Ramirent profits stall as slowdown hits

Ramirent's revenues grew by 18.9% in the second quarter of 2008 but profits fell because of further softening of the market, particularly in the Baltic States.

Ramirent's chief executive officer, Kari Kallio, said market sentiment weakened during the quarter and the economic downturn had a negative impact on construction in many of its territories.

"The market development is diverging more between different countries", said Mr Kallio, "In the Nordic countries, our business operations in Finland and Sweden continued on a good level, while in Norway our operations weakened due to the slow down in the construction market. In Denmark, construction activities are still decreasing, which continues to burden our operations, especially through tough price competition.

"In Europe East, strong growth continued in Russia, Ukraine and Lithuania, while our business volumes and operating profits decreased in Estonia and Latvia compared to last year. In Europe Central, growth was strong in Poland, Czech Republic and Slovakia, while in Hungary our operations stayed on low level due to the weak market."

Revenues in the quarter increased by 18.9% to €180.8 million, and operating profit fell marginally from €36.5 million to €35.5 million.

"We expect the rental market growth to continue to slow down", said Mr Kallio, "We have adjusted our investment plans to the market situation. We aim to take advantage of our wide geographical presence and will reinforce the process of re-allocating fleet capacity to countries facing favourable market conditions."

Ramirent said it had revised its capital expenditure plans, and will prioritise moving existing fleet to buoyant areas and on making acquisitions.