02.11.2011

Cramo black all over

Finnish based rental company Cramo has posted its third quarter results with revenues up around 40 percent, while profits almost tripled.

In the nine months to the end of September revenues were €487 million - 40.9 percent higher than a year ago. This translated into pre-tax profits of €21.9 million compared to a loss last year of €3.6 million. Capital expenditure, excluding acquisitions was €109.3 million compared to just €25 million last year.

In the third quarter revenues were up 39.3 percent to €181.6 million, while pre-tax profits almost tripled to €20 million. Capital expenditure in the quarter was €37.5 million compared to €9.1 million in the same quarter of 2010, although 60 percent of this was for cabins and equipment for its modular space business- mostly in Sweden.

All of Cramo’s business regions moved in profit in the third quarter, with strong performances in Finland and Sweden while Central Europe -the recently acquired Theisen business - continued to pick up contributing €51.5 million of revenue year to date. Norway, Denmark and Eastern Europe moved back into profit with strong revenue improvements.

Chief executive Vesa Koivula said: “The third quarter of 2011 was positive for the Cramo, the demand for rental services and the price level continued to develop favourably, and we achieved a positive result in all of our business areas. I am particularly delighted to report strong sales growth and profit improvement in Eastern Europe, as well as the continued positive development of our Central European segment, which was formed in connection with the acquisition of Theisen Group.”

“In the past few years, Cramo has been able to achieve stronger organic growth compared to its competitors, in almost all of its market areas. In addition, markets which are new to the Group, such as Germany, will balance country-specific risks. The integration of Tidermans and Stavdal, acquired in June, has progressed as planned. Both acquisitions reinforce Cramo’s regional market position.”

“I am confident that our solid market position, stronger balance sheet and flexible operating model provides us with a solid foundation for successful trading, even in a less favourable business environment.”

Vertikal Comment

This is an exceptional performance from Cramo, the company has at times appeared to struggle through the slowdown and seemed to lag behind its
Finnish compatriot Rami Rent in terms of profitability. Yet each region has performed well during the third quarter with percentage revenue gains all in double digits – all but Denmark being above 20 percent!

If they all were to even just hold their revenues for the fourth quarter the group could be looking at annual revenues of around €670 million. In all likelihood there is every chance of it being closer to €700 million.

Much of the increase has come from acquisitions in Sweden, Norway along with the Theisen takeover in Germany at the end of January. It is clear that the additions have helped revitalise several sectors of the business.

With Loxam looking at annualised revenues of around €750 million with its Locarest acquisition, it could be a race to be the first billion dollar equipment rental company in Europe and then next year who knows? The billion Euro company?