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In the reporting period from 1 January 2025 to 31 March 2025, the Group’s net turnover was EUR 2,142,293. Compared to the corresponding period in 2024, when turnover was EUR 2,558,808, this represents a decrease of approximately 16%. The primary driver of the decline was the discontinuation of rental activities in Estonia. Meanwhile, turnover in Latvia increased by 5% in 2025 compared to the same period in 2024, and in Lithuania, rental turnover grew by 6%. However, the growth in these markets was not sufficient to fully offset the decrease experienced in Estonia. Despite the decline in turnover, operating costs were reduced by 12% compared to Q1 2024, largely due to the cessation of rental operations in Estonia. As a result, the Group achieved an improved EBITDA of EUR 14,624, which represents a 22% increase year-on-year. The Group reported a first-quarter loss of EUR 399,887, primarily attributed to the seasonal slowdown in rental activity typical for this period. Such downturns are common in the construction equipment rental industry, due to reduced construction activity and project delays during the first quarter. Despite these challenges, the Group anticipates that the losses will be offset by increased profitability in the subsequent quarters, aligning with industry trends where demand for rental equipment typically rises during the warmer months. In addition, a rental agreement concluded in March outside the Baltic region is expected to have a positive impact on the Group’s results throughout the remainder of 2025. In anticipation of the peak rental season, the Group has strategically invested an additional EUR 1.1 million into fixed assets, enhancing its equipment fleet to meet the expected surge in demand. This proactive approach is designed to improve the fixed asset turnover ratio, a key metric indicating efficient utilization of assets to generate revenue. Taking into account these new fixed asset acquisitions, the Group anticipates an increase in rental income by the end of 2025, which is expected to provide significant EBITDA improvement for the full year. Concurrently, the Group is actively expanding its customer base through targeted marketing initiatives and strategic partnerships, aligning with industry practices that emphasize customer acquisition and retention to drive growth. These efforts are expected to contribute positively to the Group's financial performance in the upcoming quarters. Gints Vanags SIA Arsenal Industrial, CEO Mobile: + 371 26 303 848 E-mail: gints.vanags@arsenalrent.com www.arsenalnoma.lv |