09.05.2017

Strong start for Rami

Finnish international rental company Ramirent has reported a steep first quarter rise in revenues and profits.

Total revenues for the quarter were up 12.7 percent on last year at €164.6 million with strong improvements in rental, services and equipment sales. All countries, apart from Denmark also reported solid growth, with Denmark which represents around six percent of revenues declining just over three percent. Pre-tax profits for the period more than tripled to €10.9 million. Capital expenditure increased around three percent to €41.6 million, while net debt increased 18.3 percent to €340 million.

Chief executive Tapio Kolunsarka said: “Our year got off to a good start with strong net sales growth of more than 12 percent in the first quarter, partly due to the timing of Easter. The growth in rental sales was good and profit flow-through improved markedly. First-quarter comparable EBITA-margin was at the same level as for full-year 2016.”

“Our profitability improvement was driven by volume growth, good market conditions, favourable business mix and improved pricing in some of our segments as well as steady progress in our profitability improvement actions. The EBITA margin improved in all segments and we are particularly pleased with the profitability improvement in Sweden and Europe Central. Our cash flow after investments was positive at €5.2 million in the first quarter.”

“I am delighted to see progress in our key priorities to improve profitability. Improved efficiency in Europe Central is now a fact and the supply chain performance and cost efficiency is gradually improving also in Sweden. Turnaround activities in the Swedish scaffolding business and Norway’s Temporary Space business also advanced during the quarter. However, as we are now entering our peak season, we must stay very focused on our core business and basic priorities in order to sustain our performance.”

“Rental is a future-proof business and we remain optimistic on the long-term opportunities to develop our company, benefiting from the trends of outsourcing non-core activities, resource efficiency and helping increase productivity in construction. To that end, we are working on a comprehensive strategy update that will be completed later this year.”

Vertikal Comment

A first class set of numbers from Ramirent which puts the company slightly ahead of fellow Finnish international rental group Cramo in terms of revenues, but pre-tax profits still lag well behind its main competitor which reported first quarter profits of over €15 million on slightly lower revenues.

Fact is regardless of this Ramirent appears to be back on a roll and benefiting from the economic upturn in many if the markets which have been sluggish in recent years. Barring any major geo political upsets the next few years look bright for Ramirent.