27th Aug 2014 10:11
LONDON (Alliance News) - APR Energy PLC said Wednesday that it swung to a pretax profit and revenue more than doubled in its first-half, driven by "significantly higher" activity from new contracts and increased utilisation levels on its enlarged fleet.
In its half-year results for the six months to June 30, 2014 the fast-track power solutions provider said it swung to a pretax profit of USD54.3 million from a USD16.1 million loss last year.
Revenue more than doubled to USD254.2 million from USD87.2 million in the comparable period of 2013, driven by significantly higher activity from new contracts, contract extensions and high utilisation levels on its enlarged fleet following the commissioning of a number of significant contracts during the second-half of 2013, said APR.
Revenue for the period also included USD43 million from its GE Power Rental business post acquisition, including USD13.5 million arising from its Australian contract, also announced Wednesday, it said.
APR Energy said that the period saw record contract renewals of 1,206 megawatts for the year-to-date, with a renewal success rate in excess of 90%.
APR's total fleet capacity rose 37% in the period to 2,194 megawatts from 1,607 megawatts last year. The company said fleet capital expenditure came in lower for the half-year at USD139 million, compared to USD245 million last year, reflecting continued fleet investment, including the ongoing maintenance of the enlarged fleet and essential equipment to support the three commissioned power plants in Myanmar, Angola and the South Pacific.
The company also said that its capital expenditure reflects an increase of 120 megawatts of mobile gas turbine capacity and associated balance of plant, and "positions the Group to take advantage of new large-scale opportunities."
Following the period-end, APR Energy completed a new five-year, USD770 million facility, with an accordion feature to enable additional financing up to USD1 billion. "The facility strengthens the Group's financial position, while providing significantly greater flexibility, additional capacity for growth and improved liquidity to manage through our business cycle, at a lower cost," said the company.
Looking ahead, APR remains confident that it will achieve strong year-on-year growth in the full-year, though warns that it faces a number of headwinds as it enters the second-half due to geopolitical conditions in some emerging markets where it holds contracts.
It also said that it continues to focus on securing longer-term, larger-scale power projects which are in the pipeline, "although as these projects typically have a longer development cycle, the precise timing of customer decision making and award remains difficult to predict," said APR.
"Overall it has been a solid period for the group with strong year on year growth. Our focus on contract renewals has paid off, as illustrated by our 90% contract renewal rate and the extension of our contracts in both Libya and Uruguay..." said newly-appointed CEO Laurence Anderson.
"We continue to see many opportunities in both emerging and developed markets across the world to deploy semi-permanent power solutions although, as ever, the timing of large scale power projects will remain difficult to predict," he added.
In a separate statement Wednesday APR Energy said Non-Executive Chairman Michael Fairey is stepping down from his role as chairman with immediate effect. The company has appointed John Campion to take on the position of Executive Chairman, vacating his CEO role which will be taken on by Anderson who most recently served as president of APR.
Campion and Anderson co-founded the business in 2004. Since then Campion has served as CEO while Anderson has served as president and COO.
The company also said that Lee Munro has been appointed chief financial officer. He previously served as interim CFO.
In a further statement APR Energy said Wednesday that it has signed a contract for a peaking power plant in Port Hedland, Pilbara in Western Australia.
The power plant features four state-of-the-art GE TM2500+ dual-fuel turbines running on clean-burning natural gas, said the company. The plant, contracted with the end-user customer Horizon Power, is set to run for a term of at least 30 months and will serve as a bridging solution until TransAlta Energy (Australia) develops a permanent power plant, due for completion in early 2017.
APR Energy said that the plant has been designed for extreme conditions - temperatures in Western Australia can reach 48 degrees Celsius in the summer - and can be quickly expanded by an additional two aero-derivative turbines as capacity requirements grow.
The project boosts APR's generation capacity in the Asia Pacific region to 410 megawatts.
The company said the agreement replaces its earlier contract with Forge Group Power Party Limited, which was assumed as part of APR's acquisition of GE's power rental business. Following the declaration of bankruptcy by Forge and a number of its other affiliated companies, its contract with APR Energy and its rental contract with Horizon were terminated.
Horizon Power is a state-owned utility, serving Western Australia, a region with growing power demand and the hub of Australia's extractive industry.
Shares in APR Energy were Wednesday morning trading 8.78% lower at 499.00 pence per share, one of the biggest fallers on the London market.
By Alice Attwood; [email protected]; @AliceAtAlliance
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