Challenging half year for Cramo
By Euan Youdale06 August 2014
Cramo Group’s consolidated sales for January to June 2014 decreased by 2.8% to €300 million compared to the same period in 2013, although In local currencies, sales increased by 0.9%.
The challenging market started to improve during the second quarter, said the company, but at a slower pace than anticipated. Improvements were seen in Sweden, Denmark and Poland, while Finland provided a profit increase but Germany weakened the overall result.
In Eastern Europe, sales and profit developed well, and Fortrent, the joint venture operating in Russia and Ukraine, adjusted its costs and reduced its investment level to meet the difficult market situation caused by the Ukrainian crises.
“Our result for the second quarter of 2014 did not meet our expectations, but I believe that Cramo Group will reach its full-year performance goals,” said Vesa Koivula, president and CEO of Cramo Group. “We have performance improvement actions in place in several countries and I also expect demand for rental services to improve during the rest of the year.”
During the six months the company adjusted its cost structure in Norway through personnel reductions and reorganising its depot network. “In Central Europe, our result was weakened by the transition programme, but the result will improve during the second half of the year,” added Mr Koivula.
Cramo refinanced its longterm loan facility in June, with an increase from €325 million to €375 million. The loan facility will mature in 2020 and includes a one-year extension option.
In April, Cramo expanded its modular space business in Germany by acquiring C/S RaumCenter and by signing a contract with Technische Werke Ludwigshafen. In Finland, Cramo strengthened its position in the construction machinery rental market by acquiring OptiRent.
Looking to the future the company said it expected growth in the second half of the year, with that strengthening in 2016. The equipment rental market will grow faster than construction, it added.