Aggreko posted group revenue of £1.561 billion (about U.S. $2.214 billion) in 2015, a decline of 1 percent compared to £1.577 billion in 2014. Low commodity prices and lower emerging market growth program were offset by sector and geographic diversity. Trading profit was £244 million compared to £306 million in 2014.
The Rental Solutions sector was flat year over year with £618 million in revenue compared to £616 million in 2014. Sector diversity offset a 25-percent decline in oil-and-gas revenues. Eight out of 12 sectors within Rental Solutions grew, with particular strength in petrochemical & refining and events. The company posted strong growth in temperature control and benefited from the acquisition of ICS, a specialist heating business. The sector generated good margins and returns despite a challenging year.
The Power Solutions business unit posted good growth in key markets and improving margins and returns. It had strong performances in the Middle East, Russia and Africa and a successful delivery of the European Games. The company’s Brazilian market continued to be challenging but Aggreko took further action to reduce its cost base.
Looking ahead to 2016, the Power Solutions Utility business started the year with a strong order book and a healthy prospect pipeline; 140 MW of new orders, and the signing of a two-year extension of its 148 MW of diesel contracts in Japan. The Rental Solutions business unit, in particular in North America, started slowly in 2016 following a lower run rate exiting 2015 than expected, and the company is cautious in its expectations for this part of the business in 2016.
On a Group level, the company anticipates investing around £250 million on fleet capex, focusing on investment in more fuel-efficient gas and diesel engines, flexing the spend according to market conditions. Aggreko expects profit before tax and exceptional items to be slightly lower than 2015 on a constant currency basis.
“We have ended 2015 with a strong balance sheet, with net debt slightly down; as we continue to generate good levels of operating cashflow; and maintain discipline in our investment in new fleet,” said CEO Chris Weston. “We have also maintained the full year dividend in line with last year, reflecting our continued confidence in the strength and prospects of the business which provides a much needed service to our customers. As we enter 2016, I am encouraged by the prospect pipeline we are seeing and pleased by the progress we are making with our business priorities.”
In North America, revenue was down 26 percent year over year in the oil and gas sector, but petrochemical & refining, now the company’s largest sector in North America, revenue jumped 25 percent with lower oil prices acting as a stimulus. Event revenue also increased.
Aggreko is based in Scotland, with U.S. headquarters in Houston.
