26.03.2024

€2.5 billion record for Loxam

French international rental company Loxam achieved revenues of more than €2.5 billion in 2023, a record result for the company.

Full year numbers

Overall revenues improved 6.2 percent to €2.55 billion, with growth in all but the Nordic region. Pre-tax profits improved almost 11 percent to €102.2 million.

The company reports revenues in three regions - France, Nordic countries and the rest of the world. The results were as follows:

Results by reporting region

France:
Revenues - €1.04 billion + 6.6%
Operating profit - €390.2 million + 7.4%
Revenue as % of group total = 40.8%

Nordics:
Revenues - €705.7 million - 7.7%
Operating profit - €216.8 million - 0.5%
Revenue as % of group total = 27.7%

Rest of the world:
Revenues - €804.4 million +14.4%
Operating profit - €319.2 million +19.5%
Revenue as % of group total = 31.5%

Capital expenditure & Net debt

Capital expenditure on the rental fleet fell by more than 30 percent to €516.5 million, while sales of used equipment from the fleet increased by more than 27 percent.
Net debt at the end of the year was €4.34 billion, a rise of almost seven percent on the same point last year.

Fourth Quarter

The overall revenues for the fourth quarter were €662.1 million, up 6.7 percent on the same period last year. Pre-tax profits however fell 39 percent to €12.7 million.

Results by reporting region

France:
Revenues - €265.9 million + 5.5%
Operating profit - €99.3 million + 8%
Revenue as % of total = 40.1%

Nordics:
Revenues - €182.5 million - 2%
Operating profit - €51.0 million – 0%
Revenue as % of total = 27.6%

Rest of the world:
Revenues - €213.6 million +17.5%
Operating profit - €82.4 million +22%
Revenue as % of total = 32.3%



Chief executive Gérard Déprez said: “After a year of strong development in 2022, the 2023 performance underlined the ability of the group to continue its development thanks to its widespread geographical coverage and customer diversification.”

“The group’s revenue exceeded €2.5 billion for the first time and we are very pleased that we have recorded revenues of more than €1 billion in France, thanks to organic growth. Loxam is one of the few rental companies surpassing €1 billion of revenue in its home market. Besides, the Rest of the World division has continued to develop quickly, growing by nearly a third in two years. It has now become the second largest division of the group, which confirms the pertinence of our decision to invest where markets are developing. In 2023, we were pleased with our development in the Brazilian market. We now count among the largest rental companies there, thanks to the acquisition of Motormac and A Geradora which reinforce our presence in the most densely populated areas of the country.”

“The increase of the group EBITDA margin by 1 point underlined our ability to limit the impact of cost inflation on our margins in 2023, thanks to strict cost control measures and rising rental and service prices. I am also satisfied with our financial discipline throughout 2023. Thanks to a reduction of our capex in the fourth quarter. In December 2023, we completed the refinancing of our SSN 2025 bonds enabling us to extend the maturity of our financial debt. We are satisfied with the amortisation profile of our debt as we have no major bond debt maturity before 2026.”

Vertikal Comment

Loxam has led the European rental market for many years, and continues to do well, particularly with its stronghold in France. However, others such a Boels, Mateco and Kiloutou etc.. are catching up.

The challenge, as many big equipment rental company’s find, is offering the same format in each country in which you operate. For example, while Loxam is a general rental company in France and some other markets in which it operates, it is largely just an access rental company in the UK and that seven years after it acquired Nationwide Platforms. The success of the big ‘consolidators’ in the USA is to offer their entire product range in every state they move into, with a consistent identity.

All that said this is a decent result with growth in key new markets which will help diversify the business. Achieving sales of over €2.5 billion - mostly in Europe and €1 billion in France is impressive by anyone’s measure.