2015-10-29 08:00:00 CET
2015-10-29 08:00:05 CET
REGLAMENTUOJAMA INFORMACIJA
Cramo Oyj - Interim report (Q1 and Q3)
Cramo’s Interim Report January–September 2015
Sales growth and profitability improvement continued
Vantaa, Finland, 2015-10-29 08:00 CET (GLOBE NEWSWIRE) -- Cramo Plc Interim
Report 29th October 2015, at 9.00 am Finnish time (EET)
Cramo's Interim Report January-September 2015
Sales growth and profitability improvement continued
7-9/2015 highlights (the 7-9/2014 comparison figures in brackets):
-- Sales EUR 172.4 (171.1) million; the change was 0.7%. In local currencies,
sales grew by 3.0%
-- Comparable EBITA before non-recurring items EUR 31.4 (30.5) million and
EBITA margin 18.2% (17.8%).
EBITA after non-recurring items EUR 30.2 (30.5) million and EBITA margin 17.5%
(17.8%)
-- Comparable earnings per share before non-recurring items EUR 0.45 (0.45)
and earnings per share after non-recurring items EUR 0.43 (0.45)
-- Cash flow from operating activities EUR 53.7 (33.2) million, cash flow
after investments EUR 10.9 (-5.4) million
-- Leif Gustafsson appointed the Group's new President and CEO, will take up
the position on 1 January 2016
1-9/2015 highlights (the 1-9/2014 comparison figures in brackets):
-- Sales EUR 480.7 (471.2) million; the change was 2.0%. In local currencies,
sales grew by 4.6%
-- Comparable EBITA before non-recurring items EUR 59.9 (47.3) million and
EBITA margin 12.5% (10.0%). EBITA after non-recurring items EUR 58.7 (47.3)
million and EBITA margin 12.2% (10.0%)
-- Comparable earnings per share before non-recurring items EUR 0.78 (0.54)
and earnings per share after non-recurring items EUR 0.75 (0.54)
-- Cash flow from operating activities EUR 111.6 (70.4) million, cash flow
after investments EUR -1.4 (-26.8) million
-- Gearing 87.3% (85.6%)
-- Cramo has decided to publish quarterly financial information also by
product area
Guidance for 2015 unchanged: There are economic and political uncertainties in
Cramo's markets related to 2015. With the current market outlook, Cramo Group's
sales will grow in local currencies and the EBITA margin will improve in 2015
compared to 2014.
KEY FIGURES AND RATIOS 7-9/15 7-9/14 Change 1-9/15 1-9/14 Change 1-12/1
(MEUR) % % 4
--------------------------------------------------------------------------------
Income statement
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Sales 172.4 171.1 0.7 % 480.7 471.2 2.0 % 651.8
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EBITDA 55.8 55.1 1.3 % 133.8 119.5 12.0 % 167.3
--------------------------------------------------------------------------------
EBITA before 31.4 30.5 3.0 % 59.9 47.3 26.6 % 73.2
non-recurring items 1)
2)
--------------------------------------------------------------------------------
% of sales 18.2% 17.8% 12.5% 10.0% 11.2%
--------------------------------------------------------------------------------
EBITA after 30.2 30.5 -0.9 % 58.7 47.3 24.1 % 70.3
non-recurring items 1)
2)
--------------------------------------------------------------------------------
% of sales 17.5% 17.8% 12.2% 10.0% 10.8%
--------------------------------------------------------------------------------
Operating profit (EBIT) 28.3 27.8 1.5 % 52.5 39.4 33.0 % 34.3
--------------------------------------------------------------------------------
Profit before taxes 24.6 24.8 -0.8 % 42.5 29.6 43.6 % 21.5
(EBT)
--------------------------------------------------------------------------------
Profit for the period 18.9 19.7 -3.8 % 33.1 23.5 41.1 % 16.0
--------------------------------------------------------------------------------
Share related
information
--------------------------------------------------------------------------------
Earnings per share 0.45 0.45 -0.2 % 0.78 0.54 43.4 % 0.91
(EPS) before
non-recurring items,
EUR 3)
--------------------------------------------------------------------------------
Earnings per share 0.43 0.45 -5.2 % 0.75 0.54 39.3 % 0.37
(EPS), EUR
--------------------------------------------------------------------------------
Earnings per share 0.43 0.45 -3.9 % 0.75 0.53 40.7 % 0.36
(EPS), diluted, EUR
--------------------------------------------------------------------------------
Shareholders' equity 10.52 11.13 -5.5 % 10.40
per share, EUR
--------------------------------------------------------------------------------
Other information
--------------------------------------------------------------------------------
Return on investment, % 5.4 % 6.9 % 4.2 %
4)
--------------------------------------------------------------------------------
Return on equity, % 4) 5.4 % 8.2 % 3.4 %
--------------------------------------------------------------------------------
Equity ratio, % 43.1 % 43.8 % 43.9 %
--------------------------------------------------------------------------------
Gearing, % 87.3 % 85.6 % 84.7 %
--------------------------------------------------------------------------------
Net interest-bearing 407.1 415.2 -1.9 % 385.4
liabilities
--------------------------------------------------------------------------------
Gross capital 46.7 45.1 3.4 % 134.3 125.5 7.0 % 159.1
expenditure (incl.
acquisitions)
--------------------------------------------------------------------------------
of which -0.1 -0.3 8.5 11.0 -23.0 % 11.4
acquisitions/business
combinations
--------------------------------------------------------------------------------
Cash flow from 53.7 33.2 61.9 % 111.6 70.4 58.5 % 118.3
operating activities
--------------------------------------------------------------------------------
Cash flow after 10.9 -5.4 -1.4 -26.8 -6.5
investments
--------------------------------------------------------------------------------
Average number of 2,486 2,534 -1.9 % 2,528
personnel (FTE)
--------------------------------------------------------------------------------
Number of personnel at 2,478 2,546 -2.7 % 2,473
period end (FTE)
--------------------------------------------------------------------------------
1. EBITA is operating profit before amortisation and impairment resulting from
acquisitions and disposals.
2. The EBITA for the third quarter of 2015 included EUR 1.2 million in
non-recurring costs relating to the change of the President and CEO. In the
fourth quarter of 2014 the non-recurring costs included in EBITA amounted
to EUR 2.9 million, of which EUR 2.2 million relating to Denmark and EUR
0.7 million to non-recurring costs at the Group level.
3. The profit for the third quarter of 2015 included EUR 1.2 million in
non-recurring costs relating to the change of the President and CEO. In the
fourth quarter of 2014 the non-recurring costs included in the profit for
the period amounted to EUR 23.6 million, of which EUR 2.2 million relating
to Denmark, EUR 0.7 million to non-recurring costs at the Group level, EUR
25.5 million to an impairment on goodwill and intangible assets in Central
Europe and EUR 4.8 million to a tax income.
4. Rolling 12 months. In the third quarter of 2015, comparable return on
investment before the effect of the non-recurring items for 2014 and for
the third quarter of 2015 was 8.7% (6.9%) and comparable return on equity
before the effect of the non-recurring items was 10.6% (8.2%).
CEO VESA KOIVULA'S COMMENT
Positive profit development continued
“Rental markets continued to gradually strengthen in Cramo's main market areas.
In the third quarter of 2015, Cramo Group's sales growth and profitability
improvement continued. Our sales grew in local currencies by 3.0% and our EBITA
margin before non-recurring items improved from 17.8% to 18.2%. We achieved a
particularly good result in Finland, despite the difficult market situation in
new construction. In Central Europe the result improved clearly but remained
below the target level. Profitability also improved in Sweden and Denmark. In
Sweden we took further performance improvement actions during the third quarter
and I believe that the actions carried out will bear fruit going forward.
In January-September our sales grew in Finland, Sweden and Eastern Europe and
amounted to EUR 480.7 million. In local currencies, sales grew by 4.6%. Our
January-September EBITA before non-recurring items improved by 26.6% and also
relative profitability developed favourably.
Modular space sales increased in local currencies by 7.4% during the first nine
months of the year, and according to our estimates, demand will remain at a
good level. We also continued to improve our profitability within modular
space. Our target is to further spur sales growth in the modular space area.
We completed performance improvement actions throughout the entire Group,
particularly with regard to materials and services, whose share of sales
decreased as planned during the period under review. In addition, the adoption
of our Performance Management Model will further improve our productivity, and
I believe that “For a great day at work” and our customer promises related to
the Cramo Story programme contribute to strengthening our position as the first
choice for customers.
When I took up the position of President and CEO of Cramo Group at the
beginning of 2004, our company was just beginning to turn its gaze beyond
Finnish borders. During the past 12 years, as a united Cramo team we have
increased the sales of our Group approximately ninefold and achieved a leading
position in the European equipment rental and modular space markets. I am happy
and proud to be leaving a healthy and growing Cramo Group to my successor Leif
Gustafsson,” says Vesa Koivula, the soon-to-be-retired President and CEO of
Cramo Group.
SUMMARY OF FINANCIAL PERFORMANCE IN JANUARY-SEPTEMBER 2015
Sales
Cramo Group's consolidated sales for January-September 2015 were EUR 480.7
(471.2) million. Sales showed a year-on-year increase of 2.0%. In local
currencies, sales grew by 4.6%.
Sales grew by 5.8% in Finland, by 4.4% in Sweden and by 4.8% in Eastern Europe.
In local currencies, sales grew by 8.2% in Sweden and by 5.2% in Eastern
Europe. Sales decreased in Norway, Denmark and Central Europe where operations
have been restructured.
As for product areas, sales growth in the first nine months of the year was
1.4% (4.0% in local currencies) for equipment rental and 5.1% (7.4% in local
currencies) for modular space. Demand for modular space has remained at a good
level.
In the third quarter, sales were EUR 172.4 (171.1) million, growing by 0.7%. In
local currencies, sales grew by 3.0%. Rental sales, of crucial importance for
the company, continued to grow year-on-year.
In the third quarter, sales grew in local currencies by 5.9% in Finland, by
7.3% in Sweden and by 3.9% in Eastern Europe.
Costs
Performance improvement actions have had a positive effect on the Group's
result in 2015. In January-September, indirect costs (employee benefit expenses
and other operating expenses) before non-recurring items decreased by EUR 7.9
million year-on-year. During 2015, performance improvement actions have focused
particularly on direct costs (materials and services), whose share of sales
decreased clearly in the second and third quarters.
Result
Profitability improved year-on-year. The comparable January-September EBITA
before non-recurring items was EUR 59.9 (47.3) million, showing growth of
26.6%. Comparable EBITA margin was 12.5% (10.0%). The third quarter included
EUR 1.2 million in non-recurring costs relating to the change of the President
and CEO. EBITA after non-recurring items was EUR 58.7 (47.3) million and EBITA
margin 12.2% (10.0%) of sales.
The comparable July-September EBITA before non-recurring items was EUR 31.4
(30.5) million, showing growth of 3.0%. Comparable EBITA margin was 18.2%
(17.8%) of sales. EBITA after non-recurring items was EUR 30.2 (30.5) million
and EBITA margin 17.5% (17.8%) of sales.
In January-September, profitability improved in all business and product areas
of the Group. Profitability was good in Finland and Sweden and in the third
quarter also in Eastern Europe. In addition, the result improved clearly
year-on-year in Norway, Denmark and Central Europe where Cramo has adjusted and
focused its operations. The net result of the Russian-Ukrainian joint venture
Fortrent also improved.
In July-September, the result improved in all business areas with the exception
of Norway and Eastern Europe. In Finland, the result improved clearly, despite
the poor market situation in new construction. In Central Europe, the positive
profit development continued. Profitability was affected by Group's costs not
allocated to segments, which were clearly higher than in the previous year.
In January-September, as for product areas, equipment rental EBITA was EUR 44.9
(34.2) million, or 10.9% (8.4%) of sales. In modular space, EBITA was EUR 21.6
(19.3) million, or 31.2% (29.3%) of sales. In the third quarter, equipment
rental EBITA was EUR 25.8 (24.2) million, or 17.5% (16.5%) of sales, and
modular space EBITA was EUR 8.0 (6.9) million, or 32.1% (28.3%) of sales. As of
the beginning of 2015, Cramo publishes quarterly financial information also by
product area.
In January-September, comparable earnings per share before non-recurring items
were EUR 0.78 (0.54) and earnings per share after non-recurring items were EUR
0.75 (0.54). The third-quarter comparable earnings per share before
non-recurring items were EUR 0.45 (0.45) and after non-recurring items EUR 0.43
(0.45).
In January-September, cash flow from operating activities was EUR 111.6 (70.4)
million. Cash flow from investing activities was EUR -113.0 (-97.2) million and
cash flow after investments EUR -1.4 (-26.8) million. Gross capital expenditure
was EUR 134.3 (125.5) million. Gross capital expenditure includes EUR 8.5
(11.0) million for acquisitions.
The third-quarter cash flow from operating activities improved clearly
year-on-year and was EUR 53.7 (33.2) million, which was a result, among other
issues, of improved working capital management. Cash flow after investments was
EUR 10.9 (-5.4) million.
The Group's gearing was 87.3% (85.6%) at the end of September.
MARKET OUTLOOK
The national economies in Europe are taking an upward turn but growth is still
estimated to be modest in many countries and there are significant
country-specific differences. The European Central Bank's monetary stimulus is
expected to improve the economic outlook for the eurozone. The decline in the
oil price is expected to have a positive impact on economic development with
the exception of Norway and Russia. The greatest uncertainties about economic
development are related to the geopolitical situation and the risks related to
the European financial markets and currency rate fluctuations.
In Europe, market-specific differences are considerable also in the development
of construction and the demand for rental services. In their reports published
in June, the construction market analysts Euroconstruct and Forecon estimated
that in 2015, construction would increase in all of Cramo's operating countries
with the exception of Finland, where construction will remain on par with the
previous year, and Estonia, Latvia and Russia, where construction will decline.
In the long term, the equipment rental market is expected to grow faster than
construction. Changes in demand usually follow those in construction with a
delay. In addition to construction, the demand for equipment rental services is
affected by industrial investments and the rental penetration rate.
According to its June forecast, the European Rental Association (ERA) expects
equipment rental services to increase in all of Cramo's main markets in 2015.
The growth is expected to somewhat strengthen compared to 2014.
(All construction market forecasts presented in this review are estimates by
Euroconstruct, unless otherwise stated.)
GUIDANCE ON GROUP OUTLOOK
The guidance of Cramo Plc's Board of Directors for 2015 is unchanged: There are
economic and political uncertainties in Cramo's markets related to 2015. With
the current market outlook, Cramo Group's sales will grow in local currencies
and the EBITA margin will improve in 2015 compared to 2014.
CHANGES IN MANAGEMENT
On 6 August 2015, the Board of Directors of Cramo Plc appointed Leif Gustafsson
(48) as new President and CEO. Leif Gustafsson will take up the position on 1
January 2016 following the retirement of Vesa Koivula, Cramo's current
President and CEO. Leif Gustafsson will join Cramo from Stena Metall Group. He
has been the CEO of Stena Recycling International AB since 2012, prior to which
he served as the CEO of Stena Recycling AB from 2008 to 2012. Prior to Stena
Metall, Gustafsson was the CEO of YIT Sweden.
BRIEFING
Cramo will hold a briefing and a live webcast at Rake-sali, address:
Erottajankatu 4 C (Level 5) in Helsinki on Thursday, 29 October 2015 at 11.00
am. The briefing will be in English.
It can be viewed live on the Internet at www.cramo.com. A replay of the webcast
will be available at www.cramo.com from 29 October 2015 in the afternoon.
PUBLICATION OF FINANCIAL INFORMATION 2016
Cramo Plc's Financial Statements Bulletin for 2015 will be published on
Wednesday, 10 February 2016.
The Annual Report containing the full financial statements for 2015 will be
published in electronic format in week 10/2016.
Cramo Plc's 2016 Annual General Meeting will take place on Thursday, 31 March
2016, in Helsinki.
In 2016, Cramo will publish three interim reports:
The interim report for January-March 2016 will be published on 4 May 2016.
The interim report for January-June 2016 will be published on 3 August 2016.
The interim report for January-September 2016 will be published on 28 October
2016.
CRAMO PLC
Vesa Koivula
President and CEO
Further information:
Vesa Koivula, President and CEO, tel: +358 40 510 5710
Martti Ala-Härkönen, CFO, tel: +358 10 661 10, +358 40 737 6633
Distribution:
NASDAQ OMX Helsinki Ltd.
Major media
www.cramo.com
Cramo is Europe's second largest rental services company specialising in
construction machinery and equipment rental and rental-related services as well
as the rental of modular space. Cramo operates in fifteen countries with 330
depots. With a group staff around 2.500, Cramo's consolidated sales in 2014 was
EUR 652 million. Cramo shares are listed on the NASDAQ OMX Helsinki Ltd.
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