Volkswagen Financial Services (FS) has posted its annual results for the financial year 2018, revealing a 6.2% increase in operating profit to reach a record €2.61bn (£2.23bn).

The portfolio of current contracts also reached a record high in 2018, with a total of more than 20m units recorded at the end of the year – an increase of 5.5% year-on-year. The total assets of the Volkswagen FS division at the end of 2018 amounted to €207.6bn (£177.9bn), up from €186.9bn in 2017.

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“Our intention is to reach a portfolio of 30m contracts by 2025 and also save €850m each year from then onwards,” said Lars Santelmann, chairman of the management board of Volkswagen FS. “This will be achieved by enhancing our productivity, by introducing standard IT systems and by optimising our sales costs.”

The company grew in almost all product categories over the course of 2018, driven by services such as maintenance and wear and tear and the fleet business in Europe. Volkswagen noted that activity in this area of the business is likely to grow as a result of the company’s participation in FleetLogistics.

The range of mobility services offered by Volkswagen FS is also being expanded by the acquisition of LogPay Financial Services and the related entry into the business of local public transport payment processing.

The results also highlighted a slight decline in the portfolio of insurance contracts. The firm attributes this to the fact that the insurance contracts of Volkswagen Versicherungsdienst Vienna, Austria, no longer form part of the results for 2018. The company was sold to Porsche Bank AG, Austria.

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Looking to the future, Santelmann stated that the company is in the process of optimising its cost structure and digitalising its business model. “Our focus will be on efficiencies as well as sales. Volkswagen FS has set themselves a target of achieving cost-income ratio of 40% by the end of the year 2025,” he said.