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FINLAND AND BALTICS CAPITAL MARKETS DAY 2013 Anna Hyvönen, EVP, Finland and Baltics

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Page 1: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

FINLAND AND BALTICS

CAPITAL MARKETS DAY 2013 Anna Hyvönen, EVP, Finland and Baltics

Page 2: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

28%

Largest equipment rental company in Finland Most extensive range of product and services Widest customer centre network Strong expertise in industrial projects

Profile

2

24%

Share of Group net sales (%) 1-9/2013

Share of Group EBIT (%) 1-9/2013

Highlights Q3/2013

Demand was steady in Southern and Central Finland Market activity weakened in Northern and Western Finland Strong EBIT margin due to strict cost control Ramirent defended price levels in tough environment Capacity utilisation was on a healthy level

Outsourcing deal with Caverion:

• 5-year rental agreement with annual sales of appx. MEUR 5

• 19 employees moved to Ramirent

Ramirent is the market leader in Finland

Well-positioned for a market upturn

Page 3: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

154 134 137

155 167

113

0246810121416182022

020406080

100120140160180

2008 2009 2010 2011 2012 1-92013

Profitability has improved since the financial crises

3

Capital expenditure, MEUR

Capital expenditure, MEUR

Financial highlights 2008-2013 Leading market position maintained throughout the cycle

Reduced operative risk

Better product mix and flexibility in resourcing Divestments of formworks and partnering for scaffolding installations

Average EBIT margin of 14.7% Reduction in personnel from 704 to 533 Optimisation of customer centre network

MEUR (%)

Net sales and EBIT-margin

29

13 17

34

26 22

05

10152025303540

2008 2009 2010 2011 2012 1-92013

Several actions to improve margins underway

Page 4: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

1,40% 1,45% 1,45% 1,40% 1,40% 1,40%

0%

1%

2%

3%

4%

2010 2011 2012 2013E 2014E 2015E

VTT expects rental market to grow by 3% in 2014 supported by new construction start-ups and renovation Equipment rental increasing in the industrial sector Companies interested in outsourcing to minimise assets and free up capital Rental penetration highest in access equipment; lowest in heavy and light machinery

Equipment rental market, MEUR1) Key market dynamics and trends

Market structure (2012)

4

538 587 595 580 599

0

100

200

300

400

500

600

700

2010 2011 2012 2013E 2014E

MED

IUM

LO

W

HIG

H

Ramirent

Cramo

Pekkaniska

Telinekataja

HRK

Others

Positive signs for equipment rental market

1) VTT in November 2013 2) Source: European Rental Association 2013; Rental Turnover* / Total construction output *Equipment rental companies turnover, including rental-related revenues, merchandise as well as sales of used equipment. For other companies providing rental services as a secondary business, estimates for their share of turnover generated by rental activities have been applied.

Finnish market expected to recover in 2014

Rental penetration rate (%) 2)

Page 5: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

5

Key growth areas

Shipyards and shipbuilding

Windpower

Industry

Construction 52%

Industrial 25%

Services &

Retail 16%

Public 2% Private 4%

Various growth pockets for Ramirent in Finland

Sales by customer sector 1-9/2013

Construction

Private

HUB

Customer centre

Page 6: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

Focus areas Key initiatives Targets

6

Sustainable profitable

growth

Employee emphasis

Operational quality, safety and efficiency

Best-in-class customer experience – building the service culture Customer proximity Improve customer understanding Customer driven solutions

Deliver value for money Easy to do business with Clear value proposition Differentiating from competition

Building a culture that engages and empowers our people Attracting talent Wellbeing and safety in our working environment

Positive working environment Rewarding career opportunities Diversity Strong image as good employer

Sustainability Improving safety at work Optimise fleet management and fleet operations

Reduce CO2 emission Reduce accident frequency rate Flexibility in operations

Targeting growth and EBITA margin of at least 18%

Strategic focus areas for 2014-2016

Page 7: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

7

Construction of Tower Hotel in city centre of Tampere, Finland

Ramirent's offer • Tower crane, Access and

Safety equipment • Electrification and energy

efficient lighting system • Scaffolding & Weather covers • Humidity and dust control • Light machinery • Work site services

Customer Benefits • One-stop-shop for all equipment

and services needed • Dedicated single point of contact • High quality, safety and ecology

standards • 24/7 equipment support • Knowhow of large projects

On-time delivery – no space for storage

Raising tallest hotel in Finland with Ramirent TotalSolveTM

Tower hotel, SRV

Page 8: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

BALTICS – PART OF EUROPE EAST CAPITAL MARKETS DAY 2013 Anna Hyvönen, EVP, Finland and Baltics

Page 9: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

22%

Ramirent has a strong presence and network in the Baltic countries

The three Baltic countries were integrated under joint management Resources and network optimisation Profitability has improved considerably after the financial crisis Net sales below peak cycle levels

Second largest equipment rental company in the Baltic States; #2 in Estonia, #1 in Lithuania, #1 in Latvia Easy customer accessibility through 41 customer centers Broad range of products and services Baltics is reported in the Europe East segment

Profile

9

6%

Share of Group net sales (%) 1-9/2013

Share of Group EBIT (%) 1-9/2013

Highlights Q3/2013

*EBIT excluding the capital gain of EUR 10.1 million from the formation of Fortrent was EUR 4.5 (5.9) million or 16.1% (12.9%) of net sales. Europe East share of Group EBIT excluding the capital gain was 6.6% in 1-9/2013.

Demand for equipment rental remained at good level in the Baltic States EBIT strengthened due to improved capacity utilisation in the Baltics Fixed costs under control and price levels steady

Improved profitability based on market recovery

Highlights 2008-2013

Europe East adj. 6.6%*

Page 10: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

Rental penetration is lower than in the Nordics Potential outsourcings cases in the market Growth potential in infrastructure and services sector Construction output in the Baltic countries expected at same levels in 2014 compared to 2013

Equipment rental market*, MEUR Key market dynamics and trends

Market structure (2012)

10 Source: Euroconstruct 6/2013 and *financial statements & annual reports of Baltic equipment rental companies

Construction output in the Baltics, MEUR

0

2000

4000

6000

8000

Estonia

Latvia

Lithuania

Ramirent

Cramo

Peri

Storent

Others

Baltic equipment rental market has lower penetration than the Nordic countries

185

115 95

109 127

0

50

100

150

200

2008 2009 2010 2011 2012

Market recovery expected to continue

Page 11: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

Infrastructure construction and energy sector main growth pockets in the Baltics

HUB

Customer centre

11

Key growth areas

Energy

Construction 59%

Industrial 12%

Services & Retail 24%

Public 2% Private 4%

Service & retail

Infrastructure construction

Sales by customer sector 1-9/2013

Residential construction

Page 12: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

Focus areas Key initiatives Targets

12

Sustainable profitable

growth

Operational excellence

To grow in building renovation and industrial customer segments Customer driven product and service offering Professional customer management

Develop customer centre network Shortening of repair times and reducing non-available fleet Improve logistics and profitability of services

Optimal customer center locations

Maintain strict cost control

Targeting growth and EBITA margin of at least 18%

Strategic focus areas for 2014-2016

Growing the share of industry and building renovation in customer portfolio

Optimal product & service portfolio balances investments and reduces cost and capital

Page 13: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

13

Industrial project: VKG Oil Plant, Kohtla-Järve, Estonia

Ramirent's offer • Design, consultancy,

installations • On-site temporary outlet • Access equipment • Heavy equipment • Site modules • Scaffolding • Formworks

Customer Benefits • One main provider for all

equipment • Savings in cost from on-site

access to machines • Ramirent knowhow of

equipment suitable for energy projects

On-site temporary outlet for quick response times

Ramirent TotalSolveTM for Oil plant in Estonia

Page 14: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

14

Winning the customer every day Making things easy for the customer providing high quality service at every stage Finding the most suitable solution for the customer need Providing best-in-class customer experience

Customer first – Ramirent service culture

Page 15: FINLAND AND BALTICSinvestors.ramirent.com/sites/default/files/cmd/cmd2013_evp_anna... · 1-9/2013 Share of Group EBIT (%) 1-9/2013 . Highlights Q3/2013 . Demand was steady in Southern

Q&A