total	Carrying value
Expected cash from financial assets	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000
Subordinated loan and reserve accounts	-	10,156	42,636	40,825	139	93,756	89,717
Lease Receivables	-	290,044	781,520	1,879,616	35,391	2,986,571	2,503,439
Amounts due from related parties	695,015	265,145	338,401	907,537	97	2,206,195	2,061,966
Trade and other receivables	-	83,112	2,259	5,434	-	90,805	90,804
Leased assets held for sale	-	966	-	-	-	966	966
Corporation tax	-	-	3,209	-	-	3,209	3,209
Cash and cash equivalents	117,101	-	-	-	-	117,101	117,101
Receivable on forward exchange contracts net of spot rate at 31 December 2024	-	1,052	2,320	1,172	-	4,544	5,488
Total expected cash inflows	812,116	650,475	1,170,345	2,834,584	35,627	5,503,147	4,872,690

GRENKE FINANCE PLC

152

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Short term liquidity

Liquidity risk management comprises of the day to day management of incoming and outgoing payments. A “liquidity overview” for the GRENKE AG Group is prepared for short term reporting

	On Demand	Up to 3 Months	4 to 12 Months	1 to 5 Years	5 to 10 Years	Total	Carrying value
Financial obiligations	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000	€ 000
Financial liabilities	-	539,162	805,781	2,408,985	46,027	3,799,955	3,332,155
Amount due to related parties	166,659	120,243	329,638	911,465	-	1,528,005	1,414,460
Lease liabilities	-	51	152	579	-	782	1,111
Accruals	-	15,092	-	-	-	15,092	15,092
Payable on forward exchange contracts net of spot rate at 31 December 2024	-	1,821	4,167	4,088	-	10,076	7,717
Total financial obligations	166,659	676,369	1,139,738	3,325,117	46,027	5,353,910	4,770,535
Expected surplus cash inflows/(outflows) after meeting financial obligations	645,457	(25,894)	30,607	(490,533)	(10,400)	149,237	102,155

GRENKE FINANCE PLC

153

on a weekly basis, i.e. on the first working day of each calendar week. It includes all relevant information on short−term cash developments in the coming weeks. The weekly liquidity overview provides the current liquidity status of the GRENKE AG Group and the Group and Company. It focuses on cash flows from the leasing business.

Reporting distinguishes between four liquidity levels:

Cash liquidity: credit on all bank accounts plus overdrafts and all “immediate” (one week) cash flows

Liquidity 1: cash liquidity plus cash flows due or received within one month. This also includes tied−up assets that can be monetised within this period

Liquidity 2: liquidity 1 plus cash flows due or received within three months. This also includes tied up assets that can be monetised within this period.

Liquidity 3: liquidity 2 plus cash flows due or received in more than three months. This also includes tied-up assets that can only be monetised in a period of more than three months.

Medium and long term liquidity

Monthly static liquidity planning is carried out in addition to short- term liquidity management and weekly reporting. The basic assumption of this planning is the liquidation of the existing

leasing and lending portfolio in accordance with the contractual agreements so that the proceeds from the assets flow in due time. The liabilities are also repaid on time on the basis

of contractual agreements. As the duration of the liabilities side approximates that of the asset portfolio, financing largely matching maturities is ensured.

In addition, dynamic liquidity planning is carried out at least once every quarter with the aim of replicating the liquidity status for the next periods, which serves to manage the liquidity of the Group and Company.

Grenke AG unconditionally and irrevocably guarantees all debt securities of the Group and Company.

Market Risk

Market risk is defined as potential losses that may result from uncertainty about future development (amount and volatility) of market prices. Financial market price fluctuations can have a significant effect on the Group and Company cash flow and profit after tax. Of particular importance are changes in interest rate markets and certain currencies. Market risks at the Group and Company are considered material.

The Group and Company strategic approach is to enter into market risk exclusively in conjunction with the operating business and reduce these risks to the greatest extent possible. As part of the risk management and ongoing monitoring of interest and currency positions, the

Group and Company actively manages its positions and risk (for example, by hedging open currency positions) in the course of ordinary business.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Market Risk (Continued)

GRENKE FINANCE PLC

154

In addition to risk-prone, market-sensitive positions such as floating-rate notes or receivables in foreign currencies, we also consider the sensitivity and elasticity of the respective market prices to be important factors when dealing with interest and currency risks. The goal of the Group and Company is to limit the effect of market price volatility on the Group and Company’s net profit. This means striving to ensure the highest possible independence of net profit to interest rate and currency market developments while maintaining a proper balance between the costs and benefits of hedge relationships. The parameters used for conducting risk analysis by means of a sensitivity analysis are:

a concurrent parallel increase or decrease of 10 percent in the value of the euro compared with all major foreign currencies and

a parallel shift of 100 basis points (one percentage point) in the term structure of interest rates.

The potential economic effects identified in the analyses are estimates based on fictitiously assumed changes in market prices and that all other conditions will remain unchanged. This is the reason that the shift in the term structure of interest rates is viewed independently of any related effects on other interest rate-induced market developments. The actual impact on the consolidated income statement can differ significantly from this as a result of the actual developments.

The predominant market risks and the outstanding interest rate and currency risk positions are discussed at least once monthly with the responsible member of the Board of Directors in the

Market Risk Task Force and on the basis of ongoing analyses. The Group and Company is not exposed to the risk of changes in equity prices or raw material prices.

The Group and Company uses derivative financial instruments specifically when ordinary business activities involve risks that can be minimised or eliminated through the appropriate derivatives. The sole instruments used are interest rate and currency swaps and forward exchange contracts. Each derivative contract relates to an underlying economic transaction with a corresponding opposing risk position. The contract partners are only those banks with predominantly good or very good credit ratings with an S&P rating of BBB+ or higher.

Interest rate risk for the Group and Company arises from the effects of changes in the market interest level on the positions of the interest book (interest-bearing asset and liability items) and the corresponding impact on net interest income. The Group and Company has very few financial instruments which are exposed to variable rates of interest. The Group and Company has due to the increasing interest rate environment put in place interest rate swaps which hedge €350m of its asset based liabilities which are exposed to variable rates of interest.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Market Risk (Continued)

GRENKE FINANCE PLC

155

Most of the Group and Company’s financial instruments have fixed rates of interest. The following instruments that result to net exposure to interest rate risk are as follows:

	2024	2023
	€	€
Credit support accounts	8,363,000	10,050,000
Amount owed by Grenke AG	100	100
Interest bearing cash accounts	115,777,993	117,615,914
Cash pool balances	593,990,152	449,608,066
Bonds	(10,000,000)	(10,000,000)
Subordinated loans and reserve accounts	102,630,073	116,469,842
Asset Based Liabilities	(489,218,577)	(505,979,298)
Interest rate swaps hedged amount	505,000,000	385,000,000
Net Exposure to interest rate risk	826,542,741	562,764,624

The potential impact on profit before tax of a change in interest rates of plus or minus 100 basis points as per the reporting date is shown below.

Company and consolidated	2024	2024	2023	2023
	+100 bp	-100 bp	+100 bp	-100 bp
	€	€	€	€
Potential (decrease)/increase in profit	8,265,427	(8,265,427)	5,627,646	(5,627,646)

Open interest rate positions are assessed monthly according to the internal definition and the required action is initiated. Refinancing is then completed by the team using the hedging transactions decided by the Board of Directors.

Due to the international nature of its business, the Group and Company has unsettled foreign currency positions, thereby exposing the Group and Company to currency risk. Hedging strategies defined internally are applied in an effort to limit or eliminate these risks. The

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Market Risk (Continued)

GRENKE FINANCE PLC

156

derivatives used are recognised on the statement of financial position at their fair values under the line items financial assets or financial liabilities.

Currency risks mainly relate to the financing of Group companies and franchisees operating outside the euro-zone. The hedging of unsettled foreign currency cash flows takes place on

the basis of internally defined hedging limits that take effect when the holding at the day’s exchange rate amounts to €500k per currency. The exchange rate is fixed by means of contracts and is therefore well known for the entire internal financing of the operational business in Australia, Canada, Switzerland, Denmark, Great Britain, Sweden, Chile, Poland, USA and Singapore. The exchange rate is also fixed for a majority of the financing in the United

Arab Emirates, the Czech Republic and Hungary. As a result, the only risk that remains is the risk on the respective open tranches where the hedging limit of €500k continues to apply.

In general, risks arise from currency fluctuations which relate to financial assets and financial liabilities. The use of derivatives (forward exchange contracts and currency swaps are used for currency risk) lessens the market sensitivity of the underlying transaction, i.e. cash flows from financial assets and financial liabilities. Ideally, the instruments are offset almost entirely.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

GRENKE FINANCE PLC

157

Market Risk (Continued)

The Group and Company’s currency risk is generally hedged. The unhedged foreign currency balances of the Group and Company converted at the spot rate for the Euro at 31 December are set out below:

Year End 31 December 2024

Foreign currency	Nominal value of foreign currency balances in foreign currency	Nominal Value of Forwards Exchange Contracts in foreign currency	Unhedged amount in foreign currency	Unhedged amount in €
				€
AED	203,046,213	221,207,566	(18,161,353)	(4,778,675)
AUD	207,237,041	214,013,000	(6,775,959)	(4,040,042)
CAD	130,095,495	132,315,000	(2,219,505)	(1,484,817)
CHF	4,541,859	4,500,000	41,859	44,474
CLP	44,779,065,617	45,305,268,000	(526,202,383)	(510,272)
CZK	235,765,321	310,901,000	(75,135,679)	(2,983,350)
DKK	980,957,539	1,068,459,000	(87,501,461)	(11,732,878)
GBP	45,656,698	45,808,000	(151,302)	(182,472)
HUF	3,977,767,976	3,425,149,000	552,618,976	1,343,428
PLN	181,796,307	183,627,000	(1,830,693)	(428,232)
RON	41,847,700	-	41,847,700	8,412,782
SEK	1,422,038,239	1,526,746,000	(104,707,761)	(9,137,600)
SGD	915,896	900,000	15,896	11,223
USD	10,443,074	11,082,000	(638,926)	(615,002)
JPY	33,250,000,000	33,250,000,000	-	-
TRY	1,593	-	1,593	43

GRENKE FINANCE PLC

158

Total exposure in €

(26,081,390)

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Market Risk (Continued)

Year End 31 December 2023

Foreign currency	Nominal value of foreign currency balances in foreign currency	Nominal Value of Forwards Exchange Contracts in foreign currency	Unhedged amount in foreign currency	Unhedged amount in €
				€
AED	170,146,817	184,748,566	(14,601,749)	(3,593,481)
AUD	156,291,608	159,499,000	(3,207,392)	(1,972,202)
CAD	106,143,572	108,617,000	(2,473,428)	(1,689,269)
CHF	12,862,011	12,700,000	162,011	174,958
CLP	32,099,934,850	32,882,835,000	(782,900,150)	(803,147)
CZK	192,608,493	270,704,000	(78,095,507)	(3,158,692)
DKK	717,853,728	778,836,000	(60,982,272)	(8,182,355)
GBP	27,269,280	27,090,000	179,280	206,294
HUF	4,204,134,009	3,067,726,400	1,136,407,609	2,968,672
PLN	154,601,680	159,400,000	(4,798,320)	(1,105,731)

GRENKE FINANCE PLC

159

RON	27,916,833	-	27,916,833	5,610,747
SEK	1,191,563,727	1,284,171,000	(92,607,273)	(8,346,005)
SGD	30,532,028	30,088,000	444,028	304,316
USD	5,361,804	5,250,000	111,804	101,180
JPY	33,250,000,000	33,250,000,000	-	-
TRY	1,592	-	1,592	49
NOK	1,379	-	1,379	123
Total exposure in €				(19,484,543)

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

43. RISK MANAGEMENT OBJECTIVES AND POLICIES OF THE GROUP AND

COMPANY (Continued)

Market Risk (Continued)

The following table shows the Group and Company’s sensitivity to a 10 percent appreciation or depreciation in the Euro against the respective other currencies as per 31 December 2024 and 31 December 2023 their impact on the profit before tax.

Foreign

2024

2023

currency

10%

-10%

10%

-10%

Depreciation

Appreciation

Depreciation

Appreciation

€

AED

(530,964)

434,425

(399,276)

326,680

GRENKE FINANCE PLC

160

AUD

(448,894)

367,277

(219,134)

179,291

CAD

(164,980)

134,983

(187,697)

153,570

CHF

4,942

(4,043)

19,440

(15,905)

CLP

(56,697)

46,388

(89,239)

73,013

CZK

(331,483)

271,214

(350,966)

287,154

DKK

(1,303,653)

1,066,625

(909,151)

743,850

GBP

(20,275)

16,588

22,922

(18,754)

HUF

149,270

(122,130)

329,852

(269,879)

PLN

(47,581)

38,930

(122,859)

100,521

RON

934,754

(764,798)

623,416

(510,068)

SEK

(1,015,289)

830,691

(927,334)

758,728

SGD

1,247

(1,020)

33,813

(27,665)

USD

(68,334)

55,909

11,242

(9,198)

TRY

5

(4)

5

(4)

NOK

-

14

(11)

Contractual Risk

Contractual risk relates to risks to net assets and earnings as a result of unguaranteed residual values. Contractual risk is limited by generally concluding full pay out leases and never entering into maintenance or warranty risks.

Legislative Risk

The Group and Company currently will be required in its annual report for the year end 31 December 2025 to report under the Corporate Sustainability Reporting Directive. The Directors have been monitoring what the Group and Company will be required to report and they believe that the Group and Company will be able to comply with the legislation.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

GRENKE FINANCE PLC

161

44. ULTIMATE PARENT UNDERTAKING GROUP AND COMPANY

The parent undertaking of the smallest and largest group of undertaking for which group financial statements are drawn up, and of which the Group and Company is a member and is consolidated, is GRENKE AG, a company incorporated in Germany. Copies of its GRENKE AG Group financial statements are available at Neuer Markt 2, 76532 Baden−Baden, Germany and also at www.GRENKE.de. GRENKE AG is the immediate and ultimate parent undertaking

and controlling party.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

GRENKE FINANCE PLC

162

45. RELATED PARTY TRANSACTION CONSOLIDATED AND COMPANY

	2024	2023
	€	€
GRENKE AG transactions
Management charges from Grenke AG	337,032	277,843
Licence fee charge from Grenke AG	4,162,862	8,809,295
Guarantee fee charge from Grenke AG	6,905,945	2,784,188
GRENKE Bank AG transactions
Interest paid to GRENKE Bank AG	42,171,104	25,639,478
Amounts due to GRENKE Bank AG	1,247,801,022	965,662,660
Risk premium fees paid to GRENKE Bank AG	34,580,604	39,352,222
Debt forgiven by Grenke Bank AG under the risk
premium agreement	26,214,146	20,241,477
Other transactions with GRENKE AG Group companies
Accountancy fees charged to GRENKE AG
group companies	1,816,279	1,635,609
Accountancy fees charged to GRENKE AG
group franchisees	145,515	177,192
Office rents paid by GRENKE AG Group companies
companies	18,780	269,071
Lease commissions paid to GRENKE AG Group
companies	80,904,102	74,342,167
Commissions for fees to protect lease equipment
paid to GRENKE AG Group companies	12,734,933	14,221,999
Interest received from GRENKE AG Group
companies	111,888,854	76,226,318
Interest received from GRENKE AG Group
franchisees	9,955,043	8,117,791
Interest paid to GRENKE AG Group companies	9,782,641	2,656,016
Secured amounts owed by GRENKE AG Group
companies	194,453,757	153,836,080
Unsecured amounts owed by GRENKE AG Group
companies	1,765,526,922	1,566,078,893

NOTES TO THE FINANCIAL STATEMENTS

GRENKE FINANCE PLC

163

AT 31 December 2024

45. RELATED PARTY TRANSACTION CONSOLIDATED AND COMPANY (Continued)

	2024	2023
	€	€
Unsecured amounts owed by GRENKE AG Group
franchisees	130,489,960	105,459,767
Unsecured amounts owed to GRENKE AG Group
companies	100,309,273	101,561,690
Cash pool amounts owed to GRENKE AG Group
companies	66,349,547	158,391,401
Related party disclosures Company
Transactions with SPVs
Interest received from Kebnekaise Funding Limited	573,885	512,628
Interest received from Opusalpha Purchaser II
Limited	1,253,935	988,860
Interest received from Elektra Purchase No. 25
Limited	696,013	861,711
Interest received from Coral Purchasing (Ireland)
2 DAC	767,741	596,175
Amount due from Kebnekaise Funding Limited	11,195,100	10,227,627
Amount due from Coral Purchasing (Ireland)
2 DAC	43,166,639	37,571,222
Amount due from Opusalpha Purchaser II Limited	35,197,710	34,668,783
Amount due from Elektra Purchase No. 25 Limited	8,851,862	20,018,077
Amount due from FCT "GK" Compartment G2	620,832	3,764,133
Amount due from FCT "GK4" Compartment GK4	2,100,000	5,785,000
Amount due from FCT "GK5" Compartment GK5	1,497,931	4,435,000
Interest and expenses paid to FCT "GK"
Compartment G2	4,396,128	6,181,286
Interest and expenses paid to FCT "GK4"
Compartment GK4	7,841,895	5,782,379
Interest and expenses paid to FCT "GK5"
Compartment GK5	6,311,896	6,123,581
Amount owed to FCT "GK" Compartment G2	62,135,597	140,334,353
Amount owed to FCT "GK4" Compartment GK4	184,999,949	184,999,998
Amount owed to FCT "GK5" Compartment GK5	173,692,269	155,728,369
Amount owed to Kebnekaise Funding Limited	68,390,762	24,916,578

GRENKE FINANCE PLC

164

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

45. RELATED PARTY TRANSACTION CONSOLIDATED AND COMPANY (Continued)

	2024	2023
Amount paid to directors	€	€
Amounts paid to Directors	470,277	447,818

All of the above entities are related parties because they are members of the Grenke AG Group

which owns 100% of the share capital of the Company.

The management charges from GRENKE AG are for IT services and for administrative services from GRENKE AG Group.

The licence fee charge from Grenke AG is for the use of the Grenke brand, business model and proprietary systems.

The guarantee fee charge from Grenke AG is for the provision of guarantees and other means of explicit support by Grenke AG to the Company for the purposes of its financing activities.

The transactions on which interest is paid to GRENKE Bank AG and the amounts due to GRENKE Bank AG are explained in note 33.

The transactions on which guarantee fees are paid to GRENKE Bank AG and which payments from GRENKE Bank AG are received are explained in note 12 and note 33.

The transactions on which guarantee fees are received from GRENKE Bank AG and which payments are made to GRENKE Bank AG are explained in note 46.

The accountancy fees charged to GRENKE AG Group companies and Grenke AG Group franchisees are explained in note 15.

Grenke Limited currently occupies unit 306 and unit 307 Q House, Sandyford Industrial Estate, Dublin 18 from the Group and Company in respect of which it commences to pay the Group and Company €109,614 p.a. from 6 November 2024 until 5 November 2028 which is an amount equal to the rent which will be payable by the Group and Company to the landlord for unit 306 and unit 307. Grenke Limited also co shares the meeting rooms at Unit 310 Q House in respect of which it pays the Group and Company an amount equal to 50% of the cost of the rent of €30,040 p.a. from 6 November 2024 until 5 November 2028 for Unit 310 in Q House. There is no lease agreement between Grenke Limited and the Group and Company. The Group and Company can request that Grenke Limited vacate the units at any time if it requires the units for its own business activities. Details of the rental income are included in note 15.

GRENKE AG Group Companies in France, Spain, Portugal, Netherlands, Luxembourg, Hungary, Slovenia, Finland, Romania, Malta, Germany and Italy act as agents for the Group and Company. The agents write leases on behalf of the Group and Company, collect lease instalments on behalf of the Group and Company sell leased equipment on behalf of the Group

GRENKE FINANCE PLC

165

and Company and secure fees for protecting the Group and Company leased equipment in return for which they are paid commissions.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

45. RELATED PARTY TRANSACTION CONSOLIDATED AND COMPANY (Continued)

Interest received from GRENKE AG Group companies, secured amounts owed by GRENKE AG Group companies, unsecured amounts owed by GRENKE AG Group companies is explained in note 22.

Interest received from GRENKE AG Group franchisees, secured amounts owed by GRENKE AG Group franchisees, unsecured amounts owed by GRENKE AG Group franchisees is explained in note 22.

Interest paid to GRENKE AG Group companies and cash pool amounts owed to GRENKE AG Group companies is explained in note 12.

Unsecured amounts owed to Grenke AG Group companies and Cash pool amounts owed to Grenke AG companies is explained in note 33.

Interest income from SPV Investments and subordinated loans provided to group SPVs is explained in note 21.

Company interest and expenses paid to SPVs is explained in note 34.

Company amount owed to SPVs is explained in note 34.

Details of the directors remuneration is set out in note 17. Three of the directors receive remuneration from Grenke Finance plc. The Company does not have other key management personal apart from the directors who receive remuneration. Therefore, the details regarding the compensation of key management personnel is described in note 17.

All related party transactions were made at arm’s length.

In its responsibility to assist the financing of business activities conducted by companies of the Grenke AG Group, Grenke Finance plc applies transfer prices for financial instruments in conformity with external market levels and in accordance with national and international tax requirements.

46. CAPITAL MANAGEMENT GROUP AND COMPANY

For the purpose of the Group and Company’s capital management, capital includes share capital and capital reserve and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Group and Company’s capital management is to maximise the shareholder value.

The Group and Company manages its capital structure and makes adjustments in light of changes in economic conditions and the business and liquidity requirements of its parent GRENKE AG. To maintain or adjust the capital structure, the Group and Company may adjust the dividend payment to its parent, return capital to its parent, issue new shares or obtain

GRENKE FINANCE PLC

166

capital contributions. The Group and Company has no externally imposed capital requirements.

NOTES TO THE FINANCIAL STATEMENTS

AT 31 December 2024

47. IMPORTANT EVENTS SINCE THE YEAR END GROUP AND COMPANY

No events have occurred since the Statement of Financial Position date outside the normal course of the Group and Company’s business, or which require an adjustment to the financial statements.

48. APPROVAL OF THE FINANCIAL STATEMENTS CONSOLIDATED AND COMPANY

The Group and Company financial statements of GRENKE Finance PLC were approved and authorised for issue by the Directors on 13 March 2025.