Vantaa, Finland, 2014-07-29 08:00 CEST (GLOBE NEWSWIRE) --
Note! Figures in brackets, unless otherwise indicated, refer to the corresponding period a year earlier.
APRIL–JUNE 2014 HIGHLIGHTS
- Ramirent net sales EUR 151.8 (160.8) million, down by 5.6% or by 2.1% at comparable exchange rates - EBITA1) EUR 16.2 (22.7) million or 10.7% (14.1%) of net sales - Profit for the period EUR 7.1 (12.3) million and EPS EUR 0.07 (0.11)
JANUARY-JUNE 2014 HIGHLIGHTS
- Ramirent net sales EUR 289.3 (313.6) million, down by 7.7%; adjusted for transferred or divested operations, net sales were down by 1.5% at comparable exchange rates - EBITA excl. non-recurring items and adjusted for transferred and divested operations2) EUR 23.3 (34.0) million or 8.0% (11.1%) of net sales - Profit for the period EUR 9.7 (23.3) million and EPS EUR 0.09 (0.22) - Gross capital expenditure EUR 101.8 (62.4) million - Cash flow after investments EUR −26.6 (13.8) million - Net debt EUR 273.4 (264.2) million - Net debt to EBITDA ratio 1.6x (1.2x)
RAMIRENT OUTLOOK FOR 2014 UNCHANGED
The economic growth in 2014 is expected to be modest and construction market demand remains mixed in our core markets. Ramirent will maintain strict cost control and, for 2014, capital expenditure is expected to be around the same level as in 2013. The strong financial position will enable the Group to continue to address profitable growth opportunities.
KEY FIGURES
| KEY FIGURES (MEUR) | 4–6/14 | 4–6/13 | Change | 1–6/14 | 1–6/13 | Change | 1–12/13 |
| Net sales | 151.8 | 160.8 | −5.6% | 289.3 | 313.6 | −7.7% | 647.3 |
| EBITDA | 42.2 | 48.8 | −13.4% | 73.9 | 96.8 | −23.7% | 195.1 |
| % of net sales | 27.8% | 30.3% | 25.5% | 30.9% | 30.1% | ||
| EBITA 1) | 16.2 | 22.7 | −28.8% | 23.3 | 45.3 | −48.5% | 92.1 |
| % of net sales | 10.7% | 14.1% | 8.0% | 14.4% | 14.2% | ||
| EBIT | 14.2 | 21.0 | −32.2% | 19.6 | 39.0 | −49.7% | 82.3 |
| % of net sales | 9.4% | 13.0% | 6.8% | 12.4% | 12.7% | ||
| EBT | 9.1 | 15.2 | −40.0% | 12.4 | 30.4 | −59.4% | 63.9 |
| % of net sales | 6.0% | 9.5% | 4.3% | 9.7% | 9.9% | ||
| Profit for the period attributable to the owners of the parent company | 7.1 | 12.3 | −41.9% | 9.7 | 23.3 | −58.4% | 54.0 |
| Earnings per share (EPS), (basic and diluted), EUR | 0.07 | 0.11 | −41.9% | 0.09 | 0.22 | −58.4% | 0.50 |
| Gross capital expenditure on non-current assets | 78.3 | 30.0 | 161.2% | 101.8 | 62.4 | 63.1% | 125.8 |
| Gross capital expenditure, % of net sales | 51.6% | 18.7% | 35.2% | 19.9% | 19.4% | ||
| Cash flow after investments | −21.5 | −5.2 | n/a | −26.6 | 13.8 | −293.3% | 73.4 |
| Invested capital at the end of period | 610.5 | 611.3 | −0.1% | 579.8 | |||
| Return on invested capital (ROI),% 3) | 11.9% | 19.2% | 16.5% | ||||
| Return on equity (ROE),% 3) | 12.1% | 19.3% | 14.7% | ||||
| Net debt | 273.4 | 264.2 | 3.5% | 206.9 | |||
| Net debt to EBITDA ratio 3) | 1.6x | 1.2x | 28.4% | 1.1x | |||
| Gearing,% | 84.2% | 76.8% | 55.8% | ||||
| Equity ratio,% | 40.3% | 43.1% | 48.9% | ||||
| Personnel at end of period 4) | 2,651 | 2,781 | −4.7% | 2,561 |
1) EBITA is operating profit before amortisation and impairment of intangible assets. 2) The non-recurring items include a non-taxable capital gain of EUR 10.1 million from the formation of Fortrent in the first quarter 2013. Transferred and divested operations included Russia, Ukraine and Hungary. 3) Rolling 12 months 4) As of first quarter 2014, reporting of number of personnel was changed to FTE (full-time equivalent) which indicates the number of employees calculated as full time workload for each person employed and actually present in the company. Comparative information has been changed accordingly.
MAGNUS ROSÉN, RAMIRENT CEO:
“Slower than expected sales of equipment rental continued in many of our markets in the second quarter 2014. Second–quarter net sales decreased by 2.1% at comparable exchange rates. Second– quarter EBITA margin was below the previous year level at an unsatisfactory 10.7% (14.1%).
Lower than expected demand and slow progress in the start-up of new projects impacted negatively on sales in Sweden. Our profitability in Norway was impaired by low demand from residential construction, decreased fleet utilisation and increased pricing pressure. In Finland, acquisitions and recovering market demand supported sales growth. Demand picked up in the Baltic States and Poland and we have relocated fleet capacity to these markets during the first half of the year. Softness in construction activity in Denmark, the Czech Republic and Slovakia continues to burden our operations in these countries. Cost reductions have and will be further reinforced to adapt the cost base to market demand in all low-performing segments. In both Sweden and Norway, cost reductions were insufficient to mitigate the impact on profitability from lower demand. In Denmark, activities to streamline operations and realise synergies with Sweden continue.
In the second quarter we took important steps in building on our capabilities to deliver More Than MachinesTM. The acquisition of a majority stake in Safety Solutions Jonsereds AB supports our growing focus on safety and the acquisition of DCC (Dry Construction Concept) business reinforces our capabilities in the growing business sector of weather protection. We also strengthened our offer of services for industrial customers by concluding an outsourcing agreement with Empower for significant parts of their equipment fleet in Finland.
In July, we signed a contract with German-based Zeppelin Rental to form a joint venture to serve the Fehmarnbelt tunnel construction project, subject to approval from relevant authorities. The partnership will enhance our position as a potential supplier for the project and by combining our complementary capacities we can present a unique offer for the entire lifecycle of the project on both the Danish and the German side.
We will continue to pursue efficiency improvements to realise our targeted Group EBITA level of 17% by the end of 2016. Our key measures comprise developing the common Ramirent platform, integrated solutions, pricing management, optimising customer centre network, improving fleet utilisation rates and the governance of sourcing operations.
Our industry is transforming with rental developing into two complementary business models, rental over-the-counter and provision of integrated solutions, creating an opportunity for Ramirent to leverage its know-how of both. As part of our efficiency measures, we are focusing on improving our competitive position and developing our offer to efficiently fulfil needs of our customers’ and earn their trust as a partner in both types of business.
Based on our continued solid financial position, we are well positioned to continue pursuing outsourcing opportunities and acquisitions.”
MARKET OUTLOOK FOR 2014
According to a forecast published by Euroconstruct in June 2014, the Finnish construction market is expected to grow by 0.8% in 2014. Residential construction is estimated to decline during this year as new residential start–ups will decline considerably compared to the previous year. Activity in non–residential construction is expected to pick up supported by several large upcoming construction projects. Renovation is forecasted to increase as a result of government stimulus measures and increasing need of renovations. Confederation of Finnish Industries (EK) expects industrial investments to increase slightly this year, supported by higher investment activity in the energy sector.
According to a forecast published by Euroconstruct in June 2014, the Swedish construction market is expected to increase by 4.4% in 2014. Residential construction is estimated to increase markedly compared to the previous year. Non–residential construction is expected to grow slightly in 2014. The government’s new transport infrastructure plan will fuel the construction activity in railway and road construction, especially in the Stockholm and Gothenburg areas. Due to a continuously expanding and ageing building stock, renovation will continue to grow also in 2014. Market activity in several industrial sectors is expected to develop positively.
According to a forecast published by Euroconstruct in June 2014, the Norwegian construction market is expected to grow by 0.4% in 2014. New residential construction will decline clearly due to the general uncertainty in the sector. Infrastructure construction is going to remain active mainly due to a major leap in government grants to railway and metro projects. Market activity in renovation is expected to remain stable in all construction sectors. According to the Norwegian Oil and Gas association, investments in the oil and gas sector are forecasted to be close to last year’s level in 2014. The slow market activity in the residential construction sector as well as overcapacity in the equipment rental market will impact negatively on the rental market in the second half of the year.
According to a forecast published by Euroconstruct in June 2014, the Danish construction market is expected to grow by 2.5% in 2014. Volumes in residential construction are estimated to pick up, however from low levels. Market activity in non-residential construction is expected to improve mainly due to increasing construction of buildings for education and health as well as a gradual upturn in the general economic situation. Renovation is expected to increase supported by healthy demand from all construction sectors. Infrastructure construction is forecasted to grow fuelled by several new transport infrastructure projects and energy investments.
According to a forecast published by Euroconstruct in June 2014, the construction market in the Baltic States is expected to be slightly below last year’s level. The construction market is estimated to increase in Lithuania by 3% and to decrease in Latvia by 2% and in Estonia by 7% according to Euroconstruct. Residential construction in the Baltic States is estimated to grow supported by new building start–ups and improving consumer confidence. Non–residential construction is expected to recover in Latvia and Lithuania during 2014. The market in infrastructure construction will weaken markedly due to a transition period in EU funding. The overall demand for equipment rental in the construction sector is anticipated to remain at a healthy level. High activity in the energy sector will support the Baltic equipment rental markets in 2014.
Significant risks include the expansion of the Ukrainian crisis and severe economic sanctions implemented by the EU. According to a forecast published by Euroconstruct in June 2014, Russian construction market is projected to decrease at some 1% in 2014. In Russia, residential construction is estimated to remain close to last year’s level as non-residential construction is forecasted to decline about 5% in 2014. However, there are a lot of potential shopping centre projects coming to the market. The market situation is likely to remain challenging in Ukraine.
Construction activity is expected to pick up in Poland especially within residential and infrastructure construction. However, several large projects are being completed and there is a lack of new large projects starting in the short-term. The market situation in renovation is estimated to remain stable. In 2014, the Polish construction market is estimated to grow by 4.2% according to a forecast published by Euroconstruct in June 2014. New power plant projects in the energy sector will support demand in 2014. In the Czech Republic, the construction market is expected to decrease by 3.8% this year. The Slovakian construction market is forecasted to recover supported by residential and infrastructure construction. In 2014, the construction market is expected to increase by 1.7% in Slovakia.
ANALYST AND PRESS BRIEFING
A briefing for investment analysts and the press will be arranged on Tuesday 29 July 2014 at 11:00 a.m. Finnish time at the Ramirent Group head office located at Äyritie 16, Vantaa, Finland.
WEBCAST AND CONFERENCE CALL
You can participate in the analyst briefing on Tuesday 29 July 2014 at 11:00 a.m. Finnish time (EET) through a live webcast at www.ramirent.com and conference call. Dial−in numbers are: +358 9 81710 465 (FI), +46 8 5199 9355 (SE), +44 2 0319 4 0550 (UK) and +1 8 5526 92605 (US). Recording of the webcast will be available at www.ramirent.com later the same day.
FINANCIAL CALENDAR 2014
Ramirent observes a silent period during 21 days prior to the publication of annual and interim financial results.
Interim report January–September 6 November 2014 at 9:00 a.m
The financial information in this stock exchange release has not been audited.
Vantaa, 29 July 2014
RAMIRENT PLC Board of Directors
FURTHER INFORMATION CEO Magnus Rosén tel. +358 20750 2845, magnus.rosen@ramirent.com
CFO and EVP, Corporate Functions Jonas Söderkvist tel. +358 20 750 3248, jonas.soderkvist@ramirent.com
SVP, Marketing, Communications and IR Franciska Janzon tel. +358 20 750 2859, franciska.janzon@ramirent.com
DISTRIBUTION NASDAQ OMX Helsinki Main news media www.ramirent.com
Ramirent is More Than MachinesTM. We are a leading rental equipment group combining the best equipment, services and know-how into rental solutions that simplify customer business. We serve a broad range of customers, including construction and process industries, services, the public sector and households. In 2013, the Group’s net sales totalled EUR 647 million. The Group has 2,650 employees at 301 customer centres in 10 countries in the Nordic countries and in Central and Eastern Europe. Ramirent is listed on the NASDAQ OMX Helsinki Ltd.
