Aggreko on track to meet FY market expectations

Temporary power supplier Aggreko said on Tuesday that it was on track to meet market expectations for the year.

In an update for the nine months to 30 September, the company said underlying group revenue was down 2% on last year, with reported revenue down 8%. Excluding revenue from the Winter Olympics in 2018 and early design revenue for the Tokyo 2020 Olympics this year, underlying revenue was in line with last year.

Revenue in the rental solutions business, which makes up 53% of group sales, was down 1%, with a mixed performance. In North America - its largest region - underlying revenue grew 4%, reflecting good growth in most of its key sector. Despite softening in the region since the half year, revenue was up 12% excluding the impact of hurricane related work in 2018.

Elsewhere, Aggreko said growth in Continental Europe has been offset by a weaker performance in Northern Europe, while in Australia Pacific good growth in the mining sector has been offset by a 100 MW emergency utility sector contract positively impacting the prior year results, it said.

Underlying revenue in the power solutions industrial business, which makes up 27% of group revenue, was in line with the previous year. Excluding both the 2018 Winter Olympics and the early design revenue for Tokyo 2020, revenue was up 7% compared to 4% at the half year.

Aggreko said Latin America and the Middle East and Africa are performing well, while its Eurasia business is stabilising after a slowdown in the first half.

Underling revenue in the power solutions segment, which accounts for 20% of group revenue, was 0.7% lower during the nine-month period, with average megawatts on hire 9% lower at 2,445 MW.

"Our full year earnings outlook is in line with market expectations and we remain on track to deliver mid-teens return on capital employed in 2020," it said.