12.03.2014

Mills Rental up 41%

Brazilian based access and telehandler rental specialist Mills Rental has published its 2013 results, with another year of strong revenue and profit growth.

Total revenues for the rental division which is almost entirely made up of self-propelled aerial lifts and telescopic handlers were R357.3 million ($151 million) – 41 percent higher than in 2012, thanks to a larger fleet, nine new depots and strong utilisation partially offset by falling rates and less profitable product mix. Pre-tax profits for the division improved 40 percent to R121.4 million($51.3 million).

Moving to the fourth quarter, revenues improved 31 percent to R97.2 million ($41,2 million) a new quarterly record, while EBITDA increased 51 percent to R56 million($23.7 million). Two new locations were opened in the quarter, in Aracajú, in the state of Sergipe, and in Cuiabá, in Mato Grosso state, taking the total network to 26, with branches opened since 2010 making up 69 percent of the division’s revenues.

Total capital expenditure was R267.2 million ($115.3 million) - 66 percent higher than in 2012.

Mills operator training is also growing and according to the company represented 73.5 percent of all IPAF PAL cards issued in South America in the year.

The Mills group as a whole posted annual revenues of R832.3 million ($352.6 million) up moire than 25 percent on the year, with pre-tax profits of R233.3 ($98.9 million).

Vertikal Comment

Once again a set of dazzling numbers from Mills, a warning however – whatever goes up must come down – growth at this pace in a developing market has typically resulted in an equally impressive correction, as supply overshoots underlying demand. A small one line reference to weaker rates in the annual report might just be an early indicator.

Brazil is a truly amazing market at the moment for aerial lifts, with companies appearing ready and willing to not only embrace powered access, but also pay the prices – which have to be substantially higher than the traditional methods. However one wonders if in the face of a post Olympic slow-down some users will switch back to traditional equipment, at least for a while.

In the long term Brazil with its size, industry and massive resources will of course be one of the world’s largest markets for powered access, but the path may not always be a straight and easy one.