Aggreko, world leader in temporary power and temperature control, said this week that trading in the fourth quarter has been better than expected, driven by strong performance in International Power Projects. The company now expects group revenue for the year to top £1 billion (more than U.S. $1.6 billion), with operating profit around £260 million (about U.S. $420 million). The company expects revenues to rise about 7 percent and operating profit 27 percent, with earnings per share jumping at least 33 percent.
Aggreko expects to generate net cash inflow of around £160 million for the year.
Aggreko’s International Power Projects business traded strongly in the fourth quarter, with revenue rising about 8 percent. Local business continued to trade in line with the pattern seen in the third quarter. The company expects revenue in the fourth quarter, in constant currency and adjusted for a 53rd “trading week” in 2009, to be down about 21 percent, with rates continuing to be weak and all areas other than the Middle East, Russia and China posting lower revenues. The sharpest declines in rates and volume have been in temperature control; volumes in power have remained robust and are only slightly down from the previous year.
The company expects progress in 2010 on a constant currency basis. Activity levels in international power projects are encouraging and the company expects to begin the year with 10-percent more MW on rent than the same time last year. Aggreko expects 2010 to be a strong year for major events, starting with the Winter Olympics in Vancouver, for which Aggreko is the official supplier of temperature control and power.
Aggreko expects to expand its fleet, planning to spend around £180 million on new fleet in 2010, £30 million more than in 2009, and about 1.2 times fleet depreciation.
The company will announce preliminary results March 4, 2010.
Based in Scotland, with U.S. headquarters in Houston, Aggreko North America is No. 10 on the RER 100.