Revenues and profits were again hit significantly in the third quarter as Mills Estruturas e Serviços de Engenharia continues to battle economic challenges in its home country of Brazil.
Net revenue for the third quarter was R$86.1 million, 18.2% below the second quarter. The decline between quarters was mainly due to equipment rental revenue, which dropped 13.1%, or R$11.2 million. In comparison to the third quarter in 2015, revenue was down 36.9%, from R$136.5 million to R$ 86.1 million.
In Mills’ rental segment, revenue for the quarter was R$4.3 million, down 20.9% on the R$5.4 million in the same period in 2015.
The company said R$3.9 million of the decrease between quarters this year could be explained by the end of some contracts related to the Olympics held in Rio de Janeiro in August.
The sales revenue of new and semi-new equipment, which is part of the company’s ongoing reduction plan, totalled R$6.2 million in the third quarter, 27.2% lower than the amount recorded in the previous quarter.
EBITDA was down 18% quarter-on-quarter to R$11.2 million from R$13.7 million. Compared to the third quarter in 2015, profits had dropped 67.8%, from R$34.8 million.
In a statement, the company said, “The quarter's performance reflects the current economic environment, which continues to negatively impact our rental revenues and our margins. Since the company does not believe in the recovery of its results in medium the term, it has several initiatives underway to adapt its structure to this new reality.
Concerning AWPs, the company said it was hopeful for the future, “This equipment is exposed to different sectors of the economy. With the resumption of the Industrial and Construction GDP, the aerial work platforms rental market should resume gradually, reflecting primarily in the equipment utilization rate and later in price.”