Ramirent Plc's Half Year Financial Report January-June 2018: Strong and steady performance continued

Ramirent Plc    Half Year Financial Report      August 8 2018 at 9:00 EEST

April-June 2018 in brief

  • Net sales EUR 186.4 (174.1) million, up by 7.0% or 10.1% at comparable exchange rates
  • EBITA EUR 28.8 (22.0) million or 15.4% (12.6%) of net sales
  • EBIT EUR 26.6 (19.8) million or 14.3% (11.4%) of net sales
  • EPS EUR 0.18 (0.12)

January-June 2018 in brief

  • Net sales EUR 362.6 (338.7) million, up by 7.0% or 10.1% at comparable exchange rates
  • EBITA EUR 52.7 (38.6) million or 14.5% (11.4%) of net sales
  • EBIT EUR 48.4 (34.4) million or 13.4% (10.2%) of net sales
  • EPS EUR 0.32 (0.20)
  • Comparable ROCE 15.9% (11.4%); ROCE 15.7% (8.4%)
  • Gross capital expenditure EUR 110.7 (94.0) million
  • Cash flow after investments EUR -23.1 (-11.5) million

Ramirent's guidance for 2018 unchanged
In 2018, Ramirent's comparable EBIT is expected to increase from the level in 2017.

KEY FIGURES (MEUR) 4-6/18 4-6/17 CHANGE 1-6/18 1-6/17 CHANGE 1-12/17
Net sales 186.4 174.1 7.0% 362.6 338.7 7.0% 723.7
EBITDA 54.5 48.2 13.0% 103.5 90.8 13.9% 205.5
% of net sales 29.2% 27.7%   28.5% 26.8%   28.4%
Comparable EBITA 28.8 22.0 30.9% 52.7 38.6 36.8% 99.01
% of net sales 15.4% 12.6%   14.5% 11.4%   13.7%
EBITA 28.8 22.0 30.9% 52.7 38.6 36.8% 97.7
% of net sales 15.4% 12.6%   14.5% 11.4%   13.5%
Comparable EBIT 26.6 19.8 34.3% 48.4 34.4 40.9% 90.61
% of net sales 14.3% 11.4%   13.4% 10.2%   12.5%
EBIT 26.6 19.8 34.3% 48.4 34.4 40.9% 89.3
% of net sales 14.3% 11.4%   13.4% 10.2%   12.3%
Comparable EPS, EUR 0.18 0.12 54.6% 0.32 0.20 64.1% 0.592
EPS, EUR 0.18 0.12 54.6% 0.32 0.20 64.1% 0.59
Gross capital expenditure 57.4 52.4 9.6% 110.7 94.0 17.7% 166.4
Cash flow after investments -9.5 -16.7 43.3% -23.1 -11.5 -101.4% 51.6
Capital employed       677.7 653.6 3.7% 654.4
Comparable ROCE, %3       15.9% 11.4%   13.9%2
ROCE, %3       15.7% 8.4%   13.8%
Comparable ROE, %3       27.2% 16.4%   22.0%
ROE, %3       26.9% 11.3%   22.0%
Net debt       390.6 378.6 3.2% 337.9
Net debt to EBITDA ratio       1.8x 2.0x -12.1% 1.6x
1 Excluding items affecting comparability (IACs) of EUR -1.3 million in 1-12/2017
2 Excluding IACs of EUR -1.3 million adjusted with tax impact of EUR 0.6 million in 1-12/2017

3 Capital component of key figure is calculated as the average of the 5 previous quarter end values

Ramirent's President and CEO Tapio Kolunsarka:
"Second quarter results materialized broadly as per our internal expectations and we delivered the seventh consecutive quarter of profit improvement. Strong net sales growth continued in the quarter at 7.0% or 10.1% at comparable exchange rates. At the same time, our EBIT increased by 34.3% to EUR 26.6 (19.8) million with EBIT-margin improving to 14.3% (11.4%).

All our segments increased their net sales and profitability in the second quarter. Sweden delivered again excellent growth in both rental and especially service sales in large projects. Performance in Eastern Europe continued strongly, this time particularly in the Baltic countries. In Finland, profitability improved despite somewhat slower topline growth. In Norway, we saw an upturn in sales and solid profit improvement with EBIT-margin approaching double-digit level. In Denmark, our performance improved as per our expectations.

After the first half of the year, we are well on our way towards our 2020 financial targets: our comparable ROCE was 15.9%, just shy of our 16% target set for 2020. Our EPS improved by 64.1% being EUR 0.32 (0.20), which is well in line with our target to have a double-digit average annual EPS growth rate in 2018-2020.

After the review period, on 30 July 2018, we signed an agreement to divest our Temporary Space business to Procuritas Capital Investors VI Holding AB. This is a logical step in our strategic path to focus on capital efficient profitable growth in our core equipment rental business. We believe that this transaction will support the Temporary Space business to achieve its full potential under the new focused ownership and it enables us to direct our growth investments into higher-yielding areas in our core business.

Market outlook for the second half of the year remains positive as activity levels are good in all of our markets. Our organization's execution ability remains solid and we are in a good position to continue to pursue profit improvement. However, it needs to be highlighted that the second half and especially Q3 of last year were very strong, making the comparisons ahead of us tougher to beat."

Market outlook for 2018
Ramirent's market outlook is based on the available forecasts disclosed by local construction and industry associations in its operating countries. 

The demand outlook for 2018 looks favorable for equipment rental across Ramirent's diverse customer base and geographies. In Sweden, continued strong momentum in the construction sector is expected to maintain the demand for equipment rental in 2018, although the medium-term outlook is more uncertain and the risk level is elevated. In Finland, market conditions in the equipment rental market are expected to stay favorable. In the Baltic countries, Poland, Czech Republic and Slovakia, the market conditions for equipment rental are also expected to remain favorable. The Norwegian and Danish equipment rental markets are estimated to be fairly active.

Audiocast and conference call
A briefing for investment analysts and the press will be arranged on August 8, 2018 at 10:30 a.m. Finnish time (EEST) through a live audiocast viewable at www.ramirent.com combined with a conference call. The dial-in number for conference call: +358 9 8171 0495 (FI), +46 8 5664 2702 (SE), +44 2031940552 (UK) and +1 8557161597 (US). A recording of the audiocast and teleconference will be available at www.ramirent.com later the same day.

Financial calendar 2018-­2019
Ramirent observes a silent period during 30 days prior to the publication of annual and interim financial results.

2018
Interim report January-September                               November 7

2019
Financial Statements Bulletin 2018                             February 8
Annual General Meeting                                              March 14
Interim report January-March                                      April 30
Half Year Financial Report 2019                                 July 31
Interim report January-September                               October 30

The financial information in this stock exchange release has not been audited.

For further information
Pierre Brorsson, Chief Financial Officer (CFO)
tel. +46 8 624 9541, pierre.brorsson@ramirent.com

RAMIRENT is a leading rental equipment group combining the best equipment, services and know-how into rental solutions that simplify customer's business. Ramirent serves a broad range of customer sectors including construction, industry, services, the public sector and households. In 2017, Ramirent Group sales totaled EUR 724 million. The Group has 2,943 employees in 300 customer centers in 10 countries in northern and eastern Europe. Ramirent is listed on the NASDAQ Helsinki (RMR1V). Ramirent - More than machines®.

Distribution
NASDAQ OMX Helsinki, main news media, www.ramirent.com


Ramirent Half Year Financial Report January-June 2018

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