26.10.2016

Positive third quarter for Cramo

Finnish international rental group Cramo has reported a very positive third quarter result.

Looking first at the nine months until the end of September, revenues were eight percent higher at €519 million, with improvements in most of its regions: Finland was 16.1 percent higher, Sweden 11.2 percent, Denmark 16.7 percent, Central Europe 3.6 percent, while Norway declined 9.5 percent, although almost two third of this drop off was currency related, and Eastern Europe slipped 2.8 percent. Pre-tax profits for the period jumped 56.4 percent to €66.5 million.

In the third quarter revenues improved 7.2 percent to €184.8 million, with increases of 15.8 percent in Finland, eight percent in Sweden, 9.5 percent in Denmark and 4.8 percent in Central Europe. Norway declined 2.7 percent and 1.1 percent in Eastern Europe. pre-tax profits for the period were 42 percent higher at €34.9 million.

Net debt at the end of the period was down 14 percent at €1.93 billion. Capital expenditure was 18 percent higher at €159.5 million.

Chief executive Leif Gustafsson said: "The demand for equipment rental and modular space has developed favourably this year, and we have succeeded in increasing sales and profit in both product areas. Our sales grew in local currencies by 8.8 percent in January to September and by 7.9 percent in the third quarter. During the third quarter, sales grew in all markets, with the exception of Norway and Eastern Europe.”

“Our profitability also continued to develop favourably. The January–September EBITA margin increased from 12.2 to 15.1 percent, and the third-quarter EBITA margin grew from 17.5 to 21.1 percent. During the third quarter, profitability improved on all markets, with the exception of Eastern Europe. I am particularly satisfied with the fact that the EBITA-result for Central Europe has turned positive. The turn for the better took place in the second quarter, and I believe that the full-year EBITA-result for Central Europe will be positive. Profit development also continued to be strong in Finland and Sweden as well as in the entire equipment rental product area.”

“I expect the demand for equipment rental and modular space to stay on a good level for the remainder of the year. Over the long term, the demand for rental services is supported by several megatrends, such as urbanisation and efforts to achieve sustainable development. Cramo is in a good position in most of its markets to capitalise on the opportunities created by the market."

Vertikal Comment

An excellent performance from Cramo which really seems to be on a roll at the moment, outperforming its main rivals as it goes from strength to strength. The company still has plenty of upside potential, particularly in Central Europe - mainly Germany. It is also good to see that it has stepped up its investment programme with more capital expenditure and that it has reduced its high debt levels.

A very positive set of numbers.