Olympics generate £59m revenues for Aggreko
By Murray Pollok22 October 2012
Revenues of £59 million from the London Olympics helped Aggreko increase sales by 22% in the three months to the end of September. Sales were up 13% after excluding the impact of the Olympics and the Poit Energia acquisition in Brazil.
However, in its trading statement Aggreko also warned that annual profits may be 2.5% lower than earlier forecast because of exchange rate movements and because it has increased its bad debt provision.
The company said its International Power Projects business saw growth of 15% in the quarter. Order intake in the period of 115 MW was lower than the same quarter in 2011, but Aggreko said it had signed two contracts shortly after the quarter, including a 74 MW order with the Hokkaido Electric Company in Japan. That project will mean that Aggreko will have more than 240 MW on rent in Japan.
Its local business delivered a better-than-expected performance in the third quarter, with revenues growing by 32%, although 11% on an underlying basis. North America grew by 13%; Europe & Middle East by 8%; and Aggreko International's local business grew by 13%.
Aggreko said it was likely to slow its investment in fleet in the first half of 2013, both because of the need to absorb the additional equipment built for the London Olympics and because it was “being mindful of a weakening macro-economic outlook in many developing economies”. The company will spend £415 million on its fleet this year.
“Overall, trading continues to run broadly in line with our expectations”, said the company, “Despite the increase in bad debt provisions during the year and unusually high mobilisation costs [for a contract in Mozambique], we expect that group margins for the year as a whole, both on a reported and underlying basis, will be at similar levels to last year.”