Olympic Games power provider Aggreko flags forecast-beating profits for 2020

Aggreko, the Glasgow-headquartered temporary power provider, has flagged forecast-beating profits as market activity recovers.

Aggreko, the Glasgow-headquartered temporary power provider, has issued an upbeat trading update. Picture: John Devlin

In a trading update, the firm told investors that it now expects to deliver profit before tax for 2020 “slightly ahead” of the top end of previous guidance of between £80 million and £100m.

In addition, a strong cash performance in the second half has resulted in a reduction in the group’s net debt over the year of around £200m.

For the current year, the firm it sticking with guidance provided in November for group profit before tax in the range £170m to £190m. Full-year results for 2020 are due to be released on March 1.

Earlier this month, Aggreko said it was investing £4.5 million to upgrade its production facility in a move that will bring together its three Dumbarton operations.

The project includes the acquisition of land at Lomondgate Park next to the firm’s existing site, which is owned by Strathleven Regeneration CIC.

Construction is already under way and represents an investment of £4m with local firms. It will bring more than 300 employees together in a “campus environment” which will add a rental depot to the existing manufacturing site.

As part of the firm’s net zero strategy, the site will turn into a future energy hub, replacing all diesel with low-emission hydrotreated vegetable oil as well as exporting surplus power generated during production tests back to the national grid.

The investment and plans form part of Aggreko’s commitment to achieve net zero emissions from its own operations by 2030.

At the start of January, the company confirmed that it had sealed a crucial $315m (£231m) contract for this summer’s rejigged Olympics in Japan – now under threat again.

The group confirmed that it had agreed and signed the necessary contract revisions with the event’s organising committee to reflect “scope changes and the impact of the delay of the games into this year”. The total revenue value to the group is now expected to be around $315m, higher than previously thought.

In August, Aggreko said it remained hopeful of a $250m boost from the Olympics after reporting a slide in first-half revenue and profits.

Other events utilising the company’s kit include Glastonbury and the Super Bowl.

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