Cramo Plc Stock Exchange Release 29 March 2019 at 12 pm EET
Cramo publishes non-IFRS additional financial information of the impact of IFRS 16 related to published 2018 financials
Cramo has adopted the new accounting standard issued by the International Accounting Standards Board, IFRS 16 Leases, effective on January 1, 2019. The standard has been adopted using the non-retrospective approach, which does not require restatement of the comparative periods. The cumulative impact of the implementation is accounted for as adjustments in the opening balance.
The implementation of the new standard will affect many key figures and ratios, e.g. EBITDA, EBITA and EBIT will increase and ROCE(%) will decrease and net debt and net debt to EBITDA will increase.
IFRS 16 requires the lessees to recognise the lease agreements on the balance sheet as right-of-use assets and lease liabilities. The accounting model is largely similar to the current finance lease accounting practice according to IAS 17, the major change concerning operational leases that are activated on the Balance Sheet as well. There are two (2) exceptions allowed: these relate to either short-term contracts in which the lease term is 12 months or less, or to low value items, i.e. assets valued at USD 5,000 or less when new. Cramo has decided to utilise the exceptions to other contracts but Land and Buildings (depot and premises contracts). The most significant impact on Cramo is caused by numerous depot and premises lease contracts that were previously considered as operational. In the previous Leases standard, IAS 17, they were treated as straight-line expenses in the Income Statement but are now instead activated on the Balance Sheet in Right-of-use assets and Lease liabilities, with the assets depreciated over time and the interest component from the liabilities distinguished in the Income statement.
As a result of the implementation of this new standard, Cramo publishes restated non-IFRS information on 2018 financials for comparison purposes only. This information should be read in conjunction with Cramo's reported financial statements for 2018, published on February 8, 2019. Cramo has applied the same accounting principles in the preparation of this restated information as in its financial statements for 2018, except for the implementation of the new IFRS 16 standard. The restated information presented is non-IFRS additional financial information and has not been audited.
Restated information on 2018 financials for comparison purposes is based on reported financial notes on operational leases, i.e. leases contracts previously treated as off-Balance Sheet commitments. There are differences between the definitions of items formerly reported as off-Balance Sheet commitments and IFRS 16 lease liabilities. Cramo has identified the most material differences to concern the discounting of lease liabilities compared to the nominal amounts of commitments; definition of the lease term especially regarding the treatment of open-end contracts and extension options, mostly outside commitments, and utilising the two IFRS 16 exemptions mostly recognised in commitments. The restated non-IFRS figures based on financial notes are adjusted to reflect the differences in principles between IFRS 16 and reported financial notes.
Below are presented the restated non-IFRS 2018 figures for comparison purposes. More details can be found in the attached tables and at www.cramogroup.com/investors
| Group | |||
| KEY FIGURES AND RATIOS (MEUR) | 2018 | IFRS 16 impact | 2018 |
| Reported | with IFRS 16 impact* | ||
| EBITDA | 244.3 | 31.9 | 276.2 |
| EBITA | 124.0 | 3.0 | 127.0 |
| % of sales | 15.9% | 0.4% | 16.3% |
| Comparable EBITA** | 130.1 | 2.9 | 133.0 |
| % of sales | 16.7% | 0.4% | 17.1% |
| EBIT | 119.5 | 2.9 | 122.4 |
| % of sales | 15.3% | 0.4% | 15.7% |
| Comparable ROCE, %**, *** | 11.0% | -0.8% | 10.2% |
| ROCE, %*** | 10.5% | -0.8% | 9.7% |
| Net debt / EBITDA | 2.88 | 0.14 | 3.02 |
| Net interest-bearing liabilities | 703.5 | 131.2 | 834.7 |
| Capital employed | 1,373.0 | 131.2 | 1,504.2 |
| *Restated figures with IFRS 16 impact are based on illustrative non-IFRS calculations from reported financial notes to form a comparison basis for IFRS 16 figures in 2019. These calculations have been implemented from the opening balance of 2017. Figures are non-IFRS additional financial information and are not be considered as reported IFRS figures. | |||
| ** excluding items affecting comparability, more information on IACs presented in the 2018 Financial statements. | |||
| *** Cramo changed the calculation method of ROCE’s capital employed component into 12 months average in Q4’2018. The change has been applied into comparison figures. | |||
| Segments | |||
| Equipment rental | 2018 | 2018 | |
| Reported | IFRS 16 impact | with IFRS 16 impact* | |
| EBITDA | 195.6 | 29.6 | 225.2 |
| EBITA | 103.7 | 2.7 | 106.4 |
| % of sales | 16.5% | 0.4% | 16.9% |
| Comparable EBITA | 104.6 | 2.7 | 107.3 |
| % of sales | 16.6% | 0.4% | 17.0% |
| EBIT | 99.9 | 2.7 | 102.6 |
| % of sales | 15.9% | 0.4% | 16.3% |
| Comparable ROCE, % | 14.4% | -1.6% | 12.7% |
| ROCE, % | 14.3% | -1.6% | 12.6% |
| Capital employed | 725.0 | 116.4 | 841.4 |
| ER - Scandinavia | 2018 | 2018 | |
| Reported | IFRS 16 impact | with IFRS 16 impact* | |
| EBITDA | 117.3 | 15.1 | 132.3 |
| EBITA | 73.3 | 1.5 | 74.8 |
| % of sales | 19.8% | 0.4% | 20.2% |
| Comparable EBITA | 73.3 | 1.5 | 74.8 |
| % of sales | 19.8% | 0.4% | 20.2% |
| EBIT | 71.3 | 1.5 | 72.8 |
| % of sales | 19.2% | 0.4% | 19.7% |
| Comparable ROCE, % | 19.3% | -2.4% | 16.9% |
| ROCE, % | 19.3% | -2.4% | 16.9% |
| Capital employed | 379.0 | 64.4 | 443.4 |
| ER - Finland and Eastern Europe | 2018 | 2018 | |
| Reported | IFRS 16 impact | with IFRS 16 impact* | |
| EBITDA | 49.5 | 7.5 | 57.0 |
| EBITA | 22.5 | 0.7 | 23.1 |
| % of sales | 15.5% | 0.5% | 16.0% |
| Comparable EBITA | 22.5 | 0.7 | 23.1 |
| % of sales | 15.5% | 0.5% | 16.0% |
| EBIT | 21.6 | 0.7 | 22.3 |
| % of sales | 14.9% | 0.5 % | 15.4% |
| Comparable ROCE, % | 11.4% | -1.1% | 10.2% |
| ROCE, % | 11.4% | -1.1% | 10.2% |
| Capital employed | 193.3 | 27.5 | 220.7 |
| ER - Central Europe | 2018 | 2018 | |
| Reported | IFRS 16 impact | with IFRS 16 impact* | |
| EBITDA | 29.0 | 7.1 | 36.1 |
| EBITA | 8.0 | 0.5 | 8.6 |
| % of sales | 7.0% | 0.5% | 7.5% |
| Comparable EBITA | 8.9 | 0.5 | 9.4 |
| % of sales | 7.8% | 0.5% | 8.3% |
| EBIT | 7.1 | 0.5 | 7.6 |
| % of sales | 6.2% | 0.5% | 6.6% |
| Comparable ROCE, % | 5.7% | -0.5% | 5.2% |
| ROCE, % | 5.0% | -0.4% | 4.6% |
| Capital employed | 153.0 | 24.5 | 177.5 |
| Modular space | 2018 | 2018 | |
| Reported | IFRS 16 impact | with IFRS 16 impact* | |
| EBITDA | 63.2 | 1.9 | 65.2 |
| EBITA | 36.8 | 0.2 | 37.0 |
| % of sales | 24.3% | 0.1% | 24.4% |
| Comparable EBITA | 36.8 | 0.2 | 37.0 |
| % of sales | 24.3% | 0.1% | 24.4% |
| EBIT | 36.0 | 0.2 | 36.2 |
| % of sales | 23.8% | 0.1% | 23.9% |
| Comparable ROCE, % | 8.8% | -0.1% | 8.6% |
| ROCE, % | 8.8% | -0.1% | 8.6% |
| Capital employed | 622.9 | 14.4 | 637.3 |
| *Restated figures with IFRS 16 impact are based on illustrative non-IFRS calculations from reported financial notes to form a comparison basis for IFRS 16 figures in 2019. These calculations have been implemented from the opening balance of 2017. Figures are non-IFRS additional financial information and are not be considered as reported IFRS figures. | |||
Cramo Plc
Aku Rumpunen
CFO
Further information:
Mr Aku Rumpunen, CFO, tel: +358 40 556 3546, email: aku.rumpunen@cramo.com
Distribution:
Nasdaq Helsinki Ltd.
Main media
www.cramogroup.com
Cramo is Europe’s second largest rental services company specialising in construction machinery and equipment rental and rental-related services as well as the rental of modular space. Cramo operates in about 300 depots in 13 countries. With a group staff around 2,700, Cramo's consolidated sales in 2018 were EUR 780 million. Cramo shares (CRA1V) are listed on Nasdaq Helsinki Ltd.
Cramo Adapteo is the sub-brand for Cramo’s modular space operations.
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