SG Equipment Finance boosts its position in farm investment financing

Press release

5/9/2011
8:00 AM

In the first quarter of 2011, SG Equipment Finance Czech Republic (SGEF) grew markedly stronger in the financing of Czech and Slovak farmers’ investments. Over the first three months of 2011, SGEF financed agricultural machinery worth CZK 121.8 million (initial cost), which implies a year-on-year growth of 264%. The number of agricultural machinery financing agreements executed in the first quarter doubled year-on-year.

SG Equipment Finance’s experiences indicate that the economic slowdown did not have such impact on the financing of agricultural machinery as on the other segments of the leasing market. To a considerable extent, this is attributable to the currently running subsidy schemes that help farmers to invest in the replacement and development of the required machinery.

“In their decision-making on new equipment, the use of subsidy schemes is very important for farmers. In 2010, farmers used subsidies from Podpůrný a garanční rolnický a lesnický fond (PGRLF) in relation to 35% of financing agreements, while another 4% of these agreements involved a subsidy from the European Investment Bank,” said Pavel Buček, SG Equipment Finance Sales Director.

In the first quarter of 2011, the average price of a financed machine exceeded CZK 2.59 million, implying a year-on-year growth of 70%. For FY 2010, SGEF financed the acquisition of 184 agricultural machines with a total initial cost of almost CZK 375 million in the Czech Republic and Slovakia.

Across all market segments, SG Equipment Finance Czech Republic financed the acquisition of assets worth CZK 8.043 billion in 2010. Mainly thanks to the successful fourth quarter of 2010, the company outperformed its businesses plans for 2010 and further expanded its market share on the Czech market.