Aggreko bullish on the back of World Cup and overseas growth

Published on Tuesday 8 June 2010 20:38

A BOOST from contracts to supply power for the World Cup and continuing expansion in emerging markets has led Aggreko to raise its forecasts for the current year.

In a trading update yesterday the Glasgow-based temporary power specialist said the performance for the year would be "significantly better" than anticipated when it briefed the market last month.

Shares in Aggreko, headed by chief executive Rupert Soames, rose to a record high on the news, up by 53p, or 3.91 per cent, to 1,407p.

The company is also increasing its investment in new fleet to 265 million for the year, up by 45m on its previous estimate.

The additional investment will support continued growth of its International Power Projects business and the accelerated introduction of new low-emission generators into the North American market.

For the half-year ending 30 June, 2010, the company expects that group revenue in constant currency will grow by around 10 per cent and trading profit by about 20 per cent.

It said demand at its International Power Projects division has continued to be strong.

Revenues for the division are expected to grow by around 8 per cent in the first half, with margins remaining strong.

Its other division, which rents out small-scale generation and refrigeration plant for customers to operate themselves, has also seen an "encouraging pick-up" in volumes.

The performance is benefitting from a large amount of additional work for the World Cup, which will make it the largest contract ever carried out by Aggreko for a sporting event.