Reported revenue rose 8 percent year over year in the third quarter for Aggreko, world leader in power and temperature control. Rental Solutions revenue declined 7 percent year over year with North America revenue declining because of ongoing weakness in upstream oil and gas with further pricing pressure and a reduction in gas volumes.
In the Petroleum and Refining sector, Aggreko said it saw greater activity in recent months with sequential improvement in seasonally adjusted revenues.
Outside of North America, the Rental Solutions business has performed well, with growth in both Europe and Australia Pacific. Aggreko’s temperature control business also performed well, up 5 percent in the quarter including the two acquisitions the company made in the past year.
Power Solutions Industrial revenue grew 3 percent, excluding the impact from the European Games in the previous year numbers, or 9 percent lower as reported. The company had growth in Russia and Africa and revenues were at similar levels in the Middle East. However, this growth was offset by more difficult trading conditions in some of its other markets, particularly in Asia which was negatively impacted by the decline in the shipping sector.
Power Solutions Utility revenue declined 6 percent as 173 MW of gas-fueled plants in Mozambique went offline in the beginning of the year. However, year-to-date order intake remains strong at 1,034 MW, compared to 561 MW at the 2015 third quarter update. The 143 MW, 15-year contract the company was awarded in Brazil does not go on-rent until the second half of 2017.
“Whilst the environment over the last nine months has been challenging, I am pleased with our strong order intake of over 1GW and with the progress that we are making on the implementation of our business priorities,” said chief executive Chris Weston. “We are working through the status of our contracts in Argentina and continue to navigate the tough conditions in upstream oil and gas in North America. We expect the 2016 full year results to be broadly in line with current market expectations, with pre-exceptional profit before tax of around £225 million. I am confident that our continued focus on delivering our priorities is creating a stronger and more resilient group for the future.”
Aggreko said it expects fleet capital expenditure for the current year to be about £260 million, compared to £237 million in 2015.
Based in Scotland, with U.S. headquarters in Houston, Aggreko is No. 10 on the RER 100.
