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Published: 2021-09-22 16:31:05 CEST
Elmo Rent
Annual report

CORRECTION: ELMO Rent AS unaudited Interim Financial Statements for the Six Months Period Ended 30 June 2021

ELMO Rent AS has been doing better than planned this year. Thanks to the successful IPO, the company exceeded its investment plan for the first half of 2021 and therefore increased its sales revenue by 126%.

ELMO Rent's environmentally friendly vehicles sharing, mainly in the streets of Tallinn, Tartu and Pärnu, resulted in keeping unreleased of 87,181 kg of CO2 into the air in the first half of 2021, which is also a significant increase of 127% compared to the previous year.

Thanks to the successful IPO, ELMO Rent increased investments in its technology solutions, such as fleet management software, car controller and a remote-controlled car. The best domestic environmentally friendly car sharing app was also developed in the first half of 2021, the time of market entry of the app will be announced in September.

Thanks to investing in the development of technologies, the use of the company's services will become even easier than before, the communication of campaigns to customers will be more efficient and it will make coming up with new services easier in the future. The development of promising technological solutions provides the company with a competitive advantage for sustainable growth both in the domestic market and when entering new markets.

But growth and development were not limited to software. In the first six months of 2021, ELMO Rent's vehicle fleet grew up to 121 units. Compared to the first six months of 2020, the growth was 101%. Therefore, the company's fixed assets increased by 62% and made 1.97 million euros compared to the end of the year.

The growth of fixed assets was financed primarily with funds received from the IPO and leveraged with loans and leases, which increased the company's debt burden by 0.4 million euros up to 1.8 million euros by the end of the period.

ELMO Rent sales revenue increased by 126% in the first six months of 2021. While the sales revenue of the first six months of 2020 was 134,000 euros, this year 303,000 euros were earned during the same period. This is within the planned scope, because although the preconditions for exceeding the plan were created, our operations were affected by the following circumstances:

● Manufacturers’ delivery delays of electric cars and e-motorcycle. The new vehicles arrived and started earning revenue only at the end of June, therefore their impact on rental sales will not become apparent until the second half of the year.

● Longer preparation time of the new vehicles than planned. It took more time than expected to get to know the new vehicles, install the controllers and interface them, due to the increased volume and insufficient human resources.

● To increase market share and revenue, we launched electric motorcycles in June, and in August also premium cars. Their impact on turnover will become clear during this half-year. However, investments necessary to launch both new business lines we made in the first half of the year.

Expansion of the fleet with the new environmentally friendly vehicles also directly affected the availability and quality of ELMO Rent's services. ELMO Rent vehicles covered CO2-free kilometers mostly in Tallinn, Tartu and Pärnu. If last year a total of 313,476 kilometers were covered during the first six months of the year, then this year 714,604 kilometers within six months. 87181 kg of CO2, which is also a significant increase of 127% compared to the previous year.

After the successful IPO, ELMO Rent recruited new people for its team, which was inevitably reflected in the company's cost base. The following growth items mainly increased the cost base:

● Labor costs amounted to 35,708 euros in the first half of 2021 (6 months of 2020: 12,522 euros). Today, the company has ten employees with employment contracts and five employees with service contracts. The supervisory board of the company's shareholders is also engaged full-time. Within half a year, the ELMO Rent’s team has doubled, and the company will continue to create new jobs while growing.

● To grow its vehicle fleet, ELMO Rent has taken additional financial liabilities, which has also led to an increase in interest expenses. The interest expense for the first half of 2021 was 59,467 euros (6 months of 2020: 21,843 euros). To optimize this cost, the company has started also refinacing expensive interest rates.

● Investing into new business lines. However, initially the inclusion of private cars in the vehicle fleet resulted in a loss of EUR 11,000 in the first half of the year. This was mainly due to:

1) Starting a new business line in the low season

2) In order to attract new and attractive cars to the vehicle fleet, we launched an aggressive "1000 euro per month campaign", ie during the first three months ELMO Rent guaranteed owners of the shared cars a payment of 1000 euros per month, regardless of the rental income actually earned by the car.            

3) The techincal integration of some new models into our fleet and sharing service turned to be more difficult than expected. It took significantly more time than we planned, which meant unearned income for us from the parked cars.

In conclusion, ELMO Rent evaluates the costs and difficulties of starting the new business line as a valuable experience and investment in the future. There is still potential for this business line, business line growth is increasing monthly and new opportunities appear for faster business growth. Moreover, the involvement of private cars ensures growth without raising additional capital.

In summary, ELMO Rent EBITDA for the first half of the year amounted to minus 9,500 euros, while EBITDA for the whole of 2020 was 194,000 euros.

The management and the supervisory board of ELMO Rent are of the common opinion that due to the preliminary work in the first half of 2021 (investments, growth of assets, expansion of the team and bearing of losses), the company will exceed its plans for the second half of the year. This is confirmed by the financial results of the first two months, July and August, of the second half of the year.

  Balance sheet      
  30.06.2021 31.12.2020 30.06.2020
Current assets      
Cash 757 148 42 306 21 350
Receivables and advances 319 139 220 235 80 476
Inventories 365 189 0 0
Total current assets 1 076 287 262 541 101 826
Fixed assets      
Investments in subsidiaries and associates     2 500
Receivables and advances      
Tangible fixed assets 1 972 658 1 217 035 336 355
Intangible fixed assets     0
Total fixed assets 1 972 658 1 217 035 338 855
Total assets 3 048 945 1 479 576 440 681
Liabilities and equity      
Current liabilities  266 033 254 226 64 535
Debts and advances 299 276 91 246 67 124
Total current liabilities 565 309 345 472 131 659
Long-term liabilities 1 520 653 1 136 813 468 406
Total long-term liabilities 1 520 653 1 136 813 468 406
Total liabilities 2 085 962 1 482 285 600 065
Share capital at nominal value   2500 2500
Equity capital at nominal value 220 000    
Spread 934 333 0 0
Other reserves 10 000 10 000 10 000
Retained profit (loss) of past periods -15 508 -17923 -17923
Profit (loss) for the reporting period -185 842 2310 -153961
Total equity of the shareholders or stake holders of the parent undertaking 962 983 -3113  
Minority interest 0 404  
Total equity 962 983 -2709 -159384
Total liabilities and equity 3 048 945 1 479 576 440 681


Income statement    
  2021 2020
  six months six months
Sales revenue 230 672 134 000
Other business earnings 72 500 3 509
Change in stocks of finished goods and work in progress 0 0
Goods, raw materials, materials and services -184 390 -154375
Miscellaneous operating expenses -75 235 -83655
Labor costs -35 708 -12522
Depreciation and impairment of fixed assets -119 995 -18600
Significant current assets write-downs 0 0
Other operating expenses -14 222 -475
Business profit (loss) -126 378 -132118
Interest expenses -59 467 -21843
Other financial income and expenses 3  
Profit (loss) before income tax -185 842 -153961
Profit (loss) for the reporting period -185 842 -153961


Cash flow statement    
  2021 2020
  six months six months
Cash generated from operations    
Business profit (loss) -126 378 -132118
Depreciation and impairment of fixed assets 119 995 18 600
Gain (loss) on sale of fixed assets -13 883  
Other adjustments -3 816  
Total adjustments 102 296 18 600
Change in business related receivables and advances -94 198 -28867
Change in inventories -15 984 25 789
Change in business related  payables and advances 128 321 29 948
Total cash flows from operating activities -5 943 -86648
Cash flows from investing activities    
Paid for acquisition of tangible and intangible fixed assets -279080 -16156
Proceeds from the sale of tangible and intangible fixed assets 18 917 0
Paid upon acquisition of subsidiaries -300 0
Proceeds from the sale of subsidiaries 0 0
Loans granted 0 0
Total cash flows from investing activities -260463 -16156
Cash flows from financing activities    
Loans received 459 625 244 606
Repayments of loans received -188646 -82737
Repayments of the finance lease principal part  -215961 -42420
Interests paid -59463 -21843
Received from the issue of shares or stakes 985 689 0
Other revenues from financing activities 4 0
Total cash flows from financing activities 981 248 97 606
Total cash flows 714 842 -5198
Cash and cash equivalents at the beginning of the period 42 306 26 548
Change in cash and cash equivalents 714 842 -5198
Cash and cash equivalents at the end of the period 757 148 21 350


More information:

Julia Nekrassova

CEO, member of the board