Temporary power provider Aggreko today said it would be reining in its spending plans but was sticking to its full-year profit guidance.
The Glasgow-based group, which said in August that it would be cutting 600 jobs amid the downturn in oil and gas markets, told investors that it remains confident of delivering a pre-tax profit of between £250 million and £270m for 2015 – although this would be down from the figure of £289m reported for the previous year.
However, chief executive Chris Weston said the company expects to spend about £250m on its fleet of power generators and temperature control units, down from the £270m forecast given in August, “in recognition of the trading environment and as we seek to balance growth with maintaining a strong balance sheet”.
In today’s trading update, Weston said underyling third-quarter revenues at Aggreko were 7 per cent lower than the same period last year, reflecting the “challenging market backdrop”.
Sales at its rental solutions division were down 1 per cent on last year, as the firm said the ongoing weakness in the oil and gas and mining sectors had been largely offset by continued growth in other sectors, such as petrochemical and refining.
At its power solutions arm, which is focused on large-scale power projects and developing markets, revenues fell 11 per cent as the weak economic landscape in Brazil took its toll.
Weston said: “Aggreko continues to demonstrate its resilience against a challenging market backdrop and I am pleased that we are maintaining our guidance for 2015 full-year profit before tax of between £250m and £270m.
“I am encouraged with the progress we are making which, regardless of the prevailing market conditions, will strengthen Aggreko and position it well for the future.”