Post on 12-Mar-2020
1 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Landsbanki Seminar25 September 2008, St. Petersburg
Kari Kallio, President and CEO
2 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Ramirent in brief
Leading equipment rental company in Northern, Central and Eastern Europe
Net Sales of EUR 634 million (2007)
More than 4,000 employees
357 rental outlets across 13 countries
More than 100,000 customers
More than 200,000 rental units
Founded in 1955 and listed the OMX Nordic Exchange Helsinki since 1998
Headquartered in Finland
3 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
General rental companywith a wide product portfolio
Heavy Equipment
Light Equipment
Scaffolding
Lifts and Hoists
Tower Cranes
Modules
Power and Heating
Formworks
4 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
One-stop-shop supplier to a wide customer base
Czech Rep.
Customers
•ConstructionCompanies
•Industry
•Infrastructure
•Public
•Households
Suppliers
•Lifts and hoists•Tower cranes•Heavy equipment•Modules•Formworks•Light equipment•Scaffolding•Power and heating•Other
Outlet Network
One-stop-shop
5 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
0 200 400 600 800 1000
Loxam
Ramirent
Speedy Hire
Cramo
Algeko Scostman (US)
Select Plant Hire
GAM
Liebherr-Mietpartner
Mediaco Lifting
HSS Hire
2007
Market leader in Northern, Central and Eastern EuropeRental market 2007 (machinery & equipment): Europe EUR 23.5 bn
Source: IRN June 2008, ERA Convention 2008
MEUR
6 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Key business driversfor Ramirent
Growing construction markets
Increasing penetration rates
Increased equipment usage
Market consolidation
Undeveloped rental markets
Entry into new markets
7 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Financial Benefits• Release of capital for your core business• Minimizing assets & better cost control• No maintenance costs• No transportation vehicle fleet
Equipment and Service benefits• Large diversity of products• Availability of state-of-the art equipment• Use it when you need it• Proximity & delivery on the site
Safety Benefits• Pre-rental safety check • Regulation compliance• Well maintained fleet
Renting becoming the new standard
8 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Rental penetration still lowin Ramirent markets
Penetration rate measured as machinery sold directly to rental companies as percentage of total machinery sales
Source: International Rental News/ Kaplan 2006
0 %
10 %
20 %
30 %
40 %
50 %
60 %
70 %
80 %
90 %
Europe(ex. UK)2010E
Europe(ex. UK)
Poland Baltics Finland Norway Denmark Sweden UK
9 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
A balanced market portfolio
Outlet
Local head office
10 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Large potential in Central and Eastern EuropeConstruction output by Ramirent market
Inhabitants(million)
Construction Output(billion EUR)
48
8
10 11
5 5
10
20
3835
3 35
30
5
34
2 3
1 3
9
24
27
5
Norway Sweden
Finland
Denmark
145
90
**Russia
*Ukraine
Poland
Czech Rep.
Hungary
Slovakia
Lithuania
Latvia
Estonia
Source: Euroconstruct June 2008, *Business Monitor International,**Ministry for Economic Development of Russian Federation
11 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Cornerstones of Ramirent’s strategy
Profitable growth
Local leadership positions
Balanced geographic portfolio
Emphasis on organic growth
Pursuing acquisitions orconsolidation opportunitiessupporting profitable growth
Strong balance sheet
12 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
0
100
200
300
400
500
600
700
1998 1999 2000 2001 2002 2003 2004 2005 2006 20070 %
5 %
10 %
15 %
20 %
25 %
30 %
Finland Sweden Norway Denmark Europe EBIT,%
MEUR
Ramirent targets profitable growth Compound annual growth rate 1998-2007: 39%
Entry in Czech Republic, acquisitions in Sweden
and Poland
Acquisition in Poland and Hungary
Acquisition of Altima and Treffco
Acquisition of Bautas and Stavdal
Start of growth strategy
13 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Leading market positionsacross 13 countries
1971 00171*Europe Central
357
52
18
38
57
95
Outlets
1
1
1
2
1
Market Position
3 996688Group
67996*Europe East
25559Denmark
682153Norway
656167Sweden
707144Finland
Employees(average)
R12 Sales 6/2008Segments
*Europe EastRussia Estonia LatviaLithuania Ukraine
Europe CentralPolandHungaryCzech RepublicSlovakia
14 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Pan European Fleet
Finland Sweden Norway Denmark Ramirent Europe1)
Local equipment Local equipment Local equipment Local equipment
Local equipm.
Fleet management
Procurement
Finance
Rental Outlet Network
1) Ramirent Europe includes Russia, Estonia, Latvia, Lithuania, Poland, Hungary, Ukraine, Czeck Republic, Slovakia
Operating structure
Local equipm.
East Central
Fleet management
15 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
H108 Interim Report:Growth continued, but profits declinedH1 2008 Highlights
Net sales increased by 18.8% to MEUR 342.9 (288.6)
EBITDA up 9.7% to MEUR 112.1 (102.2)
EBIT was MEUR 65.0 (65.5) with a margin of 19.0% (22.7%)
Earnings per share of EUR 0.38 (0.42)
Gross Capital expenditure was 172.1 (147.2), of which machinery and equipment MEUR 139.2 (145.7)
Net debt of MEUR 373.5 (279.6), gearing of 112.5% (99.4%)
Return on invested capital (ROI) of 25.8% (28.4%)
Q2 2008 Highlights
Net sales increased by 18.9% to MEUR 180.8 (152.0)
EBIT was MEUR 35.5 (36.5) with a margin of 19.6% (24.0%),
EBIT excl. property sale gains was MEUR 35.1 (33.9)
Earnings per share of 0.20 (0.24)
16 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
19,8 %21,1 %21,3 %
24,0 %
27,6 %25,6 %26,2 %
14,7 %
19,6 %18,2 %
0 %
5 %
10 %
15 %
20 %
25 %
30 %
Q1 Q2 Q3 Q4
EBIT -margin
105117
130
146137
152166
180
162
181
0
20
40
60
80
100
120
140
160
180
200
Q1 Q2 Q3 Q4
Sales
H108- Group total
1%62.963.34%33.935.1EBIT excl. capital gains
296
3,261
22.7%
65.5
288.6
1-6/07
357
3,996
19.0%
65.0
342.9
1-6/08
24.0%19.6%EBIT-margin
Employees (average)
Outlets
36.5
152.0
4-6/07
-3%
19%
Change
-1%35.5EBIT
19%180.8Net sales
Change4-6/08MEUR
2006
2007
2008
Profits declined due to unfavourable market development in Norway and Denmark, as well as in the Baltics and Hungary.Costs increased due to expansion of the outlet network and entering new markets.
MEU
R
17 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Ramirent Group sales allocation
21 %
25 %
22 %
8 %
13 %
11 %
Finland Sweden Norway Denmark Europe East Europe Central
H1 08
21 %
25 %
24 %
9 %
13 %
8 %
H1 07
18 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Europe Central business operations continued to grow rapidly except in Hungary.Ramp up costs in Poland, Czech republic and Slovakia and the negative development in Hungary decreased profitability.
10
13
16
1817
21
0
5
10
15
20
25
Q1 Q2 Q3 Q4
Sales
23,3 % 21,4 % 20,4 %
27,9 %
9,3 %9,2 %
0 %
5 %
10 %
15 %
20 %
25 %
30 %
Q1 Q2 Q3 Q4
EBIT-margin
H108 - Europe Central (Poland, Hungary, Czech Rep., Slovakia)
97
1,0019.3%3.537.6
1-6/08
52
59822.2%4.922.3
1-6/07
21.4%9.3%EBIT-marginEmployees (average)
Outlets
2.712.8
4-6/07
2.021.0
4-6/08
-28%64%
Change
-29%EBIT69%Net sales
ChangeMEUR
MEU
R
2007
2008
19 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Ramirent in Poland
Operations started in 200042 outletsMarket leader in scaffolding, machinery andequipment rentals for construction and industry
Market environment• Stable economic growth • High construction market growth• Increased competition as “everyone” wants to
be in the market
383838Population (million)
9.4%10.7%14.6%Construction output, % change (2007: EUR 35 bn)
Key facts 2008e 2009e 2010e
GDP (growth %) 5.0 4.5 5.0
Inflation % 3.8 3.5 3.0
Source: PMR Research, GUS, Euroconstruct
20 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
H108 - Europe East (Russia, Estonia, Latvia, Lithuania, Ukraine)
52
679
18.1%
7.9
43.5
1-6/08
49
551
28.4%
10.9
38.4
1-6/07
29.4%16.0%EBIT-margin
Employees (average)
Outlets
6.2
21.0
4-6/07
3.7
23.4
4-6/08
-39%
11%
Change
-28%EBIT
13%Net sales
ChangeMEUR
27,2 %
29,4 %
34,3 %36,0 %
16,0 %
20,6 %
0 %
5 %
10 %
15 %
20 %
25 %
30 %
35 %
40 %
Q1 Q2 Q3 Q4
EBIT-margin
17
21
26 26
20
23
0
5
10
15
20
25
30
Q1 Q2 Q3 Q4
Sales
Sales decreased in Estonia and Latvia; strong growth continued in Russia, Ukraine and Lithuania. Profitability decreased due to the negative development in Estonia and Latvia.Adjustment of the fleet capacity and cost structure continued in Estonia and Latvia.
MEU
R
2007
2008
21 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Ramirent in Russia
Key facts 2008e 2009e 2010e
GDP 6.1 5.7 5.8
Inflation 9-10.5 6-7.5 5-7.0
Population (million`s) 141.7 141.6 141.5
Change % Construction output (2007: EUR 95 bn) 12.3 12.0 11.5
Market EnvironmentGrowth considerably above European averageConsiderable foreign investments Growing construction market
Source: Ministry for Economical Development of Russian Federation
Operations started in 19887 outletsStrong market position in St. Petersburg and MoscowRental customers also outside St Petersburg and Moscow area
22 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Federal districts of the Russian Federation
23 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Murmansk Area
Karelia
Vologda Area
Novgorod Area
Pskov Area
Leningrad Area
1228
857
693
657714
1632St. Petersburg, 4571 thousand
- Regional population in thousands
Russia North-West Region, Population
Vologda, 294 thousand
Tcherepovetz, 308 thousand
Petrozavodsk, 282 thousand
Murmansk, 318 thousand
Kondopoga, 35 thousand
Apatity, 64 thousand
24 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Russian rental market for construction equipment and machines
The market is in the initial stage of development:– Local companies can only provide a limited range of machines and
equipment (mostly they are specialised and lack a wide offering)and limited additional services
The market is mostly concentrated to the large cities
Annual growth was 20-30% in the last 3 years due to fast construction development in Moscow and St. Petersburg
25 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Russian rental market for construction equipment and machines
Construction companies are also renting their fleet capacity
Few big rental companies in St. Petersburg and Moscow
Big construction companies are still not rental customers
Increased demand for one-stop-shop rental
Business environment is improving
26 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Russian rental market expectations
Consolidation of the market players and development of their product and service portfolios
Regional expansion of the leading players forced by the leading construction companies that have initiated ambitious construction projects in different regions of Russia
Further growth in the market estimated at the level of 30-40% in the mid term
– based on increasing machine and equipment requirements from authorities involved in the construction sector as well as the active development of the construction companies operating in Russia
27 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
RussiaRamirent opportunities and challenges
Our largest single potential market
More challenging business environment
Long history and good base for development
Requires big investments
Geographical distances
Management
28 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Ramirent in Ukraine
Key facts 2008e 2009e 2010e
GDP 17.0 18.0 17.0
Inflation 8.0 9.0 9.5
Population (million`s) 46.5 46.0 45.5
Change % Construction output (2007: EUR 8 bn) 10.2 n/a n/a
Market environmentGrowth considerably above European averageConsiderable foreign investment activitiesFavourable labour conditions
Source: Business Monitor International
Operations started in 20033 outletsStrong market position
29 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
UkraineMarket environment
Availability of modern real estate facilities by type, sq.m
-
500 000
1 000 000
1 500 000
2 000 000
2 500 000
3 000 000
Office Warehouse Retail
Kiev
Warsaw
Prague
Budapest
Sq.m
.
Source: Colliers International and Business Monitor International
Availability of modern real estate facilities 2-3 times behind CentralEurope depending on type of property
30 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Outlook 2008The operating environment has in 2008 become more challenging and we expect overall equipment rental market growth rate to slow down.
In Nordic region, strongest growth expected in Sweden and Finland while growth slowing down in Norway and Denmark.
In Central and Eastern Europe, sustained growth expected in mostoperating countries expect for the Baltics and Hungary.
Priority set on bolt-on acquisition and reallocation of existingequipment and cost reductions in countries with weak marketexpectations.
Since Ramirent will delimit investments, cash flow is expected to bepositive for the second half of 2008 and gearing to improve.
31 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Outlook 2008
For the full year 2008, we estimate net sales growth to continue, but profit before taxes and earnings per share
to be below the 2007 level.
32 25 Sept, 2008 Landsbanki Seminar, St. Petersburg © 2008 Ramirent
Magnus Rosén, New CEO of Ramirentas of 15 January 2009
Magnus Rosén, b. 1962
Joins Ramirent from the position as BE Group’s President of Business Area Sweden since 2008
Previous experience: Managing Director at Cramo AB, Senior Vice President at Cramo Oyj; Managing Director at BT Hyrsystem AB and Service Market Manager at BT Svenska AB
Education: B.Sc. Business administration and Economics, Linköping University, MBA Stockholm School of Economics and several executive training programmes including IMD in Lausanne
33 25 Sept, 2008 Landsbanki Seminar, St.Petersburg ©2008 Ramirent
Q&A