CRAMO PLC How can Cramo grow in the coming five years Handelsbanken - - PowerPoint PPT Presentation

CRAMO PLC

How can Cramo grow in the coming five years

Handelsbanken Nordic Mid/Small Cap Seminar 2016 Stockholm 8 June 2016 CFO Martti Ala-Härkönen

FOR A GREAT DAY AT WORK

2

Cramo in brief

A leading European equipment rental service company

Russia Denmark Germany Poland Czech Republic Austria Hungary Slovakia Ukraine Belarus Lithuania Latvia Estonia Norway Sweden Finland Romania Moldova Bulgaria Slovenia Croatia Bosnia and Herzegovina Serbia Macedonia Albania Kalinin- grad

• Cramo is the second largest equipment rental service companies in

Europe, with operations in 14 countries and 2015 sales of EUR 668 million

• Cramo is also the no.1 player in both construction and non-

construction modular space in the Nordic countries

• In 2015, Cramo posted EBITA before NRIs of EUR 86.8 million

(13.0% of sales)

• The company operates under the Cramo brand in all its operating

countries and in Russia and Ukraine under the Fortrent brand (50%-owned joint venture)

• In addition to its strong market position and brand, Cramo’s key

strengths are its extensive rental concept combined with a flexible business model and operational efficiency

• Cramo's 2,500 employees serve over 150,000 customers
• Cramo was founded in 1953 and it is listed on the Helsinki Stock

Exchange 2015 sales by industry segment 2015 sales by product group* 2015 sales by business segment

14 countries + Fortrent in Russia and Ukraine Number of depots 328

54 % 25 % 15 % 2 % 4% Construction industry Other industry Public sector Households Other 25 % 18 % 10 % 10 % 21% 15,0 % Equipment rental: Tools rental Equipment rental: Access rental Equipment rental:Construction

• ecq. rental

Equipment rental: Site huts rental Equipment rental: Rental related and other services Modular space: Rental and services

* For modular space product area, sales include rental and rental related sales. For equipment rental, rental sales allocated to product areas 17 % 49 % 10 % 4 % 12% 8%

Finland Sweden Norway Denmark Central Europe Eastern Europe

3

Leading indicators positive

Cramo has a favorable geographical exposure towards stronger European economies

Construction output* Construction confidence**

** Source: European Commission, April 2016

• 60
• 40
• 20

20 40 60 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Construction Confidence Indicator (mean-adjusted)

Finland Sweden Germany Denmark Poland Europe

Construction output (% change in real terms)

2015E 2016F 2017F 2018O

• 0,3 %

3,2 %

(-1,0 %) (+3,5 %)

5,5 % 2,8 %

(+9,0 %) (+4,0 %)

2,4 % 3,9 % 2,1 % 2,6 %

(+1,8 %) (+4,2 %) (+2,2 %)

1,3 % 2,3 % 2,7 %

(+1,6 %) (+2,5 %) (+3,2 %)

Germany 0,4 % 2,0 % 1,1 % 0,3 % Austria 0,2 % 1,0 % 1,3 % 1,3 % Estonia

• 3,8 %

2,4 % 3,4 % 2,1 % Latvia

• 11,0 %

1,2 % 5,8 % 5,6 % Lithuania 3,5 % 1,1 % 3,7 % 3,3 % Poland 5,6 % 7,4 % 8,3 % 7,7 % Czech Republic 7,4 % 3,3 % 3,4 % 4,3 % Slovak Republic 10,3 %

• 1,1 %

1,1 % 1,1 % Russia

• 7,9 %
• 2,6 %

2,7 % 7,0 % Denmark 2,8 % Norway Finland 0,6 % 0,9 % Sweden

• 0,3 %

2,2 %

Sources: Euroconstruct, December 2015 and Forecon, December 2015 Country-specific data in brackets includes: Finland - Rakennusteollisuus RT (April 2016); Sweden - Sveriges Byggindustrier (February 2016); Norway – Prognosesenteret (March 2016); Denmark - Dansk Byggeri (February 2016)

Megatrends supporting growth in rental services

4

Outsourcing - Increasing rental penetration Growth in rental- related services Switch from manpower to machine Growth in renovation construction in mature construction markets

MEGATRENDS

Migration Urbanisation Ageing Globalisation Digitalisation Sustainability Environmental and climate awareness Increased energy efficiency requirements

Accelerating technological development Global and local demographic changes More stringent environmental laws and international agreements to mitigate climate change

SOCIETY PUBLIC SECTOR CONSTRUCTION OTHER INDUSTRIES

Growth in new services and solutions Growth of rental and modular space in new sectors Increasing rental penetration, outsourcing Internet of things, intelligent life-cycle follow-up Multichannel connectivity with customers

EQUIPMENT RENTAL DRIVERS MODULAR SPACE GROWTH DRIVERS

Economic benefits, change in mindset Greater preference for total solutions Need to improve productivity Quality problems (mold and moisture) in construction Ageing of buildings Dynamic, changing environment creates demand Site-specific space needs during renovation periods Fluctuating space needs: daycares, schools, accommodation End users increasingly require permanent-like quality Need for energy-efficient solutions

0,0 % 0,5 % 1,0 % 1,5 % 2,0 % 2,5 % 3,0 % 3,5 % 4,0 % 4,5 %

Clear growth potential in rental penetration

Rental is a growing industrial services business driven by structural growth drivers

Rental penetration and market size*

* Source: European Rental Association, November 2015. Penetration = rental turnover / construction output

Total market size in Europe EUR 23 bn (2014E)

→ Nordic countries EUR 3.2 bn (2014E)

Increasing rental penetration,

• utsourcing

Rental-related services Exchange of manpower for machinery Environmental concerns, energy efficiency and sustainability Renovation construction Demographic changes, immigration Capital conservation Storage space Inventory control Site downtime Cost control Disposal costs Rental economics Penetration (%) Bubble size describes market volume Presence No presence

UK EUR 6.9 bn

2.8%

France EUR 3.6 bn

1.6%

Sweden EUR 1.5 bn

3.6%

Poland EUR 0.39 bn

0.5%

Germany EUR 3.5 bn

1.4%

Norway EUR 0.89 bn

1.8%

Denmark EUR 0.43 bn

1.8%

Finland EUR 0.44 bn

1.6%

Cramo is the clear #1 in the most advanced rental market in Europe… …and has established a strong foothold in the 3rd largest market by volume. Growth drivers 5

Rental is sustainable

A Sharing Economy

6

Focus on your core business Machinery is normally non-core Transparency Budgeting and control get easier Freedom Turning fixed costs into variable Flexibility Reduce or expand equipment according to needs Improved access Access to a variety of modern, high quality products and services without keeping stock Cost efficiency Share costs with others and reduce fixed cost

The Cramo Rental Concept

7

More than 220,000 rental items

A wide range of rental-related SERVICES ranging from different site services, such as proactive site monitoring, construction site logistics, dust-control and weather-sheltering, to safety-related services, equipment and training. INDUSTRIAL PROJECTS including infrastructure, offshore and mining. Tailor-made total RENTAL SOLUTIONS for more efficient, safe and environmentally sound construction projects. MODULAR SPACE SOLUTIONS matching the standards

• f permanent structures

from classrooms and daycare facilities to high-tech offices and accommodation. SITE HUTS adaptable for various purposes and capacity needs. COMPREHENSIVE RANGE OF TOOLS and complete package solutions in building equipment. Modern, comprehensive fleet of CONSTRUCTION EQUIPMENT for any type of assignments, from major road projects to small-scale jobs. ACCESS EQUIPMENT with comprehensive safety solutions for working at heights.

Over 150,000 customers

8

Cramo’s service offering

Services are an important part of being a total rental solutions provider

Worksite logistics service

An example of a new rental-related service

9

Worksite logistics services

Traffic guidance Logistics responsible person Forklift with driver Logistics management/ Scheduling with web based application Hauling Work site cleaning Interim Warehousing Access control – Cramo Control Transportation from interim warehouse to work site

All logistics related services from one supplier

Web application for all work site needs Work site efficiency and cost control

Growth in new services and solutions Growth of rental and modular space in new sectors Multichannel connectivity with customers

In Finland, bolt-on acquisition in April 2016 to strengthen the worksite logistics services business

Kurottaja- ja Kuljetuspalvelu Parviainen Oy’s business

10

• Founded in 2004, 23 employees
• Sales of ~ EUR 3m
• Specialising in worksite logistics and

telehandler rental with operators

• Fleet brands well known in the

industry

• Main customers: the leading

companies in the construction industry

11

Illustration of rental development: Case Finland

In Finland, rental market size has nearly tripled in last 19 years

50 100 150 200 250 300 350 400 450 500 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014E 2015F 2016F Finnish equipment rental market (nominal, EURm) Finnish equipment rental market

Source: European Rental Association and Cramo analysis

A Great Day at Work

Our promise to our customers

12

We are always responsive

If the customer is not happy with our service, he or she can tell our Ombudsman and get a bonus for helping us improve.

We are always on time

If the customer cannot use our equipment as planned due to late or incomplete delivery he or she will be compensated.

Our equipment never fails

If there’s a malfunction in any equipment delivered by us, we will fix or substitute it faster than normally expected – or compensate.

This is how we make it happen!

We make our customers’ life easier and more efficient

13

Always nearby A passion to serve Reliable delivery High quality and safety Rental

• bjects for

every possible need Committed to development An easier, more efficient day

14

Q1 / 2016 performance and Group strategy

15

Highlights of Q1/2016

Profitable growth continued

Sales:

• Sales grew by 5.7% to EUR 155.4 (147.1) million
• Sales growth 6.4% in local currencies
• Sales grew by 18.9% in FIN and by 7.7% in SWE in local currencies
• Sales grew in modular space by 26.3% in local currencies

Costs:

• In Q1/2016, indirect costs as a share of sales decreased from

44.1% to 41.9%

• Direct cost ratio remained at last year’s level, although

installation services within modular space increased direct costs in relation to sales

Results / other:

• EBITA EUR 13.0m (10.1), +27.9%, EBITA margin 8.3% (6.9%)
• Strong cash flow from oper. activities: EUR 23.6 (3.5) million
• EPS EUR 0.16 (0.09)
• Net debt to EBITDA 1.96, gearing 80.0% (92.9%)
• Closing down unprofitable depots in Central Europe – results

expected to improve during 2016

• Acquisition of Parviainen Oy’s business in Finland to

strenghten worksite logistics services

10,1 13,0 10,1

1,0 1,0

• 0,4

0,3 1,0

• 0,3

0,2 1,4 1,2 0,3

5,0 6,0 7,0 8,0 9,0 10,0 11,0 12,0 13,0 14,0

Group Q1 2015 Finland Sweden Norway Denmark Central Europe Eastern Europe Non- allocated and elim. Group Q1 2016 ER MS Non- allocated and elim. Group Q1 2015

Consolidated EBITA (EUR million)

EBITA bridge Q1/15  Q1/16 by segment and product area

Absolute EBITA and EBITA margin improved, both product areas performing well

• EBITA improved to EUR 13.0

(10.1) million: +27.9%, with margin of 8.3% (6.9%)

• EBITA above LY in Finland,

Sweden, Denmark and Central Europe

• EBITA margin improved in

Finland, Denmark and Central

• Europe. In Sweden EBITA

margin remained at LY level

• EBITA above LY in both

product areas: Equipment rental and modular space

• Implementation of focused

strategy continues in 2016 Highlights

CE: Strong EBITA improvement, room for further improvement in 2016

6.9%

• f

sales 8.3%

• f

sales

DK: Improved profitability driven by modular space FI and SWE: Strong improve- ment vs. LY NO: More challenging market environment EE: performance differs between markets Strong performance both in ER and MS

Continued execution of focused strategy in 2016

• Further roll-out of Cramo Story in all
• perating countries
• Further strengthen the Cramo brand and

deliver on customer promises

• Execution and training in all work streams

and deployment of corporate culture

• Reap the benefits of performance

management

• Capture growth opportunities and focus
• n sales and business development
• Continued benefits from performance

improvement actions

4,3 % 6,3 %

Rental market* Cramo Sales

CAGRs 10-15

0,60 0,94 1,01 0,91 1,13 0,30 0,42 0,60 0,55 0,65

11 12 13 14 15

5,4 % 7,5 % 8,3 % 8,3 % 10,9 %

11 12 13 14 15

78,7 % 65,1 % 72,9 % 84,7 % 74,9 %

11 12 13 14 15

10,5 % 11,3 % 12,2 % 11,2 % 13,0 %

11 12 13 14 15

Implementation of MWBs has brought Cramo close to its financial targets in 2010-15

Sales and gearing targets achieved. In 2016, focus on EBITA-% and ROE

18

Profitability

EBITA-% > 15 % of sales over a business cycle

Debt leverage

Gearing maximum 100 %

Sales

Sales growth faster than the market

Return on equity

ROE > 12 % over a business cycle

Profit distribution

Profit distribution policy: stability, with

• appr. 40 % of EPS

EPS DPS Note: EBITA margin, ROE and EPS presented before reported non-recurring items

* Nominal rental market growth in current Cramo countries (based on ERA and management estimates)

Target Level Target Level Target Level

Strategic initiatives to back core strategy

• Cramo Group’s strategy work on

“Vision 2020” is proceeding

Modular Space growth strategy Dynamic pricing strategy Outsourcing and M&A strategy

Cramo modular space: Harmonised high-quality fleet with excellent references and growth opportunities

• Renovation needs / mold

problems

• Aging building stock
• Senior citizen housing
• Refugee inflow
• Both private and public sector

demand

• Temporary space needs in large

industrial and infrastructure projects

• Industrial customers’ demand for

flexibility in cost base (temporary

• vs. permanent buildings)
• Improving economic cycle creates

more demand for office space

• Modular space has high reputation

among private customers

Schools & Daycare

• Renovation needs / mold

problems

• Aging building stock
• Urbanisation
• Refugee inflow
• Increasing birth rate in Sweden:

More need for new schools

• Mainly public sector customers

Offices

Accom- modation Growth Drivers

Q1 Sales 28.0 M€ 2015: 22.2 M€ Q1 Sales growth 26.3% In locals Q1 EBITA 7.9 M€ 2015: 6.8 M€ Q1 EBITA-% 28.4% 2015: 30.5%

21

Future prospects

European Central Bank expects favourable financing conditions and low mortgage interest rates to boost demand for housing in Europe Intensely increasing immigration impacts positively on construction and modular space in Europe Favorable construction outlook according to Euroconstruct and Forecon In the long term, equipment rental is expected to grow faster than construction. ERA expects the usage of rental services to increase in all Cramo’s main markets in 2016 For modular space, numerous growth drivers in place. Cramo estimates that demand for modular space has increased in the Nordics by appr. 6% in recent years and that market growth is somewhat stronger in Baltics / GER Guidance for 2016 unchanged: “In 2016, Cramo Group’s sales will grow in local currencies and the EBITA margin will improve compared to 2015.”

March 2015 / 22

FOR A GREAT DAY AT WORK

THANK YOU!

Appendix

23

24

Key figures

Change EUR million (unless otherwise stated) %

INCOME STATEMENT Sales 155,4 147,1 5,7 % 667,9 EBITDA 38,7 34,3 12,9 % 185,7 Operating profit (EBITA) before amortisation and impairment of intangible assets resulting from acquisitions 13,0 10,1 27,9 % 84,8 Operating profit/loss (EBIT) 11,7 8,0 46,0 % 76,7 Profit/Loss before tax (EBT) 8,9 4,9 81,0 % 63,8 Profit/Loss for the period 7,0 3,9 81,0 % 49,7 SHARE-RELATED INFORMATION Earnings per share (EPS), EUR 0,16 0,09 78,5 % 1,13 Earnings per share (EPS), diluted, EUR 0,16 0,09 79,5 % 1,12 Shareholders' equity per share, EUR 10,46 10,11 3,5 % 11,05 BALANCE SHEET Equity ratio, % 43,7 % 42,3 % 45,7 % Gearing, % 80,0 % 92,9 % 75,1 % Net interest-bearing liabilities 372,1 412,4

• 9,8 %

368,4 OTHER INFORMATION Return on investment, rolling 12-month, % 9,5 % 4,9 % 9,0 % Return on equity, rolling 12-month, % 11,6 % 4,5 % 10,5 % Gross capital expenditure (incl. acquisitions) 30,6 41,5

• 26,3 %

175,0

• f which related to acquisitions and business combinations

8,5

• 100,0 %

9,8 Cash flow from operating activities 23,6 3,5 572,4 % 174,9 Cash flow after investments

• 4,3
• 27,8

35,6 Average number of personnel, FTE 2 497 2 487 0,4 % 2 486 Number of personnel at end of period, FTE 2 505 2 494 0,4 % 2 473

1-3/ 2016 1-3/ 2015 1-12/ 2015

25

Consolidated income statement

Change EUR (1 000) % SALES 155 436 147 061 5,7 % 667 877 Other operating income 3 284 4 182

• 21,5 %

13 462 Materials and services

• 54 806
• 51 981
• 5,4 %
• 236 619

Employee benefit expenses

• 36 601
• 35 999
• 1,7 %
• 143 899

Other operating expenses

• 28 490
• 28 820

1,1 %

• 115 510

Depreciation and impairment on tangible assets and assets held for sale

• 25 763
• 24 173
• 6,6 %
• 100 878

Share of profit/loss of joint ventures

• 101
• 140

395 EBITA 12 958 10 130 27,9 % 84 827 % of sales 8,3 % 6,9 % 12,7 % Amortisation and impairment on intangible assets resulting from acquisitions and disposals

• 1 284
• 2 137

39,9 %

• 8 114

OPERATING PROFIT/LOSS (EBIT) 11 674 7 993 46,1 % 76 714 % of sales 7,5 % 5,4 % 11,5 % Finance costs (net)

• 2 813
• 3 097

9,2 %

• 12 923

PROFIT/LOSS BEFORE TAXES 8 861 4 896 81,0 % 63 791 % of sales 5,7 % 3,3 % 9,6 % Income taxes

• 1 861
• 1 028
• 14 075

PROFIT/LOSS FOR THE PERIOD 7 000 3 868 81,0 % 49 715 % of sales 4,5 % 2,6 % 7,4 % 1-3/ 2016 1-3/ 2015 1-12/ 2015

26

Consolidated balance sheet

31.3. 31.3. Change EUR (1 000) 2016 2015 % ASSETS NON-CURRENT ASSETS Tangible assets 689 189 641 991 7,4 % Goodwill 151 114 152 185

• 0,7 %

Other intangible assets 66 339 75 445

• 12,1 %

Deferred tax assets 14 966 15 760

• 5,0 %

Investments in joint ventures 1 684 7 020

• 76,0 %

Loan receivables 15 036 17 161

• 12,4 %

Trade and other receivables 1 375 1 081 27,2 % TOTAL NON-CURRENT ASSETS 939 703 910 831 3,2 % CURRENT ASSETS Inventories 9 326 10 248

• 9,0 %

Trade and other receivables 120 811 123 324 #REF! Income tax receivables 3 356 11 334 965,9 % Derivative financial instruments 98 874 284,0 % Cash and cash equivalents 3 499 4 355

• 97,7 %

TOTAL CURRENT ASSETS 137 089 150 136

• 8,7 %

Assets held for sale Assets to be transferred to joint venture TOTAL ASSETS 1 076 793 1 060 967 1,5 % 31.3. 31.3. Change EUR (1 000) 2016 2015 % EQUITY AND LIABILITIES EQUITY Share capital 24 835 24 835 0,0 % Other reserves 326 297 323 516 0,9 % Fair value reserve Hedging fund

• 9 486
• 8 482

Translation differences

• 27 968
• 22 533
• 24,1 %

Retained earnings 151 355 126 366 19,8 % EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT COMPANY 465 033 443 703 4,8 % Hybrid capital TOTAL EQUITY 465 033 443 703 4,8 % NON-CURRENT LIABILITIES Interest-bearing liabilities 283 501 323 908

• 12,5 %

Derivative financial instruments 11 436 9 784 16,9 % Deferred tax liabilities 69 228 68 362 1,3 % Retirement benefit obligations 1 730 1 906

• 9,2 %

Other non-current liabilities 2 067 3 156

• 34,5 %

TOTAL NON-CURRENT LIABILITIES 367 962 407 117

• 9,6 %

CURRENT LIABILITIES Interest-bearing liabilities 92 114 92 868

• 0,8 %

Derivative financial instruments 537 552

• 2,6 %

Trade and other payables 148 936 113 971 30,7 % Income tax liabilities 1 916 2 282

• 16,0 %

Provisions 295 473 TOTAL CURRENT LIABILITIES 243 798 210 146 16,0 % TOTAL LIABILITIES 611 760 617 264

• 0,9 %

TOTAL EQUITY AND LIABILITIES 1 076 793 1 060 967 1,5 %

27

Cash flow statement

1-3/ 1-3/ EUR (1 000) 2016 2015 Net cash flow from operating activities 23 589 3 508 Net cash flow from investing activities

• 27 915
• 31 341

Cash flow after investments

• 4 326
• 27 833

Cash flow from financing activities Change in interest-bearing receivables 232 493 Change in finance lease liabilities

• 1 761
• 3 632

Change in interest-bearing liabilities 5 447 27 948 Hybrid capital Proceeds from share options exercised 376 1 608 Proceeds from share issue Non-controlling interest Dividends paid Net cash flow from financing activities 4 294 26 417 Change in cash and cash equivalents

• 32
• 1 417

Cash and cash equivalents at period start 3 511 5 689 Translation differences 20 83 Cash and cash equivalents at period end 3 499 4 355

160,0 161,4 182,4 184,6 148,5 160,1 173,6 175,1 140,3 159,8 171,1 180,6 147,1 161,3 172,4 187,2 155,4

• 10%
• 5%

0% 5% 10% 15% 20% 20 40 60 80 100 120 140 160 180 200 Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Quarterly sales growth % (y-o-y), line graph) Quarterly sales (EUR million, bar graph)

28

Cramo quarterly sales development

• Q1/2016 sales EUR 155.4m,

y-o-y sales growth +5.7% (+6.4% in local currencies)

− In local currencies in Q1, sales grew by 18.9% in Finland, by 7.7% in Sweden and by 18.5% in Denmark − Sales decreased in Norway, Central Europe and Eastern

• Europe. In Central Europe due

to a decrease in trading sales, whereas rental sales increased − As for product areas, sales grew in local currencies by 3.0% in equipment rental and by 26.3% in modular space

Q1/16 vs. Q1/15: +5.7% (+6.4%*)

* Change in local currencies

Highlights

Group financial target: Sales growth faster than the market

10,6 14,3 31,2 21,9 6,4 16,5 32,3 24,8 4,4 12,5 30,5 23,0 10,1 18,4 30,2 26,1 13,0

• 25%
• 20%
• 15%
• 10%
• 5%

0% 5% 10% 15% 20% 25% 5 10 15 20 25 30 35 40 45 50 Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 EBITA % (line graph) Quarterly EBITA (EUR million, bar graph)

29

Cramo quarterly EBITA development

• Q1/16 EBITA improved to

EUR 13.0 (10.1) million, or 8.3% (6.9%) of sales

• EBITA grew by 27.9% y-o-y
• The result improved in

Finland, Sweden, Denmark and Central Europe

• The result improved in both

product areas

• In equipment rental, EBITA

EUR 6.9 (5.6) million or 5.4% (4.5%) of sales

• In modular space, EBITA

EUR 7.9 (6.8) million or 28.4% (30.5%) of sales. Margin affected by the significant proportion of installation services during the period

Group financial target: EBITA margin > 15%

Highlights

261,9 257,4 64,8 65,1 40,2 % 38,5 % 44,1 % 41,9 % 50 100 150 200 250 300 350 400 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 2014 2015 2015 2016 Jan-Dec . Q1 Indirect cost (EUR million) Indirect cost ratio Indirect cost (right axis) Indirect cost ratio (left axis) 232,7 236,7 52,0 54,8 35,7 % 35,4 % 35,3 % 35,3 % 50 100 150 200 250 300 350 400 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 2014 2015 2015 2016 Jan-Dec . Q1 Direct cost (EUR million) Direct cost ratio Direct cost (right axis) Direct cost ratio (left axis)

30

Development in cost base*

In Q1/16, indirect costs as a share of sales decreased from 44.1% to 41.9%. Direct cost ratio was on par compared to Q1/15

* Comparison before reported non-recurring items 1 Direct cost refers to income statement line ”Materials and services” 2 Indirect cost refers to income statement lines ”Employee benefit expenses” and ”Other operating expenses”

QUARTERLY INDIRECT COST 2 QUARTERLY DIRECT COST 1

0,04 0,11 0,43 0,34

• 0,04

0,19 0,48 0,38

• 0,03

0,11 0,45

• 0,17

0,09 0,23 0,43 0,37 0,16 0,37 0,02 0,02

• 0,3
• 0,2
• 0,1

0,0 0,1 0,2 0,3 0,4 0,5 0,6 Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Quarterly diluted EPS (EUR) Earnings per share, diluted Impact of non-recurring items

Cramo EPS performance (diluted)

• Q1/16 EPS EUR 0.16

(0.09): +79.5%

• Q1/16 net financial

expenses EUR 2.8 (3.1) million

• Q1/16 effective tax rate

21.0% (21.0%)

* Q4/2012 includes non-recurring items having a positive net impact of EUR 3.5m on net result, or EPS EUR 0.08 ** Q4/2013 includes non-recurring items having a positive impact of EUR 1.6m on net result, or EPS EUR 0.04 *** Q3/2015 includes costs from a CEO change of EUR 1.2m with a negative impact on EPS of EUR 0.02 **** Q4/2015 includes EUR 0.8m restructuring costs with a negative impact on EPS of EUR 0.02

* ** Highlights

Q4/2014 non-recurring items amounted to EUR 0.54

*** ****

7,3 % 6,8 % 7,0 % 7,5 % 6,9 % 8,0 % 8,0 % 8,3 % 8,5 % 8,7 % 8,2 % 8,3 % 9,6 % 10,8 % 10,6 % 12,0 % 10,5 % 11,6 %

• 1%

1% 3% 5% 7% 9% 11% 13% 15% Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 ROE % Return on Equity %

32

Return on Equity

• ROE improvement continued

in Q1/2016

• ROE (R12m) 11.6% (4.5%)
• Comparable ROE (R12m)

before the costs occurring in 2015 from CEO change (EUR 1.2m) and restructuring costs in Central Europe (EUR 0.8m) 12.0% (9.6%)

• Comparable ROE reached

the financial target level of 12% ROE

• Performance improvement

actions continue in 2016

• Implementation of focused

strategy / must-win battles continue

Group financial target: ROE-% > 12%

Highlights

33

Quarterly cash flow

Strong cash flow in Q1/2016

• Q1/2016:

− Cash flow from operating activities improved clearly to EUR 23.6m (3.5m), contributed by higher EBITDA, lower investments and reduced NWC − Cash flow after investments EUR -4.3m (-27.8m) − Gross CapEx EUR 30.6m (41.5m)

• Gearing at 80.0% (92.9%)

Formation of Fortrent, acquisitions in Norway

Highlights

Acquisition of Optirent in Finland and C/S RaumCenter in Germany Acquisition of Vuokra-Pekat Oy and Visby Hyrmaskiner

3,5 23,6

• 27,8
• 4,3
• 40
• 20

20 40 60 80 Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Quarterly cash flow (EUR m) Cash flow from operations Cash flow after investments

34

Quarterly capital expenditure

• In Q1/2016, organic gross

CapEx was EUR 30.6m (33.0m)

− Organic CapEx decreased by 7.2% from Q1/15 − Acquisitions EUR 0.0m (8.5m)

• Gross capital expenditure

grew especially in Finland, Sweden and Eastern Europe. In Central Europe and Norway, investments were decreased

• As for product areas, Cramo

continued its growth investments in modular space

Note:Acquisitions in Q1/2013 include Lambertsson and Kranpunkten completed in February 2013 and Russia joint venture completed in March 2013. Acquisitions in Q2/14 include OptiRent Oy and C/S RaumCenter and in Q1/15 acquisition of Vuokra-Pekat Oy in Finland and assets of Visby Hyrmaskiner AB in Sweden. In Q4/15, acquisitions include MDS Raumsysteme’s modular space business

Highlights

24,3 40,8 33,5 25,6 15,0 22,4 31,9 31,2 27,3 41,7 45,4 33,3 33,0 46,1 46,8 39,4 30,6 0,0 0,0 0,8 0,0 31,2

• 0,8
• 0,8
• 0,6

0,0 11,3

• 0,3

0,4 8,5 0,0

• 0,1

1,3 0,0 24,3 40,8 34,4 25,6 46,2 21,6 31,1 30,7 27,3 53,1 45,1 33,6 41,5 46,1 46,7 40,7 30,6 0% 10% 20% 30% 40% 50% 60%

• 20

20 40 60 80 100 Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Gross Capital Expenditure to Quarterly sales (%) Gross Capital Expenditure (EUR m)

CapEx CapEx, acquisitions Gross CapEx to sales

375 392 388 347 365 428 402 365 375 414 415 385 412 420 407 368 372 77,4 % 79,8 % 74,3 % 65,1 % 69,7 % 92,4 % 82,9 % 72,9 % 76,3 % 89,0 % 85,6 % 84,7 % 92,9 % 91,2 % 87,3 % 75,1 % 80,0 % 0% 20% 40% 60% 80% 100% 120% 140% 300 600 900 1 200 Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Gearing % Net interest-bearing liabilities (EUR m)

Net interest-bearing liabilities Gearing %

35

Strong capital structure

• At the end of Q1/16, net

interest-bearing debt was EUR 372.1m (412.4m)

• In Q1/16, gearing at 80.0%

(92.9%)

− Gearing positively impacted by strong cash flow − Gearing impacted negatively periodically by the effect of dividend liability on equity

• Gearing clearly meeting the

financial target level of < 100%

Group financial target: Gearing < 100%

Highlights

36

Finland

Strong sales growth and improved profitability

• In Q1/16, sales grew by 18.9% y-o-y

− Cramo managed to capitalize on the improved market situation, driven especially by renovation and new construction projects − In equipment rental, the share of larger customers increased − Demand for modular space continued to be strong and the quotation base is good

• In Q1/16, profitability on a good level, EBITA EUR

3.9 (2.9) million, margin 13.6% (12.1%)

− The result improved in both product areas

• In order to stregthen its logistics services

business, Cramo acquired Kurottaja- ja kuljetus- palvelu Parviainen Oy’s business on 1 April 2016 Highlights Rolling 12-month sales and EBITA-%

1 European Rental Association, Equipment Rental Industry Report 2015, November 2015

115,5 16,3 % 16,6 % 17,4 % 18,6 % 19,1 % 19,2 % 18,8 % 18,8 % 19,4 % 20,4 % 20,5 % 19,6 % 19,5 % 19,9 % 20,5 % 20,2 % 20,3 %

0% 5% 10% 15% 20% 25% 20 40 60 80 100 120 140 Q1/2012 Q2/2012 Q3/2012 Q4/2012 Q1/2013 Q2/2013 Q3/2013 Q4/2013 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015 Q1/2016

Quarterly rolling 12-month EBITA margin Quarterly sales (Rolling 12 months, EUR m)

Sales (R12m) EBITA-% (R12m)

1-3/ 1-3/ Change 1-12/ 2016 2015 % 2015 Sales (€m) 28,6 24,0 18,9 % 110,9 EBITA (€m) 3,9 2,9 34,1 % 22,4 EBITA-% 13,6 % 12,1 % 20,2 % No of personnel (FTE) 455 453 0,4 % 448 No of depots 58 54 7,4 % 54 Key figures

1-3/ 1-3/ Change 1-12/ 2016 2015 % 2015 Sales (€m) 80,2 74,1 8,3 % 331,2 EBITA (€m) 13,2 12,2 8,2 % 61,7 EBITA-% 16,5 % 16,5 % 18,6 % No of personnel (FTE) 836 810 3,2 % 825 No of depots 100 101

• 1,0 %

100 Key figures 37

Sweden

Sales growth with good profitability

• In Q1, sales increased by 8.3% (+7.7% in locals)
• In Q1, EBITA at EUR 13.2m (12.2m) with margin
• f 16.5% (16.5%)

− The good market situation was capitalised on both product

• areas. Profitability was affected by a high amount of

modular space assembly sales and higher depreciations − The equipment rental market situation is good in nearly all major urban areas. Utilisation rates are at a good level and investments have been increased − The demand for modular space also remained good

• Long-term contract with the construction company

JM was renewed for five years

• Construction growth1 forecast 4% for 2016. ERA1

forecasts growth of about 1% for equipment rental Highlights Rolling 12-month sales and EBITA-%

* Change in local currencies

+7.7%*

1 Forecast published by the Swedish Construction Federation (Sveriges Byggindustrier) in February; European Rental Association,

Equipment Rental Industry Report 2015, November 2015 337,3 19,3 % 18,5 % 18,3 % 17,9 % 17,2 % 17,3 % 17,9 % 17,5 % 17,4 % 17,3 % 16,9 % 17,8 % 18,5 % 18,7 % 18,7 % 18,6 % 18,6 %

0% 5% 10% 15% 20% 25% 250 260 270 280 290 300 310 320 330 340 Q1/2012 Q2/2012 Q3/2012 Q4/2012 Q1/2013 Q2/2013 Q3/2013 Q4/2013 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015 Q1/2016

Quarterly rolling 12-month EBITA margin Quarterly sales (Rolling 12 months, EUR m)

Sales (R12m) EBITA-% (R12m)

1-3/ 1-3/ Change 1-12/ 2016 2015 % 2015 Sales (€m) 16,0 18,6

• 14,1 %

70,4 EBITA (€m) 1,2 1,6

• 22,2 %

5,4 EBITA-% 7,7 % 8,5 % 7,7 % No of personnel (FTE) 226 227

• 0,4 %

219 No of depots 28 28 0,0 % 28 Key figures 38

Norway

Solid profitability in a challenging market

• In Q1, sales decreased by 14.1% year-on-year

(-6.3% in local currency)

− The equipment rental market remained challenging − Resources were increased in the modular space product area and the quotation base took an upward turn

• Q1 EBITA EUR 1.2m (1.6m), margin 7.7% (8.5%)

− Profitability was impaired by the decrease in sales and the fiercer competition in equipment rental in Southern Norway − Cost adjustments continued. Target for 2016 is to develop sales operations and customer service. Operations are focused on growing market segments and geographic regions where demand is expected to increase

• ERA estimates1 that the rental market will take an

upward turn and grow appr. 2% in 2016 Highlights Rolling 12-month sales and EBITA-%

• 6.3%*

* Change in local currencies

1 European Rental Association, Equipment Rental Industry Report 2015, November 2015

67,8 1,7 % 3,9 % 5,0 % 6,3 % 6,1 % 6,8 % 6,9 % 7,3 % 8,2 % 6,7 % 5,9 % 5,4 % 5,5 % 7,5 % 7,5 % 7,7 % 7,4 %

0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10 20 30 40 50 60 70 80 90 100 Q1/2012 Q2/2012 Q3/2012 Q4/2012 Q1/2013 Q2/2013 Q3/2013 Q4/2013 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015 Q1/2016

Quarterly rolling 12-month EBITA margin Quarterly sales (Rolling 12 months, EUR m)

Sales (R12m) EBITA-% (R12m)

39

Denmark

Profitability continued to improve, market developing favourably

• In Q1, sales increased by 18.5% year-on-year

− The market situation in both product areas continued to develop favourably

• Q1/16 EBITA was EUR 0.7m (0.4m), or 9.3%

(6.7%) of sales.

− Profitability improved due to strong demand for modular space, new modular space deliveries and better cost control − In equipment rental, Cramo continued to focus on best- performing markets and product areas − The market situation also offers opportunities for targeted growth investments

• Equipment rental1 market forecasted to grow 2.6%

and construction market1 slightly over 2% in 2016 Highlights Rolling 12-month sales and EBITA-%

1 European Rental Association, Equipment Rental Industry Report 2015, November 2015; Euroconstruct, December 2015

29,5

• 5,3 %
• 5,1 %
• 3,9 %
• 13,3 %
• 10,3 %
• 8,8 %
• 12,1 %

0,1 %

• 1,9 %
• 4,1 %
• 3,2 %
• 11,4 %
• 7,2 %
• 5,3 %
• 4,0 %

6,6 % 7,3 %

• 15%
• 10%
• 5%

0% 5% 10% 5 10 15 20 25 30 35 40 45 Q1/2012 Q2/2012 Q3/2012 Q4/2012 Q1/2013 Q2/2013 Q3/2013 Q4/2013 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015 Q1/2016

Quarterly rolling 12-month EBITA margin Quarterly sales (Rolling 12 months, EUR m)

Sales (R12m) EBITA-% (R12m)

1-3/ 1-3/ Change 1-12/ 2016 2015 % 2015 Sales (€m) 7,7 6,5 18,5 % 28,3 EBITA (€m) 0,7 0,4 65,0 % 1,9 EBITA-% 9,3 % 6,7 % 6,6 % No of personnel (FTE) 98 111

• 11,7 %

97 No of depots 9 8 12,5 % 8 Key figures

40

Central Europe

Rental sales grew and profitability improved

• In Q1, sales decreased by 3.3% y-o-y

− Sales decrease was due to a decrease in trading sales. Rental sales grew both in equipment rental and in the modular space product area

• Q1 EBITA was EUR -3.2m (-4.1m), with margin of
• 22.8% (-28.7%).

− Profitability continued to improve but was still affected by the strong seasonal variation of the Central European business operations − In equipment rental, operations were focused on the best- performing geographic regions − The modular space business is growing and demand is expected to remain good

• In Germany, both construction1 and rental1 expected

to grow about 2% in 2016 Highlights Rolling 12-month sales and EBITA-%

1 European Rental Association, Equipment Rental Industry Report 2015, November 2015; Euroconstruct, December 2015

76,8 0,8 %

• 0,2 %
• 1,1 %
• 0,4 %
• 0,9 %
• 0,2 %
• 0,6 %
• 1,4 %
• 1,3 %
• 4,7 %
• 6,8 %
• 7,7 %
• 7,0 %
• 5,9 %
• 4,6 %
• 4,3 %
• 3,1 %
• 10%
• 8%
• 6%
• 4%
• 2%

0% 2% 10 20 30 40 50 60 70 80 90 Q1/2012 Q2/2012 Q3/2012 Q4/2012 Q1/2013 Q2/2013 Q3/2013 Q4/2013 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015 Q1/2016

Quarterly rolling 12-month EBITA margin Quarterly sales (Rolling 12 months, EUR m)

Sales (R12m) EBITA-% (R12m)

1-3/ 1-3/ Change 1-12/ 2016 2015 % 2015 Sales (€m) 13,9 14,4

• 3,3 %

77,2 EBITA (€m)

• 3,2
• 4,1
• 3,3

EBITA-%

• 22,8 %
• 28,7 %
• 4,3 %

No of personnel (FTE) 345 361

• 4,4 %

350 No of depots 65 74

• 12,2 %

71 Key figures

1-3/ 1-3/ Change 1-12/ 2016 2015 % 2015 Sales (€m) 9,3 9,8

• 4,4 %

50,9 EBITA (€m)

• 1,1
• 0,8

6,3 EBITA-%

• 11,3 %
• 7,8 %

12,3 % No of personnel (FTE) 476 464 2,6 % 466 No of depots 68 63 7,9 % 67 Key figures 41

Eastern Europe1

Performance varies between markets, softness especially in Latvia

1 As of 1 March 2013, sales in Eastern Europe come from Estonia, Latvia, Lithuania, Poland, the Czech Republic, Slovakia and the

Kaliningrad region in Russia. Cramo’s share (50 per cent) of the net result of Fortrent, the joint venture of Cramo and Ramirent in Russia and Ukraine, is included in the EBITA of the Eastern Europe business segment.

• In Q1, sales decreased by 4.4% y-o-y (-3.5% in

local currencies)

− In Poland and Estonia, sales developed favourably during the period. Sales declined especially in Latvia.

• Q1 EBITA EUR -1.1m (-0.8m), with margin of
• 11.3% (-7.8%)

− Profitability improved in Poland and Estonia. In Czech Republic Cramo is growing its business, which impaired the early-year profitability. In Lithuania and Latvia, the demand for equipment rental was slower than expected

• Fortrent Q1/2016

− Sales EUR 5.5m (7.2m), i.e. down by 23.6% y-o-y. In local currencies, sales decreased by 11.2% − Profit for the period EUR -0.2m (-0.3m). Cramo’s share

• 0.1m (-0.1m) included in Eastern Europe EBITA

Highlights Rolling 12-month sales and EBITA-%

* Change in local currencies

• 3.5%*

50,4 4,6 % 7,7 % 9,2 % 9,6 % 10,8 % 11,2 % 13,3 % 15,5 % 13,9 % 15,3 % 15,2 % 12,3 % 13,5 % 13,8 % 13,2 % 12,3 % 11,8 %

0% 5% 10% 15% 20% 25% 10 20 30 40 50 60 70 80 Q1/2012 Q2/2012 Q3/2012 Q4/2012 Q1/2013 Q2/2013 Q3/2013 Q4/2013 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015 Q1/2016

Quarterly rolling 12-month EBITA margin Quarterly sales (Rolling 12 months, EUR m)

Sales (R12m) EBITA-% (R12m)

ADDITIONAL INFORMATION BY PRODUCT AREA EUR 1'000 1-3 2016 1-3 2015 1-3 2016 1-3 2015 1-3 2016 1-3 2015 1-3 2016 1-3 2015 Sales 127 637 124 927 28 014 22 236

• 215
• 102

155 436 147 061

Sales growth 2,2 % 26,0 % 5,7 %

EBITDA 28 234 26 000 12 191 10 385

• 1 704
• 2 082

38 721 34 303

% of sales 22,1 % 20,8 % 43,5 % 46,7 % 24,9 % 23,3 %

Depreciation

• 21 314
• 20 441
• 4 242
• 3 609
• 207
• 124
• 25 763
• 24 173

EBITA 6 920 5 560 7 949 6 776

• 1 911
• 2 205

12 958 10 130

% of sales 5,4 % 4,5 % 28,4 % 30,5 % 8,3 % 6,9 %

Capital employed 630 136 665 560 255 970 219 977 624 6 390 886 730 891 927 Equipment rental Modular Space Unallocated amounts and eliminations GROUP

Financial summary by product area 1-3/2016

Profitable growth continued in both product areas. High installation services boosted modular space growth, while affecting its margin

+26.3%* +3.0%*

* Change in local currencies

In Q1/16, several modular space projects installed

3-storey pavillion for Kaeser Compressors at the Bauma 2016 exhibition in Munich, Germany

• Bauma 2016: In total 20 stands

built from Cramo modules (2,700 sqm of space) were delivered to exhibitors at the largest construction machinery fair in the World, Bauma

Office space in open landscape for Volvo Real Estate, Gothenburg, Sweden

• Two parallel buildings with 2,300

sqm space in two stores

• Includes open landscape

solutions, office rooms, conference and group rooms

Cramo Adapteo has a well- established presence in 8 countries with over 20 000 modular space units and with capital employed of about EUR 256m at the end Q1/16

Germany Sweden Denmark Norway Estonia Finland Latvia Lithuania