Aggreko revenue hit by pandemic

Temporary power group Aggreko has seen revenue hit due to the impact of the pandemic in the last two quarters and the lower oil price.

Aggreko's national rental centre at Voyager Drive, Orbital Retail Centre, Cannock
Aggreko's national rental centre at Voyager Drive, Orbital Retail Centre, Cannock

Aggreko, which has its national rental centre at Orbital Retail Centre, Cannock, said underlying group revenue for the nine months to the end of September was down 14 per cent on last year.

It comes as the supplier of temporary power generation and temperature control equipment wants to at least halve the diesel fuel used in customer solutions as well as cut local air quality emissions of those solutions by 2030.

It will also achieve net-zero emissions across its business operations by 2030, extending it to all services by 2050, it said.

During the energy transition, revenue is expected to grow five to 10 per cent in the medium term, driving 18-19 per cent group margin.

In a separate statement, the FTSE 250 firm said next year’s profit before tax is forecast to be in the range £170 to 190 million if the Tokyo Olympics contract proceeds as planned.

There is continuing uncertainty as to the speed of the market recovery from the pandemic and the likely range for the oil price in 2021.

However, Aggreko’s trading trends indicate increases in activity levels for its more transactional rental business and an improved outlook on the timing of its larger project mobilisations within Power Solutions.

In the year to December 31, pre‑exceptional profit before tax is expected to come in at about £100 million, which is the upper end of the previously guidance range, with capital expenditure of slightly below £200 million.

The company has seen some recovery in most of its markets for Rental Solutions, with activity levels and equipment on hire continuing to increase through the third quarter.

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