Mills revenue rise follows acquisition and investment

Euan Youdale Editor, Access International

15 August 2023

Brazil’s largest rental company Mills has reported revenue growth in all business units for the second quarter of 2023, following its move into general equipment rental last year and continued opportunities in the MEWP sector.

In the second quarter of 2023 the company’s net revenue reached R$280.5 million; a 30.2% increase on the same period in 2022. Rental revenue accounted for 89% of the growth, mainly resulting from the acquisition of heavy earthmoving equipment company Triengel Locações e Serviços (Triengel), which it has named the Yellow Line. There was also an increase in leasing and prices.

Mills’ equipment sales segment was up 60.9% to R$21.7 million in the second quarter of the year. Again, this was due to higher pricing and increased sales of used equipment as the company sought to optimise its fleet. The company’s rental costs were also up in the quarter by 20.2% to R$ 68.7 million, partly explained by the company’s entry the entry into the heavy product line.

Market opportunities

As Sergio Kariya, Mills’ CEO explained, the Heavy Rental unit, in less than a year after Triengel’s acquisition, tripled its fleet size.

Sérgio Kariya, CEO of Mills rental in Brazil. (Photo: Mills)

In addition, revenue tied to the rental agribusiness increased from 1% to 10%, “demonstrating the increase in our exposure to resilient sectors of the Brazilian economy and diversification of revenue,” confirmed Kariya.

Looking back to 2023, Kariya added, “We started the second half of the year with an optimistic view and confident that there are opportunities in all business units and in our vocation to be a One-Stop-Shop machinery and equipment rental company, focused on the proximity of our customers and partners and on the differentiated quality of our services.”

This segment, added Kariya, is an important area for growth, with its range of opportunities, including consolidation. “The growth strategy is based on a combination of acquisition of new companies and organic growth, seeking to bring know-how and accelerate the learning curve to better serve our customers. We continue to actively seek M&A opportunities, aligned with our strategy and value proposition.”

In the Light Rental unit, the MEWP market continues to show strong growth potential, said Kariya. “In 2022 we opened 15 branches that are in the ramp-up phase, and we expect to open more than four branches in 2023.

“We are seeing stronger demand in the second half of the year compared to the first. Since June, we have already seen improvements in productivity, after receiving the last large batch of equipment from orders placed between 2021 and 2022, a period in which the supply chain was stressed.”