Argentinian woes for Aggreko

By Joe Malone21 November 2017

UK temporary power provider Aggreko recorded mixed third-quarter results, with its Argentinian operations impacting on its performance.

No caption available

Most notably, its Power Solutions Utility segment revenues dropped 15% year-on-year, driven by repricing and off-hires in Argentina. However, excluding the impact of Argentina, the company’s revenues in this sector still dropped 7%.

As a result of Aggreko’s recent announcement, the company’s share price fell 11% this morning (21 November, 2018), with fears of struggles in Argentina set to continue.

The company’s off-hire rate for the first three quarters of the year was 24%, and Aggreko said it expected its full-year off-hire rate to be in line with its historic average of around 30%.

The company also expects to see continued delayed payments from some customers, particularly in Africa where liquidity remains a challenge.

Aggreko’s Rental Solutions business grew 9% year-on-year, however, including revenue from the hurricanes that impacted on Southern US and Caribbean. In North America, revenues grew 10% in its Rental Solutions segment. The wider Rental Solutions business also contributed to growth with a strong performance in Europe, particularly in UK utility sector, and a solid performance in Australia Pacific, with increased activity in the mining sector, said the company.

Aggreko invested €45 million in July, acquiring the US technology company Younicos, and the company said its integration was progressing well, citing a “healthy pipeline of opportunities” ahead.

The outlook for the full year remains unchanged, the company said, with its capital expenditure expected to be around £300 (€338.14 million).

Latest News
Rental Briefing: daily newsletter for rental sector being launched by KHL
Newsletter will provide analysis, comment and insight into the global industry
Work progresses on Four Frankfurt project
T1, the highest tower in the quartet, will have a height of 233m
Construction equipment bodies respond to UK’s net zero shift
Association bosses say ‘softer package’ sends wrong message to the industry