23rd Jun 2009 07:00
23 June 2009
Aggreko plc
TRADING UPDATE
Aggreko plc, the world leader in the supply of temporary power and temperature control, is giving the following update on trading prior to entering its close period in respect of the half-year ending 30 June 2009. Interim results will be announced on Tuesday, 25 August 2009.
Trading Update
In the first half we anticipate that a very strong performance in International Power Projects will be partly offset by weaker conditions in the Local Businesses. We expect that headline revenues will grow by at least 20% and that profit before tax will be about 55% higher than the prior year. In constant currency, and excluding pass-through fuel, we expect revenues to grow by around 5% and trading profit by about 15%.
Conditions in most of our Local Businesses have deteriorated in the second quarter, most noticeably in temperature control, where volumes are well down on last year. Although there are regional variations, in aggregate our power business is holding up well, and megawatts on rent are currently at similar levels to last year, excluding the Beijing Olympics. Generally, across most products and geographies, there has been some pressure on rates. We expect that revenues in constant currency in the first half will be about 10% lower in North America; about 11% lower in Europe and the Middle East; and at similar levels to last year in Aggreko International's Local Businesses, adjusted for the impact of the Olympics (-20% unadjusted). Looking ahead to the second half, we expect that conditions in the Local Business will continue to be challenging, and will compare with a very strong second half in 2008, when we had the benefit of both the Olympics and very high storm-related revenues in North America.
International Power Projects, on the other hand, continues to trade strongly. We expect that this business will grow its revenues in the first half, in constant currency and excluding pass-through fuel, by around 40%, and by over 80% in sterling terms. Whilst the rate of signings of new projects has slowed, the prospect pipeline remains strong. Project extensions are running at a healthy rate, and margins in the first half are likely to be at record levels. In the second half we expect the business will continue to grow but, given the very large number of new projects commissioned in the second half of 2008, it will be at a noticeably slower rate.
Overall, the Board maintains the guidance for the year given at our Preliminary Results in March, which was that we expect that profits in constant currency will be at similar levels in 2009 to those achieved in 2008. Capital expenditure is likely to be somewhat lower than previous expectations at £170m, in part due to currency movement. We also expect that the business will be strongly cash generative this year.
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Enquiries to:
Rupert Soames / Angus Cockburn
Aggreko plc
Tel: 0141 225 5900
Neil Bennett / George Hudson
Maitland
Tel: 020 7379 5151
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