13.11.2017

Pickup continues at Rami

Finnish international rental company Ramirent has posted a strong third quarter in terms of revenues and profits.

Total revenues were eight percent higher at €523.4 percent, with revenues in Finland, Sweden, the Baltic states and Central Europe all significantly higher, while Norway and Denmark fell three and five percent respectively. Pre-tax profits more than quadrupled to €57.5 million, with all six operations posting significant profit growth.

Moving on to the third quarter revenues were 9.1 percent higher at €184.7 million all sectors were higher, apart from Denmark which was marginally lower than last year. Pre-tax profits almost tripled to €30.4 million, with all but Denmark posting healthy operating profit growth, while Denmark came in at the same level as last year. Capital expenditure was six percent lower at €135.5 million while net debt increased 3.5 percent to €370 million.

Chief executive Tapio Kolunsarka said:“In the seasonally strong third quarter our team’s execution was outstanding. Our comparable EBITA increased by 53.3 percent to €34.1 million – the highest level since 2008. Net sales grew by 9.2 percent at comparable exchange rates and the EBITA-margin rose to 18.4 percent. Our performance was strong on a broad-basis in the quarter. Sweden, Europe Central, Baltics and Finland delivered very strong EBITA levels. The profitability improvement was also good in Norway. Due to favourable market conditions and our strong performance, our investment agenda remained active driving fleet investments close to last year’s level at €39.1 million. Despite this, we also generated a positive cash flow after investments of €9.5 million, which together with improved profitability brought the net debt/EBITDA ratio down to 1.8x.

“I am proud to see the quality of execution in our organisation improving. We have delivered well and ahead of schedule on many of our profit improvement priorities. From now onwards, we expect the profit improvement from our key priorities to materialise at a more gradual pace as we have been harvesting gains from the programme already since quarter four 2016. Ramirent’s situation today and the equipment rental market around us continue to offer us opportunities to create value for our shareholders also going forward.”

Vertikal Comment

Ramirent has been back on form this year, having under performed for a few years. The company is still slightly lagging behind its Finnish competitor Cramo but appears to be catching up.More importantly the company is clearly beginning to gaining substantial momentum in terms of profitability, while revenues continue to climb steadily.

However the company needs to keep an eye on privately held Loxam and TVH both of which are growing at a faster pace thanks to a number of mega acquisitions. Both have their eyes on gaining market share in some of Ramirent’s (and fellow Finnish competitor Cramo) key markets where they will be targeting the same customers.

This said both this year and next look bright.