2011 was a year when the European equipment rental industry continued its recovery. Demand increased continuously during the year in most of the markets due to higher construction volumes. The market also went through a consolidation wave, manifested in a high number of acquisitions. Ramirent focused its efforts on growth initiatives, completing 9 acquisitions and 2 outsourcing deals and a significant number of greenfield openings of new outlets. Entering the new year, market visibility has decreased significantly. However, Ramirent is well positioned and has a high preparedness to act upon changes in customer demand.

Our vision is to be the leading and most progressive equipment rental solutions company in Europe, setting the benchmark for industry performance and customer service. This long-term vision gives us the direction for developing the Company while the Ramirent values— open, progressive and engaged—guide us in our daily decisions.

Ramirent offers Dynamic Rental SolutionsTM that simplify our customers’ business. Renting is an attractive and cost efficient alternative that allows customers to focus on their core activities. Our Dynamic Rental SolutionsTM has enabled our customers to have the right capacity of reliable, eco-efficient and safety compliant equipment. Ramirent’s concept is to be a general rental company with an extensive product range. Our offering spans from single products to managing the entire fleet at customer sites. Rental solutions complement our equipment offering and are growing in importance. Our broad offering provides our customers with comprehensive rental solutions from a single point of contact. This benefits our customers and differentiates Ramirent from most of its competitors. By continuously introducing progressive new concepts and providing a best in class offering with full product range of high quality and reliable equipment, services, and solutions, we are able to deliver premium value and act as price leaders in our markets.

Ramirent currently operates in 13 European countries. We are the market leader in the Nordic region and in most of the Central and Eastern European countries where we are present. Ramirent serves customers in construction, other industries, public sector and private households. Through our extensive outlet network we have a strong local presence, close to our customers, and can fulfil a broad range of local customer requirements. We value our customers and offer industry leading customer service and aim to build long-term customer relationships through our principle of decentralised accountability and decision making that ensures a strong local customer focus. Additionally, we leverage Group-wide synergies in fleet management, building a common Ramirent platform and shared support processes.

Several drivers support long-term profitable growth of the rental business. Increasing rental penetration among construction and other industrial sectors, as well as an increasing trend to outsource equipment fleets and non-core activities, drive overall demand. The current fragmentation of the equipment rental industry gives opportunities for industry consolidation. Moreover, the long-term increase in the construction and industrial volumes and customers’ increasing need for rental related value added services provides further growth opportunities.

RAMIRENT STRATEGIC CHOICES
Vision
To be the leading and most progressive
equipment rental solutions company in
Europe, setting the benchmark for industry
performance and customer service

Mission
We simplify business by delivering Dynamic Rental SolutionsTM

Long-term financial targets
• Annual EPS growth above 15%
• ROI above 18%
• Gearing below 120%
• Dividend payout ratio above 40% of the annual profit

Key strategic objectives
• Sustainable top-line growth
• Operational excellence
• Reduced risk level

Values
• Open – We are transparent and honest to each other, our customers and our company
• Progressive – We believe in continuous improvement and knowledge-sharing
• Engaged – We are a committed team player all the way from assignment to solution

STRATEGY IN ACTION IN 2011
The market recovery that started already in the second half of 2010 continued during 2011. Ramirent used its strong financial position to capture attractive growth opportunities in the market, both through greenfield expansion as well as through acquisitions and outsourcing deals. The favourable market climate also enabled price increases in all of our large markets as the balance between supply and demand of rental capacity returned to more healthy levels.

To deliver profitable growth, Ramirent focus its efforts on managing the topline, bottom-line as well as the balance sheet. The continued effort of building our Key Account management structure and managing to grow our industrial business especially in the Nordics had a positive impact on the organic top-line growth during 2011. This organic growth was supported further by the multiple acquisitions and outsourcing deals that was closed during the year.

During the year, Ramirent made two outsourcing deals, one in Finland (Destia) and one in Denmark (Phil & Søn). This was supported by further nine acquisitions in Sweden, Norway, Finland, Denmark and Czech Republic. Eight of these acquisitions were primarily done to extend the geographic presence and product offering and come closer to the customer. The acquisition in Norway, Rogaland Planbygg A/S, was a strategic move into a new customer sector. This acquisition marked an important milestone in Ramirent’s strategy of diversifying the customer base and expanding the product offering. Rogaland’s customers are primarily the oil & gas sector. With Rogaland, Ramirent partly entered a new business area, high-class modules. With rental agreements for high-class modules typically being longer than those of Ramirent’s other product groups, the acquisition also supported our goal of extending our average rental periods. Building on the experiences from the acquisitions closed in 2009 and 2010, Ramirent successfully managed to integrate all acquisitions in a swift and efficient way during the year. In addition, Ramirent continued the mission to dense its outlet network to be close to the customer. The number of outlets end of year was a record high 406, an increase of 28 compared to end of 2010.

During the year, the Group has also strengthened the focus on sourcing. A function for non-fleet sourcing was established to increase Group synergies within the area by building up internal capabilities, best practices, processes and tools. Other areas in which capabilities has been strengthened include IT, business controlling and business development.

In order to deliver good returns, Ramirent also focus on improving its balance sheet. During the year, efforts continued to optimise the level of capital used in the company. By the end of the year, the working capital was on a satisfying low level relative to sales. Optimisation of invested capital coupled with the strong development in net sales lead to Ramirent delivering one of the highest capital turnovers in the industry globally. This was possible through efficiently managing our fleet through a disciplined investment program to avoid creating excess capacity, improving utilisation and fleet yield through programs targeted to sell and scrap non-standard and underperforming equipment and minimise unavailable fleet.

Efforts to reduce risk and increase flexibility continued on many levels. The development of cross-border co-operation continued to enable more best practise sharing throughout the Group. The development of new solution concepts accelerated and the first ones were launched in the market, “Eco Solutions” in both Norway and Sweden and “Safer Construction Worker” (Tryggare Byggare) in Sweden.

Due to the financial turmoil in Europe, market visibility has decreased significantly, making development especially in the second half of 2012 and onwards hard to predict. However, Ramirent enters 2012 well positioned and with a high preparedness to act upon changes in customer demand. Contingency plans have been updated both on Group and country level. Key initiatives to reach the vision and strategic objectives continue to be highly prioritised.

STRATEGIC OBJECTIVES FOR 2012 AND BEYOND
In 2012 and beyond, Ramirent will focus on deriving synergies from a one company structure—a “Ramirent platform”, on reducing its risk level through a balanced business portfolio, and on capturing attractive growth opportunities. Short term, Ramirent will closely follow the market development to be able to react to any changes in customer demand. Our strategic agenda will ensure continuous strong emphasis on profitability while strengthening our platform for capitalising on future profitable growth opportunities. Our extensive outlet network has continued to grow both through the downturn and during 2011 and we have a modern equipment fleet enabling us to respond to a continued increase in demand.

RAMIRENT’S KEY STRATEGIC OBJECTIVES
Sustainable top-line growth, profitability and cash flow generation
Ramirent will capture external opportunities for profitable growth by developing its offering and its customer and market portfolios. Ramirent pursues market specific opportunities to strengthen its product offering. The aim is to be a general rental company and offer equipment and solutions which fit the local markets. Safety and environment aspects are emphasised in product choices and solution concepts. Ramirent will actively focus on widening its customer base, especially through strengthened focus on industries outside construction and the public sector. Ramirent will seek growth from an increasing trend to outsource equipment fleets.

Growth will be accelerated with selective acquisitions to strengthen Ramirent’s geographic presence and offering. Opportunities to enter new markets are assessed to accelerate profitable growth in the future.

Ramirent aims to deliver high profitability both in favorable and less favorable business climates. This is done by maintaining strict cost control at all times, while at the same time not sacrificing opportunities for profitable growth. The ambition is to ensure continuous improvement of costs and productivity through benchmarking and sharing of best practices in the Group. Over a business cycle, Ramirent aims to deliver a positive cash flow by optimising capital employed by right-sizing fleet capacity in relation to demand and by managing and minimising working capital.

Operational excellence through the Ramirent platform
Ramirent will continue to have a strong focus on cost efficiency. Ramirent is developing a common “Ramirent platform” for selected key processes. This provides economies of scale through, for example, optimal fleet management and coordinated sourcing efforts.

Development of group wide IT platform and support processes will assist realising the synergies from working as one company and sharing of best practices. With regards to customers, Ramirent will maintain its decentralised accountability and strong local orientation to serve the varying needs of its local customers.

Reduced risk level through a well diversified business portfolio
Ramirent aims to reduce the risk level of the group by focused measures in five areas: geographical presences, customers, product offering, human resources and financing. Ramirent aims to balance its risk through a well diversified portfolio of customers, products and markets. To do this, focus is to offset the dependency on the construction sector by growing the share of customers in industries outside construction. Ramirent will have a broad portfolio of product and service offerings, to fulfil the different needs of our customers. Ramirent will maintain a well-diversified geographic market presence. Furthermore, Ramirent aims to support implementation of the group’s business targets by ensuring that the businesses have the necessary resources, as well as skilled and motivated people at their disposal. This means support for continuous competence development, performance management and recognition of strong performance, and finally, strengthening leadership and management competencies within the organisation. In addition, Ramirent aims for financial stability by maintaining a strong financial position and pursues flexibility by optimising the balance between fixed versus variable costs and the use of external financing possibilities.

Long-term financial targets
The Group’s long-term financial targets over a business cycle are:
1. Earnings per share growth of at least 15% p.a.;
2. A return on invested capital of at least 18% p.a.;
3. A gearing target of less than 120% at the end of each fiscal year; and
4. Ramirent’s dividend policy is to distribute at least 40% of annual earnings per share to shareholders as dividends.