28.10.2016

Strong quarter for Alimak

Swedish international mast climber and hoist specialist Alimak has reported a very positive third quarter.

Total revenues for the nine months to the end of September were SK 1.45 billion ($161 million), roughly the same as last year. At the same time order intake was three percent lower at SK1.62 billion($180 million). Pre-tax profits for the period improved nine percent to SK207.9 million ($23 million).

Moving on to the third quarter revenues were nine percent higher at SK471.4 million ($52.2 million), with order intake increasing six percent to SK512.5 million ($56.8 million). Pre-tax profits jumped just over 50 percent to SK71.1 million ($7.9 million) SK6.9 million ($760,000) of this was a gain made on the sale of the company’s US rental business to Bigge Crane and Rigging in September See Alimak sells US rental business

Chief executive Tormod Gunleiksrud said: “We had significant variations between the business areas, with a continued strong growth in Construction Equipment, while Industrial Equipment had a weak quarter, in particular on the order side. We have started marketing activities for our new midmarket industrial elevators, and we expect to have them approved and ready for sales start well before year end. We see good potential for these elevators going forward. The development of our new models based on traction technology is progressing according to plan.”

“In short, I would say that the market for Industrial Equipment remains challenging. Construction Equipment showed strong growth in the quarter. We gained market share and continued our geographic expansion. We have expanded our own sales organisation and also our network of distributors, which has now increased to around 80 in total. We have seen strong demand for our complete portfolio, both premium and mid-market products in all regions, except China and Brazil. Our offering of tower crane lifts where we work closely with Manitowoc continued to be in good demand.”

“After Sales developed well in the quarter with further improvement of the EBIT margin. The continued weak oil & gas and mining markets are impacting aftersales as well, but we have managed to increase penetration in the construction market, where we look forward to further growth. We have seen good development in parts sale and also an increase of refurbishment projects during the quarter.”

The Rental business continued to show good order intake, although at a lower level compared to a strong comparative quarter in 2015. We had a good increase in revenues, driven by a higher utilisation of the fleet, and this has also translated into a good EBIT margin development compared to third quarter 2015.”

“As in the previous year, I expect a finish in line with last year’s good volumes and margins. Last but not least, I am happy to announce that after closing of the period, we have signed an agreement to acquire Facade Access Group, the global market leader in permanent facade access solutions. Through this acquisition we will strengthen and broaden our product portfolio, expand our existing footprint and business into a global adjacent niche market within vertical access.” Click here to See Alimak acquired Façade Access

Vertikal Comment

This is a good set of numbers from Alimak, considering the challenges it is facing in some markets. The company looks to be on a good trajectory and if all is as it seems the addition of the Façade access group will add considerably to its after sales business, which already represents 35 percent of the group’s revenues and an amazing 74 percent of its profits. The after sales business tends to be pretty stable, and if anything improves in a downturn when companies age their equipment by postponing capital expenditure on new equipment.