GENERATORS firm Aggreko got a boost from the Commonwealth Games in its home city, but the strong pound means UK investors will see lower returns from its global business.
The FTSE 100 listed group, which employs a tenth of its 5,750-strong workforce in Scotland, said yesterday that half-year profits were 9 per cent lower at £132 million as it suffered a “significant adverse impact” from currency translation.
Interim chief executive Angus Cockburn said that although currency issues effectively knocked £23m off Aggreko’s bottom line, operationally it was unaffected as its global spread meant it was not a big exporter.
He added: “Currency is like a roller-coaster, and you end up back in the same place. We remain very focused on the operational performance.
“We’ve had a very encouraging start to the year, with very good underlying growth and significant contract wins.”
Excluding currency effects, the firm said revenue and profits rose by 12 per cent and 6 per cent, respectively.
Notable contracts included the football World Cup in Brazil, for which it provided all the broadcast power.
And, in the past few days, Aggreko delivered 27 megawatts of temporary power across the Commonwealth Games’ 29 venues and broadcast centre. It provided some 130 generators, 100 staff and 200 kilometres of cable.
Cockburn said that not only did the two sporting events bring in $30m (£18m) in revenues, they were also a very high-profile demonstration of the company’s capabilities.
“It’s all about how well you operate, because failure in front of a billion people if the screens go blank would not be a happy occasion for us,” he said. “That’s why we keep getting chosen, because our reliability and technical expertise is second to none in the world.”
The fastest-growing countries for the Glasgow-based group were Russia and Iraq, where it is supporting oil and gas infrastructure. Cockburn said the firm was so far unaffected by recent western sanctions against Russia, and that while it had been forced to evacuate staff from central Iraq due to the insurgency there, “life continued as normal” around core operations in Basra in Kurdistan.