Vantaa, Finland, 2011-02-10 08:00 CET (GLOBE NEWSWIRE) -- Cramo Plc Financial Statement Release 10 February 2011 at 9.00 am Finnish time (GMT+2)
Cramo’s Financial Statements for January–December 2010
- Q4/2010 sales EUR 146.4 (115.4) million, growth 26.8%
- Q4/2010 EBITA EUR 14.1 (1.4) million, change 913.3%. EBITA margin 9.6% (1.2%)
- Q4/2010 earnings per share EUR 0.28 (-0.90)
- Full year sales EUR 492.1 (446.7) million, growth 10.2%
- Full year EBITA EUR 34.5 (17.3) million, change 99.5%. EBITA margin 7.0% (3.9%)
- Full year earnings per share EUR -0.07 (-1.30)
- Full year cash flow after investments EUR 27.4 (65.4) million, gearing at end of year 103.4 (113.4) %
- Acquisition of Theisen Group in January 2011, several outsourcing deals including Lemminkäinen Group in December
- The Board proposes a dividend of EUR 0.10 per share
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The market outlook for equipment rental services for 2011 is positive. In 2011, the Group’s sales is expected to grow both as a consequence of the Theisen acquisition and organically. The Group’s EBITA margin will improve compared with 2010.
| KEY FIGURES AND RATIOS (EUR 1,000) | 10-12/10 | 10-12/09 | 1-12/10 | 1-12/09 |
| Income statement | ||||
| Sales | 146,384 | 115,402 | 492,103 | 446,676 |
| EBITDA | 33,734 | 25,017 | 117,623 | 105,955 |
| Operating profit (EBITA) before amortisation and impairment of intangible assets resulting from acquisitions | 14,056 | 1,387 | 34,478 | 17,286 |
| Operating profit / loss (EBIT) | 12,111 | -22,267 | 27,389 | -11,467 |
| Profit / loss before tax (EBT) | 8,368 | -27,494 | 4,804 | -34,202 |
| Profit / loss for the period | 8,364 | -27,485 | -2,203 | -39,858 |
| Share related information | ||||
| Earnings per share (EPS), EUR | 0.28 | -0.90 | -0.07 | -1.30 |
| Earnings per share (EPS), diluted, EUR | 0.26 | -0.88 | -0.07 | -1.28 |
| Shareholders’ equity per share, EUR | 10.52 | 9.50 | ||
| Other information | ||||
| Return on investment, % 1) | 3.7 % | -1.2 % | ||
| Return on equity, % 1) | -0.6 % | -12.1 % | ||
| Equity ratio, % | 38.7 % | 37.4 % | ||
| Gearing, % | 103.4 % | 113.4 % | ||
| Net interest-bearing liabilities | 382,032 | 383,682 | ||
| Gross capital expenditure | 86,219 | 31,931 | ||
| of which relates to acquisitions and business combinations | 33,821 | 466 | ||
| Cash flow after investments | 27,393 | 65,403 | ||
| Average number of personnel (FTE) | 2,083 | 2,356 | ||
| Number of personnel at end of period (FTE) | 2,131 | 2,018 |
1) Rolling 12 month
SUMMARY OF FINANCIAL PERFORMANCE IN 2010
Cramo Group’s consolidated sales were EUR 492.1 (446.7) million in 2010, showing an increase of 10.2 per cent. Fourth-quarter sales were EUR 146.4 (115.4) million, up 26.8 per cent.
EBITA was EUR 34.5 (17.3) million in 2010, or 7.0 (3.9) per cent of sales. EBITDA was EUR 117.6 (106.0) million, or 23.9 (23.7) per cent of sales. Fourth-quarter EBITA was EUR 14.1 (1.4) million, or 9.6 (1.2) per cent of sales.
After a weak winter and spring, the rental market saw a positive turn at the end of the second quarter, which strengthened towards the year end. The cost-saving measures implemented in 2009 also improved Cramo’s profit for the period. Fleet utilisation rates improved significantly in the second half of the year, compared with the first half.
Full-year profitability was at a good level in Finland and Sweden, which was in line with Cramo’s expectations. In Norway the business swung to profit in the third quarter. In Denmark and Central and Eastern Europe, the full-year EBITA was clearly negative; in the fourth quarter, however, an almost break-even result was reached in Denmark.
Cash flow after investments was positive, EUR 27.4 (65.4) million. Gearing decreased to 103.4 (113.4) per cent and equity ratio improved to 38.7 (37.4) per cent. Cash flow after investments in the fourth quarter was EUR 0.7 (30.1) million. It was affected by an increase in the investment level in the fourth quarter, the significant outsourcing agreement signed with Lemminkäinen Group in December and the agreements signed with Peab Group in October.
The Group’s key targets for 2010 were a positive cash flow, improvement of profitability and a decreasing gearing. These targets were achieved.
In September, Cramo Group renewed its strategic and financial targets for 2010–2013. In December, Cramo refinanced a long-term loan of EUR 375 million. The arrangement reduces the Group’s finance costs and improves liquidity, as well as the opportunities to pursue acquisitions in line with Cramo’s strategy.
After the review period, Cramo announced on 11 January 2011 it had signed an agreement to acquire 100% of the share capital of the Theisen Baumaschinen AG group. With this acquisition Cramo expands into the German, Austrian, Swiss and Hungarian markets. The transaction was closed on 31 January 2011, The purchase price was approximately EUR 47 million, of which EUR 40 million was paid in cash and the remaining EUR 7 million in Cramo Plc’s new shares. In addition to the purchase price, Cramo also assumed Theisen’s net interest-bearing debt and financial leasing liabilities, resulting in an enterprise value of approximately EUR 85 million for the transaction.
The Board proposes to convene the Annual General Meeting on Thursday, 24 March 2011. The stock exchange release on the invitation to the Annual General Meeting will be published on 17 February 2011. The Board will propose to the Annual General Meeting a dividend of EUR 0.10 per share.
MARKET OUTLOOK FOR 2011 IS POSITIVE
The construction and equipment rental service markets are expected to grow stronger in almost all of Cramo’s market areas in 2011. According to construction market research organisation Euroconstruct, construction activity will grow some 3–4 per cent in each of the Nordic countries in 2011. Double-digit growth rates are forecasted for Poland and Estonia, while elsewhere in Central and Eastern Europe (Russia included) growth is estimated at 4–6 per cent. The Czech Republic is the only one of Cramo’s market areas where construction activity is predicted to decline. Construction activity is also expected to increase in Germany, Austria, Switzerland and Hungary.
Cramo anticipates a stronger growth in the demand for rental services compared to that in construction. External forecasts also support this view: for example, VTT Technical Research Centre of Finland predicts a growth rate of eight per cent for rental services in Finland in 2011, which is clearly above the three per cent growth predicted for construction. Increased interest in equipment rental as an alternative to owning is an important factor contributing to the growth of the rental market. Construction companies are also finding arrangements where companies outsource their equipment fleets to a rental service company to be attractive.
While the outlook for full year 2011 is positive, the expectations for the first quarter result are cautious due to the winter season and one-off expenses related to the Theisen acquisition, in addition to which there will be integration expenses.
Because of the improved outlook, Cramo will increase its investment level in 2011.
GUIDANCE ON GROUP OUTLOOK
The Group’s guidance for 2011 is as follows: “The market outlook for equipment rental services for 2011 is positive. In 2011, the Group’s sales is expected to grow both as a consequence of the Theisen acquisition and organically. The Group’s EBITA margin will improve compared with 2010.”
CEO’S COMMENT
“As we entered the year 2010, we knew it would be challenging. In the first half, we continued to adjust our operations to the declining demand. The markets saw an upturn in the summer; at the same time, we renewed our strategy and targets, aligning them with the new situation. In accordance with our targets, Cramo’s profitability improved markedly in all of the Group’s market areas in the second half of the year.
The improved market situation, our refinancing arrangements and our growth orientation were visible through two significant business arrangements in December and January. The six-year outsourcing contract with Lemminkäinen Group offers Cramo significant growth opportunities in Finland, while the acquisition of the German Theisen Group is a strategic acquisition which will also bring significant new market openings and accounts in the long term.
Expectations of construction growth in 2011 vary strongly in Europe. The southern European countries and Ireland are facing an economic crisis, and construction outlook in these countries is poor, while the outlook is positive for the German-speaking countries, the Nordic region and most Central and Eastern European countries. I am confident that the timing is favourable for Cramo’s recent acquisitions, since the outlook for the equipment rental market is positive in these market areas,” says Vesa Koivula, President and CEO of Cramo Group.
SALES AND PROFIT
Cramo is a service company specialising in equipment rental services, as well as the rental and sale of modular space. Its equipment rental services comprise construction machinery and equipment rentals and rental-related services. These rental-related services include construction site and installation services. As one of the industry’s leading service providers in the Nordic countries and Central and Eastern Europe, at the end of the financial year, Cramo Plc operated in Finland, Sweden, Norway, Denmark, Estonia, Latvia, Lithuania, Poland, the Czech Republic, Slovakia and Russia.
Cramo Group’s consolidated sales were EUR 492.1 (446.7) million in 2010, showing an increase of 10.2 per cent. Sales increased in Finland, Sweden, Norway and Central and Eastern Europe, but decreased in Denmark. In local currencies, the change in sales was 2.8 per cent.
EBITA was EUR 34.5 (17.3) million in 2010, or 7.0 (3.9) per cent of sales. EBITDA was EUR 117.6 (106.0) million, or 23.9 (23.7) per cent of sales. The full-year EBITA was positive in Finland, Sweden and Norway.
Sales for October–December were EUR 146.4 (115.4) million. Compared with the corresponding period the previous year, sales were up 26.8 per cent. In local currencies, the change in sales was 18.5 per cent. When compared year-on-year, euro-denominated sales increased in all business segments except Denmark.
EBITA for October–December was EUR 14.1 (1.4) million, or 9.6 (1.2) per cent of sales. EBITDA was EUR 33.7 (25.0) million, or 23.0 (21.7) per cent of sales. EBITA for October-December was positive in Finland, Sweden and Norway. In Denmark and Central and Eastern Europe the result was better than in the previous three quarters.
The Group's reorganisation expenses in 2010 totalled EUR 2.0 (6.1) million and credit losses and credit loss provisions EUR 5.0 (6.7) million. The result also includes impairment losses on fleet totalling EUR 0.5 (2.0) million.
Expenses associated with options totalled EUR 2.3 (2.3) million.
EBIT was EUR 27.4 (-11.5) million in 2010, or 5.6 (-2.6) per cent of sales. Profit before taxes was EUR 4.8 (-34.2) million and profit for the period EUR -2.2 (-39.9) million. Net finance costs for the period were EUR 22.6 (22.7) million.
In accordance with the prudence principle, Cramo has not recognised a deferred tax asset for most of its loss-making companies in 2010. Unrecognised deferred tax assets for 2010 total EUR 4.8 (7.9) million.
Earnings per share were EUR -0.07 (-1.30). Diluted earnings per share were EUR -0.07 (-1.28). Earnings per share were EUR 0.28 (-0.90) in the fourth quarter.
Return on investment (rolling 12-months) was 3.7 (-1.2) per cent and return on equity (rolling 12-months) -0.6 (-12.1) per cent.
CAPITAL EXPENDITURE, DEPRECIATION AND IMPAIRMENT
Gross capital expenditure for the period was EUR 86.2 (31.9) million, of which EUR 33.8 million relates to acquisitions and business combinations. The investment level was increased in the fourth quarter. Investments were targeted at Sweden and the modular spaces business as planned. In fleet management, the targeted balance between the demand for and supply of rental equipment was achieved in the third quarter.
Reported depreciation and impairment on equipment and intangible assets were EUR 83.1 (88.7) million. This includes write-downs of EUR 0.8 (2.4) million on the Group’s property, plant and equipment and on assets available for sale.
Amortisation and impairment on intangible assets resulting from acquisitions totalled EUR 7.1 (28.8) million. At the end of the period, goodwill totalled EUR 148.0 (137.3) million.
FINANCIAL POSITION AND BALANCE SHEET
The Group showed a positive net cash flow of EUR 68.3 (76.6) million from operating activities in 2010. The fourth-quarter cash flow from operating activities was EUR 38.8 (26.7) million. Cash flow from investing activities in 2010 was EUR -40.9 (-11.2) million and cash flow from financing activities EUR -24.1 (-53.5) million. At the end of the period, cash and cash equivalents amounted to EUR 22.3 (18.5) million, with the net change amounting to EUR 3.3 (11.9) million.
The Group’s cash flow after investments was EUR 27.4 (65.4) million. It was affected by an increase in the investment level in the fourth quarter, the significant outsourcing agreement signed with Lemminkäinen Group in December and the agreements signed with Peab Group in October.
At the end of the period, the Group's balance sheet included EUR 2.7 (6.1) million of assets available for sale.
At the end of the period, Cramo Group’s gross interest-bearing liabilities were EUR 404.3 (402.2) million. In December, Cramo Plc signed a new long-term club loan with a total amount of EUR 375 million to refinance its existing long-term syndicated loan facility of EUR 375 million. The existing facility agreed in 2007 was due to mature in January 2013. The new unsecured loan agreement is for four years with a one-year extension option. The loan consists of a EUR 175 million term loan and a EUR 200 million revolving credit facility. The loan has two financial covenants: the Net Debt to EBITDA ratio and the gearing ratio. The new loan arrangement improves Cramo’s liquidity and reduces the Group’s interest expenses as well as provides flexibility for Cramo to pursue acquisitions.
Of the variable-rate loans, EUR 181.3 (144.2) million were hedged by way of interest rate swaps on 31 December 2010. Hedge accounting is applied to EUR 104.9 (98.2) million of these interest rate hedges. In the second half of the year, the Group increased the share of loans with a fixed rate of interest. On 31 December 2010, Cramo Group had undrawn committed credit facilities (excluding leasing facilities) of EUR 135.6 (130.1) million, of which non-current facilities represented EUR 118.0 (95.0) million and current facilities EUR 17.6 (35.1) million.
On 31 December 2010, Cramo Group’s net interest-bearing liabilities totalled EUR 382.0 (383.7) million. Gearing continued to decrease as planned, amounting to 103.4 (113.4) per cent at the end of the period.
Property, plant and equipment amounted to EUR 526.3 (522.2) million of the balance sheet total. The balance sheet total on 31 December 2010 was EUR 965.7 (918.4) million and the equity ratio was 38.7 (37.4) per cent.
During the financial year 2010, the euro weakened against most of Cramo’s other operating currencies. This had a positive effect on the Group’s comprehensive income for the period and on equity.
Rental liabilities associated with off-balance sheet operational leasing agreements totalled EUR 37.6 (40.2) million on 31 December 2010. The off-balance sheet interest liability associated with the hybrid loan was EUR 4.0 (4.0) million at the end of the period. In April 2010, Cramo Plc paid the subscribers of its hybrid bond the interest for the period 29 April 2009 to 28 April 2010.
GROUP STRUCTURE
At the end of the financial year, Cramo Group consisted of the parent company Cramo Plc, which provides group-level services, and as operating companies, its wholly-owned subsidiaries in Finland, Sweden, Norway, Denmark, Estonia, Latvia, Lithuania, Poland, the Czech Republic, Slovakia and Russia. Cramo Plc also owns a financing company in Belgium and a company in Sweden which offers group-level services. Cramo Management Oy, owned by the members of the Executive Committee, has been consolidated into the group according to SIC-12 as a Special Purpose Entity.
At the end of the period under review, equipment rental services were provided through a network of 288 (284) depots.
NEW STRATEGIC AND FINANCIAL TARGETS AND BUSINESS DEVELOPMENT
Cramo announced its new strategic and financial targets for 2010–2013 during the Capital Markets Day held on 1 September 2010.
Cramo’s strategic targets for 2010–2013 are to be the customer’s first choice as well as the “best in town” in the rental business, meaning the leading rental solutions provider in each homogenous local market (such as a city, district or region). Other strategic targets are to grow profitably faster than the market and to act as a driver of rental development.
Cramo Group’s financial targets for 2010–2013 are as follows: sales growth above 10 per cent per annum, EBITA margin above 15 per cent of sales, return on equity (ROE) above 15 per cent and maximum gearing at 100 per cent. The Group’s target is to reach the financial target levels as soon as possible during the period 2010–2013.
Achieving the strategic targets requires the roll-out of a uniform Cramo Concept and harmonised key processes in all markets, the roll-out of the “best in town” strategy in existing and new geographical areas in Europe and expanding the modular space business outside Finland and Sweden more strongly than before. Success naturally also requires the input of competent, motivated and committed personnel.
HUMAN RESOURCES
During the period under review, Group staff averaged 2,083 (2,356). In addition, the Group employed 109 (49) persons as hired work force. At the end of the period, Group staff numbered 2,131 (2,018). The number of staff is reported as full time equivalent (FTE).
The geographical distribution of personnel at the end of the period was as follows: Finland, 590 (492) employees; Sweden, 700 (700); Norway, 189 (178); Denmark, 120 (115) and Central and Eastern Europe, 532 (533) employees.
Continuous human resource development is an essential element of the Group’s strategy. In 2010 the Group launched five major group-wide development projects, the aim of which is to ensure shared values throughout the Group as well as the successful implementation of the growth strategy. On the country level HR development programmes continued to focus on developing customer service, sales and fleet management skills.
GROUP MANAGEMENT
At the end of the financial year, the Group management team consisted of the following persons: Mr Vesa Koivula, President and CEO of Cramo Group, Mr Göran Carlson, Deputy CEO, with added responsibility for the Group’s operations in Denmark, Poland, the Czech Republic and Slovakia, and Mr Martti Ala-Härkönen, CFO, with added responsibility for the Group’s business development, legal function and human resource development. Mr Koivula, Mr Carlson and Mr Ala-Härkönen comprise the Group’s Executive Committee.
The other members of the Group management team at the end of the financial year were Mr Tatu Hauhio, Senior Vice President, Finland; Mr Erik Bengtsson, Senior Vice President, Sweden; Mr Jarmo Laasanen, Senior Vice President, Baltic countries and Russia; Mr Finn Løkken, Senior Vice President, Norway; Mr Ossi Alastalo, Vice President, Fleet Management/Modular Space; Mr Martin Holmgren, Vice President, Fleet Management/Equipment Rental; and Mr Per Lundquist, Vice President, CIO.
PERFORMANCE BY BUSINESS SEGMENT
Cramo Group’s business segments consist of Finland, Sweden, Norway, Denmark and Central and Eastern Europe. In addition to segment information, Cramo also reports on the order book value for modular space. Finland generated EUR 99.6 (92.1) million or 19.9 (20.4) per cent of the total consolidated sales for 2010, Sweden EUR 251.9 (215.7) million or 50.4 (47.8) per cent, Norway EUR 69.1 (63.4) million or 13.8 (14.0) per cent, and Denmark EUR 29.5 (36.3) million or 5.9 (8.0) per cent. EUR 49.9 (44.1) million or 10.0 (9.8) per cent of sales were generated in Central and Eastern Europe.
Finland
| Finland (EUR 1,000) | 10-12/10 | 10-12/09 | Change % | 1-12/10 | 1-12/09 | Change % |
| Sales | 30,403 | 22,381 | 35.8 % | 99,583 | 92,067 | 8.2 % |
| EBITA | 3,265 | 3,652 | -10.6 % | 12,466 | 10,704 | 16.5 % |
| EBITA--% | 10.7 % | 16.3 % | 12.5 % | 11.6 % | ||
| No of employees (FTE) | 570 | 472 | 20.8 % | |||
| No of depots | 58 | 57 | 1.8 % |
In the first half of 2010, construction activity continued to be low in Finland, but in the second half of the year economic recovery was visible as a large number of new housing starts in particular. New housing starts exceeded the previous year’s level by as much as one third. Renovation projects increased clearly during the economic downturn, thanks to government support measures. While civil engineering continued at the previous year’s level, mainly due to government support, commercial and office construction starts declined further. The Confederation of Finnish Construction Industries RT has estimated construction growth in 2010 at two per cent. In the December forecast, Euroconstruct estimated construction had grown by more than four per cent in Finland.
The Finnish operations reported sales of EUR 99.6 (92.1) million in 2010, for an increase of 8.2 per cent. EBITA was EUR 12.5 (10.7) million, or 12.5 (11.6) per cent of sales. The profitability of modular space remained good throughout the year.
Fourth-quarter sales were EUR 30.4 (22.4) million, up 35.8 per cent. EBITA was EUR 3.3 (3.7) million, or 10.7 (16.3) per cent of sales. The previous year’s profit had included capital gains from the sale of used equipment.
The recovery in demand and successfully completed adjustments, such as improving the efficiency of fleet management, had a positive impact on the full year profit. In 2009–2010 Cramo converted a total of 21 depots into entrepreneur-managed franchise outlets, which has increased the flexibility of operations.
The most significant customer agreements were signed with Lemminkäinen Group. The agreements expand Cramo’s long-term collaboration with Lemminkäinen. Following the agreements signed in 2010, Cramo is Lemminkäinen Group’s preferred equipment supplier, also including construction-related services such as heating, drying and electric installation services at worksites. In October, Cramo acquired a significant portion of the rental business of the Finnish company Lambertsson Oy and signed a five-year rental equipment agreement with Peab Finland.
Cramo is the second largest player in the equipment rental market in Finland. There are also many small and specialised competitors in Finland. The number of Cramo’s depots at the end of the period under review was 58 (57), of which 21 were entrepreneur-managed.
According to the forecast published by the Confederation of Finnish Construction Industries RT in October as well as the forecast published by Euroconstruct in December, construction will grow in Finland by some three per cent in 2011. Euroconstruct predicts an increase of 6.6 per cent in residential construction. Commercial and office construction is expected to show an upturn with a growth rate of 1.4 per cent. The market forecast for civil engineering is -1.4 per cent.
Cramo’s strategic target in Finland is to increase its market share, particularly in the industrial maintenance sector, and to restore profitability to the pre-downturn level.
Sweden
| Sweden (EUR 1,000) | 10-12/10 | 10-12/09 | Change % | 1-12/10 | 1-12/09 | Change % |
| Sales | 74,521 | 57,373 | 29.9 % | 251,857 | 215,675 | 16.8 % |
| EBITA | 14,600 | 7,830 | 86.5 % | 41,186 | 36,026 | 14.3 % |
| EBITA--% | 19.6 % | 13.6 % | 16.4 % | 16.7 % | ||
| No of employees (FTE) | 665 | 657 | 1.2 % | |||
| No of depots | 119 | 116 | 2.6 % |
The demand for construction and equipment rental services in Sweden developed favourably throughout the year. Growth was particularly strong in the Stockholm area and in southern Sweden, and it picked up also elsewhere in the second half of the year. The Swedish Construction Federation (Sveriges Byggindustrier) estimated the growth in construction activity in 2010 at 3.0 per cent and Euroconstruct at 2.4 per cent. Growth expanded from strong activity in the civil engineering sector in the previous year to residential construction, particularly new residential construction.
The Swedish operations reported sales of EUR 251.9 (215.7) million in 2010, for an increase of 16.8 per cent. In local currencies, the change in sales was 5.2 per cent. EBITA was EUR 41.2 (36.0) million, or 16.4 (16.7) per cent of sales.
Fourth-quarter sales were EUR 74.5 (57.4) million, up 29.9 per cent. In local currencies, the change in sales was 16.0 per cent. EBITA was EUR 14.6 (7.8) million, or 19.6 (13.6) per cent of sales.
Growing demand and a clear improvement in fleet utilisation rates strengthened the full-year result. Shorter rental periods nevertheless increased transport and repair costs. The profitability of modular space remained at a good level throughout the year.
In October, Cramo sold its heavy equipment driving and operating services business in Sweden to Peab and renewed the equipment rental contract with Peab for the next five years. The sold business comprises rental-related driving and operating services which have generated sales of some 15 million on an annual level. Other significant contracts concluded during the year included the acquisition of the rental business of Svensk Byggleasing and the outsourcing agreement with Frijo AB in July, both in the Stockholm area.
Cramo is the clear market leader in the Swedish equipment rental business, and the company successfully strengthened its position in 2010. At the end of the period, Cramo had 119 (116) depots in Sweden, of which 41 (40) were entrepreneur-managed depots.
The Swedish Construction Federation (Sveriges Byggindustrier) estimated in October that construction will grow by five per cent in 2011, while in December Euroconstruct estimated the growth rate at some four per cent. The growth forecasts for all construction sectors (residential construction, commercial and office construction and civil engineering) are approximately 3–5 per cent.
Cramo's strategic targets in Sweden for 2010-2013 are efficiency and profitability improvement in particular, as well as achieving the “best in town” position in all areas.
Norway
| Norway (EUR 1,000) | 10-12/10 | 10-12/09 | Change % | 1-12/10 | 1-12/09 | Change % |
| Sales | 19,667 | 16,319 | 20.5 % | 69,120 | 63,427 | 9.0 % |
| EBITA | 399 | 871 | -54.2 % | 303 | 3,995 | -92.4 % |
| EBITA--% | 2.0 % | 5.3 % | 0.4 % | 6.3 % | ||
| No of employees (FTE) | 189 | 178 | 6.2 % | |||
| No of depots | 29 | 27 | 7.4 % |
Euroconstruct estimates that construction decreased by about three per cent in Norway in 2010. However, demand started to recover in the second half of the year. Residential construction grew, but commercial and office construction as well as civil engineering declined. Price competition was intense in the first half of the year, which was also reflected in Cramo’s profit. The situation nevertheless improved in the second half of the year.
The Norwegian operations reported sales of EUR 69.1 (63.4) million in 2010, for an increase of 9.0 per cent. In the local currency, the change in sales was 0.4 per cent. EBITA was EUR 0.3 (4.0) million, or 0.4 (6.3) per cent of sales. The result includes credit losses and credit loss provisions of EUR 0.7 (0.2) million.
Fourth-quarter sales were EUR 19.7 (16.3) million, up 20.5 per cent. In the local currency, the change in sales was 15.2 per cent. After a difficult start of the year, the favourable profit development, which started in the third quarter, continued during the fourth quarter. EBITA was EUR 0.4 (0.9) million, or 2.0 (5.3) per cent of sales.
One of most significant contracts concluded during the year was the five-year co-operation agreement with the mobile crane supplier Nordic Crane Group AS. The agreement covers the entire Nordic region. As a part of the arrangement Cramo acquired the entire share capital of Hego Maskinutleie AS, a Bergen-based access equipment rental company, from Nordic Crane. The agreements widen Cramo’s customer portfolio in the industrial sector in particular. Another important rental agreement was concluded with Elkem AS in the industrial sector. In addition, the public-sector customer base was expanded.
Cramo estimates that in terms of market position, it is the second largest service provider in the sector in Norway and that the Group strengthened its position in 2010. At the end of the period under review, Cramo had 29 (27) depots in Norway.
Cramo will continue the measures aimed at improving the profitability of its Norwegian operations. These measures include a reorganisation of logistics and transport, and the service and maintenance network.
Euroconstruct predicts that construction activity will increase in Norway by just over three per cent in 2011. Residential construction will grow by more than 11 per cent, and civil engineering by some five per cent, while commercial and office construction will decrease further.
Cramo’s strategic targets in Norway are to improve its profitability, be the “best in town” and achieve growth both organically and through acquisitions.
Denmark
| Denmark (EUR 1,000) | 10-12/10 | 10-12/09 | Change % | 1-12/10 | 1-12/09 | Change % |
| Sales | 8,630 | 9,275 | -7.0 % | 29,493 | 36,303 | -18.8 % |
| EBITA | -6 | -4,389 | 99.9 % | -5,328 | -8,860 | 39.9 % |
| EBITA--% | -0.1 % | -47.3 % | -18.1 % | -24.4 % | ||
| No of employees (FTE) | 120 | 115 | 4.3 % | |||
| No of depots | 17 | 17 | 0.0 % |
The decrease in construction activity in Denmark exceeded expectations in 2010. In the December forecast, Euroconstruct estimated construction had decreased by more than seven per cent. Residential construction decreased by more than nine per cent, and commercial and office construction by almost 10 per cent. Civil engineering construction remained at the previous year’s level. The demand for modular space remained good despite the weak market situation.
The Danish operations reported sales of EUR 29.5 (36.3) million in 2010, for a decrease of 18.8 per cent. EBITA was EUR -5.3 (-8.9) million, or -18.1 (-24.4) per cent of sales. The result for the period includes reorganisation expenses of EUR 0.9 (3.5) million and credit losses and credit loss provisions of EUR 0.7 (1.7) million, as well as an impairment loss of EUR 0.1 (1.3) million recognised in the fleet.
Fourth-quarter sales were EUR 8.6 (9.3) million. EBITA was EUR 0.0 (-4.4) million, or -0.1 (-47.3) per cent of sales. The result developed towards the better throughout the year, and in the fourth-quarter an almost break-even result was achieved.
Cramo reorganised its Danish operations in 2010, including the management. Business was more tightly focused on key accounts and industries; correspondingly, some functions were discontinued. Co-operation with Cramo’s operations in southern Sweden was increased; for example, the access equipment maintenance functions were combined with those in the Malmö region. Thanks to adjustment measures, Cramo succeeded in increasing the utilisation rates.
Cramo successfully further strengthened its position outside the construction industry, particularly in the health care sector. The most significant customer agreement concerned expanding the scope of the modular space agreement with Herlev hospital, as well as its extension until 2018.
Cramo estimates that in terms of market position, it is the second largest service provider in the sector in Denmark. At the end of the period under review, Cramo had 17 (17) depots in Denmark.
Increasing profitability to a satisfactory level will be Cramo's key objective in Denmark. In Denmark, too, Cramo aims to be the “best in town” in selected areas. This may also require structural changes.
In its June forecast, Euroconstruct estimated that the Danish construction market will show an upturn with a growth rate of some three per cent in 2011. The strongest growth rate is expected in civil engineering. Commercial and office construction as well as residential construction will also see an upturn.
In addition to profitability improvement, Cramo’s long-term targets for 2010–2013 include expanding the operations to cover the entire offering of the Group. The Group will seek growth in the modular space business in particular.
Central and Eastern Europe
| Central and Eastern Europe (EUR 1,000) | 10-12/10 | 10-12/09 | Change % | 1-12/10 | 1-12/09 | Change % |
| Sales | 15,812 | 11,332 | 39.5 % | 49,886 | 44,119 | 13.1 % |
| EBITA | -1,089 | -5,192 | 79.0 % | -11,464 | -17,631 | 35.0 % |
| EBITA--% | -6.9 % | -45.8 % | -23.0 % | -40.0 % | ||
| No of employees (FTE) | 532 | 533 | -0.1 % | |||
| No of depots | 65 | 67 | -3.0 % |
Cramo Group’s equipment rental sales in Central and Eastern Europe come from Estonia, Latvia, Lithuania, Poland, the Czech Republic, Slovakia and Russia.
According to the forecast published by Euroconstruct in December, construction in the Baltic countries fell by 12–19 per cent in 2010. However, there was an upswing in the gross domestic product throughout the Baltic region in the third quarter, and this is expected to lead to an upturn in construction activity in 2011. In Slovakia, construction activity decreased by some six per cent and in the Czech Republic by ten per cent. In Poland, construction market growth was only four per cent instead of the expected ten per cent, as civil engineering activity was lower than anticipated due to several projects being postponed to future years.
In Russia, the decline in construction halted in 2010 and construction activity remained at the previous year’s level. However, regional differences are marked: in Moscow, for example, growth is strong, while in St. Petersburg construction continued to decrease markedly. The share of residential construction is significant in Russia, which suffers from a housing shortage, and government activity in the residential construction sector actually maintained a slight growth also in 2010.
Cramo’s equipment rental business sales in Central and Eastern Europe were EUR 49.9 (44.1) million in 2010, for an increase of 13.1 per cent. In local currencies, the change in sales was 7.8 per cent. EBITA was EUR -11.5 (-17.6) million, or -23.0 (-40.0) per cent of sales. The result for the period includes reorganisation expenses of EUR 0.8 (1.0) million and credit losses and credit loss provisions of EUR 2.1 (3.0) million.
The strong growth which started in the third quarter continued during the fourth quarter. Fourth-quarter sales were EUR 15.8 (11.3) million, up 39.5 per cent. In local currencies the change in sales was 35.0 per cent. EBITA was EUR -1.1 (-5.2) million. Fleet utilisation rates improved to a good level in almost all of the Central and East European countries. The fourth-quarter result includes credit losses and credit loss provisions of EUR 0.6 (0.7) million. Although the full-year result was negative, the result developed positively during the year.
Improving profitability and utilising opportunities for growth, in Poland and Russia in particular, were Cramo’s key objectives in Central and Eastern Europe in 2010. Growth was in fact particularly strong in Russia (60.2 per cent) throughout the year. Cramo reorganised its Russian operations in 2010, including their management, and continued to develop the services in line with the Cramo concept. Several new service concepts were launched in Russia during the year, including the equipment rental outlet on the K-Rauta premises in St. Petersburg. The customer base is expanding from Finnish companies to Russian and international construction companies. Cramo succeeded in reinforcing its market position in the Moscow, Kaluga and Kaliningrad regions.
In Poland, Cramo expanded its service offering and the sales and fleet management operations, and business developed favourably. In the Baltic countries, especially Estonia, operations developed more favourably than expected despite the difficult market conditions. In the Czech Republic, the market situation continued to be difficult throughout the year.
At the end of the period, the number of depots in Central and Eastern Europe was 65 (67), of which 13 (10) were entrepreneur-managed.
According to the forecast published by Euroconstruct in December 2010, construction is expected to grow in all markets except the Czech Republic in 2011. In Russia, construction is expected to show an upturn with a growth rate of five per cent. In the Baltic countries, residential construction is expected to drive growth in construction, with growth rates estimated at some 10 per cent in Estonia, four per cent in Latvia and five per cent in Lithuania. In Poland, civil engineering is expected to drive construction growth, which is predicted at 13 per cent. In Russia, the construction market is expected to show an upturn with a growth rate of some six per cent. In the Czech Republic, the forecasted decrease in construction activity is estimated at some three per cent.
Cramo’s strategic target in Central and Eastern Europe is to grow profitably faster than the market and to be the best rental service provider on the local level in each market. Cramo also intends to decrease its dependence on the construction industry, which accounted for approximately 90 per cent of the Group’s net sales in Central and Eastern Europe, compared with approximately 50 per cent in Cramo’s other market segments.
SHARES AND SHARE CAPITAL
On 31 December 2010, Cramo Plc’s share capital as registered in the trade register was EUR 24,834,753.09 and the number of shares was 30,660,189, including Cramo Management Oy’s holding of 316,288 shares. There were no changes in the share capital or the number of registered shares during the period under review.
On 30 September 2010, the Board of Directors of Cramo Plc resolved to apply for listing of stock option rights 2006B of Cramo Plc Stock Options 2006 programme on NASDAQ OMX Helsinki to commence on 1 October 2010. The total number of stock options 2006B issued is 1,000,000. There are currently 74 key employees holding a total of 737,000 of these stock options. A wholly-owned subsidiary of Cramo Plc currently holds 247,000 stock options 2006B which will not be used for share subscription. Each stock option 2006B entitles its holder to subscribe for one Cramo Plc share at a subscription price of EUR 25.62. The share subscription period is from 1 October 2010 to 31 January 2012. The shares possibly subscribed for with the stock options 2006B will account for a maximum of 2.4% of the number and voting rights of Cramo Plc’s shares and voting rights after registering of the new shares.
A total of 142,191 new shares were subscribed for with the stock options 2006A in December. The new shares were registered in the trade register after the review period on 13 January 2011 and trading in them began on 14 January 2011. The share subscription price of EUR 1,871,233.56 was credited in its entirety to the reserve for invested unrestricted equity. As a result of the share subscriptions, the number of Cramo Plc shares increased to 30,802,380.
CUrrent option PROGRAMMES and incentive schemes
Based on the 2006A option scheme, Cramo has issued a total of 1,000,000 stock options. At the end of the period under review, 306,000 of these options were held by a wholly-owned subsidiary of Cramo Plc. These options will not be used for share subscription. Each stock option outstanding entitles its holder to subscribe for one new share in the company. The share subscription period was from 1 October 2009 to 31 January 2011. The planned schedule for listing the shares subscribed for under the 2006 option scheme on the NASDAQ OMX Helsinki is as follows:
- Share subscription by 31 January 2011 – listing on 11 February 2011
The 2010 Annual General Meeting decided that stock options be issued to the key personnel of the Cramo Group as a part of the incentive and commitment programme for the key personnel. The maximum total number of stock options issued will be 1,000,000 and they will be issued gratuitously. The share subscription price will be based on the prevailing market price of the Cramo Plc share on the NASDAQ OMX Helsinki Ltd in October 2010. The share subscription period for stock options will be 1 October 2013 to 31 December 2014. In November, the Board of Directors decided on the distribution of 1,000,000 stock options 2010.
On 31 December 2010, Cramo Group's key personnel held a total of 551,809 stock options 2006A, 737.000 stock options 2006B, 882,500 stock options 2006C, 895.000 stock options 2009 and 1,000,000 stock options 2010.
Cramo Management Oy, owned by the members of the Executive Committee, holds 316,288 shares in the company. The transfer of these shares is restricted during the validity of the arrangement, expiring in autumn 2012.
TRADING ON NASDAQ OMX HELSINKI
Cramo Plc has been listed on the Helsinki Stock Exchange since 1988. The share code is CRA1V. On the Nordic list, Cramo Plc is classified as a Mid Cap company in the industrials sector.
In the financial year from 1 January to 31 December 2010 the lowest trading price for Cramo Plc stock was EUR 11.04 and the highest was EUR 19.44. The trading-weighted average share price for Cramo Plc stock was EUR 14.22. The closing price for the share on 31 December 2010 was EUR 19.08 and the company’s market value was EUR 585.0 million.
CHANGES IN SHAREHOLDINGS
During the period under review, Cramo Plc received the following notifications pursuant to Chapter 2, section 9 of the Finnish Securities Markets Act:
Hartwall Capital Oy Ab announced on 26 March 2010 that it had received the right to decide on the use of the voting rights of the following parties: K. Hartwall Invest Oy, Kusinkapital Ab, Pinewood Invest OÜ, Pallas Capital Oy, Fyrklöver-Invest Oy Ab, Gustav Tallqvist, Christel Hartwall and Gulle Therman. On the date of the announcement, the combined total holding of these parties was 7,775,672 shares, representing 25.3 per cent of Cramo Plc shares and votes.
The holding of Suomi Mutual Life Assurance Company of Cramo Plc shares and votes increased over one twentieth (1/20) on 19 May 2010. On the date of the announcement, the company’s holding was 5.06 per cent of Cramo Plc shares and votes, or 1,552,069 shares.
The holding of Suomi Mutual Life Assurance Company of Cramo Plc shares and votes fell below one twentieth (1/20) on 26 May 2010. On the date of the announcement, the company’s holding was 4.93 per cent of Cramo Plc shares and votes, or 1,510,176 shares.
ANNUAL GENERAL MEETING AND VALID BOARD AUTHORISATIONS
Cramo Plc’s Annual General Meeting on 13 April 2010 approved the consolidated financial statements and the parent company’s financial statements for 2009 and discharged the members of the Board of Directors and the President and CEO from liability. The Annual General Meeting approved the Board’s proposal that no divided be paid. In December 2010, the Board decided not to convene an Extraordinary General Meeting to decide on a possible dividend payment for 2009.
The Annual General Meeting resolved that the Chairman of the Board of Directors shall be paid EUR 60,000 per year, the Deputy Chairman EUR 40,000 per year and the other Board members EUR 30,000 per year. As a rule, 40 per cent of the annual remuneration will be paid in Cramo Plc shares purchased on behalf of the Board members. In addition, the Board members will receive an attendance fee or EUR 1,000 for committee meetings.
Mr Stig Gustavson, Mr Eino Halonen, Mr Jari Lainio, Mr Esko Mäkelä and Mr Fredrik Cappelen were re-elected, and Mr Victor Hartwall and Mr Thomas von Hertzen were elected as new Board members.
Ernst & Young Oy, a firm of authorised public accountants, was appointed as Cramo Plc’s auditor, with Mr Erkka Talvinko, APA, as the responsible auditor.
The Annual General Meeting decided to authorise the Board of Directors to repurchase, or to accept as pledge, a maximum of 3,066,000 of the company’s own shares. Only the company’s unrestricted equity may be used to repurchase own shares. The Board of Directors shall decide on how own shares will be repurchased and/or accepted as pledge.
The Annual General Meeting authorised the Board of Directors to decide on the transfer of the repurchased own shares so that under the authorisation, a maximum of 3,066,000 shares may be transferred, in one or several tranches. The Board of Directors shall resolve on the terms for the transfer of shares.
The Annual General Meeting authorised the Board of Directors to decide on a share issue as well as on option rights and other special rights entitling to shares as follows: The shares issued will be new shares, and their maximum number is 6,132,000. Shares or special rights entitling to shares may be issued in one or more tranches. The Board may resolve upon issuing shares to the company itself, and the Board shall resolve on all of the terms of the share issue and the special rights entitling to company shares.
The Annual General Meeting decided that stock options be issued to the key personnel of the Cramo Group as a part of the incentive and commitment program for the key personnel. The maximum total number of stock options issued will be 1,000,000 and they will be issued gratuitously. The share subscription price will be based on the prevailing market price of the Cramo Plc share on the NASDAQ OMX Helsinki Ltd in October 2010. The share subscription period for stock options will be 1 October 2013 to 31 December 2014. The Board of Directors decided on the distribution of stock options in the fourth quarter of 2010.
The Annual General Meeting adopted a resolution to amend article 8, section 2, of the Articles of Association: “Notice to the General meeting of Shareholders shall be published in a newspaper determined by the Board of Directors at least three (3) weeks before the date of the meeting, but no later than nine (9) days before the record date of the General meeting of Shareholders. The notice shall state the date on which a shareholder must notify the company at the latest, in order to attend the General Meeting of Shareholders.”
CORPORATE GOVERNANCE AND AUDITORS
As of 13 April 2010, Cramo Plc’s Board of Directors is composed of Mr Stig Gustavson (Chairman), Mr Eino Halonen (Deputy Chairman), Mr Fredrik Cappelen, Mr Victor Hartwall, Mr Thomas von Hertzen, Mr Jari Lainio and Mr Esko Mäkelä. The Audit Committee members are Mr Eino Halonen (Chairman), Mr Fredrik Cappelen, Mr Thomas von Hertzen and Mr Esko Mäkelä. The members of the Nomination and Compensation Committee are Mr Stig Gustavson (Chairman), Mr Jari Lainio and Mr Victor Hartwall.
Until 13 April 2010, Cramo Plc’s Board of Directors consisted of Mr Stig Gustavson (Chairman), Mr Eino Halonen (Deputy Chairman), Mr Fredrik Cappelen, Mr Gunnar Glifberg, Mr Hannu Krogerus, Mr Jari Lainio and Mr Esko Mäkelä.
The Board met 11 times during the financial year. The average attendance rate of Board members was 96.6 per cent. The Audit Committee met 5 times and the Nomination and Compensation Committee met 3 times.
On 31 December 2010, the Board members, the President and CEO and his deputy held, either directly or through companies in which they exercise control, a total of 2,985,060 Cramo Plc shares, which represents 9.7 per cent of the company’s shares and votes, and a total of 348,000 stock options.
The company’s auditors were Ernst & Young Oy, Authorised Public Accountants, with Mr Erkka Talvinko, APA, as the responsible auditor.
Cramo Plc observes the Finnish Corporate Governance Code, which entered into force on 1 January 2010. Cramo Plc’s insider guidelines are based on the Finnish Securities Markets Act, rules and regulations issued by the Financial Supervision Authority and the insider guidelines of the stock exchange. Euroclear Finland Oy maintains an insider register of Cramo Plc’s permanent insiders, whose holdings are also available on Cramo Plc’s website.
The Corporate Governance statement issued by Cramo Plc’s Board of Directors can be found on the Cramo Plc website.
ESSENTIAL RISKS AND UNCERTAINTIES
In addition to global economic developments, the main sources of uncertainty in Cramo’s business are related to the economic cycles and financial development of each country, fluctuations in interest and exchange rates, availability of financing, credit loss risks, the success of the Group’s acquisitions, personnel-related risks, availability of competent management and recruitment-related risks, tax risks and other business risks.
The risks involved with business increased during the economic downturn. In particular, the risks associated with the reorganisation of the Group’s operations, fleet management related risks, the availability and price of financing, risks related to financial covenants of loan terms, exchange rate risks, risks related to the implementation of the Group’s ERP system, risks related to franchising arrangements, risks related to rental prices in different markets as well as credit loss risks increased during the downturn. In addition, the downturn increased the impairment risks to the balance sheet values resulting from acquisitions. Greater attention has been paid to the Group’s risk management in the changed operating environment.
SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE
The 142,191 new shares subscribed for under the stock option rights 2006A in December were registered in the trade register on 3 January 2011, and trading in them began on 14 January 2011. As a result of the share subscriptions, the number of Cramo Plc shares increased to 30,802,380.
On January 11, 2011, Cramo announced having signed an agreement to acquire a 100 per cent stake of the share capital of Theisen Baumaschinen AG. The seller is Arrex Beteiligungs-GmbH, a privately-owned holding company. The purchase price was approximately EUR 47 million, of which EUR 40 million was paid in cash and the rest in Cramo Plc’s new shares pursuant to a directed share issue made to the seller, equalling approximately EUR 7 million. Cramo also assumed Theisen’s net interest-bearing debt and financial leasing liabilities, resulting in an enterprise value of approximately EUR 85 million for the transaction.
Cramo used its existing long-term credit facilities to finance the cash part of the transaction. Cramo Plc’s Board uses its share issue authorisation granted by the Annual General Meeting held on 13 April 2010 for the directed share issue.
Theisen Group is among the top three providers of equipment rental services in Germany. Approximately 90 per cent of the group’s sales are generated in Germany, which is Europe’s largest construction market. The size of the German equipment rental market is estimated at approximately EUR 3.5 billion. Theisen Group also operates in Germany, Austria, Switzerland and Hungary. Theisen Group had 274 employees at the time of the signing of the transaction.
On January 11, 2011, Cramo announced Theisen’s business details:
“In 2009, Theisen generated sales of approximately EUR 85.7 million, EBITDA of approximately EUR 11.4 million and EBIT of approximately EUR 3.0 million (IFRS adjusted). Theisen’s EBITDA margin is affected by a siginificant part of the Group’s fleet being financed by operational leasing. The Group’s profitability is expected to have improved somewhat in 2010.”
The preparation and auditing of Theisen Group’s consolidated accounts under German GAAP for 2010 are under way. The impact of Theisen on Cramo Group’s consolidated income statement and balance sheet will depend, in addition to IFRS accounting standards (i a, converting Theisen’s financial leasing liabilities into an IFRS balance sheet by dividing the leasing expenses into depreciation and interest) and Cramo’s IFRS compliant accounting practises, on conditions stipulated in the share purchase agreement relating to the adjustment of the purchase price.
Therefore, contrary to the January 11, 2011 announcement, no specific information may be given as to the level of Theisen’s 2010 results.
However, as previously disclosed, Cramo estimates the Theisen transaction to be earnings-neutral to Cramo Group in 2011 and earnings-accretive thereafter.
On January 31, 2011, Cramo announced closing the Theisen acquisition January 31, 2011. According to the terms and conditions of the acquisition, Cramo directed 374,532 new Cramo Plc shares to Arrex Beteiligungs-GmbH. The new shares are estimated to be registered into the trade register and listed and admitted to trading on the main list of NASDAQ OMX Helsinki Ltd together with the existing shares in Cramo by 20 February 2011. The new shares are subject to a lock-up arrangement pursuant to which 50 per cent of the shares issued in the share issue may not be transferred during a period of one year from the closing of the transaction and the remaining 50 per sent of the shares may not be transferred during a period of two years from the closing of the transaction.
Theisen Group will be consolidated into Cramo Group as of February 1, 2011. Theisen Group will constitute a new business segment in Cramo’s reporting as “Central Europe” as of Q1 2011. Cramo will not separately publish pro forma calculations for periods prior to closing.
On February 10, 2011, Cramo announced that 551,809 new shares subscribed for under the stock option rights 2006A in January 2011 were registered in the trade register on 10 February 2011, and trading in them will begin on 11 February 2011. As a result of the share subscriptions, the number of Cramo Plc shares increased to 31,354,189.
PROFIT DISTRIBUTION POLICY AND BOARD OF DIRECTOR’S PROPOSAL FOR PROFIT DISTRIBUTION
The Board proposes to the Annual General Meeting to pay a dividend amounting to EUR 0.10 per share for the financial year 1 January–31 December 2010.
The information in this Financial Statements Bulletin is based on unaudited figures.
ACCOUNTING PRINCIPLES
This Financial Statements Bulletin has been prepared in accordance with IAS 34: Interim Financial Reporting. In the preparation of this Financial Statements Bulletin, Cramo has applied the same accounting principles as in its financial statements for 2009, except for the new and revised IFRS standards which the company has adopted: IFRS 3 standard (“Business Combinations”) and IAS 27 standard (“Consolidated and Separate Financial Statements”) as well as other amendments to other standards attributable to these revisions.
The above-mentioned revisions to standards have not had a significant impact on the reported balance sheet, income statement and notes.
| CONSOLIDATED BALANCE SHEET (EUR 1,000) | 31 Dec 2010 | 31 Dec 2009 |
| ASSETS | ||
| Non-current assets | ||
| Tangible assets | 526,326 | 522,191 |
| Goodwill | 147,998 | 137,339 |
| Other intangible assets | 102,001 | 90,843 |
| Deferred tax assets | 14,301 | 19,137 |
| Available-for-sale financial investments | 347 | 340 |
| Derivative financial instruments | 1,053 | 238 |
| Trade and other receivables | 3,613 | 4,990 |
| Total non-current assets | 795,638 | 775,079 |
| Current assets | ||
| Inventories | 13,803 | 11,591 |
| Trade and other receivables | 125,333 | 99,526 |
| Income tax receivables | 5,114 | 6,599 |
| Derivative financial instruments | 825 | 898 |
| Cash and cash equivalents | 22,313 | 18,520 |
| Total current assets | 167,388 | 137,134 |
| Assets available for sale | 2,671 | 6,148 |
| TOTAL ASSETS | 965,697 | 918,360 |
| EQUITY AND LIABILITIES | ||
| Equity | ||
| Share capital | 24,835 | 24,835 |
| Share issue | 1,871 | |
| Other reserves | 186,926 | 186,910 |
| Fair value reserve | 117 | 117 |
| Hedging fund | -1,197 | -2,296 |
| Translation differences | 3,426 | -12,431 |
| Retained earnings | 103,309 | 91,117 |
|
Equity attributable to shareholders of the parent company |
319,287 | 288,252 |
| Non-controlling interest | 503 | 503 |
| Hybrid capital | 49,630 | 49,630 |
| Total equity | 369,420 | 338,385 |
| Non-current liabilities | ||
| Interest-bearing liabilities | 346,776 | 351,606 |
| Derivative financial instruments | 2,543 | 3,809 |
| Deferred tax liabilities | 78,348 | 79,036 |
| Other non-current liabilities | 4,207 | 6,816 |
| Total non-current liabilities | 431,875 | 441,267 |
| Current liabilities | ||
| Interest-bearing liabilities | 57,569 | 50,596 |
| Derivative financial instruments | 1,853 | 680 |
| Trade and other payables | 100,984 | 82,855 |
| Income tax liabilities | 3,997 | 4,576 |
| Total current liabilities | 164,403 | 138,707 |
| Total liabilities | 596,277 | 579,975 |
| TOTAL EQUITY AND LIABILITIES | 965,697 | 918,360 |
|
CONSOLIDATED INCOME STATEMENT 1 Jan 2010 - 31 Dec 2010 (EUR 1,000) |
10-12/10 | 10-12/09 | 1-12/10 | 1-12/09 |
| Sales | 146,384 | 115,402 | 492,103 | 446,676 |
| Other operating income | 4,254 | 4,122 | 15,110 | 7,262 |
| Change in inventories of finished goods and work in progress | -860 | -1,452 | 1,015 | -1,486 |
| Production for own use | 2,119 | 1,609 | 4,694 | 9,148 |
| Materials and services | -58,972 | -44,007 | -183,479 | -150,882 |
| Employee benefit expense | -28,354 | -23,831 | -101,939 | -103,062 |
| Other operating expenses | -30,836 | -26,826 | -109,880 | -101,700 |
| Depreciation and impairment on tangible assets and assets available for sale | -19,679 | -23,630 | -83,145 | -88,669 |
| EBITA | 14,056 | 1,387 | 34,478 | 17,286 |
| % of sales | 9.6 % | 1.2 % | 7.0 % | 3.9 % |
| Amortisation and impairment on intangible assets resulting from acquisitions | -1,945 | -23,654 | -7,089 | -28,754 |
| Operating profit / loss (EBIT) | 12,111 | -22,267 | 27,389 | -11,467 |
| % of sales | 8.3 % | -19.3 % | 5.6 % | -2.6 % |
| Finance costs (net) | -3,743 | -5,227 | -22,586 | -22,734 |
| Profit / loss before taxes | 8,368 | -27,494 | 4,804 | -34,202 |
| % of sales | 5.7 % | -23.8 % | 1.0 % | -7.7 % |
| Income taxes | -4 | 9 | -7,007 | -5,657 |
| Profit / loss for the period | 8,364 | -27,485 | -2,203 | -39,858 |
| % of sales | 5.7 % | -23.8 % | -0.4 % | -8.9 % |
| Attributable to: | ||||
| Equity holder of parent | 8,378 | -27,471 | -2,142 | -39,831 |
| Non-controlling interest | -15 | -14 | -61 | -27 |
| Profit / loss attributable to equity holders' of parent | ||||
| Earnings per share, undiluted, EUR | 0.28 | -0.90 | -0.07 | -1.30 |
| Earnings per share, diluted, EUR | 0.26 | -0.88 | -0.07 | -1.28 |
|
COMPREHENSIVE INCOME STATEMENT 1 Jan 2010 - 30 Sep 2010 (EUR 1,000) |
10-12/10 | 10-12/09 | 1-12/10 | 1-12/09 |
| Profit / loss for the period | 8,364 | -27,485 | -2,203 | -39,858 |
| Other comprenhesive income | ||||
| -Change in hedging fund, net of tax | 1,374 | 126 | 1,099 | -923 |
| -Change in exchange rate differences, net of tax | 4,195 | 339 | 33,956 | 15,915 |
| Total other comprehensive income | 5,569 | 465 | 35,055 | 14,992 |
| Comprehensive income for the period | 13,933 | -27,020 | 32,852 | -24,866 |
| CHANGES IN CONSOLIDATED STATEMENT OF EQUITY (EUR 1,000) | Share capital | Share issue and other reserves | Fair value reserve | Retained earnings, translation differences, hedging fund | Attributable to equity holders of the parent company | Non-controlling interest | Hybrid capital | Total equity |
| At 1 Jan 2009 | 24,835 | 186,910 | 117 | 107,614 | 319,476 | 319,476 | ||
| Total comprehensive income | -24,866 | -24,866 | -24,866 | |||||
| Dividend distribution | -6,132 | -6,132 | -6,132 | |||||
| Share-based payments | 2,254 | 2,254 | 2,254 | |||||
| Non-controlling interest | -2,480 | -2,480 | 503 | -1,977 | ||||
| Hybrid capital | 49,630 | 49,630 | ||||||
| At 31 Dec 2009 | 24,835 | 186,910 | 117 | 76,390 | 288,252 | 503 | 49,630 | 338,385 |
| At 1 Jan 2010 | 24,835 | 186,910 | 117 | 76,390 | 288,252 | 503 | 49,630 | 338,385 |
| Total comprehensive income | 32,852 | 32,852 | 32,852 | |||||
| Exercise of share options | 1,871 | 1,871 | 1,871 | |||||
| Share-based payments | 2,312 | 2,312 | 2,312 | |||||
| Hybrid capital | -6,000 | -6,000 | -6,000 | |||||
| Changes within equity | 16 | -16 | ||||||
| At 31 Dec 2010 | 24,835 | 188,797 | 117 | 105,538 | 319,287 | 503 | 49,630 | 369,420 |
|
CONSOLIDATED CASH FLOW STATEMENT 1 Jan 2010 - 31 Dec 2010 (EUR 1,000) |
1-12/10 | 1-12/09 |
| Net cash flow from operating activities | 68,333 | 76,565 |
| Net cash flow from investing activities | -40,940 | -11,162 |
| Cash flow from financing activities | ||
| Change in interest-bearing receivables | -610 | 94 |
| Change in finance lease liabilities | -35,309 | -25,806 |
| Change in interest-bearing liabilities | 15,952 | -69,209 |
| Hybrid capital | -6,000 | 49,500 |
| Proceeds from share options exercised | 1,871 | |
| Acquisition of own shares | -2,480 | |
| Related party investments | 503 | |
| Dividends paid | -6,132 | |
| Net cash flow from financing activities | -24,095 | -53,530 |
| Change in cash and cash equivalents | 3,298 | 11,873 |
| Cash and cash equivalents at period start | 18,520 | 8,123 |
| Translation differences | 495 | -1,476 |
| Cash and cash equivalents at period end | 22,313 | 18,520 |
| COMMITMENTS AND CONTINGENT LIABILITIES | 31 Dec 2010 | 31 Dec 2009 |
| On own behalf | ||
| Mortgages on company assets | 83,317 | |
| Pledges | 169,424 | |
| Pledges, finance lease | 154,091 | 156,018 |
| Interest on hybrid capital | 4,044 | 4,044 |
| Investment commitments | 1,226 | 93 |
| Commitments to office and depot rents | 98,271 | 83,401 |
| Operational lease payments | 37,602 | 40,226 |
| Other commitments | 580 | 355 |
|
DERIVATIVE FINANCIAL INSTRUMENTS (EUR 1,000) |
31 Dec 2010 | 31 Dec 2009 |
| Fair value | ||
| Interest rate swaps | -1,490 | -3,622 |
| Currency forwards | -1,028 | 263 |
| Nominal value | ||
| Interest rate swaps | 181,331 | 144,178 |
| Currency forwards | 177,380 | 129,588 |
| MODULAR SPACE ORDER BOOK (EUR 1,000) | 31 Dec 2010 | 31 Dec 2009 |
| Value of outstanding orders for modular space | 87,685 | 102,773 |
| Value of orders for modular space rental | 83,261 | 101,285 |
| Value of orders for sale of modular space | 4,424 | 1,488 |
| SHARE RELATED KEY FIGURES | 10-12/10 | 10-12/09 | 1-12/10 | 1-12/09 |
| Earnings per share (EPS), EUR 1) | 0.28 | -0.90 | -0.07 | -1.30 |
| Earnings per share (EPS), diluted, EUR 2) | 0.26 | -0.88 | -0.07 | -1.28 |
| Shareholders’ equity per share, EUR 3) | 10.52 | 9.50 | ||
| Number of shares, end of period | 30,660,189 | 30,660,189 | ||
| Number of shares, issue-adjusted, average 4) | 30,343,901 | 30,522,534 | ||
| Number of shares, issue-adjusted, end of period 4) | 30,343,901 | 30,343,901 | ||
| Number of shares, diluted by share options, average | 31,750,741 | 31,121,644 |
- Calculated from issue-adjusted average number of shares
- Calculated from diluted average number of shares
- Calculated from issue-adjusted number of shares at the end of the period
-
Number of shares deducted by shares held by Cramo Management Oy
INFORMATION PRESENTED BY BUSINESS SEGMENT
The Group’s segments are divided geographically and consist of Finland, Sweden, Norway, Denmark and Central and Eastern Europe.
| Sales by segment (EUR 1,000) | 10-12/10 | 10-12/09 | 1-12/10 | 1-12/09 |
| Finland | 30,403 | 22,381 | 99,583 | 92,067 |
| Sweden | 74,521 | 57,373 | 251,857 | 215,675 |
| Norway | 19,667 | 16,319 | 69,120 | 63,427 |
| Denmark | 8,630 | 9,275 | 29,493 | 36,303 |
| Central and Eastern Europe | 15,812 | 11,332 | 49,886 | 44,119 |
| Inter-segment sales | -2,649 | -1,278 | -7,837 | -4,915 |
| Group sales | 146,384 | 115,402 | 492,103 | 446,676 |
| EBITA by segment (EUR 1,000) | 10-12/10 | 10-12/09 | 1-12/10 | 1-12/09 |
| Finland | 3,265 | 3,652 | 12,466 | 10,704 |
| % of sales | 10.7 % | 16.3 % | 12.5 % | 11.6 % |
| Sweden | 14,600 | 7,830 | 41,186 | 36,026 |
| % of sales | 19.6 % | 13.6 % | 16.4 % | 16.7 % |
| Norway | 399 | 871 | 303 | 3,995 |
| % of sales | 2.0 % | 5.3 % | 0.4 % | 6.3 % |
| Denmark | -6 | -4,389 | -5,328 | -8,860 |
| % of sales | -0.1 % | -47.3 % | -18.1 % | -24.4 % |
| Central and Eastern Europe | -1,089 | -5,192 | -11,464 | -17,631 |
| % of sales | -6.9 % | -45.8 % | -23.0 % | -40.0 % |
| Non-allocated capital gains and other income | 1,031 | 5,746 | 1,031 | |
| Non-allocated Group activities | -3,072 | -2,433 | -8,380 | -8,013 |
| Eliminations | -42 | 17 | -52 | 34 |
| Group EBITA | 14,056 | 1,387 | 34,478 | 17,286 |
| % of sales | 9.6 % | 1.2 % | 7.0 % | 3.9 % |
| Depreciation by segment (EUR 1,000) | 10-12/10 | 10-12/09 | 1-12/10 | 1-12/09 |
| Finland | -3,439 | -4,138 | -14,566 | -16,678 |
| Sweden | -7,913 | -7,715 | -31,916 | -30,573 |
| Norway | -2,280 | -2,413 | -9,613 | -9,391 |
| Denmark | -1,006 | -2,800 | -5,692 | -8,071 |
| Central and Eastern Europe | -5,085 | -6,553 | -21,399 | -23,843 |
| Non-allocated items and eliminations | 43 | -10 | 41 | -111 |
| Total | -19,679 | -23,630 | -83,145 | -88,669 |
| Reconciliation of Group EBITA to earnings before taxes (EUR 1,000) | 10-12/10 | 10-12/09 | 1-12/10 | 1-12/09 |
| Group EBITA | 14,056 | 1,387 | 34,478 | 17,286 |
| Amortisation and impairment on intangible assets resulting from acquisitions | -1,945 | -23,654 | -7,088 | -28,754 |
| Net finance items | -3,743 | -5,227 | -22,586 | -22,734 |
| Earnings before taxes | 8,368 | -27,494 | 4,804 | -34,202 |
| Capital expenditure by segment (EUR 1,000) | 10-12/10 | 10-12/09 | 1-12/10 | 1-12/09 |
| Finland | 26,728 | 1,979 | 34,854 | 10,406 |
| Sweden | 17,085 | 3,174 | 35,133 | 8,874 |
| Norway | 3,665 | 1,281 | 8,453 | 7,782 |
| Denmark | 679 | 0 | 690 | 288 |
| Central and Eastern Europe | 3,788 | 121 | 5,143 | 2,589 |
| Non-allocated items and eliminations | 1,071 | 57 | 1,946 | 1,992 |
| Total | 53,015 | 6,613 | 86,219 | 31,931 |
| Assets by segment (EUR 1,000) | 31 Dec 2010 | 31 Dec 2009 |
| Finland | 164,906 | 151,593 |
| Sweden | 449,591 | 398,148 |
| Norway | 98,415 | 94,512 |
| Denmark | 49,150 | 58,882 |
| Central and Eastern Europe | 146,903 | 161,294 |
| Non-allocated items and eliminations | 56,732 | 53,931 |
| Total | 965,697 | 918,360 |
| Liabilities by segment (EUR 1,000) | 31 Dec 2010 | 31 Dec 2009 |
| Finland | 39,986 | 44,291 |
| Sweden | 160,869 | 148,230 |
| Norway | 34,996 | 37,019 |
| Denmark | 10,990 | 15,679 |
| Central and Eastern Europe | 41,119 | 54,047 |
| Non-allocated items and eliminations | 308,317 | 280,708 |
| Total | 596,277 | 579,975 |
QUARTERLY SEGMENT INFORMATION
| Sales by segment (EUR 1,000) | 10-12/10 | 7-9/10 | 4-6/10 | 1-3/10 | 10-12/09 | 7-9/09 | 4-6/09 |
| Finland | 30,403 | 27,430 | 22,694 | 19,056 | 22,381 | 23,834 | 22,580 |
| Sweden | 74,521 | 64,839 | 60,602 | 51,895 | 57,373 | 55,296 | 52,952 |
| Norway | 19,667 | 17,023 | 15,332 | 17,097 | 16,319 | 15,615 | 15,742 |
| Denmark | 8,630 | 8,395 | 6,728 | 5,740 | 9,275 | 9,747 | 8,750 |
| Central and Eastern Europe | 15,812 | 14,361 | 10,698 | 9,014 | 11,332 | 11,979 | 10,445 |
| Inter-segment sales | -2,649 | -1,693 | -2,092 | -1,403 | -1,278 | -1,382 | -1,150 |
| Group sales | 146,384 | 130,356 | 113,964 | 101,400 | 115,402 | 115,089 | 109,319 |
| EBITA by segment (EUR 1,000) | 10-12/10 | 7-9/10 | 4-6/10 | 1-3/10 | 10-12/09 | 7-9/09 | 4-6/09 |
| Finland | 3,265 | 6,105 | 2,546 | 550 | 3,652 | 4,291 | 1,829 |
| % of sales | 10.7 % | 22.3 % | 11.2 % | 2.9 % | 16.3 % | 18.0 % | 8.1 % |
| Sweden | 14,600 | 12,332 | 8,835 | 5,418 | 7,830 | 11,084 | 9,810 |
| % of sales | 19.6 % | 19.0 % | 14.6 % | 10.4 % | 13.6 % | 20.0 % | 18.5 % |
| Norway | 399 | 310 | -303 | -103 | 871 | 853 | 1,079 |
| % of sales | 2.0 % | 1.8 % | -2.0 % | -0.6 % | 5.3 % | 5.5 % | 6.9 % |
| Denmark | -6 | -831 | -1,268 | -3,224 | -4,389 | -1,571 | -1,154 |
| % of sales | -0.1 % | -9.9 % | -18.8 % | -56.2 % | -47.3 % | -16.1 % | -13.2 % |
| Central and Eastern Europe | -1,089 | -1,488 | -4,047 | -4,839 | -5,192 | -3,008 | -4,517 |
| % of sales | -6.9 % | -10.4 % | -37.8 % | -53.7 % | -45.8 % | -25.1 % | -43.2 % |
| Non-allocated capital gains and other income | 0 | 0 | 0 | 5,746 | 1,031 | 0 | 0 |
| Non-allocated Group activities | -3,072 | -1,304 | -1,931 | -2,073 | -2,433 | -2,052 | -2,157 |
| Eliminations | -42 | 29 | -66 | 27 | 17 | -21 | -52 |
| Group EBITA | 14,056 | 15,153 | 3,766 | 1,503 | 1,387 | 9,577 | 4,838 |
| % of sales | 9.6 % | 11.6 % | 3.3 % | 1.5 % | 1.2 % | 8.3 % | 4.4 % |
LARGEST SHAREHOLDERS
| TEN LARGEST SHAREHOLDERS 31 Dec 2010 | SHARES | % | |
| 1 | Hartwall Capital Oy Ab | 4,993,619 | 16.29 |
| 2 | K. Hartwall Invest Oy | 2,432,000 | 7.93 |
| 3 | Rakennusmestarien Säätiö (Construction engineers' fund) | 1,862,620 | 6.08 |
| 4 | Mariatorp Oy | 1,238,000 | 4.04 |
| 5 | Sijoitus-Wipunen Oy | 750,000 | 2.45 |
| 6 | Odin Finland | 643,944 | 2.10 |
| 7 | Nordea Nordenfund | 509,780 | 1.66 |
| 8 | Fondita Nordic Micro Cap | 404,000 | 1.32 |
| 9 | Ilmarinen Mutual Pension Insurance Company | 352,256 | 1.15 |
| 10 | Cramo Management Oy | 316,288 | 1.03 |
| Ten largest owners, total | 13,502,507 | 44.04 | |
| Nominee registered and non-Finnish holders | 6,834,824 | 22.29 | |
| Others | 10,322,858 | 33.67 | |
| Total | 30,660,189 | 100.00 | |
There were no material transactions with related parties during the period under review.
This report includes certain forward-looking statements based on the management’s expectations at the time they are made. These involve risks and uncertainties and are subject to change due to changes in general economic and industry conditions.
Vantaa 9 February 2011
Cramo Plc
Board of Directors
The information in this bulletin is based on unaudited figures.
BRIEFING
Cramo will hold a briefing and a live webcast in the Kämp Kansallissali, address Aleksanterinkatu 44 A (2nd floor), Helsinki, on 10 February 2011 at 11:00 am. The briefing will be in English.
To watch the briefing live on the Internet, go to www.cramo.com. A replay of the webcast will be available at www.cramo.com as of 10 February 2011 in the afternoon.
PUBLICATION OF FINANCIAL INFORMATION 2011
The Annual Report containing the full financial statements for 2010 will be published in electronic format in week 10/2011.
The 2011 Annual General Meeting will take place on Thursday, 24 March 2011, in Helsinki.
Cramo will publish three Interim Reports in 2011.
The January–March Interim Report will be published on Monday, 9 May 2011.
The January–June Interim Report will be published on Thursday, 4 August 2011.
The January–September Interim Report will be published on Tuesday, 1 November 2011.
FURTHER INFORMATION
Vesa Koivula
President and CEO, tel. +358 10 661 10, +358 40 510 5710
Martti Ala-Härkönen
CFO, tel. +358 10 661 10, +358 40 737 6633
DISTRIBUTION
NASDAQ OMX Helsinki Ltd.
Principal media
www.cramo.com
