Zenith has grown its funded fleet by 5% year-on-year, helped by a 10% increase in company car and salary sacrifice vehicles.

Its risk fleet now stands at more than 78,000 units – a 0.6% increase on the last quarter – while the leasing company’s overall fleet, including managed vehicles, is now in excess of 173,760 units – up by more than 3% over the past year and 2% quarter-on-quarter.

Deliveries were up 10% year-to-date and termination volumes up 35%.

Zenith, which was ranked the country's seventh largest leasing company in the most recent FN50, says that its order bank continues to normalise, reaching 7,731 vehicles at the end of December 2023, with lead times now at 120 days, a level last seen in March 2021.

Almost two-fifths (39%) of Zenith’s funded fleet is now made up of battery electric vehicles (BEVs) and 42% of its order bank, as of December 31, 2023.

However, while turnover was £581.5 million, up 20% year-on-year, gross profit stood at £100.4m, down 8%, as a result of pressure in the used car market for both internal combustion engine (ICE) and electric vehicles (EVs).

EBITDA was £46m, down 22% year-on-year, while operating expenses increased by 9% year-on-year, up to £54.4m, driven primarily by inflation and ongoing investment.

Zenith reports that average termination profit per vehicle was down by more than a third (37%) year-to-date.

In response, it has launched a new initiative to extend the current BEV fleet with existing drivers, mitigating inflation of their lease costs and its residual value (RV) risk.

The consumer division, meanwhile, has launched two new solutions to expand its target market and leverage its existing capabilities and infrastructure: a business contract hire (BCH) proposition for small businesses; and a partnership with a major high street bank to provide personal contract hire (PCH) solutions for BEVs.

The commercial division grew its managed fleet following the successful onboarding of Travis Perkins and Wales and West Utilities.

In response to changes in customer requirements, the right-sizing of the trailer fleet continues, with a 5% reduction since July 2023.

Tim Buchan, Zenith's chief executive officer, said: “I am pleased with our performance during the quarter. While inflation continues to drive up operating costs, and weaker consumer demand contributes to a decline in used vehicle prices, Zenith’s diversified offering and innovative approach has again underpinned our top line growth.

“We remain focused on ensuring the optimal efficiencies of our operations, while investing in new propositions and service solutions that can deliver the most impact.

“We have expanded our offering by opening new vertical markets such as business contract hire, as well as launching a significant white-label partnership with a high street bank.

“We’ve also seen strong growth in our funded corporate company car and salary sacrifice schemes, which have increased by 10% year-on-year.”

He continued: “As our group transformation programme enters its next phase, I am pleased to announce that Andrew Kirby will stay within the Group, and on the leadership board, to support its delivery.

“Andrew will be leading the business transformation team which will migrate all our corporate division customers onto our new digital platform and oversee the introduction of a new financial system.

“Our liquidity remains strong, with over £100m across our available cash and revolving credit facilities, enabling us to continue growing the fleet and delivering our strategic objectives.

“As always, I’d like to thank all our colleagues for their continued hard work and dedication and our customers and partners for their support and confidence in Zenith.”